Questions About Project Cost Reconciliation

Some cost management professionals said it’s a waste of time chasing, say, USD0.25, spending hours to reconcile. The cost of the effort involved translates to maybe more than tens of thousand times the amount being reconciled.

My question to you all. 1) Do you think that this reconciliation exercise down to the cents value is really needed and why? 2) Is there a better approach?… a faster way of reconciliation? Rufran hashtag#pmsolutionpro hashtag#rufranfrago hashtag#projectmanagement Picture credit: blog paytraq.com, 2019.

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Typical Attributes of a Phantom Schedule

Some of the typical attributes of a Phantom Schedule are as follow:

1) Secret (unknown to the other contracting party)

2) It is a simplified version of the contract schedule

3) Considered more reliable and accurate

4) Viewed as a validation schedule that provides better forecasts5.

5) Updated in the background by sponsoring party

6) Decision-making tool by sponsoring party. Management decisions are no longer based on the forecast of the current contract schedule.

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What is the Purpose of a Phantom Schedule?

A client or contractor may develop it individually with each one, believing that it is more reliable than the current official schedule and/or the existing baseline.

Construction contractor can come up with a more aggressive version of the contractual schedule to create some form of relief time zones. It creates some form of time buffer zones by using earlier schedule plan dates. The sub-contractor then sign on a more optimistic schedule with the contractor.

The contractor hides the already optimistic phantom schedule for background update. At this point, and just on the contractor-subcontractor side alone, there are already four schedules at play and being maintained separately; i.e. 1) subcontract schedule, 2) subcontract phantom schedule, 3) contractor phantom schedule, and 4) contract schedule.

A recent technical article rightly stated the same thing, that one of the reasons why a phantom schedule is developed is “when the client no longer has any faith that the contractor’s contract schedule submittals are realistic (Beisler, S. & Zack, J., 2016.Cost Engineering. May\Jun 2016. p21).

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