Define what the allowance covers
State the allowance amount, estimate code, scope boundary, pricing basis, and approval. Name exclusions and the event expected to replace the allowance, such as design release or a subcontractor proposal.
A broad reserve without a scope statement cannot be reconciled cleanly. Use the construction allowance vs contingency as the related control and keep the record with the estimate revision under review.
Record each drawdown against new scope
When detail arrives, record the new cost, the allowance amount removed, the remaining balance, and the estimate revision. Keep scope growth separate from replacement of work already covered. Attach the drawing, quote, or decision that supports each transaction.
AACE recommended practices offer general estimating references. The project documents, contractor procedures, and approved estimate remain the controlling basis for the decision.
| Review field | Required record |
|---|---|
| Allowance | Amount, code, and scope basis |
| Drawdown | Detailed cost introduced |
| Offset | Allowance amount removed |
| Balance | Remaining scope and decision |
Close the balance deliberately
Review negative balances, unused balances, and allowances past their resolution milestone. Decide whether the balance returns to the estimate, transfers with approval, or remains for a named unresolved item.
Do not zero the log merely to match the current total. Use the estimate assumption expiry review as the related control and keep the record with the estimate revision under review.
