Project Structures and Financial Management
What the domain tests
This domain covers project and task structures, financial structures, budgets, rate schedules, burden schedules, cross-charge, and intercompany processing. You must know how costs and revenue are built from rates and burdens and how shared costs move between projects or legal entities.
Core rules
- Project structure is the project-to-task hierarchy; financial structure is the cost and revenue budget structure. Keep them aligned but distinct.
- Cost rate schedules drive labor costs; bill rate schedules drive customer billing. They are separate objects with effective dates and precedence.
- Burden schedules apply indirect costs through burden multipliers. Precedence determines order; sequential burdens compound, additive burdens apply to the base.
- Cross-charge moves costs for shared services between projects; intercompany processing creates payable and receivable entries between legal entities.
- Budgets are controlled by budget type, status, and baseline; forecasts are separate from budgets.
Worked example
A labor expenditure is $100. The burden schedule applies fringe at 25% and overhead at 10% sequentially. Fringe = $25, overhead = 10% × ($100 + $25) = $12.50, burdened cost = $137.50. If the schedule were additive, overhead would be $10 and total cost $135. The bill rate schedule is applied separately for billing, so do not add the bill rate to the burdened cost.
Traps
Do not use a bill rate schedule to calculate project cost. Do not assume burdens are always additive. Check effective dates and precedence before calculating. Cross-charge is not the same as intercompany; one can trigger the other, but they are configured differently. Budget versus forecast is a common distractor.