Assessment

Task 1
Apply project cost
management techniques
BSBPMG423
Student Declaration
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cheated or plagiarised the work or colluded with any other student(s)
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◻ I understand the rights to re-assessment
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 Table of Content

Student Declaration........................................................................................................................2
Task 1 – Knowledge Questionnaire.................................................................................5
Question 1........................................................................................................................................6
Question 2........................................................................................................................................6
Question 3........................................................................................................................................7
Question 4........................................................................................................................................7
Question 5........................................................................................................................................7
Question 6........................................................................................................................................7

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RTO Provider: 91153 - CRICOS Code: 02672K
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Task 1 – Knowledge Questionnaire

Task summary and instructions

What is this This assessment is a written questionnaire with a mix of objective and
assessment task subjective questions.
about?
The questionnaire is designed to meet the knowledge required to
meet the unit requirements safely and effectively.

The questions focus on the knowledge evidence required for this unit
of competency:

 budgeting processes
 cost estimation methods, techniques and tools
 project life cycle
 cost management strategies and processes
 financial assets, liabilities and records
 cost management tools and techniques.

Your assessor will be looking for demonstrated evidence of your

ability to answer the questions satisfactorily, follow instructions,
conduct online research and review real or simulated business
documentation as instructed.
What do I need to do  submit your answers to the questions within the set timeframe,
to complete this task  answer all questions as instructed,
satisfactorily?  answer all questions using your own words and reference any
sources appropriately,
 all questions must be answered satisfactorily.

It is advisable to:

 review the questions carefully,

 answer the questions using online research and the learning
material provided for the unit and by reviewing real or simulated
relevant business documentation (such as policies and
procedures),
 further research the topics addressed in each question.

Specifications You must submit to GOALS the

 assessment coversheet,
 answers to all questions,
 references.

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RTO Provider: 91153 - CRICOS Code: 02672K
greenwichcollege.edu.au
 Task summary and instructions

Resources and • computer with Internet access,

equipment • access to Microsoft Office suites or similar software,
• learning material.
Re-submission You will be provided feedback on your performance by the Assessor.
opportunities The feedback will indicate if you have satisfactorily addressed the
requirements of each part of this task. If any parts of the task are not
satisfactorily completed, the assessor will explain why, and provide
you with written feedback along with guidance on what you must
undertake to demonstrate satisfactory performance. Re-assessment
attempt(s) will be arranged at a later time and date. You have the
right to appeal the outcome of assessment decisions if you feel that
you have been dealt with unfairly or have other appropriate grounds
for an appeal. You are encouraged to consult with the assessor prior
to attempting this task if you do not understand any part of this task
or if you have any learning issues or needs that may hinder you when
attempting any part of the task.

Answer all the questions below:

Question 1

Outline the main steps in the budgeting process for a project.

The budget steps of a project is established by a specific staff and it all starts by providing the
project budget, and thus being able to prepare cost estimates depending on the time, labor and
resources that it requires, with the above it is possible to develop an estimate of the costs of the
activities that are carried out and also through the communication of the aforementioned, strategies
are developed for the cost management processes.

Question 2

Identify and outline three (3) cost estimation methods, techniques and tools.

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RTO Provider: 91153 - CRICOS Code: 02672K
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 Cost estimation methods, Outline (30-50 words/item)
techniques and tools
The ascending estimate This method consists of estimating the cost of a project from
dividing the general project into components, to estimating the
costs of individual works or activities, and thus by adding these
costs, together they will conclude and form the contingencies
that will be estimated for the entire project. .
Parametric estimation It is a technique that uses data from previous projects and
several variables, to calculate the estimated costs and the
relationships that exist between the specifications, schedules,
costs, resources and labor and obtain good precision.
Analog estimation Therefore, the actual costs of past projects are the basis for
estimating the costs of current or future projects. Also review
previous budgets and contingencies and improve your
efficiency although it is less expensive and less time consuming
than other techniques.

Question 3

Explain the following key steps of the project cost management process. For each, state
at which stage of the project life cycle it is used.

Step Explanation and stage of project life-cycle (30-50

words/step)
Cost Estimation This process is used to develop approximate project financing
based on estimates and maintain more accurate totals to
identify areas of overspend and persistence over the life of the
project.

Budget Determination This allows adding to the estimate of the estimated cost of
each project and finally obtaining the so-called reference cost
budget (excluding management contingencies) for the entire
project, taking into account certain limits.
Spending control Cost control involves identifying and reducing costs to increase
company profits, this can be done on a project-by-project or
company-wide basis. This provides an overview of overall
business costs by identifying areas.
Account reconciliation It is important to verify that all invoices and receipts match
actual cash flows for a given period. Therefore, it is used to
record data in order to recognize the position of the company
and accurately forecast the growth strategies of the company.

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RTO Provider: 91153 - CRICOS Code: 02672K
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Question 4

Identify and outline three (3) cost management strategies and processes.

Cost management strategies Outline (30-50 words/item)

and processes.
Time As you gain experience in project cost management, you will
be able to identify areas that can be improved and restructured
in your process. It can be of great benefit to a business; In
project management, this means improving your cost
management process to make it easier and more efficient for
future projects.
Trial By testing different options, effective and ineffective
modifications are identified; it allows to eliminate unsuccessful
strategies, and to identify and develop better strategies. This is
very important to develop better techniques and thus avoid
losses and/or errors.
Error When existing systems or new builds fail or don't work as
expected, you can take action to determine what happened;
this will allow you to fix the problem and prevent it from
happening again in the future.

Question 5

Define the following terms, and provide an example of each:

Term Definition and example

Financial asset Financial assets generally refer to cash in a project, the transfer
of financial assets is payment for products or services provided.
When an asset is left which is paid to the other party, it means
that it fulfilled its obligation, a clear example is bank deposits.
Liabilities Instead of paying the debt with money, it is also common to
pay it with non-voting shares of a company for a given period,
be it short, medium or long term. A clear example is the sale of
foreign currency.
Financial records These are statements that reflect the state of the business at a
given time. These include a series of documents that reflect the
financial position of a company by keeping information about
the companies. A clear example is the balance sheet.

Question 6

Identify and outline two (2) cost management tools and techniques.

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RTO Provider: 91153 - CRICOS Code: 02672K
greenwichcollege.edu.au
 Cost management tools and Outline (30-50 words/item)
techniques.
Monitor costs: It's about monitoring project expenses as they occur, taking
corrective action if you see cost variances in real time. to know
if the budget was exceeded before the project is completed.
Change control: Set clear goals for the project during the planning phase,
manage all stakeholder changes while working on the project.
This helps to prevent corruption and to be able to prepare
correctly for changes in order to adapt the project.

BSBPMG423 - Apply project cost management techniques V3 2021 Page 9

RTO Provider: 91153 - CRICOS Code: 02672K
greenwichcollege.edu.au