COST OVERRUN Meaning and
Definition
-
Cost overrun refers to a financial situation in which the actual expenditure of a project or activity exceeds the initially estimated budget. It occurs when the final cost incurred for completing a particular project is higher than the projected or planned expenses. Cost overruns are often seen in construction, infrastructure development, and other large-scale projects that involve significant investments of time, money, and resources.
The factors leading to cost overruns can vary and may include inaccurate initial estimations, unexpected increases in material or labor costs, delays, changes in design or specifications, unforeseen risks or challenges, and poor project management. These overruns can significantly impact the profitability and viability of a project, as they can result in financial losses and delays in completion.
Cost overruns can have various implications on different stakeholders involved in a project. For contractors or companies undertaking the project, they can lead to reduced profit margins, strained cash flow, contractual disputes, and potential damage to reputation. Clients or investors may experience financial losses, diminished return on investment, and delays in reaping the expected benefits of the project.
To mitigate cost overruns, diligent planning, accurate estimation, and effective management of resources and risks are crucial. Employing experienced project managers, conducting thorough feasibility studies, implementing appropriate cost control measures, and continuous monitoring and evaluation can help minimize the likelihood and impact of cost overruns. Regular communication and collaboration between all parties involved can also contribute to early identification and resolution of potential issues, preventing cost overruns from escalating.
Overall, managing cost overruns is essential to ensure the successful execution and completion of projects within the set budget and time frame.
Common Misspellings for COST OVERRUN
- xost overrun
- vost overrun
- fost overrun
- dost overrun
- cist overrun
- ckst overrun
- clst overrun
- cpst overrun
- c0st overrun
- c9st overrun
- coat overrun
- cozt overrun
- coxt overrun
- codt overrun
- coet overrun
- cowt overrun
- cosr overrun
- cosf overrun
- cosg overrun
Etymology of COST OVERRUN
The word "cost overrun" is composed of two separate parts: "cost" and "overrun".
The term "cost" derives from the Middle English word "coste" which originated from the Old French word "coste" meaning "expense" or "cost". It can be traced back further to the Latin word "costa" meaning "rib" or "side".
The word "overrun" consists of "over", which means "above" or "beyond", and "run", derived from the Old English word "rinnan" meaning "to flow" or "to move swiftly".
Therefore, when combined, "cost overrun" refers to an excess or increase in expenses beyond the originally estimated or allocated amount.
Similar spelling word for COST OVERRUN
Infographic
Add the infographic to your website:
