When an investor needs a project audit

A project audit is inexpensive relative to the project: three to five weeks of an independent team's work. The difficulty is that it is almost always commissioned at the point where every participant already knows the answer and the decision space has narrowed to a choice between bad options.

Seven signals

1. The completion date moves regularly and the explanation is new each time. This indicates that no calculated forecast exists.
2. Budget expenditure leads physical completion by 15 percentage points or more. The overrun has already happened; only its size is open.
3. Status reports are produced by whoever is accountable for status. Without independent verification, reporting is the performer's management tool, not the investor's.
4. Additional works are growing without comparable growth in physical completion. A symptom of either incomplete original scope or absent change control.
5. Contractors have begun writing about suspension or claims. The legal phase starts before the investor has recorded the facts.
6. A change of manager or contractor, or the entry of a new investor, is planned. Any handover requires an established reference point.
7. A lender or shareholder has requested an independent assessment. Here the audit stops being a choice and becomes a financing condition.

What the output must contain

An audit that ends in a description of problems is useless: the participants already know the problems. A usable output contains four mandatory elements:

• A completion date forecast justified by critical path — a calculation, not an estimate of "plus six to eight months".
• A final cost forecast and Cost to Complete, with the build-up and assumptions disclosed.
• A risk register with quantified schedule and cost impact.
• A roadmap: specific actions, owners, dates and expected effect.

A good audit answers not "what is wrong" but "what to do in the next ninety days and what result that will produce".

What to do with the result

After an audit an investor typically takes one of three routes. Continue in-house, applying the roadmap corrections. Close one specific management gap by buying a Managed Service — most often project controls or technical supervision. Or hand the project over to be managed: Project Recovery if it is in crisis, or a full technical customer contract if the project is manageable but nobody is managing it.

Audit or cost and schedule review

If the project has not started or is at an early stage, a full audit is excessive. Verifying the budget and schedule before approval calls for a shorter format — an independent document review over two to four weeks, without on-site quantity and quality verification.