KHA_25690_Human_Resource_Planning_and_costing and KHA_25690-project_cost

Section 1: Plan Human Resource

Activity 1:

1)    Project organisation and structure:

A project organization and structure can be established in a company or an organization with effective and efficient management of the project. Here a complete cooperation and coordination of each and every individual is required within the organisation. Here different styles of teams can exist in an organisation and they play significant role in managing the projects. A project organisation and the relevant structure can be introduced by the top authorities and it can be managed with the help of other managers.

2)    Association of competency in the project tasks:

It is very important that the competencies are associated and aligned in the project tasks. Various projects are undertaken by company in order to establish the core competencies of the organisation and thus gain competitive advantage from its competitors in the market. In order to gain success in any project task it is very important to align the existing competencies of the company with the project tasks. It will improve the efficiency of the project and will make it more competitive.

3)      Criteria for assisting project managers:

There are various criteria that can be used to assist the project management team in allocating the personnel to planned work outputs. Here the main criteria should be the eligibility and the experience of the personnel in managing various projects. The skills and knowledge of each and every personnel in that domain should also be taken into consideration. The team should be selected in a way that can maximise the effectiveness of the project and eventually will lead to the growth of the organisation.

Section 2: Implement Personnel Training and Development

Activity 2:

1)    Description of project role in the criteria list:

When the project role is developed there are various descriptions that can be included in the criteria list. The descriptions that can be included in the criteria list are the sound understanding of the processes and the project. Here the personnel should be aware of the vision and mission of the organisation and the main aim or the objective of the project. The personnel should be capable to make the project a success and should be dedicated towards achieving the goal. Here the personnel should be able to perform in a timely manner and efficiently (Atkinson, 1999).

2)    Strategic approaches:

A well managed project team can add significant value to the organisational growth and development. A company needs to take various strategic approaches to make the project successful. Co-location is also a strategic approach that helps building team relationship by face-to-face interaction and that benefits the organisation. A co-located team usually exists so that the organisational presence can be at two places and thus both the teams can coordinate and communicate with other. It will increase the efficiency of the project and thus it can benefit the organisation (Dinsmore and Cabanis-Brewin, 2011).

3)    Measures used for performance evaluation:

Here various methods can be used to measure the performance of the team and the individual. It is known that a collective performance of each and every individual can determine the performance of the team. Here the performance of a team can be measured by the level of success that the team has achieved, in terms of fulfilling the aims and objectives of the project. The success of the team can be determined by the resources that have been used and the time duration that has been taken in achieving the desired goals. Here the contribution of each and every individual can be measured as well. The performance of each individual can be measured in terms of his contribution in the process. This includes the degree of skills and knowledge used by the person in making the project a success (Gilmore and Williams, 2009).

4)    Methods used for performance management:

In order to conduct the performance assessment of the team various methods can be used in the process. The most common methods used in performance management are performance expectation, continuous feedback, performance evaluation, goal-setting, training and recognition. These are a few methods that can be used for improving the performance of the employees or the personnel in project management. Here a goal should be provided to the personnel along with the performance expectation from the employee. Performance evaluation at specific interval and feedback is necessary. The required training can improve the skills of the employees and the recognition of their good performance will enhance their performance even more. These methods include the elements of motivation and guidance that can improve their performance (Gray, Larson and Desai, 2006).

5)    Five stages of team development:

The five stages of team development are forming, storming, norming, performing and adjourning. These stages can be described now.

  • Forming:  in the first stage of forming the team first meet with each other and they introduce themselves. The interaction at this stage is very important as people share their interests, backgrounds, experiences with one another and thus it is important for the establishing a basic coordination between the team members.
  • Storming: at this stage the team starts working together and they get to know the techniques and status of each and everyone in the team. At the end of the stage members become more accepting of one another and thus the effectiveness of the team is determined at this stage.
  • Norming: at this stage the team members perform together and they also resolve any conflicts or differences among one another. At this stage the team agrees on a common goal the ways or methods to achieve the goal.
  • Performing: at this stage the team performs as a cohesive unit and the teams are expected to foster effectiveness and creativity, complete tasks and make decisions by working interdependently. Here the performance of each and everyone is important along with the cooperation and coordination among them.
  • Adjourning: at this final stage the project is adjourned after the team have succeeded in achieving the set goal (Harel and Tzafrir, 1999).

It is very important that a project manager use the theory while developing teams as it will improve the efficiency and effectiveness of the team and the issues can be identified in terms of each stage and thus proper measures can be implemented to take care of the issue.

6)    Main objectives of developing a project team:

The main objectives of developing a project team process are achieving various goals for the growth and development of an organisation. Here the skills and knowledge of each and every employee can be used for the benefit of the organisation. It can be difficult for an individual to achieve certain goal related to the organisation and thus teams are built in order to achieve that goal in a timely manner and by optimising the utilisation of resources. Here a synergy can be created within the team and the efficiency of the members can increase manifolds while working as a team. Thus project team process is developed (Mathis and Jackson, 2000).

7)    Improving the performance:

The performance of an individual as well as teams can be improved by communicating performance expectation, continuous feedback, performance evaluation, goal-setting, training and recognition. In terms of these activities the area that is subject to actions for improvement is in the use of their technical skills and theoretical knowledge in the practical basis. Here the skills and knowledge that is applied for the success of the project is very important and thus the training is provided to effectively use the skills.

8)    Communicating measures to address shortfalls:

After evaluating the performance of the employees or team members, feedback should be given to the members regarding their performance. Here the first step should be communicating the measure to address the shortfall. Each and every employee and the team member should be aware of the evaluation process and they should also have complete knowledge of the time and measures used in the method. Here the employees should be addressed regarding these methods beforehand by the mangers.

9)    Strategies to encourage good performance:

One of the strategies that are used in order to encourage good performance or behaviour from individuals as well as teams is the reinforcement method. Here continuous feedback can be provided to the employees and team members. The reinforcement can encourage good performance from the employees. Here the reinforcement can be of positive or negative type. Positive reinforcement includes monetary and non monetary benefits like gifts rise in the salary, promotion, recognition for the good work etc. These can encourage the employees to perform better at workplace. On the other hand negative reinforcements may include demotion. In present scenario positive reinforcements are preferred over the negative reinforcements (Verma, 1996).

Section 3: Lead the Project Team

Activity 3:

1)      Impact of issue resolution on project:

Several issues and conflicts can be seen during a project building and the operations. Here the personnel from diverse fields are allocated in a team in order to achieve the goals of the company collaboratively. In the Storming stage various conflicts can occur among the individuals as they may have different opinions or point of views regarding various situations and they may react differently to certain problems. These conflicts within the team can decrease the efficiency of the team and the performance of the team will suffer. As a result the goal of the team may not be achieved or it can be timelier. In such scenario the organisation will suffer consequently.

2)    Improving individual and team performance:

It is the duty of the human resource manger to effectively use their abilities for managing the human resource and take appropriate measures to resolve any form of conflict within the team. In order increase the performance of an individual or a team the human resource manger need to resolve any issues or conflicts within the members and he should establish the coordination and cooperation between them.

3)    Remedial or corrective action to improve team performance:

A human resource manager can take various remedial measures to improve the performance of a team and boost their morale. It is very important to boost the morale of the employees or the team members to improve their performance. The human resource manager can encourage them towards their work and they can provide continuous feedback on the performance of the team members. It is the responsibility of the manager to make the employee aware of any form of inefficiency or lack of performance and correct it immediately. In order to improve the employee morale the manager need to treat employees with respect and offer them an open and regular communication.

4)    Preventive action of human resource manager:

The human resource manager can take several preventive measures as well to improve the team performance or morale. The preventive measures can include establishing a code of conduct within the team. The code of conduct can prevent any form of discrimination, unethical behaviour within the individuals and it can boost the morale of the employees and team members.

5)    The main characteristics of conflict:

The main characteristics of conflict are,

  • It requires at least two people to engage in conflict.
  • The conflict can occur when there is a disagreement between the individuals regarding some issue.
  • The conflict can be centred on opinions, methods, goals, values or desires.
  • The conflict can be influenced by the power of the individual or their overpowering nature.

6)    The common reasons for conflict:

 The common reasons for conflict during a project are,

  • Conflict regarding the resources that are basically used in office space or for the project.
  • Conflict regarding the priority of various activities.
  • Conflict regarding the role of each and every individual in the team and their actions.
  •  Conflict regarding difference in opinion, styles, values, or methods of achieving the goal.
  • Conflict can also occur due to different perception of the team members.

7)    Actions taken to resolve conflict:

The human resource manager has to make sure that any form of conflict between the employees does not have any significant impact on the performance of the team or the objectives of the project. Here the conflict must be resolved immediately in order to restrict the impact of the conflict on the performance of the team or the objectives of the project. Immediate action on the conflict and resolving at its inception is very important as it can have a significant impact on the project.

Section 4: Finalise Human Resource Activities

Activity 4:

1)    Considerations of disbanding the project:

After the objectives of the project are fulfilled or the goal is reached, the project team is disbanded. Before a project team is disbanded, a moment should be taken to celebrate the accomplishments. Then the team members can review their contributions and they can engage in a general discussion about the problems that were faced during the project. The problems may include various conflicts within the individuals, problems with the resource allocation or other activities of the project. Finally the next step for the team members is discussed and they are asked about the experience of the project and what they learned from it.

2)    Lessons learned from the project:

The members can learn various lessons from participating in the project and they can use it in future for other projects. Here the members communicate regarding the project objective, the goals, how much they have achieved, where they failed, how they could have improved, in which area they lacked etc are discussed before disbanding. In the review session they are asked if their abilities were utilised properly during the project. The discussion is also done on why various conflicts occurred during the project and how they could have been avoided. Any form of suggestion for improvement in future is also communicated. These can help the team to plan for future development in projects.

3)      Aspect of project human resource management:

The review on the project human resource management should be given on the performance of the team members and on the conflict resolution. After the project is over and the members of the team are disbanded, a review should be given on the how the members performed during the project. Here a review should also be given on the conflicts that occurred during the project and how they could have been resolved.

4)      The Plan-Do-Check-Act:

The Plan-Do-Check-Act process of continuous improvement can be used there to review the human resource management in relation to project management. Continuous improvement is required in HRM like any other operations or production process. Here Plan-Do-Check-Act can be used for reviewing the performance of the team members. First it should be reviewed if the team member has performed as planned and then it should be checked that where they went wrong. After that actions should be taken to resolve the issues and to improve the performance of the team members.

Written/Oral Questions:

1)      There are various legislations that are applied in HRM. These are,

  • Equal opportunities for the safety and health protection for the employees.
  • Sex Discrimination Act
  • Race Relation Act
  • Employment Equality (in terms of religion, sexual orientation, culture)
  • Disability discrimination

2)      The human resource manager along with their team is involved in project human resource management. The project manager along with the entire team members is involved in the project human resource management.

3)      The role and responsibility of the project manager in the project human resource management is managing the project plan. Here the project manger has to manage the performance of the team members and provide them with required feedback. Any form of conflict that may impede the success of the project or that can create various difficulties in achieving the goal is resolved by the manager.

4)      There are various methods that can be used to manage and improve the performance of the team.  Here cloud based project management tools can be used to improve the collaboration in the team. Here the project requirement can be documented and a continuous review and feedback process can be used to improve the performance. A Plan-Do-Check-Act can be used for continuous improvement.

5)      A 360 degree feedback method can be used in a team. A continuous feedback on the performance of the individuals will rectify their lack in performance and it will also identify the specific area where they have lacked in performance. It will help in continuous monitoring of the performance and thus it will improve the efficiency of the individuals and that will improve the performance of the team.

6)      There are various tools and techniques that can be utilised when developing the human resource plan. These tools and techniques include organisational charts, organisational theories, networking, stakeholder analysis, human resource practices and various templates. These tools and techniques can be effectively used for developing human resource plan.

7)      The tools and techniques that are used while developing the project team includes General Management Skills, Training, Team-Building Activities, Ground Rules, recognition & Reward and co-location. These can be used for project team development.

8)      There are various types of organisational structure. The advantages and disadvantages of each organisational structure can be described here.

  • Pre-bureaucratic structure:
  • The advantages of the structure include the total centralisation of the process. The founder can control the growth and development and the communication is done on one-on-one process that is very effective for the organisation.

The disadvantage of the organisational structure is in its lack of standardisation in various tasks. It is only effective in smaller organisations and can be used only to resolve simple tasks.

  • Bureaucratic structure:

The main advantage of the structure is in its transparency by clearly defined roles and responsibilities. They have the respect for merit and a clear hierarchical structure.

The disadvantages of the structure can be the discouragement towards innovation and creativity. It is hard for an organisation to adapt to the changing environment.

  • Functional structure:

The advantages of the structure are the clear lines of authority, efficiency, accountability and communication within the organisation.

The disadvantage of the structure is the increased interdependency among the members. A departmental focus may cause problems in communication.

  • Divisional Structure:

The advantages are separate functional environment in terms of location, product line or the customers. It gives the opportunity to excel in service and product lines.

The disadvantages are the duplication of roles across the divisional units.

  • Matrix structure:

The matrix structure gains the advantage of divisional as well as functional structure. The expertise of the members benefits the organisation.

The disadvantage is in the decentralised approach and there can also be conflicting loyalties and interests.

  • Team structure:

The advantage of the structure is in achieving the common objective by group effort. It increases the efficiency and provides effective results.

The disadvantage of the structure is in the risk in relation of employee control and the requirement of training for the employees to perform effectively.


Atkinson, R. (1999). Project management: cost, time and quality, two best guesses and a phenomenon, its time to accept other success criteria. International journal of project management, 17(6), pp.337–342.

Dinsmore, P. and Cabanis-Brewin, J. (2011). The AMA handbook of project management. 1st ed. New York: American Management Association.

Gilmore, S. and Williams, S. (2009). Human resource management. 1st ed. Oxford: Oxford University Press.

Gray, C., Larson, E. and Desai, G. (2006). Project management: The managerial process. McGraw-Hill/Irwin.

Harel, G. and Tzafrir, S. (1999). The effect of human resource management practices on the perceptions of organizational and market performance of the firm. Human Resource Management, 38(3), pp.185–199.

Mathis, R. and Jackson, J. (2000). Human resource management. 1st ed. Cincinnati, Ohio: South-Western College Pub.

Verma, V. (1996). The human aspects of project management. 1st ed. Upper Darby, PA: Project Management Institute.


Activity 1

Answer to Q 1:

Company Name Quotation Price Hardware cost Additional Cost Per year Duration Total Cost Average cost per year
Access IT Company







Vision IT Technical Consultants







Total IT Solutions







From the above calculation it can be said that supplier B, that is Vision IT Technical Consultants will be the most cost effective for Safe Hands Insurance Company’s new AIS.


Activity 2

Answer to Q 1:

Previously, the use of management accounting mainly revolves around the determination of cost as well as financial control purpose. But research pointed out that a wide range of limitation of management accounting already taken place. Therefore as an accountant they need to take initiative to minimize the limitation of management accounting. In order to do so primarily they need to gather information for management planning and control. Subsequently through using such information they need to reduce waste of resources of business operation. Finally they will also have to create value through effective utilization of resources.

Answer to Q 2:

Management of financial data supports to operate the business in an efficient way. Accuracy of data is also crucial for the team as inaccurate data can lead financial losses, low productivity as well as loss of opportunities.

Therefore, the process of accessing the financial data for effective management should prioritize the frustrations, bottlenecks and inefficiencies associated with the data and then based on their merit data have to use.

Answer to Q 3:

Precise cost information is essential to budgeting. Organizations that employ precise cost management procedure and make available budget developers with prepared right to use to cost information develop both the accurateness and the swiftness of their budget process. Regulating the cost management system across the organization is an imperative approach in enhancing the association between cost management and budgeting.

At the same time use of variance analysis is also another initiative to link the cost management to budgeting. It supports the organization to recognize the areas in which expenses are relatively high then average business operation cost.

Activity 3:

Answer to Q 1:

Personal budget are prepared prior to income is generated or expenses are incurred. Therefore it can be said that budget is the best educated guess as at what extent income will be generated as well as expenses will be occurred. But in real life the expenses most of the time cross the budgeted limit. This is the reason why personal budget evidenced large volume of negative variance. Therefore to report such large volume of negative variance there needs to incorporate information related to changes in cost as well as difference in income generation. Some time changes in economic realities might also influence this negative variance. Therefore, changes in economic realities should also have to incorporate in the report.

Answer to Q 2:

While reporting, evidence provides an objective foundation to the arguments and made it more than a mere collection of opinions regarding a particular aspect. All such evidenced are utilized with the aims of convincing the reader of the reports to accept the fact as well as recommendation made by the writer. Another important aspect for providing evidence is that since the writer are asking the readers of the report to consider risk while the writer attempting to persuade them, there needs to provide supporting facts as well as figures for the assertion to meet their requirements. It is also facts that providing evidenced answers the particular question “how the researcher claims the particular aspects?”

On the other hand, providing conclusion sum up the findings made by the report as well as to what extent these findings impacts on the particular issue. At the same time the conclusion of the report also indicates in which area the research did not put emphasis, which also recognize the scope for future research work.

Activity 4:

Preparation of profit and loss report is one of the significant financial statements of any organization during a particular financial period. Preparation of this report provides information related to flow of money both inflows as well as outflows during that period. It also provides clear information towards the management as well as potential investors whether the organization evidence viable operation during that particular period or not.

In order to make the profit and loss report error free and comprehensive, there needs to recognize several aspects like net sales of the organization during that particular period. Subsequently there needs to calculate gross margin after considering cost of goods or service sold and any other factors. At the same time there needs to sum up all regular expenses to obtain total expenses. By subtracting the total expenses from the gross margin earnings before interest and tax can be found. Subsequently adjusting tax, interest expenses net profit or loss can be found.

Activity 5:

Answer to Q 1:

While preparing a report at the initial stage there needs understand the purpose of the report. However, the following documents should have to use to prepare an appropriate report:

  • Report plan;
  • Structure of the report;
  • Secondary information;
  • Guidance for appropriate writing style;
  • Guidance for appropriate referencing style

Answer to Q 2:

The below mentioned common errors might be evidenced during the preparation of financial report:

  • Error related to accompanying information;
  • Error related to long term debt disclosure;
  • Error related to related party disclosure;
  • Errors of omission;

Answer to Q 3:

 In the modern economy organizations irrespective of their industry face mounting pressure to provide elevated quality of information in more timely as well as effective manner. Therefore there requires a smart, effective closing cycle which will create a foundation for assessment of the financial performance of the project over the time frame. Then only it will enhance the timeliness as well as accuracy of the execution of the project.

Financing a project mainly requires assessment of the negative impacts on the financial performance of the project, which basically of two types such as if the project will not executed within the budgeted cost as well as time, secondly if the project fails to utilize the hundred percent capacity of the allocated capital.

The below mentioned entity are responsible for project financing:

  • Sponsored project services staff;
  • Principal investigator;
  • Chief financial officer;
  • Directors of finance;
  • Project manager;

Answer to Q 4:

During preparation of bank reconciliation below mentioned inconsistencies might be taken place:

  • If deposited checks are returned for the reason that the drawee bank is in other nation. In that particular case there needs to reverse the entry related to deposit;
  • In case of un cleared check that persist to not be obtainable, it should be treated as any other un cleared check specifically for short run. However, in the long run there needs to contact the payee to find out if they ever received the check or not and accordingly needs to void the old check and issue a new one.
  • If the checks getting clear after having been voided, first of all there needs to find out whether the payee cashed the new check. If not then there needs to void the new one or else there require to pursue repayment of the second check with the payee.

Answer to Q 5:



Cost of goods sold


Gross profit


Interest earnings


Selling and Administrative expenses


Earnings before depreciation interest and tax (EBDIT)




Interest expenses


Tax @ 30%


Net Income



Activity 6:

Project management itself contains wide range of subsection like planning, coordination and review stages, budget preparation, and allocation of funds, execution, review and closure. Allocation of cost directly involves with process of finalizing accounts.

During the allocation of cost for each individual sub activity of the project there needs to make associate entry in the ledger book. Subsequently, there is needed to prepare trail balance and final accounts for each sub categories.

Activity 7:



Written / Oral Questions

Answer to Q 1:

The project manager is the one who will be responsible for the entire project. Since allocation of cost is one of the important parts of managing project, fails to manage cost allocation for each individual activity of the project might leads to deviate from the budgeted cost for the project. As a consequence it will impact on the revenue, cash flow as well as investment funds of the organization. Therefore, it is important for project manager to consider the financial responsibilities with care.

In this context it can be said that there is no difference between financial responsibilities and accountabilities.

Answer to Q 2:

It is evidenced that preparation, effort and care that have to be given for preparing a report should always reflect its usage. The reason behind such concept is the opportunity cost. It is fact that instead of preparing this report the preparer of the report might engage himself or herself in any other activities that are beneficial for them.

Answer to Q 3:

Performance indicators basically act as a critical success factor for achieving success for organizational internal controls. The reason behind is that by establishing such critical success factors, organization might understand their performance level considering whether they attain it or deviated from the target during the audit of the performance level.

Answer to Q 4:

The below mentioned entities are the main stakeholders with whom a business should consult:

1] External stakeholders:



2] Internal stakeholder:

Project manager


Senior management

Business analyst

Each of the above mentioned entities plays different role in execution of the project. Taken for example, the sponsor of the project provides the capital resources for the project, whereas the supplier provides the raw material necessitates for the project. Similarly the CFO, project manager are responsible for the execution of the project within the budgeted time as well as cost of the project.

Answer to Q 5:

Work practices are largely influenced by the segregation of duties. It is fact that if duties are not segregated then each individual will be responsible for entire activities, this may create communication gap and ultimately leads to deviation from the desire result. But if duties are segregated then each individual have enough information regarding their role and consequently improves the reliability of the project.

Answer to Q 6:

While budget is considered the educated guess for the business operation, reporting the performance depicts the true position of the organization. If the organization practices improper budgetary techniques then it might lose relative market share, which largely impacts the long run sustainability of the business. On the other hand, a budget time table supports the organization mainly in the short run. It helps to attain short run objective of the business.

Answer to Q 8:

 Materiality threshold narrates to the implication of dealings, balances as well as errors enclosed in the financial statements. Materiality therefore describes the threshold or cutoff point subsequent to which financial information turn into pertinent to the assessment making requirements of the users.

Answer to Q 9:


PV= FV X [1 ÷ (1 + i) ^ n]

Where, PV = present value

FV= Future value

 i = Compound interest rate;

n = Number of years;


FV = $ 1000

i = 8 %

n = 2 years;


PV = $ 1000 * [1 / (1 + 0.08) ^ 2]

= $ 857.34



Answer to Q 1:

Fred’s Shed

Work Breakdown Structure



Number/ ID

Task Description

Predecessor relationship



Resources (people and materials required to complete

the task)


1  Purchase Materials

3 days

    2 people

$ 26000

2 Site preparation

8 days

5 people

$ 4000

3  Construction of shed

1, 2

11 days

10 people

$ 8000

4  Clean up


 1 days

3 people

$ 1000

Answer to Q 2:

The following are the budgets that are related to project management

Materials budget;

Cash budget;

Overhead budget;

Answer to Q 3:

Profit and loss statement:

A profit and loss statement summarizes the revenues, costs and expenses incurred during the execution of the project.

Statement of retained earnings:

The statement of retained earnings bring together the starting and finale retained earnings over the duration of the project, with utilizing information such as net earnings from the other financial statements

Balance sheet:

The statement of balance sheet summarizes a company’s assets, liabilities and shareholders’ equity over the duration of the project.

Cash flow statement:

The cash flow statement summarizes the cash engenders as well as used during the execution of the project specified in its headline.