Discussion Of ZS Real Estate Company L Project Cost Budget Management Issue

For the real estate enterprises,although comprehensive budget management can improve the level of management and strengthen the competence,enterprises should lay much emphasis on budget management of project cost in consideration of the main business content of real estate enterprises is project development,which will occupy a large amount of manpower,resources and circulating fund,and has a long time span.As an important part of project management,cost management of project need professional financial staff to perform analysis,calculation,supervision and assessment,in the mean time,to understand the features of industry.Especially for industry of real estate,each project occupies many resources and takes a long time,effective budget management of project cost can assist the enterprise in achieving financial objective and business strategy.ZS,a real estate enterprise,locates in a second-and third-tier city,and has a lot of experiences in development of real estate projects.The market of real estate in X city returns back rapidly and the price of housing is steady with little increases,and the enterprise decides to grab this opportunity,develop an obtained land and propose Project L.According to the features of real estate,the investment cycle is long,and the fund recycling is slow.It always takes several years from project design to construction completion,of which the policy regulation from government acts as a great risk.However,as a main business in ZS Enterprise,proposition of Project L bases on strengthening competence of enterprise and obtaining higher economic benefits.Thus,budget management of project cost is quite important.This article will combine relative theories of budget management of project cost with Project L from ZS Enterprise tightly,and will discuss this case deeply in the following several aspects:Firstly,a brief introduction of ZS Enterprise and Project L will be preformed,and will go deep step-by-step according to procedures of budget management.This article will introduce the compiling of budget management of project(including organization structure of enterprise and responsibility center,feasibility analysis,cost segregation,cost estimation and progress planning),the analysis of executive condition of each stage of project,the evaluation of executive condition through Earned Value Method,and the work adjustment of budget according to analysis results.Secondly,the analysis of assessment system and assessment index of Project L’s budget management will be discussed,including evaluation form and how to conduct evaluation and analysis of effect of budget management of project cost.The main contents are accuracy analysis of budgeting,effect of uncontrollable factors on budget management,and evaluation of completion condition of target.Finally,the experience summary of budget management of cost from ZS Enterprise’s Project L is presented,mainly from two aspects(the process implementation of budget management and technical support).The main premise is improving the efficiency of budget management of project cost,which means improve efficiency of budgeting and budget adjustment,encourage all department employees participate actively in management,at the same time,complete cost databases,optimize information system,improve the combination of financial management and technical management,change budget management of project cost of enterprise to more refine and more comprehensive.This article not only describes the whole process of budget management of project cost from ZS Enterprise’s Project L in detail,and also provides information and discussions and suggestions,relating to budget management of project cost,for other enterprises from real estate industry and for other industry such as manufacturing.