The magic and benefit from cost accounts in Primavera P6

Resources and cost.

Let us commence with the implementation of resources in the project schedule. When applying the resources, you can straightforwardly link the values of the resources with units and prices to resources and cost-load the complete plan.

You can monitor and control the resources and their associated cost clearly at the WBS level.  This is, in many ways not sufficient. Here, you need to add cost account data to each and every activity you want to monitor and control cost.

Cost accounting

Cost accounts are hierarchical, and they enable you to track activity costs and earned value according to your organization's specific cost account codes. This is what the help function from Primavera specifies.

You can see the function of cost accounts as very similar to the pivot tables in Excel, and you can use them equally.

For example, you have various WBS  elements with the activity ”pour concrete”.

It is unlikely that you can monitor and control the cost element of each individual activity. This is, in general terms, too cumbersome and time-consuming to do to gain benefits from action.

By control, I mean planned cost versus actual cost.These costs may vary depending on the number of units and the price.

But you still want to monitor and  control the cost, and then is the cost account function a valuable tool?

Here is a short lesson.

Step 1

Hereunder you see a small example schedule. Based on the typical WBS layout, including the costloading and the achieved progress. So far, for good. Yes, it is an excellent graphic, but I want to see the numbers. I hear you think! So, look at the following pictures.

Schedule with bars, histograms and s-curves

Resource assignments

Activity usage spreadsheet.

Earned value data

You see Cost Performance Index (CPI), Schedule Performance (SPI), Cost Variance, Cost Variance Index Schedule variance, and much more if you select the appropriate columns.

How to apply Cost Accounts

So, now we are going to use the cost account feature.

First, we make up an account structure or framework to suit your organization. I have used various formats but for this tutorial, I have added some additional accounts, and you will see them in the following picture.

I made a new group and sorted the layout, and you can now clearly see the cost data gathered and sorted by the cost accounts.

Cost data per cost account.

Here, above, you see the group and sort layout on the basis of cost accounts. I have made 3 example accounts: 1 for cost account X, 1 for cost account Y, and one for cost account for contingency, which is standard in my cost accounts.  This can be a suitable and adequate basis for cost reporting based on cost accounting.

This is one of the pivotal features of connecting the project data based on cost accounts in lieu of reporting on the basis of the WBS structure.

The magic of writing reports in P6

In the next section, you will discover the magic of report writing in Primavera P6. Let us start!

This report is a typical report as a starting point for a monthly statement on the basis of cost control accounting and reporting.

What can you see?

• ·        The cost accounts code
• ·        The resource codes
• ·        Cost account name/ activity code
• ·        Activity name
• ·        Planned units
• ·        Actual units
• ·        Remaining units
• ·        Planned cost
• ·        Actual cost
• ·        Remaining cost

Would you like to discover this report in Excel? No problem, just configure it from CSV to Excel.

In the reports function, we have a large selection of reports to suit our requirements.

Summary

As I stated at the start of the article ,

I trust that I succeeded in the purpose of exploring and delving into How to use and gain from cost accounts in Primavera P6.

I enjoyed it very much, and I hope that this article contributes to the project management and project control community.

Jan van den Berg

December 2023