1. Manage Project Costs Unit Guide Diploma of Project Management Qualification Code BSB51507 Unit Code BSBPMG504A

2. Units of Study – Diploma
Units in the Diploma of Project Management
BSBPMG501A Manage Application of Project Integrative Processes
BSBPMG502A Manage Project Scope
BSBPMG503A Manage Project Time
BSBPMG504A Manage Project Costs
BSBPMG505A Manage Project Quality
BSBPMG506A Manage Project Human Resources
BSBPMG507A Manage Project Communication
BSBPMG508A Manage Project Risk
BSBPMG509A Manage Project Procurement 2

3. Manage Project Costs On completion of this unit you will –
be able to identify, analyse and refine project costs to produce a project budget
understand how to use a project budget as the principle mechanism to control project costs
This unit is Ungraded which means that you will be found Competent or Not Yet Competent based on the completion of the assessment activities and the evidence of competency provided.

4. Elements of Competency
Each unit of study is composed of elements of competency
Manage Project Costs comprises 3 elements of competency –
Determine project costs
Monitor and control project costs
Conduct financial completion activities
Elements of competency are further broken down into performance criteria, these can be found on the next slides

5. Determine Project Costs
Resource requirements for individual tasks are determined, with input from stakeholders and guidance of others
Project costs are estimated to enable budgets to be developed and agreed cost management processes implemented
Within delegated authority, a cost management plan is developed and implemented to ensure clarity of understanding and ongoing management of project finances  

6. 2. Monitor and Control Project Costs
Agreed financial management processes and procedures are implemented to monitor actual expenditure and to control costs
Cost analysis methods and tools are selected and used to identify cost variations, evaluate options and recommend actions to a higher project authority
Agreed actions are implemented, monitored and modified to maintain financial and overall project objectives throughout the project life cycle  

7. 3. Conduct Financial Completion Activities
Appropriate activities are conducted to signify financial completion
Review of project outcomes is undertaken using available records and information to determine the effectiveness of cost management processes and procedures
Cost management issues and recommended improvements are identified

8. Associated Readings Mandatory – Recommended – PMBOK Chapter 7
Diploma of Project Management Skills Kit – Manage Project Costs
Learning Guide 2 – Develop Project Plans, pages 7 and 19
Learning Guide 3 – Administer & Monitor Project, pages 8 to 12
Learning Guide 4 – Finalise Project, page 2, 3 and 6
Learning Guide 5 – Review project, pages 2 to 5

9. Team Assignment Criteria
Components
Marks
Basic Competency
Higher Competency
Detailed Project Budget 10
Project budget prepared using direct and indirect resource costs, including labour
Project budget includes both capital and operational expenditure
Less common indirect costs are also considered
Budget assumptions 5
Basic budgetary assumptions are documented and contribute to the finalisation of the project budget eg labour rates
Advanced budgetary assumptions are documented eg exchange rates, GST etc
Project Cost management procedures
Procedures include tolerance and delegated authority
Explanation of the tools and techniques used to estimate the project budget
Basic understanding of tools and techniques
At least two estimating methods used
Advanced understanding of tools and techniques
More than two methods used and experts consulted
Concepts such as’ recharge’ included
Total 30
19.5 to 25
25.5 to 30

10. Individual Assignment Criteria
Components
Marks
Basic Competency
Higher Competency
Detailed Project Budget 5
Project budget prepared using direct and indirect resource costs, including labour
Project budget includes both capital and operational expenditure
Less common indirect costs are also considered
Budget assumptions
Basic budgetary assumptions are documented and contribute to the finalisation of the project budget eg labour rates
Advanced budgetary assumptions are documented eg exchange rates, GST etc
Project Cost management procedures
Procedures include tolerance and delegated authority
Explanation of the tools and techniques used to estimate the project budget
Basic understanding of tools and techniques
At least two estimating methods used
Advanced understanding of tools and techniques
More than two methods used and experts consulted
Concepts such as’ recharge’ included
Explanation of the tools and techniques used to track and capture actual costs and check progress against baseline 10
At least two capture and tracking methods used
Change Requests – showing impact on cost
Multiple change request forms including analysis of the impacts on the overall project objectives
Evidence of approval or rejection of the change requests
Revised baselined budget provided
Evidence of implementation of approved change requests
Change Request Log
Project Budget Performance Reports
Detailed budget performance reports showing variances against baseline budget
Advanced budget performance reports including concepts such as earned value and forecast to complete
Total 50
32.5 to 42
42.5 to 50

11. Best wishes for your studies
Northern Beaches TAFE and the
Business and Commerce Business Line of the
Northern Sydney Institute
wish you success in your studies! 11