Set up Budget from Project Contract

Linarc streamlines the transformation of your project contract into a structured, activity-aligned budget. This integration establishes a robust financial baseline that enhances cost control, progress tracking, and accurate forecasting.

• Each contract line item is automatically converted into a corresponding budget line item by default.
• Customize budget lines by assigning specific cost codes and locations, then distributing the total value across cost types such as material, labor, and equipment.
• The system automatically calculates overhead based on contract terms, with any unallocated funds designated as profit for that line item.
• A single contract line item can be split into multiple budget lines. For example, this allows you to distribute a contract line item value across different building levels or zones for more precise cost tracking. 

Set up the Project Budget

• Ensure that you're in the Project 'Budget Allocation' screen. If not:
  • Click the app launcherand select 'Finance' from the project management console
  • Click 'Contract' on top, then select 'Budget' on the left

The commitment contract line items appear on the left pane. You can set up a budget for each line item on the right. 

• The left pane lists the following details:

  • Contract Line - The specific scope item or work category defined within the contract.

  • Contract Value - The total amount allocated for that contract line.

  • Remaining Contract - The balance amount still available after budget allocations.

  • Actions - Click  the button to add a new budget row for the selected contract line.

• Select a contract line item. By default, the system automatically converts each contract line into a single budget line item for the full amount. 
• To further divide this value, click 'Add New Row' to create additional budget lines associated with the same contract. Alternatively, click the  button to duplicate an existing line and split the total original amount across all associated budget rows.
• Click inside the cells to enter the following values:
  • Cost Code -  The cost code of the line item. Typically, this is the standard code for the task or deliverable as per CSI Master Format. If your company uses a custom coding system, the corresponding code is shown.
  • Description -The label of the budget item
  • Location (Optional) - The specific project area, level, or spot to which the budget line-item is associated. As a prerequisite, make sure the project’s location hierarchy is already set up. See Manage Locations - Overviewto know more.
    • Click inside the cell and select the appropriate location from the hierarchical list of project locations.   
  • Quantity - The planned amount of work to be materialized 
  • Unit of Measurement - The unit by which the amount of work done is measured 
  • Effort Hours - The effort hours required for completion of the task in manhours
  • Budget -The planned cost allocated for completing the work defined in this line item. 
  • Labor - The manual labor cost estimated for the job
  • Material - Planned cost for the materials used for the work 
  • Equipment - The estimate of cost incurred by the use of equipment and machinery for the work
  • Subcontractor - The planned cost associated with work performed by external subcontractors for this item. 
  • Others -Any additional planned expenses that do not fall under labor, material, equipment, or subcontractor costs. 
  • Overhead - Overhead and operational costs that the company bears, relevant to the task. This is auto-calculated based on the contract terms.
  • Profit -The projected margin earned for this work item, calculated based on the contracted and allocated value.
  • Click the 'Delete' button to remove the row.
  • Click the 'Add New Item' button at the bottom and repeat the process to add more line items.
• Click the  button at the top right to save the budget line items for each contract line

• Repeat the process for all other contract line items.

Verify that every contract line item balances correctly with its budget breakdown before finalizing. You can edit the budget line items corresponding to all contract line items at any time until the budget is locked. 

Edit / Remove Budget Line Items

Linarc allows unlimited reallocation of budget line items as long as the total remains within the contracted amount. You can,

• Edit and redistribute costs across all budget line items under each contract line.

• Edit cost categories, such as material, labor, equipment, and others, can be adjusted for any budget line item.

• Reallocation is allowed for all saved budget line items under every contract line until the budget is locked.

To edit a budget line item

• Click inside the cell you want to edit and enter the desired value
• Click the 'Delete' button to remove the row.
• Click the 'Add new row' button at the bottom to add a new budget line item

Alternatively,

• Click the button in the Actions column of a contract line item to add a new budget row under that contract.
• Click the 'Save' button at the top to save the changes.

Lock the Budget

• Click the button on the top right to confirm the budget allocated

• Click 'Yes' to confirm your action

You cannot modify a locked budget. Any future adjustments must be made through approved change orders. Once done, you can allocate funds from your budget to your scheduled work items. See Allot Budget to Scheduled Work Items for more details.