Training on Financial Management for Projects and Contracts

Course Overview

Welcome to the Financial Management for Projects and Contracts Course! In today's competitive business environment, project and contract managers are not only responsible for meeting technical and schedule objectives but also for achieving profitability targets and cost-related benchmarks. This course delves into the financial implications of everyday operating decisions and actions, extending beyond the usual financial indicators. Participants will explore how finance and accounting can impact projects, enhancing their strengths and strategic capabilities in financial management.

Target Audience

This course is ideal for:

• Project Professionals and Managers
• Contract Professionals
• Commercial Executives
• Project and Contract Personnel seeking to deepen their financial understanding

Course Objectives

By the end of this financial management training, participants will be able to:

• Communicate effectively with accounting and financial personnel
• Develop and apply tools for comparing project financial returns
• Expand project scheduling and cost control to include additional financial metrics and tools
• Minimize project financial risk
• Read, understand, and analyze accounting and financial data
• Grasp how finance often drives organizational decisions and evaluations of project performance

Course Outline

Day 1: Fundamentals of Finance

• Understanding the time value of money
• Exploring discounted cash flows
• Differentiating direct vs. indirect costs
• Analyzing fixed, variable, and semi-variable costs
• Performing break-even analysis

Day 2: Contract Profitability - Pricing

• Developing pricing strategy and tactics
• Planning for profit and cost estimating
• Exploring cost-based, market-based, and value-based pricing

Day 3: Asset Management - Cash is King

• Importance of cash and timing of cash flows
• Managing inventory and equipment
• Understanding revenue recognition and financing arrangements

Day 4: Risk Management, Terms and Conditions

• Techniques for managing risk
• Scenario and sensitivity management
• Conducting Earned Value Analysis (EVA) and variance analysis
• Reviewing contract terms and conditions

Day 5: Cost Estimating - What Works Best

• Exploring cost estimating methods
• Planning and scheduling effectively
• Utilizing historical data and experience curves
• Understanding the relationship between cost estimating and pricing
• Using Excel® to analyze historical data