What is a costed plan?

Cost plans are typically prepared by a cost consultant and provide an estimate of what the actual costs are likely to be. Cost plans evolve through the life of the project, developing in detail and accuracy as more information becomes available about the nature of the project.

What is a cost plan in project?

A cost management plan is a document that helps you map and control a budget. It enables project managers to estimate their costs, allocate resources to the right areas, and control overall spending. Cost management plans keep all project costs in one place, including direct and indirect costs.

How do you make a cost plan?

7 Steps to Writing a Project Cost Management Plan

  1. Develop Work Breakdown Structure (WBS) …
  2. Identify Project Resources. …
  3. Estimate the Costs. …
  4. Establish Performance Indicators. …
  5. Get Done with Budgeting. …
  6. Formulate Cost Recording Procedures. …
  7. Establish a Cost Control Mechanism.


What is the difference between cost estimate and cost plan?

In the construction industry — a good example of project management — a cost estimate is a prediction of the costs of construction. A cost plan determines the fiscal feasibility of an initiative.

What is cost planning process?

Cost planning and project estimating is the process of budget formation, cost control through the design process and finally cost control through procurement and the construction phases. The project costplan is an evolution of the feasibility stage costing as well as risks identified through design development.

What is the purpose of a cost plan?

The purpose of the cost plan is to allocate the budget to the main elements of the project to provide a basis for cost control. The terms budget and cost plan are often regarded as synonymous.

Why is a cost plan important?

Cost planning is an essential part of the project management process. Project managers need to understand where costs fall in their schedule to manage demand for resources. Typically, all resources that consume costs will be included in a resource optimised schedule.

What should a cost management plan include?

Below are 11 key elements to include in a cost management plan:

  • Measurement units. The first section in a cost management plan is the units of measurement portion. …
  • Location. …
  • Earned value management. …
  • Percent completion. …
  • Control thresholds. …
  • Precision levels. …
  • Levels of accuracy. …
  • Reporting formats.

What is a Stage 3 cost plan?

BG 78/2021, Project Information Process, written by Nick Blake and John Sands, and published by BSRIA in January 2021, states in relation to a stage 3 cost plan: ‘The Stage 3 cost plan reflects the increasing level of design development and represents more cost certainty than the Stage 2 cost plan. ‘

What is a cost plan architecture?

Cost plans are typically prepared by a cost consultant and provide an estimate of what the actual costs are likely to be. Cost plans evolve through the life of the project, developing in detail and accuracy as more information becomes available about the nature of the project.

What are the stages of cost planning in construction?

These stages are typically design development, detailed design, and construction.

Who is responsible for preparing cost estimate?

Other professionals such as quantity surveyors and cost engineers may also prepare cost estimates or contribute to cost estimates. In the US, according to the Bureau of Labor Statistics, there were 185,400 cost estimators in 2010.

What are the basic types of cost estimating?

Below, we explore four of the most common cost estimation techniques that you can leverage.

  • Analogous Estimating. …
  • Parametric Estimating. …
  • Bottom-Up Estimating. …
  • Three-Point Estimating.


What are the 4 main functions of cost management?

While cost management is viewed as a continuous process, it helps to split the function into four steps: resource planning, estimation, budgeting and control.

What should be included in a cost management plan?

Below are 11 key elements to include in a cost management plan:

  • Measurement units. The first section in a cost management plan is the units of measurement portion. …
  • Location. …
  • Earned value management. …
  • Percent completion. …
  • Control thresholds. …
  • Precision levels. …
  • Levels of accuracy. …
  • Reporting formats.

What is a cost plan RICS?

The RICS definition of an elemental cost analysis is: ‘…a full appraisal of costs involved in previously constructed buildings… aimed…at providing reliable information which will assist in accurately estimating (the) cost of future buildings.

What are the stages of cost planning in construction?

These stages are typically design development, detailed design, and construction.

What Is a Stage 2 cost plan?

It is used as a way of controlling the estimated costs during the design and construction phases of a project, and so cost plans are living documents which must be managed throughout the life of the project. The Stage 2 cost plan reflects the design prepared at this stage.