A person can create a time-phased budget by charting a certain period of time and then allocating resources to that specific period, states 4castplus. This type of budgeting allows individuals and organizations to better understand resource expenditures during particular periods, or phases.
The basic format for a time-phased budget is to list time periods in the first row and specific resources in the first column, notes 4castplus. Typically, resources are items expended as part of the project or goal. For instance, a person may use time-phase budgeting to allocate hours spent throughout the day. Moreover, businesses may use time-phased budgeting to track costs over particular time periods.
Managers use time-phased budgeting to assess performance, according to Project Insight. Under this approach, time intervals are labeled in the first row, whereas the specific employee is labeled in the first column. The resources utilized by the employee are then entered in the intersecting row and column. A manager can track employee progress with this type of chart. However, it is important to consider the concept of a cost baseline when using a time-phased budget. This baseline represents the total cost allocated over a specific time period and should not be altered unless the scope of the specific project changes, notes Project Insight.