Bring project records onto a consistent basis.
Cost reports, invoices and payment records can describe different stages of the same project. Comparing them requires an understanding of the period, the scope of work and the basis on which amounts were recorded.
A financial review can examine how those records connect and test the calculations relevant to the agreed question. Technical, contractual and other matters outside the financial scope need to be identified.
Questions this analysis can address
How do project costs and payment records reconcile?
What is the basis of the relevant calculation?
Which timing or scope differences affect the comparison?
Scope may include
Cost record review
Review the classification, timing and supporting material for project costs.
Financial reconciliation
Compare cost reports, invoices and payment records on a consistent basis.
Claim calculation review
Examine relevant calculations and the assumptions behind adjustments.
Reporting
Explain the financial analysis and the information on which it depends.
How the analysis develops
The review establishes the relevant project period, the calculation under examination and the records available. Entries can then be reconciled and differences in timing, scope or treatment explained.
A total is useful only when its components are understood. The report should show the basis of any adjustments and identify questions that require additional information or expertise.
Before an engagement
Why can project cost and payment totals differ?
A cost may be recorded before payment, relate to a different period or include a different scope of work. The definitions and supporting records should be reconciled before comparing totals.
How is the scope established?
The initial discussion defines the question, the records available and the intended use of the analysis. Suitability, independence, responsibilities, fees and deliverables are agreed before work begins.
What should I send first?
Begin with a short description of the background, the question and any relevant dates. Arrangements for sharing confidential source records should be agreed separately.