COST control helps to keep track of appropriate project changes that may affect the project budget.
During the process of execution of the project, the budget needs to be monitored and controlled.

The purpose of cost control is to ensure that the financial trends of the project are continuously tracked and possible cost overruns are noticed so that appropriate mechanism is initiated to bring the project to focus. Cost monitoring involves knowing the project cost, keeping accounts of project commitments, and knowing the estimated costs to complete the project.

Cost Control Tools
It is always important in a project to adhere to the project budget during execution. This is because a deviation from project budget is the principal characteristic of an unsuccessful project. In cost control, it is required to collect the actual costs and regularly creating reports for expenses. It is important to monitor the financial trends as well as anticipating costs of works that still remain to be completed. Cost variances and approved budget changes must also be accounted for to maintain effective cost control.

Two cost control techniques for budget control include the change control method and the earned value management method. Cost change control system is used to evaluate change requests as they relate to cost and processing the approval of those requests to be reflected in the project budget. Project performance reviews are used to compare cost performance on the project (earned value) to what should have been done (planned value) on the project. This could be measured in work packages or milestone achievement.

How to Estimate Cost
To make a good and reliable estimate will depend on the information that is available about the project to the estimators. So information gathering is an important part of the cost estimation process. A better understanding of the project definition and the work breakdown structure containing all the elements and activities that make up the project will be required for a reliable and effective cost estimate. The parameters, data and specification of the product or service must be disclosed and known to the estimators as they will define the time and resources required to achieve the project objectives.

The following simple formulas are useful for estimating project costs.

.Equipment: Equipment cost = purchase price + taxes and other logistics requirements. The purchase price for equipment can be obtained from vendors or historical data.

Facilities: Cost of facilities = lease price x time period
Labour cost = (hourly rate x number of hours required)
Training costs = (tuition cost x number of attendees)
Transportation = (daily rate x period of usage)