6 Tips to Effectively Track Expenses

by Jennifer Bridges, PMP (formerly, Jennifer Whitt)

Have you ever had your pay or bonus cut because your project budget was off track? I have. So I’m going to share tips for expense tracking that I created for the biggest dummy, me. Not many project managers are fond of this topic; in my world, I had a department manage expenses for me. When I no longer had an organization to rely on and had to manage project expenses myself, I learned a hard lesson when my pay was docked. I actually made it harder than it really was, so have boiled the most important steps down to dummy terms.

#1 – Establish Systems. Use some kind of project management software or Excel to pull all of the expenses together and track. Identify how it’s going to be done, when and who it’s going to be done by.

#2 – Provide Online Access. Provide online access to expense tracking not only for yourself but also for your team, especially if you are a traveler and out of the office frequently.

#3 – Identify Budget Items. It’s important to think through all of the expense items that need to be tracked for the project. Sit down and think about equipment, people, real estate you are buying, building or leasing, marketing, and any kind of legal items such as intellectual property or expenses related to contracts.  Don’t forget expenses related to travelling for meetings.

#4 – Create Budget.  Once you have identified all of the expense items to budget and have put it in your system, whether it’s our project management software or Excel, also make sure you have identified all fixed and variable costs. Know which ones may vary depending upon certain things, and then create the budget. Once the budget is created, it has to be approved by your change control board, stakeholders, or whoever has the authority in your group or organization to approve it.

#5 – Assign Someone. Problems arise when there isn’t someone assigned to track expense items, i.e., if someone orders equipment or is responsible for real estate or legal costs. Assign an actual individual, not just a group or an organization, to be accountable for tracking those expense items.

#6 – Track and Control Realtime. Once you provide online access to your approved budget and have assigned responsibility for tracking, be sure to track and control expenses realtime. When you are able to quickly ascertain when something is way off budget, or you’ve over or under spent, then you are able to control expenses and escalate issues in a timely manner.

Tip:  use templates and pay attention to details, details, details! If you overlook certain items then you might find yourself like I did, and be docked in your pay. I certainly don’t want it to happen to you, and I don’t ever want it to happen to me, again.

If you found these tips from Jennifer Bridges, PMP (formerly, Jennifer Whitt) of value and are a PMP looking to earn PMI PDUs, you might be interested in her self-paced, downloadable courses at PDUs2Go.com.


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