1 00:00:00,008 --> 00:00:03,006 - I often review my checking account and the charges 2 00:00:03,006 --> 00:00:07,000 on my credit card to ensure things are as expected. 3 00:00:07,000 --> 00:00:09,003 Budget reporting is the equivalent 4 00:00:09,003 --> 00:00:11,001 of verifying your checking account, 5 00:00:11,001 --> 00:00:13,006 and it needs to be done frequently, 6 00:00:13,006 --> 00:00:17,006 but it's a disaster if your budget reporting is inaccurate. 7 00:00:17,006 --> 00:00:20,003 Here are items whose accuracy you should verify 8 00:00:20,003 --> 00:00:23,003 before finalizing your budget reports. 9 00:00:23,003 --> 00:00:26,007 Most project managers track charges by month. 10 00:00:26,007 --> 00:00:30,003 However, accounting months don't always line up 11 00:00:30,003 --> 00:00:32,000 with calendar months. 12 00:00:32,000 --> 00:00:35,001 Ensure your reporting is consistent tracking items 13 00:00:35,001 --> 00:00:37,004 over the same timeframe. 14 00:00:37,004 --> 00:00:40,008 Otherwise, your financial numbers could be inconsistent, 15 00:00:40,008 --> 00:00:45,000 which can cause your report's accuracy to be questioned. 16 00:00:45,000 --> 00:00:47,006 Verifying your purchases is critical. 17 00:00:47,006 --> 00:00:50,006 You might buy materials at different times than planned, 18 00:00:50,006 --> 00:00:53,004 or charges you didn't plan for, 19 00:00:53,004 --> 00:00:56,000 such as shipping, can create variances 20 00:00:56,000 --> 00:00:57,007 in your project reporting. 21 00:00:57,007 --> 00:00:59,008 So review the invoices 22 00:00:59,008 --> 00:01:03,006 for accuracy on all your project purchases. 23 00:01:03,006 --> 00:01:06,009 Check all costs allocated to your project. 24 00:01:06,009 --> 00:01:09,009 I've had more than one experience where costs were allocated 25 00:01:09,009 --> 00:01:11,009 to my project in error. 26 00:01:11,009 --> 00:01:13,005 Double check that the charges assigned 27 00:01:13,005 --> 00:01:16,007 to your project are valid and accurate. 28 00:01:16,007 --> 00:01:20,009 Question anything you didn't expect. 29 00:01:20,009 --> 00:01:24,009 Verify the accuracy and timing of contractor invoices. 30 00:01:24,009 --> 00:01:27,002 Ensure that the right people are being charged 31 00:01:27,002 --> 00:01:29,009 to your project, their hours are correct, 32 00:01:29,009 --> 00:01:32,001 and that the hourly rate is accurate. 33 00:01:32,001 --> 00:01:36,009 Also, note the timeframe for the invoice. 34 00:01:36,009 --> 00:01:39,005 I once had a contracting company that invoiced us 35 00:01:39,005 --> 00:01:43,000 every other week, and matching that up with monthly reports 36 00:01:43,000 --> 00:01:46,004 required data manipulation to ensure accuracy. 37 00:01:46,004 --> 00:01:49,004 So make sure you understand the timing 38 00:01:49,004 --> 00:01:51,004 of contractor invoices. 39 00:01:51,004 --> 00:01:56,000 Understand any overhead charges allocated to the project. 40 00:01:56,000 --> 00:01:59,003 Overhead costs for senior management time, facilities, 41 00:01:59,003 --> 00:02:01,008 utilities, and other general expenses 42 00:02:01,008 --> 00:02:04,004 are sometimes distributed to projects. 43 00:02:04,004 --> 00:02:08,001 This is appropriate if they're allocated fairly, 44 00:02:08,001 --> 00:02:11,000 but typical errors are made with overhead charges, 45 00:02:11,000 --> 00:02:12,003 so keep a look out. 46 00:02:12,003 --> 00:02:14,007 It's fair when overhead charges are added 47 00:02:14,007 --> 00:02:18,000 to the hourly rate in employee charges to your project. 48 00:02:18,000 --> 00:02:19,001 If this differs 49 00:02:19,001 --> 00:02:22,003 from how overhead expenses are distributed, question 50 00:02:22,003 --> 00:02:25,009 the formulas used to be sure they're appropriate. 51 00:02:25,009 --> 00:02:29,005 Also, management time can be double counted. 52 00:02:29,005 --> 00:02:31,003 Managers included in overheads 53 00:02:31,003 --> 00:02:34,003 might also bill time directly to your project. 54 00:02:34,003 --> 00:02:38,003 As a result, you're charged twice for management time. 55 00:02:38,003 --> 00:02:40,000 In the exercise files 56 00:02:40,000 --> 00:02:42,001 I've included a more comprehensive list 57 00:02:42,001 --> 00:02:45,003 of data items to verify for your budget reports. 58 00:02:45,003 --> 00:02:48,001 Check all these items and you'll ensure 59 00:02:48,001 --> 00:02:51,000 you don't overdraw your project's checking account.