PROJECT MANAGEMENT Essay Example | Topics and Well Written Essays - 750 words

PROJECT MANAGEMENT - Essay Example ontingency to accommodate the risk of incurring unidentifiable but normally occurring costs within the defined scope† (â€Å"What is Cost Baseline,† n.d.). This is referred to as a â€Å"financial plan prepared for every major expense category, such as administrative cost, financing cost, production cost† ( â€Å"Cost Budget†; â€Å"Budget,† n.d.). It essentially contains the list of all planned and expected revenues and expenses which is defined by Sullivan & Sheffrin (2004) as the â€Å"plan for saving and spending.† This is considered as one of the vital plans to be taken up before starting to operate a business because this report helps in the proper allocation of resources, â€Å"evaluates performance and formulates plans† (Ward, n.d.). Cash flow report is also called as the statement of cash flows or funds flow statement (Helfert, 2001). Previous accountants termed this as the flow of funds statement (Bodie, Kane & Marcus, 2004). This report mainly tackles on the change of cash all throughout a business year. The change of cash involves three major categories; operating cash flow, investing cash flow, and financing cash flow (Comiskey & Mulford, 2000). It is further defined by Erich Helfert (2001) as the â€Å"financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, and breaks the analysis down to operating, investing, and financing activities.† This report has been employed by companies because â€Å"it eliminates allocations which might be derived from different accounting methods, such as various timeframes for depreciating fixed assets† (Epstein & Jermakowicz, 2008). This report is usually used by companies to determine â€Å"the costs of multiple resources for all periods during which the resources are available between a specified start and end time† (â€Å"Resource Costs Summary Analysis,† n.d.). It is quite helpful to minimize certain unnecessary expenditures and to find out practical and long-term