ABSTRACT
Cost management means far more than the control of expenditure. Cost management involves ensuring not only that the amounts of money spent and received are in accordance with budgets, but also that the timing of each transaction is appropriate. The contractor usually has some degree of responsibility for ensuring that the project purchaser's cost objectives are also satisfied. The total cost approach is a way of regarding costs holistically, solving logistical problems or otherwise planning to achieve the lowest overall cost. The true total cost approach should extend to include the costs to be incurred by the customer after the project has been handed over. The initial project budgets should be derived from the cost estimates used when the tender or internal project proposal was prepared. The routine cost accounting systems would normally cover costs associated with the payment of invoices, and the later job costs when materials are issued from stores for manufacturing jobs.
