ABSTRACT
The costs of purchased goods, equipment and services typically account for well over half the direct costs of a project. Thus efficient purchasing and contract control is an essential component of cost control. An effective project manager or project management office (PMO) will ensure that regular communications are established between project control staff and other departments in the organization. The cost engineering function in the PMO will ensure that the project manager is kept aware of costs spent and committed in relation to budgets. Cash is the lifeblood of an organization. Without cash in the bank a company cannot operate. Cash is needed to pay for the provision and upkeep of premises, pay staff wages and salaries and settle bills from the suppliers of goods and services on time. Good practice will limit the number of people in an organization who are allowed to put their signature to documents such as petty cash vouchers, service contracts and purchase orders.
