Cost control is the process of monitoring cost and performance. This doesn't necessarily involve cost reduction but is a process of confirming that spending conforms to plans, policies and regulations. Cost control also monitors the performance of strategies, programs, projects and operations to ensure that spending achieves business objectives. The following are illustrative examples of cost control.
Validating cost estimates using techniques such as reference class forecasting.
PlanningValidating business plans, project plans and operations plans to ensure costs can be mapped to measurable objectives.
BudgetsThe process of validating, approving and controlling budgets.
Due diligence in purchasing such as a process of competitive bids for contracts.Financial controls such as accurate and timely accounting according to applicable principles, standards and regulations.
Cost ReportingMonitoring costs and cost variances.
Performance ReportingReporting the performance of programs, projects and operational spending against plans.
GovernanceGovernance of programs, projects and other spending initiatives to step in and correct issues. For example, terminating a project that isn't likely to achieve its objectives or stay within its budget.
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