Budgeting Flashcards
What does EVM stand for?
Earned Value Management
EVM is a project management technique used to assess project performance and progress.
What is the purpose of EVM?
It provides a snapshot of project performance against estimated financials
EVM helps in understanding where the project stands in relation to its budget and schedule.
What does a budget surplus indicate?
Excess funding available beyond the planned expenditures
A budget surplus can allow for the reallocation of resources or investment in other areas.
What happens when an issue arises in project management?
It escalates and becomes a formal issue that needs addressing
Issues are typically documented and managed through a formal process.
What are the types of project costs?
Fixed, variable, direct, indirect
Understanding these cost types is crucial for accurate budgeting and forecasting.
What is a contingency reserve in project management?
Funds set aside to address unknown risks
Contingency reserves help manage uncertainties that may impact project costs.
Fill in the blank: EVM provides a _______ of project performance.
snapshot
True or False: A project sponsor is responsible for approving the budget.
True
The project sponsor typically has the authority to approve funding and budget changes.
What triggers the go or no-go decision in project management?
Customer or end-user feedback
Feedback is crucial for determining whether to proceed with a project phase or adjust plans.
What is the significance of milestone payments in project management?
They serve as decision gates for project progression
Milestone payments are often tied to the completion of specific project phases.
Fill in the blank: Budget issues escalate when they cannot be _______.
fixed
What is the role of risk management in project budgeting?
To identify and mitigate unknowns that may affect project costs
Effective risk management helps in maintaining budget integrity and project success.
What does ‘controlled funding’ refer to in project management?
Funding that is released based on certain criteria or milestones
Controlled funding ensures that resources are allocated efficiently and only when necessary.
What is an iterative approach in project management?
A process that involves repeated cycles of feedback and adjustments
Iterative processes allow for continuous improvement and adaptation based on stakeholder input.
What is the significance of ‘funding returned to sources’?
It indicates funds that are no longer needed and are returned to the original budget sources
This process helps in maintaining financial accountability within projects.
