From the course: Applying Managerial Accounting
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Project accounting
- Nearly every organization has BAU functions, that is, business as usual, but most also have change or project work. It's not actually difficult to estimate BAU effort. You just have to observe the day-to-day business processes of an organization. But with project effort, estimating and tracking is far more complex because requirements are diverse, and they usually differ from project to project. And in my experience, traditional accounting and finance systems usually aren't equipped to handle it. And then there's governance. Scrutiny tends to be quite high on project financials. So there needs to be a high level of confidence in the quality of cost estimates and also reporting back against those estimates. So, yes, I get it. But you can make it a little less intimidating if you simply break it down into parts. So, how about we work with a real life example to help further explain project accounting? Say your transport…
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