Journal
Cost codes that swallow a variance before the monthly meeting
Budget variance reviews fail when the cost report still uses the tender breakdown and the site has been living in a different structure for months. Preliminaries is the usual hiding place. Crane weeks, extra security after a break-in, and winter working all land there, then the commercial meeting argues about a lump figure.
We ask for the cost codes as they are actually coded on site, not as they appeared in the form of tender. If the QS will not split preliminaries, we still list the known extras underneath the line so the client can see them. That is not a reforecast; it is a legend for the number already on the page.
Materials variances deserve their own sentence. A timber package bought early at a better rate can offset a labour overrun in the same code. Presenting a net zero as ‘on budget’ is true in arithmetic and unhelpful if the labour hours are the thing that will slip the end date.
Contingency should appear as a remaining balance, not as a percentage of original. After a flood in the basement on a jobs in Inverness, remaining contingency mattered more than the original 5 percent. The pack showed pounds left, the known calls on it, and the date of the last drawing freeze.
If you cannot get a committed-cost report in time for the meeting, say the figures are draft. A labelled draft is kinder than a confident table that moves again on Friday.