The main function of Invantive Estate is to determine the prognosis of the result of a project. The difference between the prognosis and the budget is the deviation. This topic describes how the figures in the financial project overviews are worked out. It follows the manual of the product. ## Three Views on the Result A project can be looked at from three sides: - the initial prognosis, which is the budget, usually set by the project developer in an exposé that becomes a project once it is approved; - the actual result, which is read from the general ledger when the project has ended; - the interim estimate of the final result, which is the prognosis and its deviation from the budget. Projects can last for years. Large differences between the prognosis and the final result are common if the results are not controlled closely. The product supports that control with the information known at the time of the report. ## Prognosis at End of Work The prognosis of the financial result is: - the expected revenues minus the expected costs. For administrations that follow IFRS, a second result takes into account what has been processed in the results of the organisation while the project still runs: - the expected revenues minus the expected costs minus the result already taken. The three amounts come from the master roll ups. See [[Invantive Estate/Concepts/Cost Types|Cost Types]]: - The expected revenues are the sum of the expected revenues on the cost types of the master roll ups of type "Revenues". - The expected costs are the sum of the expected costs on the cost types of the master roll ups of type "Costs". - The result already taken is the sum of the invoice lines on the cost types of the master roll ups of type "Results". ## Deviation per Cost Type The remainder of a cost type, before the settings for displaying are applied, is: - the budget of the cost type; - minus the approved budgets on specific contracts; - minus the budget spent outside the contracts with a specific budget; - plus the deviation of the contracts with a specific budget. The deviation of a contract with a specific budget is its contract budget minus the budget spent on it. Whether a positive remainder counts is decided by the setting "Release Deviation" on the project, and by a setting on the cost type: - If displaying is on for the whole project, positive and negative remainders both count in all cost types. - If displaying is on for the cost type, or the cost type holds revenues, positive and negative remainders count. - If displaying is off for the cost type and it holds no revenues, a remainder, positive or negative, is replaced by 0. ## Budget Spent on a Contract The budget spent on a contract is the largest of: - the latest estimate, if there is one; - the amount invoiced with an order, if its absolute value is higher than the absolute value of the orders, the contractual revenues or the budgeted revenues. When a revenue is not yet tied to a contract, has invoices and the attribute "1 period", the invoiced amount is also used; - otherwise the amount of the orders, the contractual revenues or the budgeted revenues. To this the amount of the invoices without an order is added. ## Why Revenues Need a Basis The calculation assumes the worst case. For costs it assumes the whole budget will be used. For revenues it assumes there will be none until they are registered as revenues. A project with a budget of EUR 1,000,000 revenue and EUR 800,000 cost, and no registered revenues, therefore shows a negative prognosis. The revenue budget has to be broken down into revenues, as soon as the project developer knows them, to give a useful prognosis. ## Levels of Reporting The reports of the financial project overview exist in four levels of aggregation. Level 1 is the most summarised and level 4 the most detailed. Each report gives the revenues, the costs and the result, each split into budget, prognosis and deviation. Reports can be consolidated over sub projects. See [[Invantive Estate/Concepts/Project|Project]]. ## See Also - [[Invantive Estate/Concepts/Budgets|Budgets]] - [[Invantive Estate/Concepts/Latest Estimates and Expectations|Latest Estimates and Expectations]] - [[Invantive Estate/Concepts/Invoices|Invoices]]