How Cost-to-Complete Affects Financial Planning
Cost-to-complete calculations allow contractors to project the additional costs needed to complete the project, helping to ensure there are enough resources to cover the remaining work. It helps identify any potential budget shortfalls or surpluses and allows for proactive cash flow management.Best Practices for Calculating Cost-to-Complete
Contractors should continuously update their cost-to-complete estimates as the project progresses. Regular assessments help ensure accurate financial planning and mitigate the risk of budget overruns. Use financial management tools to track costs in real-time for more precise forecasting.Related Terms: Variance Analysis, Contingency Budget, Cashflow Forecast