Budget Management
Introduction
HighStone collates Cost Allocation data from a number of sources and this information is used to manage the on-going costs incurred in the daily activities of general maintenance and implementation of schemes. HighStone also includes the capability to build up and define budgets and target costs for these costed activities thereby providing a direct means for comparing cost incurred against prepared budgets and target prices.
The creation of target budgets is a generic facility within HighStone and this can be configured to handle a wide range of cost headings. Also the budget definition can be applied to a number of different Object Classes within the contract definitions to give pricing and budget control across different management areas. These definitions may be run in parallel using different definitions of base pricing information and / or direct budget entry.
The typical definition for cost management is to look at the individual cost headings of Labour, Plant (Equipment), Materials, Sub-Contract costs and Overheads. HighStone offers a wider range of up to 16 separate cost headings that can be run against all budget activities. Typically these cost headings will be aligned to the Cost Capture definitions so that a direct comparison on Budget Price against Costs can be made.
Base budget information may be defined in two ways:
- Direct entry of budget values against the relevant activity and cost headings.
- Build-up of budgets from a defined list of Priced Items, or Schedule of Rates, wherein items are defined with appropriate cost analysis splits already in place for the delivery of a given quantity of an item.
Budget management may be defined at a number of direct levels within HighStone, depending on the required configuration.
- Annual maintenance and routine works budget. Typically set for 12 month periods and monitored throughout the year. Often this exercise is aimed at internal cost control as the costs of such works are not recharged directly to a client. In HighStone this budget management is defined on the Master Scheme definition of each works activity, with a new budget being defined for each financial year.
- Major scheme and project delivery. Typically these works elements are estimated / priced individually and the costs incurred are recharged. Target prices are built up from a Schedule of Rates that quantifies the price of delivery of all elements of work activity. In HighStone this budget management is defined on the individual Scheme definition. In some configurations budget pricing is set at the Works Order object level, rather than the Scheme object level.
- Minor Works and Repair of Damage to Assets may be priced at the individual incidence level, which may be at the HighStone Works Order or Incident object level. As noted above, budget pricing may be drawn from a general Schedule of Rates or from a parallel definition that gives a re-charge rate for all repair works (typically applied in Insurance Claims, or works undertaken for Third Parties).
All HighStone budget / price functions are designed to complement the Cost Capture of works activities, and provide direct and on-going comparisons. Where costs are re-charged to an external client, these costs may be based on the actual incurred cost of the works, the original defined price, or a re-measure of the original price to pick up actual works incurred.
Annual Budgets for Routine Works