Thursday, February 21, 2008

What is Contingency Allowances in Cost Budget?

For Contingency Allowances,
  • When considering adding a contingency allowance to your budget:
    - Avoid contingency.
    - Based on the WBS input, make sure that the work package do not already have a contingency amount tacked onto the base estimate.

  • Inform the project team.
    - Let them know that the project will be managed against a point estimate without contingency.

  • As project manager, you must release contingency funds only through closely controlled and well documented process, which is typically included in the cost management plan.

  • Contingency is not to be used as a slush fund without controls.

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Recommended Books on PMP

Suggested Study Materials

  • PMP-Preparation Recommended Books
  • PMP Exam Prep, Fifth Edition: Rita's Course in a Book for Passing the PMP Exam
  • A Guide to the Project Management Body of Knowledge, Third Edition (PMBOK Guides)
  • The PMP Exam: How to Pass On Your First Try (Test Prep series)