Funding Limit Reconciliation for capital construction projects is the process of comparing the planned expenditure of project funds against any limits on the commitment of funds for the project to identify any variances between the funding limits and the planned expenditures (Project Management Institute, A Guide to the Project Management Body of Knowledge (PMBOK® GUIDE) – Sixth Edition, Project Management Institute, Inc., 2017). Thus, the funding limit reconciliation is very crucial for every capital construction project to prevent the large variation in the expenditure of the funds for the project to allow the project owner to pay the contractors and other vendors on the projects. This particular project management technique will often lead to the revision of the schedule as well as the allocation of the works to be executed to ensure that funding limit variances are avoided.To enable the accurate management, monitoring, evaluation ad reporting of the funding limit reconciliation on capital construction projects, there is a need to have the project’s approved baseline budget for which the budget projection details the approved funds available for the project. In addition, there is a requirement to capture the details of all awarded commitment contract agreements and their projected invoicing as submitted by each contractor for their planned work in place. The content of those two documents enables managing, monitoring, evaluating, and reporting on the funding limit reconciliation for each project and at each period of the project’s duration.

PMWeb 7 Monitoring, Evaluation and Reporting Funding Limit Reconciliation on Capital Construction Project

Using a Project Management Information System (PMIS) like PMWeb, the business processes for budget and commitments are examples of the ready-to-use business process templates available in PMWeb. The templates for both business processes also allow creating the monthly projection for available fund limit as well as the spending requirement for each commitment contract.  

Similar to all cost management-related processes, the cost breakdown structure (CBS) levels need to be established to determine the levels where the funding limit reconciliation are managed, monitored, evaluated, and reported on. PMWeb cost code module allows defining up to sixteen (16) levels for the cost breakdown structure (CBS) levels for which each level could be ten (10) digits long. 

The left-hand side of the report displayed above shows an example of the cost breakdown structure (CBS) levels that the funding reconciliation limit report uses. This enables the reader to roll up or drill down the reported variance for the funding limit reconciliation for each period of the project’s duration.

PMWeb 7 Costs Budgets Cost Codes 
Main

For each capital construction project, the PMWeb budget module captures the baseline module as well as all budget adjustments and transfers. In addition, the PMWeb commitment module captures the details of all awarded commitment contracts. The commitment change order module is used to capture all changes to the commitment contracts. Both budget and commitment modules allow the project team to define the projection for each cost center. The budget defines the available fund limit whereas the commitment defines the spending requirement for each commitment contract. The difference between those two values defines the funding limit variance for each period.

PMWeb 7 Costs Budgets Budgets Construction Budget
Main
Budget Projection

Similar to all other business processes managed in PMWeb, supportive documents that are usually associated or required for each budget or commitment business process transaction can be attached to their relevant template. It is highly recommended to add details to each attached document to better explain to the reader what is being attached and viewed.  In addition, links to other relevant records of other business processes managed in PMWeb can be also linked to the reported progress. 

PMWeb 7 Forms Inspections Progress Observation Level 01
Attachement

It is highly recommended that all those supportive documents, regardless of their type or source, get uploaded and stored on the PMWeb document management repository. PMWeb allows creating folders and subfolders to match the physical filing structure used to store hard copies of those documents. 

PMWeb 7 Document Manager Projects Capital Project Construction Phase BP02 Superstructure

To ensure that the submit, review, and approve dates of each budget and commitment business process transaction submission are captured, assign a workflow to each business process. The assigned workflow then maps the submit, review and approve tasks, roles or roles assigned to each task, task duration, task type, and actions available for the task. In addition, the workflow could be designed to include conditions to enforce the approval authority levels as defined in the Delegation of Authority (DoA) matrix. 

PMWeb 7 Workflows Business Processes (BPM)

When a budget or commitment business process transaction is initiated, the workflow tab available on the relevant template captures the planned review and approve workflow tasks for each transaction as well as the actual history of those review and approval tasks. The captured workflow data will include the actual action data and time, done by who, action taken, comments made, and whether team input was requested.

PMWeb 7 Forms RFIs Conflict 
Workflow

PMWeb

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