What is the unawarded budget balance?

Why percentage-of-budget-spent is the wrong number

Ask a project how it is doing on cost and you will usually be told how much of the budget has been spent. It is a comforting number and it is close to useless, because spend is a lagging measure of decisions taken weeks or months earlier. By the time it moves, the decision that caused it cannot be revisited.

The unawarded balance is the opposite kind of number. It is scope not yet bought, at prices not yet fixed, with alternates still on the table. It is the money you still control.

How it is calculated

Current budget, less everything that is already spoken for:

• Current budget — the original budget, plus or minus approved transfers between lines.
• Less committed cost — awarded contracts and purchase orders, counted from the award and not from the invoice.
• Less approved variations — change orders that have been approved and have therefore become money.
• Less direct costs — day works, statutory fees, utilities and owner-supplied materials, none of which have a purchase order behind them but all of which are spend.

The reading that catches people out

A line can show a healthy percentage of budget remaining and still have a negative unawarded balance. That is not a healthy line. It means the line has already committed more than it has left, and the invoices simply have not arrived yet.

This is the specific failure a budget-versus-invoices spreadsheet cannot detect, because it was never holding the columns you would need to compute it.