Abstract

In the construction field, most civil engineers are unaware of detailed project management,
specifically budgeting and cost control of construction projects. It is difficult to asset
information on budgeting and cost control even in the literature survey. This detailed study
of project management would benefit civil engineering students to understand the explicit
concept of budgeting and cost control. Basically, cost control is interdependent on the
budget, so the knowledgeof budgeting and cost control is essential for the project's success
and profit. In this review, we present meticulous information of budget planning and cost
control with a two-step mechanism.

Budgeting and Cost Control in a Construction Project

Management
[Link]. Scholar Sujata Janardan Pawar, Assi. Prof. Trupti Kulkarni, [Link] Janardan
Pawar
Department of Civil Engineering,
D. Y. Patil Institute of Engineering & Technology (DYPIET),
Ambi, Pune, Maharashtra, India 410 506
Abstract-In the construction field, most civil engineers are unaware of detailed project
management,specifically budgeting
and cost control of construction projects. It is difficult to asset information on budgeting and
cost control even in the literature
survey. This detailed study of project management would benefit civil engineering students
to understand the explicit concept
of budgeting and cost control. Basically, cost control is interdependent on the budget, so the
knowledgeof budgeting and cost
control is essential for the project’s success and profit. In this review, we present meticulous
information of budget planning
and cost control with a two-step mechanism.

Keywords-cost management, budget, cost control, direct cost, and indirect cost.
I. INTRODUCTION

Project management is the key to the success of any project which leadsthe team to
work to achieve the project goals with given restrictions, detailed knowledge, relatable
skills, ssential tools, and techniques to make the work worthwhile. Project management
starts with the planning and initiation whichlater on, will be executed with proper
monitoring and final closing of the project as per the goal.

In all this process, from planning to the closing of the project, correct management of
funds is the key to success which is by considering profit with customer satisfaction is the
most important factor for the growth of the company and individuals which is simply
called Cost Management. In project cost management, to keep expenditures within the
approved budget, we follow the steps like estimation, budgeting, and costs controlling
throughout the project life cycle. Project cost management can be divided into planning,
estimation, budgeting, and cost control. In this project, we are going to study the concept
of budgeting and Cost control in detail, how to prepare the budget for a construction
project, and what factors are required to be considered while preparation of the budget
like Direct (Hard) cost and Indirect (soft) costs, Study of how to manage the Cost control
of a construction project to complete the project with profit and customer satisfaction.
Finally, we will do a case study on a budget
by preparing a budget for a project. Initially, we need the Bill of quantities and the General
Arrangement Drawing (GAD) of the project which is always available when we are planning
to start a new project or in case of tenders from different clients, these data are available.
Therefore, from this basic data, we will discuss how to prepare the budget by considering
all the factors that affect the project’s profit-loss statement and give an idea about at
what level of cost management we are going to work on and what changes we need to do,
or what corrections we required in our working style. Construction Project Management
can be divided into eightcategories, such as Project Management Planning, Time
Management, Quality Management, Contract Administration, Risk Management, Safety
Management,
Construction Management Professional Practice, Cost Management, [Link] these
categories play a vital role in the project’s success. A project management plan is a
formal document that defines how a project is going to be carried out. It outlines the scope,
goals, budget, timeline, and deliverables of a project, and it's essential for keeping
a project on track.
Cost Management is a function that includes the processes which are required to
maintain effective financial control of projects; it can be split into cost management
as, evaluating, estimating, budgeting, monitoring, analyzing, forecasting, and reporting the
cost
information. According to Techslang “Cost management is simply the process of planning a
company's budget and controlling it as well as spending the money according to the
budget”.Cost management in project management is the
process of planning, estimating, budgeting, and controlling the project cost. For a project
to be called successful, it must carry on the requirements and scope, its execution quality is
of a high
standard, and it should be completed within schedule and budget with customers or the
client’s satisfaction.

Project cost management helps to create a financial

baseline which project managers can target the status of
their project costs and realign the direction if

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[Link] involved in cost management are Resource

planning, cost estimation, cost budgeting, and cost
[Link] planning is the first and most important
step that comes in cost management, which can be called
as the heart of any cost management initiative.

To make a project a reality, managing every resource like

money, manpower, machinery, material, utilities, etc. is
the main task that can be planned here. The goal of cost
estimation is to prevent budget overruns and provide an
accurate calculation of all assigned costs to each project
element. Estimates need to be validated by company
leaders, clients, and suppliers.

Resource planning and estimation at the initial stage of

the project are varied most of the time according to
different factors like changes in drawings, material
availability, market conditions, geotechnical conditions,
and so on and so forth which later affect budgeting,
therefore these possibilitiesmust be consideredduring
budgeting.

Cost budgeting is mainly involved setting an approved

budget for each task of the project, as determined by the
resource plan and cost estimation. It aims to identify a
cost baseline to keep costs on track. Budgeting is
important in the development of any major business
project, whereas, cost control refers to the practice of
adjusting costs based on the predetermined budget and
cost required during actual construction. The overall end
goal of cost control is to increase the profitability of the
project, and the company with customer satisfaction.

Cost estimate in the initial stage, budget in the planning

stage, cost monitoring in the execution stage, and
financial evaluation in weekly/fortnightly, monthly,
quarterly, yearly and in the closing stage are the basic
tools of cost control. In this paper, we are going to study
the last two steps in Project cost management which are
Budgeting and cost control with the example of one
bridge project.
II. OBJECTIVES

i) To know the value of Budgeting & Cost control in

the success of a construction project with
profitability.
ii) Study, how to prepare a budget for a construction
project
iii) Study of how to manage the Cost control of a
construction project to complete the project with
profit.
iv) Preparation of a budget for a construction project.
III. STUDY AREA OF THE PROJECT

Every entrepreneur works for their personal ans

company’s growth. Nowadays there is a vast increase in
the procurement of construction material. The ratio
Labour cost: Material cost in construction is
approximately 30:70 or 40:60 which means the material
acquired is approximately 60% to 70% cost of the project
concerning labor costs. Similarly, another key factor that
needs to be considered while preparing the budget isthe
hard costs and soft costs of the project. Hard costs
account for 70% to 85% of the total construction costs
whereas, soft costs account for just 15% to 30% of the
total construction costs, but we can save cost with proper
management of soft cost as it is not directly linked with
the construction items but is important and controllable.

Therefore, to start with the preparation of the budget, the

concept of what is budgeting and what is hard cost and
soft cost must be clarified in detail. The potrayal toward
profit ratio does not finish after the preparation of the
budget, but the budget execution starts with cost control.
For cost control, these three fundamental questions should
be asked: where to save the cost? What methodology do
need to be adopted for cost control? And where to focus?

Here we introduce the cost impact sheet, which plays an

important role in cost control, as it shows us the cost
impact on the budget cost while the issue of new work
order/ purchase orders timely. After reading the topic,
everyone thinks that it is a theoretical topic, nothing is
practical here. But as we go through it, we will understand
how practical, and the key topic is this.
IV. METHODOLOGY

1. Budget Planning:

Fig 1. Process chart for Budget methodology.

1.1 Project Gist/ Details/Salient Features – To start

budgeting the basic information is required to collect
which is called Salient features or Project GIST
(Goals, Ideas, Step-Projects, and Tasks). Examples of
some of the points that come under salient features
are Project name, location of the project, agencies
involved in the project such as Client, architect,
design consultant, PMC, suppliers, vendors, etc.,
Tender or project cost, Start and completion date of
the project, project details such as type of structure,
built-up area, configuration, etc., contract clauses
such as, defect liability period (DLP), Basic rate,
Price variation, Milestone, liquidated damage,
mobilization advance and so on. Collection of all this
information needed for the budgeting. Keeping the
compatible designs and detailed construction process,

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with alternative methods of calculation in the absence

of the project.

1.2 Project Planning-At every stage of construction,

project planning is done as per requirement. Design a
standard model of planning with all activities defined
and identified for each activity, Resources like
material, manpower, plant & machinery,
overheads, utilities, etc. required for completion of
the project with the cost of these resources. At the
initial stage, during construction and post-
construction we are doing the project planning as and
when it is necessary and required to revise as per the
situation at that time.

1.3 Suppliers and Sub-Contractors: Suppliers and

Subcontractors help in the budgeting process as they
have the actual ideas about the cost of the resources.
Having Suppliers/ Sub-contractors set out the prices of
the materials, products, and services for the budget
according to the project type, material type, project
location, design, structure, etc.

1.4 Calculation of Budget: Determination of the values

of execution of the project based on information
available at the time of commencement i.e. estimated
information/ specific information. We can divide the
calculations as Hard cost and Soft cost, put the values
of the items that come under Hard cost and Soft cost,
working on where we can save the cost as the control
of soft cost is in hands of project managers or
management team. Decision making plays a vital role
here. The example is, at the time of mobilization all
the staff is not allotted to save the manpower cost and
planned according to the activities by using the
schedule of the work.

1.5 Commitment:Measuring the company’s commitment

to implement the project by the planning done. We can
improve the company’s commitment by,
 Standardizing the working process - with the help of
past work experiences, standard codes, designs, etc.
 Technical Training – by providing the training by the
senior professionals either internal or external to
improve the working capacity with the quality of the
manpower involved in the project.
 Implementation capacity – The technologies,
construction methods, etc. are implemented day by
day and accordingly, the organizations made
implement in their working style. But the acceptance
of the implementation is not that easy in some cases,
therefore we need to check it.

2. Cost Control:

Fig 2. Key Points of Cost Control.

2.1 Project Feasibility: Project feasibility is the study of

various elements of the project to determine the
potential for project success. It will be done before the
start of a project to identify obstacles, form strategies
to overcome them, and ultimately attract investors, and
finally perform financial modeling using current cost.
2.2 Bidding & Contracting: Here we compare the
contracts to budgets. A contract is a legal agreement
between the client and the contractor after completion
of bidding, which contains terms & conditions, a bill
of quantities (BOQ), drawings, and specifications. The
contractor has to work on these factors and prepare the
budget by referring to them. In the budget, we
considered overheads and profit which are not
mentioned in the main BOQ. Therefore, we have to
compare the contract to the budget.
2.3 During Construction: During construction, one
should be reviewed projected costs & variance. A
projected cost is the predicted total cost of the project
or a milestone/phase at the time of its completion,
which should be reviewed for the original estimated
cost is entered at the milestone/phase level, and the
current estimated cost is automatically set equal to the
original estimated cost. Cost projection analysis,
 Identify project development expenses where finance
planners identify an amount of finance required for
developing the project,
 project delivery costs Estimation,
 Creating a high-level description of the project
costs,(iv) ongoing maintenance costs identification etc.
Variance can either be favorable or unfavorable. The
example of Unfavorable variances means that cost of
labor exceeds the budgeted value, while favorable
variances mean the cost of labor cost was less than the
budgeted value.
 Therefore, a review of the projected costs and the
variance at each phase/ milestone helps to know where
we can control the cost and where the cost will be
unavoidably exceeding.
2.4 Post Construction: After the completion of the
construction project, one should perform a Variance
analysis. To understand the exact status of the variance

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in budget cost and the actual cost while construction

an analysis should be done. This analysis can be done
post-construction or after achieving a milestone or
monthly/quarterly/yearly. It can be changed as per the
organization’s review cycle.
V. HOW TO EXECUTE THE BUDGETING
AND COST CONTROL?

1. Preparation of Budget:

1.1. Data Collection

Proper Data collection helps to prepare a proper budget
 Collect Project GIST (Goals, Ideas, Step-Projects, and
Tasks)/ salient features
 Collect Drawings and specifications
 Collect Bill of quantities (BOQ) – BOQ is not fixed till
work completion, it can be changed if the drawings &
specifications will be changed,
 Prepare Rate analysis of each BOQ item
 Prepare Work breakdown structure (WBS),
 Prepare a Labour master list with current market rates
 Prepare a Material master list with current market rates
 Prepare Plant and machinery (P&M) master list with
current market rates for purchase as well as for hiring
 Prepare the standard diesel/fuel consumption list for
each P&M to get the diesel/fuel cost.
 Lead calculations for the supply of material, like
Murum, aggregates, etc.
 Prepare a hierarchy for the project and accordingly the
list of employees allotted for the project with their
current salary and possibilities of promotions/ bonuses
till the completion of the project.
 Prepare a detailed schedule for Site mobilization – Site
mobilization is the initial setup that contains a number
of factors that need to be considered and are comes
under Indirect cost/ soft cost/ overheads. The factors
that come under this are, divided as, (a) For Staff, (b)
For labor, (c) For work execution.

For Staff –
 Staff accommodation in the project/site office area or
outside the project/site office area with all living
facilities.
 Vehicles for staff Conveyance,
 Staff insurance and Medical facilities

For labour/ drivers/ operators-

 Labour camp with facilities like electricity, drinking
water, toilets and wash area with proper drainage
systems, etc.,
 CAR policy,
 Insurance & Medical facilities.

For Site –
 Site Office with facilities like electricity, drinking
water, toilets with proper drainage systems, etc., ∙ IT
systems and services for staff like computers, printer
& scanner, Mobiles, stationery, etc.,
 Security service with cabin,
 Installation of plant,
 Parking area for Machinery, vehicles, etc., ∙ Canteen
facility,
 Insurance for P&M,
 Material testing Laboratory,
 Storeroom,
 Steelyard,
 Safety material and PPE kits for staff as well as for
labor, etc.
 There are a number of factors that come under the
Indirect cost which can be controlled by the project
manager with proper planning & scheduling.
1.2. Budget Preparation:
After the collection of the data, we link it with the BOQ,
rate analysis, and project planning. The result is our
project budget. Another thing we have to consider is the
contractor’s profit, interests on loan, Bank guarantees,
security deposits to the client, etc.

We can prepare the project budget in 3 different ways,

1.2.1Vertical format – in this format, from each BOQ

item, we list out the vertical list of the material, labor,
P&M, wastage, etc., make the total amount per unit and
multiply it by the total quantity of the item, to get the
budget rate & amount of that item as per Fig, No.

Fig 3. Vertical budget format.

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1.2.2 Horizontal format - in this format, all the material,

labor, P&M, etc., are listed horizontally and make the
total amount per unit and multiply it with the total
quantity of the item, to get the budget rate & amount of
that item. The advantage of this format is, that we are able
to take the sum at the end for each component (like
Mason/ cement/ JCB) for material purchase, labor
allotment, machinery hours, etc. as per Fig, No.
Fig [Link] budget format.

1.2.3 Direct rate analysis- in this format, we prepare a

rate analysis in another sheet and link the per-unit rate in
front of the BOQ item, multiply it with the total quantity
of the item, to get the budget rate & amount of that item.

2. Budgeting Cycle:
The role is not finished, once the budget is prepared, but
there is a budget cycle as shown in Fig.3 below,

Fig 5. Budgeting cycle

3. Important Reports for Cost Control:

 Project cost abstract with detailed rate analysis ∙
Activity-wise cost analysis
 Resource schedule
 Billing schedule
 Subcontractor work order status
 Material recovery statement
 Work order issue and completion status report
 Payment status by work order or subcontractor or
project
 Advance and recovery status for subcontractors
 Work order rate comparison is done for different
subcontractors for the same activity.
 Rate comparison from the same subcontractor for the
same activity in different projects or periods.
 Comparison of work orders with the client invoices.
 Comparison of work orders with the budget.
 BOQ amendment history
 Daily/ monthly/ quarterly/ half-yearly/ yearly
progress report.
 Daily/ monthly/ quarterly/ half-yearly/ yearly work
schedule.
 Monthly procurement plan.

Currently, most of the construction industries are going

for Enterprise resource planning (ERP) software.
Examples of ERP software are, SAP, Hit office, QE-Pro,
Strategic ERP, Quadra, etc. All the reports mentioned
above can be automatically generated, if we did the works
like Work order preparation, billing, purchase, GRNs
(Good issue note), and many more.

The different organizations required different reports for

cost control in different formats, which are developed by
the teams of the ERP software agencies as per the client’s
requirement. To get the reports as required, the site team,
remote office/ branch officeteam, as well as the
headquarters or main office team has to update the data,
from time to time in the ERP. The base of this data comes
from the budget. Therefore, for cost control, every person
involved in the project should be aware of the project
budget.
VI. RESULTS & CONCLUSIONS

 Understand the importance of the study of budgeting

at the education level.
 Understanding cost control is a key to the success of
the project with high profitability.
 Learn the step-by-step procedure to prepare a project
budget.
 Budgeting and cost control is not the theoretical
topic, but it is the most important topic as the profit
and loss factors control by this only.
 There should be practical at the education level
regarding how to prepare the budget of a construction
project and what are the cost control tools in the
project.
 According to the survey done with the help of a
questionnaire with the peoples working in the
construction industry, approximately 70% of peoples
think that Budgeting and Cost control is important in
Construction Project Management in the range of
90% to 100%. And out of 100 construction

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professionals, only 5 to 6 peoples are aware of

budgeting and cost control.
REFERENCES

[1] I (Sujata J. Pawar) started to work in the construction

industry in 2009 but introduce first time with this
topic during my professional carrier in 2020, while
working in RMK Infrastructure Pvt. Ltd., Pune,
India.
[2] A survey was done me with the help of a
questionnaire, with the people working in the
construction industry on “Budgeting and Cost
Control in Construction Project Management”
[3] A Contractor’s Guide to the Construction Budget,
Dawn Killough, 141 articles, Last updated: Dec 22,
2020, Published: Nov 06, 2020, Reading time: 5
minutes.
[4] Construction Budget: A Quick Guide (with
Examples),By Peter Landau, Aug 26, 2021
[5] Budgeting Cycle from [Link]
[6] LBT Business Management Manual`- copyright ©
ILO & don Bosc Timor-Leste, first published 2015.
manual, managing your road construction business,
Timor-Leste, ILO & don Bosco 2015, ISBN: 978-92-
2-130861-4
[7] How to Build a Successful Budget Plan That Works,
Jessica Chang
[8] Tactive Project Management Module([Link]
[Link]/construction-
project management-software)

1 Introduction
In construction projects, the project cost and budget are closely linked, making it easier to
create a
situation where the project cost exceeds the budget [1-3]. If this problem occurs, it will
reduce the
overall construction efficiency, affect the project, and seriously affect the overall
construction quality.
To ensure the accuracy of the project cost budget of construction projects, it is necessary to
fully grasp
the actual situation and choose the appropriate project cost budget measures [4-5]. The
only way to
achieve construction goals and management objectives when dealing with complex
construction
problems is by choosing reasonable budgetary measures [6-8]. Therefore, enterprises
need to pay
great attention to the problem of over-budgeting engineering costs, and when preparing
construction
projects, cost estimators need to pay great attention to grasp the various constraints that
exist fully,
and they need to carry out budgetary studies in advance and choose reasonable solutions
for the safety
hazards that exist.
Budget and cost management focus on the construction segment, an important cost
segment in the
building construction process [9-11].Executing cost budgets for construction projects,
controlling the
transfer and use of funds, and securing sufficient funds for the project are essential to
achieve the
basic control objectives of capital operations [12-13]. Financing and planning are crucial
aspects of
engineering projects that significantly impact project cost budgeting and cost
management. To
develop residential construction projects, it is crucial to establish a sound cost budget
management
system that increases the adequacy and rationality of cost use. Cost budgets exist in all
aspects of
construction, and the combination of budget target breakdowns and early warning
mechanisms can
effectively control project costs, scientifically reduce costs and improve economic efficiency
[14].
Since the quality of work is directly related to the cost inputs and economic benefits of a
construction
project, it is essential to complete cost budgets with high quality to obtain results in
project cost
management.
The literature [15] suggests that planning construction surge control projects needs to be
estimated in
terms of time, cost budget, and required resources. Using a network planning approach,
the cost
minimization of the four control projects was analyzed, and the construction deadlines and
dynamic
plan of project activities were determined. The optimization problem was solved using
linear
programming to reach cost minimization within the project's deadline constraints. The
results show
that the proposed method's cost savings are significant, which is an important
challenge in
construction management. The literature [16] shows that construction cost
management in
construction projects plays a key role in the design phase, and models are widely promoted
in the
architectural design process for estimating construction costs. The current status of
engineering cost
management in the design phase of construction projects was explored, and it was found
that cost
control of engineering costs is of great practical significance for the development of the
construction
industry. The deviation value of estimation can be used to prove the validity and
accuracy of
construction cost estimation, which is a basic basis for cost control of construction projects.
The literature [17] examined the factors contributing to effective cost control in the UK
construction
industry and assessed their importance. The study focused on the factors that significantly
influence
cost overruns, effective cost control techniques, and the factors that choose cost control
techniques
for a project. Relying on a mixed research approach, the most effective cost-control
techniques and
factors influencing the choice of cost-control techniques were qualitatively explored.
Factors
influencing effective cost control techniques in the UK construction industry were
identified and
ranked, and the model can be used to mitigate cost overruns and effective cost control
techniques
learning in the construction industry. The literature [18] shows that construction cost
control is crucial
in the construction phase and affects the economic efficiency of the construction
company. The
analysis of price deviations in the construction phase is done using cost control principles
and cycle
Research on construction project cost budget and cost control based on matrix model
3
theory. Organizational, technical, economic, and contractual measures control prices.
The cost
deviation in the construction stage of engineering projects can be accurately analyzed
through
empirical analysis, and corresponding control measures are provided to correct the
deviation. The
study shows that it is feasible to incorporate the cycle theory into the cost control of
construction
projects. The literature [19] tested the use of information management technology for
transforming
the information acquisition and transmission paths in the traditional project management
process and
concluded that construction information technology could be widely used in construction
schedule
management and cost control according to its application mode in the construction
industry. A model
representing the effectiveness of construction information technology management is
proposed, the
needs of construction schedule management and cost control are analyzed, and its
advantages are
clarified to promote the development of the construction industry and to improve the
efficiency of
schedule management and cost control.
This paper aims to create a framework for cost control of construction projects and solve
the matrix
model using a genetic algorithm. The number of elements in the matrix is extracted, the
matrix's
symmetry about the element is judged by the element's position in the matrix, and
the one-
dimensional matrix is extended to the high-dimensional space. The symmetry of the nearest
neighbor
sampling reaction matrix nodes determines the spatial symmetry rate. The matrix
nodes are
discretized to optimize the maximum fitness value in the population of genetic algorithms
for iterative
iterations. Fitness calculation, selection, crossover, and mutation operations are
performed during
each iteration until the termination condition is satisfied. The solution objective
function is
transformed into the fitness function to obtain the single objective function of the target
based on the
intrinsic relationship between them. The algorithm's convergence performance is
improved by
establishing a comprehensive optimization function. The results show that in the cost
budget work of
construction projects, a scientific cost budget and cost control system should be
developed to
guarantee its scientific rationality, control the cost within a reasonable range, and
accelerate the
development of construction projects.
2 Cost control framework for construction project cost
The cost of construction projects mainly includes direct, indirect, profit, and tax
components. The
direct cost mainly refers to the physical and auxiliary construction costs in the construction
process,
including equipment, labor, materials, inspection, and other costs. Indirect costs are
incurred in
project management and production activities, including management fees and business
activities.
Cost budgeting is a crucial task in a construction project. Through the cost budgeting work,
we can
estimate the capital investment of the project and the cost consumption of each link in the
construction
project to realize the project's scientific investment. To obtain the expected economic
benefits of the
construction project, it is necessary to strengthen the cost budget control, and it can be said
that the
cost control work of the project cost budget is very important in the implementation
process of the
construction project.
The cost control framework of the construction project can be seen in Figure 1.
Before the
implementation of the construction project, the cost management personnel should do a
good job of
fully analyzing and studying the design drawings of the whole construction project,
optimizing the
construction plan and improving the scientificity and rationality of the construction
plan. The
effective implementation of the project cost budget control work can ensure that the cost
input of the
project is within the budget and promote the smooth implementation of the project
construction. The
effective implementation of construction project cost control can help enterprises
reasonably assess
the overall situation of engineering construction cost input, and the cost budget result can
also provide
the most intuitive engineering cost input suggestion for the construction party. Ensure
the project
Jingsi Yang, Zhenhai Li and Ge Yang. Applied Mathematics and Nonlinear Sciences, 9(1)
(2024) 1-15
4
meets the relevant standards while minimizing the cost of investment in the engineering
construction
process. Not only can this method save capital costs, but it can also prevent the construction
stagnation
phenomenon caused by insufficient funds in the construction process. Scientific and
reasonable
engineering cost budget forms can significantly reduce the construction cost input of
construction
enterprises by implementing construction project cost control.

Figure 1. Framework for cost control of construction projects

3 Genetic algorithm optimization matrix model
3.1 Constructing the matrix model
The matrix model refers to the spatial division of point, line, and surface reference objects in
space
using the minimum boundary matrix projection method or the Cartesian coordinate system,
which is
abstracted into a 3 × 3 directional relationship matrix to represent the directional
relationship between
the reference object and the target object [20]. The matrix model is a better approximation
of spatial
directional relationships than the traditional model and can be applied to the
representation of
directional relationships between regions, lines, and point objects, which is more intuitive in
terms of
expression and consistent with the human cognitive style. Data scientists use matrix
operations to
model data analysis because they are one of the most common and closest
mathematical
representations. In this paper, we construct a matrix model based on a genetic algorithm
and apply it
to construction project cost budgeting and cost control, which can effectively achieve real-
time cost
control.
Given a matrix of size , if is symmetric about element , it is
necessary to satisfy the:
(1)
Where indicates the number of elements less than in the statistical array , and
indicates the number of elements greater than in the statistical array. The symmetry
of the matrix about the element is judged by the position of the element in the matrix, and
if the matrix
is standard symmetric about the element, then equation (1) must hold, and its value also
reflects the
Process
Supervisory
control
Project Name
Construction Order
Entrusted cost consulting company
Bill of Quantities
Bidding control price
Design Institute
Design
adjustments
Generate bidding documents
Bidding documents (bidding
construction unit)
Determine the winning price and construction unit
Engineering changes
Quantity adjustment Unit price adjustment
Project completion settlement
Budget Adjustment

123
, , ,...,
m
A e e e e=
1 m
A
i
e
()()
,,0
i i
Less A e More A e− =
Less
Elem
Arry
More
Elem
Research on construction project cost budget and cost control based on matrix model
5
symmetry of the matrix about the element. Extending a one-dimensional matrix to a
higher-
dimensional space of size , the space can be described by a matrix of size :
(2)
A point in space is known, and if the space is symmetric about , then
the space is symmetric in every dimension about the projective position of , i.e., the
following
conditions are satisfied:
(3)
In Eq. (3), denotes the rd column of matrix , where denotes the th dimension
of . To better represent the space with respect to symmetry, the concept of symmetry
rate
is proposed:
(4)
Where the symmetry ratio reflects the symmetry of the matrix about the point, and the
higher the ratio,
the more likely it is that the matrix is symmetric about . In high-dimensional spaces, the
common
sampling methods are hypersphere sampling, hypercube sampling, and -nearest neighbor
sampling.
The symmetry of this high-dimensional space about is converted to the symmetry problem
of
matrix about and matrix about by modeling the space of nearest neighbors of
point in the high-dimensional space as matrices . The spatial symmetry rate is
defined as:
(5)
In Eq. (5), the core point has a small value, while the boundary point has a large value.
Due to the complexity of the nearest neighbor space of the cost budget, it is inaccurate to
extract
the boundary based only on the size of the value. However, the average distance between
the
S
n m 
Mar
n m 
11 12 1 1
21 22 2 2
1 2
1 2
j m
j m
i i ij im
n n nj nm
aaaa
aaaa
Mar

aaaa
aaaa
 
 
 
 
=  
 
 
 
 
 

1 2
, ,...,
i i i im
x x x x=
S
i
x
i
x
()()
()()
()()
()()
1111
2222
3333
,,0
,,0
,,0
,,0
i i
i i
i i
m im m im
Less Mar x More Mar x
Less Mar x More Mar x
S Less Mar x More Mar x
Less Mar x More Mar x
− =


−

=


−

=




=


m
Mar
m
Mar
ij
x
j
i
x
S
i
x
()()
1
, ,
i
m
j ij j ij
x

j
n Less Mar x More Mar x
P

n
=
− −
=

i
x
k
i
x
1
S
1i
x
m
S
im
x
i
x
m
1 2
, ,...,
m
SSS
()
()()
1
, ,
m
j ij j ij
i

j
k Less S x More S x
SP x

k
=
− −
=

SP
SP
k
SP
Jingsi Yang, Zhenhai Li and Ge Yang. Applied Mathematics and Nonlinear Sciences, 9(1)
(2024) 1-15
6
cost budget and its nearest neighbors is much larger than the core and boundary points. In
order
to separate the cost budget accurately, this distance needs to be discretized to enable fast
separation
of the cost budget. The common discrete functions and their first-order partial
derivatives are as
follows:
(6)
(7)
Where the rate of change increases as gradually increases, resulting in an auxiliary
discretization
using this function, designed to enhance the variance of the cost budget from the
remaining data
points. Introducing the discretization in equation (5):
(8)
Where denotes the Euclidean distance between and , and is the th
nearest neighbor of . After discretization, the value of for the cost budget increases
rapidly
and is much larger than the values of the boundary and core points, making the sensitivity
of the
boundary extraction to the cost budget decrease rapidly.
3.2 Genetic algorithm process
The mechanism of operation determines the salient features that distinguish the genetic
algorithm
from other optimization-seeking methods. The flow chart of the genetic algorithm is
depicted in
Figure 2. The main principle of the genetic algorithm for solving the problem is to
initialize the
problem's solution as chromosomes by certain encoding and determine the fitness
value of each
chromosome according to the optimization objective. The selection operation is performed
according
to the fitness value, and individuals with high fitness values are retained, while those with
low fitness
values are eliminated. The retained individuals undergo crossover and mutation operations,
and the
cycle is repeated until the termination condition is reached. The optimal solution is the
output of the
optimal individual, which is decoded into the optimal solution.
k
()
2
lg
x
y x
y x
y x
y e
=


=


=


=

1
2
1
x
y
x
y

x
x
y
x x
y

e
x


=






=





=
 


 =


x
()
()()()
1
1
, ,
,
m

exp
j ij j ij
k i ij
i
j
j
k Less S x More S x
dist x c
HP x

k k
=
=
 
− −
 
= 
 
 
 
()
,
i ij
dist x c
i
x
ij
c
ij
c
j
i
x
HP
Research on construction project cost budget and cost control based on matrix model
7

Figure 2. Genetic algorithm flow chart

The values of crossover and variation probabilities have a great influence on the
performance of
genetic algorithms, and the traditional genetic algorithms have fixed values of these two
parameters
in the evolutionary process, which sometimes lead to premature genetic algorithms. The
proposed
strategy for adaptive selection of genetic probabilities is based on this reason. The basic idea
is that
the crossover probability and variation probability change automatically with the fitness
value, i.e., when the fitness values of individuals in the population converge or are locally
optimal,
so that and increase. And when the population fitness is more dispersed, make and
decrease, where and are expressed as follows:
(9)
(10)
Where is the maximum fitness value in the current population, is the fitness value of the
larger of the two individuals to be crossed or the fitness value of the individual to be
mutated. is
the average fitness value of the current population, and and are constants. In general
, . The genetic algorithm is an iterative process, during each iteration, the
fitness calculation, selection, crossover, and mutation are performed until the termination
condition
is satisfied.
Termination
condition
judgment
Start
Initial population
Applicability calculation
Select Action
Cross operation
Mutation operation
Next generation population
Output optimal results
Finish
t=t+1
Yes
No
c
P
m
P
c
P
m
P
c
P
m
P
c
P
m
P
()
1 max
max
2
,
,
c
kff

f f
P f f
kff

 −
 

= −


 

()
3 max
max
4
,
,
m
kff

f f
P f f
kff

 −
 

= −


 

max
f
f 
f
123
, , kkk
4
k
1 2
1.0k k = =
3 4
0.5k k = =
Jingsi Yang, Zhenhai Li and Ge Yang. Applied Mathematics and Nonlinear Sciences, 9(1)
(2024) 1-15
8
Genetic algorithms basically do not use external information in evolutionary search but only
use the
fitness function as the basis and use the fitness value of each individual in the population to
perform
the search. The fitness function selection is crucial, as it directly affects the convergence
speed of the
genetic algorithm and the ability to find the optimal solution. Solving the objective function
directly
into the fitness function is a simple and intuitive process, and if the objective function is the
minimum
problem, then:
(11)
In Eq. (11), is the maximum estimate of .
If the objective function is a maximum problem, then:
(12)
In Eq. (12), is the minimum value estimate of .
3.3 Establishment of the objective function
In engineering cost, the optimal cost of the system is generally sought given the target
quality level.
The objective function of genetic algorithm based quality cost optimization is obtained by
combining
the relationship of quality cost as:
(13)
The single objective function for each of the three objectives was obtained according to
equation (13),
and then a comprehensive optimization function was established based on the intrinsic
relationship
between them, with the quality model as:
(14)
Where is the total quality of the project and is the quality of the process using the th
model. The cost model is as follows:
(15)
(16)
Where is the total cost of the project, is the cost of the rd process using the th model,
and is the cost factor for the th process.
()
()
()()
max max
,
0
cfxfxc
−

Fit f x
=


max
c
()
f x
()
()
()()
min min
,
0
fxcfxc
−

Fit f x
=


min
c
()
f x
()()
()

1
1
min 2
n
b
i
y C i tg
 
=
 
=
 

1
n
ij
i
Q Q
=
=

Q
ij
Q
i
j
()
*
ij ci i ij ci
CCDT

=+−
1
n
ij
i
C C
=
=

C
ij
C
i
j
i
Research on construction project cost budget and cost control based on matrix model
9
The duration model is as follows:
(17)
(18)
Where is the time spent on the nd process on the critical line and is the set of all
processes
on the critical line in the network plan.
In the construction of actual projects, the contractor should choose options to control and
optimize
costs according to the owner’s quality requirements. The first task is to determine the
model of the
relationship between reliability and construction costs. When the quality level is very high,
the cost
will increase sharply, and when the quality level is very low, the cost is close to 0. Quality
and cost
are curvilinearly related. Here, a tangent function is used to model the relationship between
the cost
of each subsystem, , and the reliability, :
(19)
In equation (19), is the cost of subsystem with a reliability of . is
the basic cost value of subsystem , is the number of subsystems , and is the cost
growth index.
The optimization model is:
(20)
Where, is the total system cost, is the total system reliability, is the lower bound of
reliability for subsystem , and is the lower bound of system reliability.
Using genetic algorithm for construction project cost budget and construction cost
optimization, the
system reliability constraints are processed, and the matrix model ranking and optimal
preservation
strategy are used in the selection operation, which improves the convergence
performance of the
genetic algorithm and can successfully solve the cost control problem.
4 Construction project cost budget and cost control analysis
4.1 Matrix model analysis of variance
To further identify the statistical variance results of the matrix model in the genetic
algorithm, all
solutions obtained from a total of 40 operations of the genetic algorithm were
ranked as non-
dominated. The solutions of the first front end are considered as the non-dominated
solutions of the
matrix model, and the number of non-dominated solutions and the number of
solutions with the
ij
i k
T D

=

1,2,...,i n =
ij
D
i
k
()
()
i i
CRx
()
i
R x
()
()
()()
0
= , 1,2,...,
2
i
iiii
C R x C x tg R x i n


 
 
 =
 
 
 
 
()
()
i i
CRx
i
x
()
i
R x
()
0 i
C x
i
x
n
i
x
i

()
()
()
()
( )( )
1
min
min
min min
1,2,...,
.
n
iSii
i
xi i
Si S
fRxCCRx
RRxin
s t

R R
=


= =



=







S
C
S
R
minxi
R
i
x
minSi
R
Jingsi Yang, Zhenhai Li and Ge Yang. Applied Mathematics and Nonlinear Sciences, 9(1)
(2024) 1-15
10
highest number of solutions obtained from 40 operations are counted, and the average
number of
solutions, the variance and the proportion of non-dominated solutions are calculated. The
statistical
variance results are displayed in Table 1. In the case of the 5×6 matrix problem, the
number of
solutions obtained in independent runs is 5, and all of them are non-dominated. In solving
the 10×6
matrix problem, the ratio of the number of solutions to the number of non-dominated
solutions is
larger with a variance of 1.5, and in solving the 15×6 matrix problem, the variance is higher
than that
of the remaining two matrix models. The above analysis shows that the accuracy and
stability of the
matrix model calculated using the genetic algorithm are higher when solving the
construction project
cost budget and cost control.
Table 1. Statistical variance results

5×6 Matrix
10×6 Matrix
15×6 Matrix
Genetic
Algorithm
Solve for the largest number of numbers
6
12
9
Average number of solutions
6
9
7
Percentage of non-dominated solutions
100%
76%
69%
Variance
0
1.5
1.7
At this stage, the building construction assembly cost mainly includes labor cost,
material cost,
machinery cost, measure cost, enterprise management fee, profit, regulation fee, tax, and
many other
elements. Usually, the latter several costs of the pricing rules, such as enterprise overhead,
profit, fees
and taxes, are calculated according to the base of direct costs, and the study of direct costs
has a higher
utilization value. In this paper, we take a building frame shear wall structure residential
building as
an example to compare the assembly type building, new green building and traditional cast-
in-place
structure building project and discuss the project cost budget and cost control strategy.
The cost
components of the building project are compared in Figure 3. The cost budgets of the three
buildings
are roughly the same, and the index unit price required for the piling project in the
assembled building
far exceeds that of the remaining two buildings, reaching 215 yuan per square meter. The
construction
industry's current development status indicates that prefabricated components have not yet
reached
mass and large-scale production and the low output results in higher costs. At the same
time, the
actual construction process of prefabricated components must go through many links, such
as sleeve
grouting, seam clearing and gluing, support reinforcement, component lifting, etc., and
much money
must be invested in each link. In addition, after the prefabricated components enter the
construction
site, the volume, hardness and structure of different components are different, so they
need to be
stored with special steel trusses, and separate storage sites must be set up, thus incurring
additional
costs.
Research on construction project cost budget and cost control based on matrix model
11

Figure 3. Comparison of cost components of construction parts

4.2 Cost control analysis of engineering cost
The project budget and cost is the biggest difference between assembled buildings,
new green
buildings, and traditional cast-in-place buildings. Japan has more forward-looking
technology in
assembled buildings and a more comprehensive grasp of relevant production
standards and
specifications, so its cost budget and cost control problems are uncommon. Since China’s
production
standards for assembled buildings are not yet perfect, and there is a great lack of assembly
concepts
among engineering cost estimators, improving the project cost budget of assembled
buildings as early
as possible is the key element to control the project cost. The analysis of construction
project cost is
shown in Table 2. The total cost of a traditional cast-in-place building is the lowest among
the three
kinds of construction projects, and the assembled building is the highest, with a cost cost
cost of
1128.61 yuan per square meter. In the process of building construction, cost control needs
to be solved
from the root problem of its high cost, and the purpose of cost control can only be achieved
after truly
solving its essential problems. To control the construction mode cost, starting with the
materials when
they arrive is necessary. When the material unloading truck into the field to start its efficient
use, to
avoid the use of special materials stacked for the classification of professional placement
site costs,
as far as possible to implement the flow of work for an uninterrupted mode of operation.
The next
transport from the material incoming to the truck unloading is an uninterrupted flow
operation, and
at the same time, carrying out a close operation form must rely on the orderly management
mode of
the site and the close cooperation of the construction organization personnel of each
department.
Table 2. Construction project cost analysis table
Project Name
Assembled Building
Traditional cast-in-place
construction
New Green Building
Construction
cost (million
yuan)
Square
meter cost
2
(Yuan/ m )
Construction
cost (million
yuan)
Square
meter cost
2
(Yuan/ m )
Construction
cost (million
yuan)
Square meter
cost
2
(Yuan/m )
Sub-
projects
Cast-
in-
place
Concrete
244.4
284.88
362.4
434.90
240.10
274.89
Steel
reinforcement
161.50
193.52
218.1
260.75
160.66
188.53
Components
533.68
638.53
0
0
500.15
551.30
Grouting material
2.90
11.68
0
0
2.80
8.87
Subtotal
942.38
1128.61
580.5
695.65
903.71
1023.59
Water supply
Fire protection Heating Ventilation Piling Roof Other

and drainage
0
50
100
150
200
250
Index unit price (Yuan/m2)
Engineering category
Prefabricated building
The new green is simply
Traditional cast-in-place
Jingsi Yang, Zhenhai Li and Ge Yang. Applied Mathematics and Nonlinear Sciences, 9(1)
(2024) 1-15
12
To ensure that all construction processes of construction projects can be carried out in an
orderly
manner in all aspects, it is necessary to complete the cost budgeting and cost control work
with high
quality to fully ensure the quality of construction projects and maximize the profit of
construction
enterprises. The cost control of construction projects before and after using the matrix
model is
compared and tested, and Figure 4 displays a cost control comparison chart.
Figure 4(a) illustrates the cost proportion not integrated into the matrix model. The labor
cost and
engineering material cost consumption cost are high, among which the average cost
consumption
index of traditional cast-in-place construction is not the highest, and the labor cost reaches
38%. For
construction enterprises, cost budget control is a work that runs through the beginning and
end of the
project construction; therefore, the project cost also needs to achieve the whole process
control. The
cost budget control is mainly focused on the cost of the construction project during the
decision-
making stage of the project. The relevant personnel needs to effectively control the planned
use of
the project itself, based on the profound implementation of market and construction site
investigation
work. At the same time, as the construction progress continues to advance, the budget staff
of the
enterprise strengthens the comparison between expected cost and overall cost, strictly
controls the
cost budget, and ensures that the construction cost is within the range set in advance at all
times. To
prevent similar situations from happening in future work, it is necessary to review the
accident
process once the cost exceeds the budgeted cost.
The cost ratio after incorporating the matrix model is shown in Figure 4(b). the cost control
after
incorporating the matrix model is in a downward trend, and the labor cost, engineering
material cost,
machinery and equipment cost and management cost under the index are down 10% than
before, and
the cost of regulation of new green building is only 6%. Construction budget cost control
mainly
refers to the construction of the building project before the construction of the various
elements that
may be involved in a detailed combination of design drawings and the preparation of a
detailed budget
book. The cost of each component of the assembly project is calculated in detail during
budget
preparation. The purpose of building construction budget cost control is to provide the
initial budget
cost to the construction side and the owner side of the building to facilitate cost
control and
optimization for both of them in the later building construction process and in the final
accounting
process. Therefore, the construction field should be combined with the overall
development
characteristics to develop a new industry standard, and the government also needs to
optimize
construction-related policies as much as possible continuously. Secondly, the
construction of the
industrialized base of assembly building for the characteristics of each region within the
scope and
its location layout must comply with the relevant national regulations to meet the
development plan
of the construction industry. Finally, the building in the construction process involves
various aspects
of cost control efforts. The current control of building construction costs is
inadequate. The
construction unit and the developer should improve the effective communication between
the two
sides, and in this way, reach a consensus on cooperation and jointly solve the problem of
controlling
the cost of constructing assembled buildings.
Research on construction project cost budget and cost control based on matrix model
13

(a) Proportion of costs not integrated into the matrix model

(b) Cost ratios after incorporation into the matrix model

Figure 4. Construction cost control comparison chart
5 Conclusion
This paper identifies the statistical variance of the matrix model based on the genetic
algorithm, solves
the algorithm arithmetically, and calculates the average number of solutions and the model
is used in
the construction project cost budget and cost control with high accuracy. Comparing
the cost
components of the building project parts, the three building cost budgets are approximately
the same,
and the index unit price of the piling project in the assembly building reaches 215 yuan per
square
meter. A comparative test of construction project cost control before and after the matrix-
based model
was conducted, and the indicators under labor cost, engineering material cost,
machinery and
equipment cost and management cost all decreased by 10% after incorporating the model
than before.
Labor costs Engineering
Mechanical

material costs
equipment
costs
Administrative
Fees Profit Taxes

expenses
0
5
10
15
20
25
30
35
40
Proportion (%)
Expense category
 Prefabricated building
Traditional cast-in-place buildings
New green buildings
Labor costs
Engineering material costs
Mechanical equipment costs
Administrative expenses
Fees
Profit
Taxes
0
5
10
15
20
25
30
Proportion (%)
Expense category
Prefabricated building
Traditional cast-in-place buildings
New green buildings
Jingsi Yang, Zhenhai Li and Ge Yang. Applied Mathematics and Nonlinear Sciences, 9(1)
(2024) 1-15
14
Therefore, construction project cost budget and cost control are essential
management items in
modern engineering construction, which is of great significance to solving the problems
of high
project cost and poor overall standardization of engineering construction.
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