Why might a project structure built solely to the funding structure not be considered best practice?

Study for the GFEBS Project Systems Exam. Use flashcards and multiple choice questions, complete with explanations. Get ready to excel in your exam!

A project structure that relies solely on the funding structure may lack the necessary organization to adequately capture and report costs associated with specific activities and deliverables. Cost reporting is essential for effective project management, as it provides insights into whether the project is staying within budget and guides decision-making for future funding allocation.

Without a robust project structure integrating both the financial aspects and the operational components, tracking actual costs against planned budgets becomes challenging. This can lead to inaccuracies in financial reporting, erosion of accountability, and difficulties in assessing project performance. A well-defined structure should incorporate a Work Breakdown Structure (WBS) that allows for detailed tracking and reporting, facilitating a better understanding of how funds are being utilized across individual project tasks.

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