How Can Project Management Information Systems (PMIS) Support The Important Role of Internal Audit? Part 3
Ensuring there is no non-authorized transfer of budget funds from one cost center to another
All budget transfers must be done using the PMWeb Budget Request form. Access to this form will be limited to those who had been authorized by the organization to do budget transfers. To ensure that there no non-authorized transfer of budget funds, the approval of this form needs to be linked to a workflow. PMWeb visual workflow allows the user to map the different steps needs to submit review share and approve the budget transfer.
PMWeb visual workflow also adding conditions and branches to map the different approval levels needed to approve a budget transfer. Those could be relevant to the transfer amount, reason among others. Those can be conditions that can be set to “All” to happen or “ANY” could happen.
Ensuring contingency spending is authorized by the project owner
Contingency spending is similar to PMWeb budget transfers but the transactions will be limited to the contingency cost breakdown structure (CBS) level. Conditional workflows will be created to ensure that contingency spending is authorized by the project owner.
Ensuring fair and proper commercial bid analysis for technically qualified bidders
PMWeb procurement module will be used to do the commercial bid analysis where the price from each bidder will be displayed against the approved project cost estimate. A workflow will be added to this module to ensure fair and proper commercial bid analysis for technically qualified bidders had been done.
Ensuring no erroneous or unsupported change orders
All change orders will be captured in PMWeb change management module. The PMWeb change order form will have the data that must be provided for every single change order. Additional custom fields can be added to meet the organization’s requirement. Each change order should have all supportive documents attached to it. In addition, all other relevant PMWeb records need to be linked to the change order. Workflow will ensure that each change order is submitted, reviewed and approved by the designated team members. PMWeb report writer can design any output report needed to report on change orders to ensure that there erroneous or unsupported change orders.
Ensuring reported progress invoice is aligned with schedule reported performance
PMWeb scheduling module allows developing and maintaining the project schedule as well as import the project schedule from Oracle Primavera P6 or MS Project. This will enable to assign the relevant project schedule activity to the bill of quantity (schedule of values) line item. This will ensue that the reported progress invoice is aligned with schedule reported performance.
Ensuring reported progress invoice is aligned with the earned budget
Another PMWeb Cost Management module is known as the Forecast Module where a monthly forecast of the project financial status can be assessed and saved. The forecast module allows capturing the following information for each cost breakdown structure (CBS) level:
- Approved Total Budget (also known as Budget At Completion or BAC)
- Budget Planned Value (PV) up to the current financial period
- Approved Actual Progress Invoice for the current period (Also known as Actual Cost or AC)
- Balance to complete which is the variance between the Budget Planned Value and Actual Cost. This is an optional field
- Project Schedule Activity assigned to the cost breakdown structure (CBS) level
- Project Schedule Activity percent complete
- Earned Value (EV) which is the Approved Total Budget (BAC) multiplied by the Project Schedule Activity percent complete
- Earned Value Metrics which include
- Cost Variance (CV) which the difference between Earned Value (EV) and Actual Cost (AC)
- Cost Performance Index (CPI) which is the ratio of Earned Value (EV) to Actual Cost (AC)
- Schedule Variance (SV) which the difference between Earned Value (EV) and Planned Value (PV)
- Schedule Performance Index (SPI) which the ratio of Earned Value (EV) to Planned Value (PV)
This monthly forecast report will ensure that the reported progress invoice is aligned with the earned budget. PMWeb report writer allows the organization to create a tabular and graphical report to display the earned value analysis status of the selected project.
Ensuring that payments made against approved progress invoices to consultants and contractors are used to cover expenses incurred on the same project and were not used for other projects
One of the recommended practices is to have a checklist as an integral part of each progress invoice. The checklist will include entries to be completed by the project approved subcontractors and suppliers where they need to confirm that they have received the payment for the last approved progress invoice. This checklist will be done using the “Checklist” tab in PMWeb which can be added to most PMWeb forms.
Ensuring that proper value engineering workshops were conducted as planned and associated cost savings are reflected in the approved project budget
PMWeb meeting minutes module will be used to capture details of all Value Engineering workshops as it will capture the details of all project life cycle cost savings and follow-on actions to ensure that those actions are transmitted to the design team and other project stakeholders. The PMWeb meeting minutes module will track the status of all actions identified and whether they were implemented or not. The PMWeb meeting minutes module allows to generate the next meeting agenda from the current meeting minutes to ensure continuity of items discussed. Similar to other PMWeb modules, the module allows attaching all type of project documents and link all relevant PMWeb records.
As for ensure that associated cost savings are reflected in the approved project budget, the PMWeb budget adjustment module will be used to capture the details. PMWeb budget adjustment module can create different type of adjustment documents to differentiate between Value Engineering Cost Savings, Contingency Adjustment, Budget Transfers, Budget Adjustments and other needed adjustment forms.
Ensuring updated risk register and all approved risk response actions are implemented
PMWeb custom form builder provides the organization with the option to implement all needed project management processes including risk management to match their own process requirements. For each risk identified, the custom form can be designed to capture the details of the risk particulars, assessment and approved response action. Similar to other PMWeb modules, all supportive documents can be attached to the form and relevant documents are linked to the form. The workflow will be used to capture the steps for submitting the reviewing, reviewing and assessing the risk and approving the risk response. The form field security level can limit access to each field based on the approved permission list.
This data will become the basis for developing and maintain the project risk register. The register will provide details of all risks, assessment and approved risk response actions. This will be a real-time report showing the latest status of all project risks.
Ensuring that there is an updated Early Warning Notification (EWN) process for all events that could impact the project
The Early Warning Notification (EWN) is of one of the requirements of NEC3 contracts where it require all project stakeholders to formally notify each other of an early warning of certain types of events that could, if they happen increase the project price, delay completion date and/or impair the performance of the works in use. For some, the EWN is considered as a proactive project risk management process.
PMWeb custom form builder will be used to create the EWN. Similar to other PMWeb modules, EWN allows attaching all supportive documents. The workflow option allows creating multiple workflow variations depending on the attributes assigned to the EWN to ensure that it get transmitted to right project team members for review and approval without wasting the time in trying to guess who should be involved.
Ensuring updated issues log and all approved resolutions are implemented
The PMWeb Custom Form Builder will be used to create the issues form to capture the details of who have raised issue, proposed resolution and if implementing the resolution has solved the issue. PMWeb report write will be used to create the issues log which will display the needed issue fields as well as displaying color indicators to provide an alert on the criticality of the issues. This will help the organization to ensure a real-time updated issues log that will highlight the status of all proposed issues resolution.
Ensuring there no excessive or delayed closure of RFIs that could result in change orders
PMWeb default Request for Information (RFI) module will be used to capture all details of project RFIs. This will include the query, proposed solution and answer. In addition, it provides details if the RFI could impact the project scope, cost and/or schedule as well as the project schedule activity details. The RFI module allows attaching documents, linking records and having workflow to submit, review and approve.
PMWeb report writer will be used to prepare the RFI log and other tabular and graphical reports that could be needed to report on the status of RFIs to ensure that there is no excessive or delayed closure of RFIs that could result in change orders.
Ensuring that Meeting Minutes are documented and being managed in an effective method with no long pending meeting business items
PMWeb meeting minutes module allows capturing all types of project meetings including progress reviews, safety and health, quality control, pre-bid and award, kick-off, value engineering, stage gate reviews among many others. PMWeb report writer allows create customized tabular and graphical reports to provide the needed information to ensure that Meeting Minutes are being managed in an effective method with no long pending meeting business items.
Ensuring complete project documentation of all drawings, specifications, communications, emails among many others
PMWeb document management module allows the organization to map their exact filing system structure into PMWeb. It can be used to create folders and subfolders to upload project documents such as drawings, specifications, communication, pictures, videos among many others. For each uploaded file, attributes can be added to better define the documents and expedite the file search process. Similar to other document management systems, PMWeb allows document versions, download document and checkout/check in documents. Documents can be viewed online as well as redline to add comments and shapes.
The next article will provide details on how can PMWeb Project Management Information System can support the internal audit team in meeting the other objectives listed above.