A Forecast is an anticipated and reasonably realistic cost that might occur on a project. Ensure that you use Forecasts to help plan for all costs that may affect the project thus ensuring the anticipated final cost of the project, the Final Forecast Cost, is communicated with much greater certainty. As the project progresses, you can use the Forecast feature to take into consideration real-life circumstances, enabling a real-time Final Forecast Cost figure.
It's OK, we know that no one can predict the future, however, it is possible to make reasonable predictions or assumptions on how events will turn out based on a logical assessment.
Mastt handles four (4) types of Forecasts:
When a Forecast is largely based on opinion in place of some empirical statistical analysis, the associated costs may be called subjective and are 'uncommitted' type. Identifying Forecast type 'Uncommitted' helps capture optimism in the project costs.
An example of an Uncommitted type Forecast would be "Allowances, $10,000".
Uncommitted type Forecasts are represented by a dark blue color in Finances and Cash Flow charts.
When a Forecast is based on the practitioners use of replicable and proven process to identify the Forecast cost, the associated uncertainty can be called ‘objective’ and are a Risk type.
An example of a Risk type Forecast would be "Risk #10 Design Risks, $10,000".
Risk type Forecasts are represented by a yellow color in Finances and Cash Flow charts.
Specific allocation of resources (capital cost, resources, and time) required in addition to the Base Estimate or Base Schedule as a provision for inherent and/or contingent risks for the desired confidence level
An example of a Project Contingency Forecast would be "Project Contingency of 10%, $100,000"
Project Contingency type Forecasts are represented by a light red (salmon :p ) color in Finances and Cash Flow charts.
An amount of the project budget base (PBB) is withheld for management control purposes. These are budgets reserved for unforeseen work that is within the scope of the project.An example of a Client Contingency type Forecast would be "Management Reserve/Defence Contingency of 10%, $100,000"
Client Contingency type Forecasts are represented by purple color in Finances and Cash Flow charts.
When used together, Forecast types provide an accurate display of the Project or Program's financial composition. Learn how to create and add a Forecast here!