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“Spreading the Wealth”:  Matching up the Distributed Budget with the Work Packages,[object Object],Once the budget structure is set, the PM is left with a single budget amount that must be used to fund all the work packages,[object Object],Ideally, an individual budget could be assigned to each Work Package, however each budget has to be individually “managed”:,[object Object],Authorized for use,[object Object],Changed to reflected updates/contract changes etc.,[object Object],Monitored for amount spent vs. amount budgetted (Cost Monitoring),[object Object],A “practical” project often has hundred of individual Work Packages, so a solution is usually needed to “collect” and control the budget at a level somewhere between one “lump sum” and individual “Work Packages,[object Object]
Where do we draw the line:  the Control Account,[object Object],Each Control Account (CA) is a group of Work Packages that will be:,[object Object],allocated a separate budget,[object Object],assigned a “charge number” that people can charge their time and expenses to,[object Object],separately managed by a Control Account Manager to make sure,[object Object],Funding available matches work required,[object Object],Expenses charged belong to the CA,[object Object],the relationship between budget allowed and costs incurred is monitored ,[object Object],$,[object Object],$,[object Object],$,[object Object],$,[object Object]
Creating the Control accounts,[object Object],Needs to be clearly connected to a single body of work,[object Object],Must all fall under one WBS “branch”,[object Object],Needs to be manageable (ie. One boss),[object Object],Most work has to fall under one OBS “branch” ,[object Object],WBS,[object Object],Organization Breakdown,[object Object],Structure (OBS),[object Object],Electrical,[object Object],Mechanical,[object Object],Design,[object Object],Systems,[object Object],Engineering,[object Object],Work Packages,[object Object],Electrical,[object Object],Drafting,[object Object],Control Accounts,[object Object],Mechanical,[object Object]
Control Account Do’s and Don’ts,[object Object],$,[object Object],$,[object Object],$,[object Object],$,[object Object],$,[object Object],Only Work Packages included,[object Object],All Work Packages must be included,[object Object],Must be on one WBS branch,[object Object],“Most” work must be performed by the same organization,[object Object]
Control Account Structure Example,[object Object],Create a control account structure from this WBS,[object Object],[object Object],Project ManagementCarpenterMasonryMetalworkerPlumber,[object Object]
Control Account Structure,[object Object],Possible Solution,[object Object],Note:,[object Object],Can’t group “Curtain Walls” and “Framing” because not the same WBS branch,[object Object],Can’t have CA for “Foundation” or “Structure” because not the same Resources,[object Object]
Budget Allocation to Control Accounts,[object Object],674-2435,[object Object],674-2435,[object Object],Budget is usually allocated to Control Accounts in proportion to the original estimates for all the Work Packages they comprise,[object Object],Two methods:,[object Object],Input activity estimates within scheduling tool – then “Roll up” to the Control Account level ,[object Object],If BOE sheets prepared align with WBS at sufficient level of detail – add BOE sheets for all related Work Packages,[object Object]
The Control Account Plan,[object Object],Work Package,[object Object],Budget Amount,[object Object],Accounting Info/ERP Integration,[object Object],Cost,[object Object],Account #,[object Object],[object Object]

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