In project management, the project managers need to know exactly what their funding requirements are, even before they commence with the project. There are two types of funding management requirement and these include the total funding requirement and the period requirement. The total funding requirement is defined as the cost that is identified in the cost baseline. It also includes the management reserves. The period funding requirement is defined as the annual and quarterly payments. Both of these funding requirements are derived from the cost baseline.
The cost baseline is an important element in determining the project funding requirement and it includes the projected expenditures as well as the anticipated liabilities that may arise in the middle of the project.
The funding may occur in incremental amounts in project management. They might not also be evenly distributed. This particular project management document should also include the sources of the funding or where the funds will be obtained. It is one of the necessary inputs that is used creating the control costs that is necessary for monitoring and updating the project costs and its changes.
This term is defined in the 5th edition of the PMBOK.
