Creating a Cost Justification Proposal: Free Template Included

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Creating a Cost Justification Proposal: Free Template Included

Cost justification is a substantiation of the need for an item of expenditure, with documentary or any other evidence. Business owners or managers may require the person incurring the cost to explain the reasons for doing so, and expect proof that expected returns would exceed the cost. All expenditure of substantial nature, not included in the annual budget require such cost justification. At times, even items mentioned in the budget may also require a justification to ensure optimal utilization of monetary resources.

Download a free cost justification template here. This template is generic, and suitable for any type of expenditure. Customize it to suit your requirements.

The following elements should be included in any standard cost justification

The sample template lists the twelve key inclusions in a cost justification, followed by the route the proposal follows in the organization. The employee forwards the justification form to the supervisor, who makes a recommendation and forward the same to the finance department. The finance department may make the recommendation based on availability of finance rather than any technical consideration. The business owner finally approves or rejects the proposal after considering all factors and various inputs.

Like the elements in the template, this process flow is also flexible. For instance, the supervisor may return the form to the employee for any changes. Upon rejecting the proposal, the supervisor may simply forward the same to the business owner after noting down his objections, allowing the business owner to have the final say.

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Creating a Cost Justification Proposal: Free Template Included

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