NGO & Project Management Technology · Beginner level

Beginner level · Module 3: Budgets and Data Collection · Lesson 1 of 3

Project Budgets and Tracking

Plan and track spending against activities.

In this lesson you will

  • Build an activity-based budget
  • Track spending and burn rate

Key concepts

budget linesunit costsactual vs budgetburn rate

The lesson

Build the budget from activities: quantities × unit costs for each line.

Track actual spending monthly against the budget, line by line.

Burn rate compares the share of budget spent with the share of time passed; big gaps signal delays or overspending.

Step by step

  1. Build the budget from activities.
  2. Create a tracking sheet.
  3. Enter sample spending.
  4. Calculate burn rate.
Worked calculation

Is the project spending on track?

Using burn rate at the half-way point to spot delays.

A 12-month project with a 120,000 USD budget, reviewed at month 6 (illustrative)
ItemWorkingAmount
Share of time passed6 ÷ 1250%
Spent so farfrom the tracker42,000 USD
Share of budget spent42,000 ÷ 120,00035%
Expected spending at an even pace120,000 × 50%60,000 USD
Behind expected spending60,000 − 42,00018,000 USD
Unspent at year end if the pace continues120,000 − (42,000 ÷ 6 × 12)36,000 USD

Explanation

Spending at 35% of budget after 50% of the time usually means activities are delayed — here, borehole repairs waiting for the dry season.

The project must spend 13,000 USD a month for the rest of the year, against 7,000 so far. Plan the catch-up now and tell the donor early if a no-cost extension or budget change may be needed.

Check your understanding

42,000 ÷ 6 = 7,000 USD a month; (120,000 − 42,000) ÷ 6 = 13,000 USD a month.

Practice activity

Build the budget and tracker for your project.

Expected result: A linked budget and tracker with burn rate.

Check your understanding

  1. How is an activity-based budget built?

    Show answer

    Quantities × unit costs for each activity.

  2. What does a low burn rate halfway through a project suggest?

    Show answer

    Activities are probably delayed.

Taught live by an instructor — online or in person. Free course lessons are for self-study and do not lead to a certificate — see registration options.