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Finance (cost breakdown for each activity/chunk in a WBS (Labour,…
Finance
cost breakdown for each activity/chunk in a WBS
Labour
Materials
plant & Equipment
sub-contract
management
overhead and admin
fees and taxation
inflation
contingency - the unexpected!
accounting vs managing project finances
accounting reports may not be available in time for the project manager to exercise control
value of work achieved recorded against worked performed in the project
material + labour recorded in a precisely attributable way for projects
expenditure alone is useless, expenditure for projects needs to recorded along with what has been achieved by that expenditure
conflicting cost classifications
time period differ - the two are rarely reconcilable
monitoring and control
CPI
ECAC = BCWS * CPI
CV
EV
50%
pro rata
percentage
Why?
Control costs
submit good case for extra funds
cu sum
S curve
estimating costs
Ground up
Three point estimating
Parametric
Simulation
Analogous
Top down
Introduction
managing project finances
Feasibility Analysis
returns not achieved until after project completed and once costs have been recovered
budget set
accounting
variable
cash flows
cash coming in
cash going out