Page 209 - Project+

of money unless corrections are made.

For the exam, remember that the cost processes include cost estimating,
creating the project budget, and controlling costs.

Expenditure Reporting

Expenditure reporting can take many different forms. As shown earlier in Table 7.4, a
simple spreadsheet showing planned versus actual costs to date and their variance

should suffice for most small projects. Project management software gives you many
options for tracking and reporting on the budget. Pie charts, bar charts, and budgets
broken down by work components are other ways to report on and display project
spending. You can also use much more advanced EVM measurements to report on
project expenditures.

When project costs are displayed graphically over time, they form an S curve, as you
can see in Figure 7.1. That’s because at the beginning of the project, spending is

minimal. It picks up once the work of the project is underway, and it tapers off at the
end of the project as the work wraps up.

FIGURE 7.1 S curve

The important thing to know about budgeting is that you have a budget. Take the time
to define estimates, create an overall budget based on the estimates, and then track
what you’re spending against what you planned and report this status to the
stakeholders. Be certain to alert your sponsor at the earliest signs of trouble with the
budget. You may be able to take action to get the budget back on track, but don’t
assume this can or will happen. The sponsor isn’t likely going to be happy with
negative budget news, but the sooner you make them aware, the sooner they can assist

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