Periodic Costing is a cost method for inventory valuation that calculates item unit costs based on the actual value of inventory and shop floor transactions that occurred at a certain period. As implied by the name, this is a calculation that is done per period.

Periodic Costing does not substitute for, overlap with, or conflict with current costing methods in QAD solutions such as standard costing or average costing. The goal of Periodic Costing is to use the actual costs from the actual transactions, invoices, BOM, routings, purchase prices, expenses, labor costs, and other actual costs.

Periodic Costing does not use the concept of variances because it always calculates based on actual values; that is, because costs are recalculated for each period, and a new actual cost is defined according to what happened during that period, all value is posted to inventory and WIP accounts. Periodic Costing calculations take into consideration transactions that affect the value of inventory and WIP.

Periodic Costing adds new methods of costing calculations that support local legal requirements for countries such as Brazil, Turkey, Italy, and many countries in Asia, Central Europe, and Latin America. It enables better support of International Financial Reporting Standards (IFRS) and business practices applied in certain industries to ensure more accurate inventory valuations for corporate reporting.