Capella UniversityFPX 5333Budget Analysis Report .

NearlyFree.Com Budget Analysis Report – Current State Shahida Rahman Capella University PM-FPX 5333 – Project Budgeting, Procurement and Quality October 29, 2019NEARLYFREE.COM BUDGET ANALYSIS REPORT – CURRENT STATE ...

NearlyFree.Com Budget Analysis Report – Current State Shahida Rahman Capella University PM-FPX 5333 – Project Budgeting, Procurement and Quality October 29, 2019NEARLYFREE.COM BUDGET ANALYSIS REPORT – CURRENT STATE Table of Contents 1. Budget Analysis 2. Current Financial State 3. Cost Estimating of Individual Schedule of Activities or Work Packages 4. Failure Points 5. Appendix A: Project Summary Report 6. Appendix B: Project Budget 7. ReferencesNEARLYFREE.COM BUDGET ANALYSIS REPORT – CURRENT STATE Budget Analysis The purpose of a budget analysis report is to be able to understand the relationship between money and NearlyFree’s Employee Orientation project is being managed. The analysis report will also identify and determine whether the budget proposed is sufficient enough to complete the project. During the budget analysis, the budget in question will be evaluated to determine the financial state of the project. The budget analysis relies on the research done on previous similar projects and their outcomes. The analysis will identify failure points of those projects and propose turnaround project budgets. Current Financial State When estimating the overall cost of a project and allocating the budget to each individual task, the top down estimating is the technique that is often used. The top down estimating technique states that when estimating where each individual task is allocated then determining where it falls into the overall project estimation. Another technique used is the analogous estimating, which is used when limited information is provided regarding the project. This estimation relies on the estimation of similar projects from the past and utilizing the current duration and estimation cost of current project. Parametric estimation is a technique that compares the relationship between two or more variables to determine the costs and duration of a project. It is essential that the variables used in a parametric estimation be quantitative values. The three-point estimation is another technique used when leaders need to estimate the cost of each task after identifying potential risk factors. The proposed project budget for NearlyFree was $25,000 while the baseline budget was $23,300. The actual current state of the project has a budget of $30,380. There was an increase in the budget of $8,080. According to the top down estimation, the cost of theNEARLYFREE.COM BUDGET ANALYSIS REPORT – CURRENT STATE project was underestimated; therefore additional funds were needed for the deliverables. Leaders may have utilized either the parametric or analogous estimation, which provided poor results and incorrect data. Leaders should have utilized the three-point estimation. It would have provided them more accurate results and would have taken into account potential risk factors. Cost Estimation of Individual Schedule Activities or Work Packages When evaluating the estimated cost of individual scheduled activities or work packages, it is essential to review the work breakdown schedule and the cost of each task associated with the project. Being able to successfully estimate the cost of a project is through effective planning, research on previous similar projects, and establishing a baseline cost. It’s also important for leaders to identify all the risks associated with the project as a failure and the potential financial risks that could make the project go over budget. The work breakdown schedule is used to estimate the cost of each task associated with the project as well as determining a deadline. When utilizing the work breakdown schedule to estimate cost of individual activities or work packages can be broken down into four steps. The four steps are: identifying deliverables, determining what tasks are needed to deliver the deliverables, breakdown of each task into subtasks, and formatting and assigning a cost to each task and its subtasks (Harned, 2019). When using the work breakdown schedule, it also helps determine a project baseline budget. Initially, NearlyFree utilized the work breakdown schedule following the four steps. To successfully estimate the cost of the individual activities and work packages, it is