What to capture
- Estimate purpose, classification and preparation date
- Scope description, deliverables and technical baseline
- Schedule milestones and assumed execution approach
- Cost breakdown and estimating methods
- Source data, normalization and price basis
- Labour rates, productivity and quantity assumptions
- Currency, escalation, taxes and location factors
- Exclusions, qualifications and unresolved decisions
- Risk, contingency and confidence treatment
- Reviewers, approvals and revision history
Explain, do not merely attach
A basis of estimate should tell the story of how the estimate was developed. References to files and models are useful, but reviewers need a concise explanation of the logic and limitations.
Maintain version control
When scope or assumptions change, preserve the prior version and identify the reason for revision. Do not silently overwrite the evidence used for an earlier decision.
Review test: could a knowledgeable person reproduce the estimate’s main logic without relying on the preparer’s memory?