The budget is used to allocate costs and resources to the project activities. As such, the finalized budget becomes the cost baseline. The project's actual costs are measured against the cost baseline throughout the Controlling phases to assure that actual costs are in line with the budgeted costs.
The expected cost of the project. It's used to measureactual project expenses against the budgeted expenses.
Depending on the project, the budget could be very small with only one or two items, or it could be a large budget with several layers of detail. You may also have a case where the project is so large the budget is divided up at the work package level so that the subproject managers are responsible for their own portion of the budget. You'll want a copy of each of the individual budgets from the subproject managers to keep with the project documentation. You can then create an overall project budget that shows the total budgets for each of the WBS elements.
There are several ways to record your budget. You can use a spreadsheet format like the one shown below to track the tasks, the budgeted amount, and actual amounts. Below Table shows the partial budget for the Store Build-Out deliverable for the New Retail Store project.
Table Budget spreadsheet
Another good method of tracking the budget is to record the budgeted costs along with project information in a spreadsheet, such as the one shown in below Table.
Table project schdule with budget estimates
Most project management software packages allow you to put cost information at the task detail level of the project schedule. You can run reports on the cost information right from the software and track budgeted versus actual expenses. When it comes time to report on project progress, you can simply print out the budget report or print the spreadsheets shown previously in the tables, depending on how you're tracking and recording the budget.
How you display and track the project budget is a matter of personal preference unless your finance department has specific guidelines you should follow. At a minimum, you must include the task number, the task description, and the estimated cost.
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Project Management Tutorial
Building The Foundation
Developing Project Management Skills
Initiating The Project
Defining The Project Goals
Breaking Down The Project Activities
Planning And Acquiring Resources
Developing The Project Plan
Executing The Project
Controlling The Project Outcome
Closing The Books
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