What is savings validation?

Savings validation is the step where finance and the project team check a savings claim before it is reported: that the baseline is evidenced, the boundary is clear, nothing is counted twice, the saving is the right type and size, and it can be measured and held.

What is the difference between hard and soft savings?

A hard saving is a cost that really falls, such as overtime or scrap, and appears in a budget line. A soft saving frees time or capacity, but no cost falls until that time is used or removed. Cost avoidance is a cost that would have occurred and did not. Keep the three apart.

Why check a saving for six months?

Many improvements fade when attention moves on. Checking the KPI each month for six months shows whether the standard holds. Six months is a common choice rather than a rule, so agree the period with finance.

What reason codes should I use?

Short codes for the common failures help: no baseline evidence, perimeter not agreed, double count, below the minimum value, no monthly KPI, not sustained, costs not netted off and wrong saving type. The template has a starter set to adapt.

Who should sign off a savings claim?

Finance, usually the plant controller or an analyst, and the project sponsor, who is accountable for the improvement. A second person outside the project checking the evidence is better still. Decide the rule once and apply it to every claim.

Free template

Updated October 25, 2026

Project savings validation checklist

A project savings validation checklist is the gate a continuous improvement saving passes through before it is reported: finance and the project agree the baseline, the boundaries, the size and the type of the saving, and that it will last. Without a gate, savings are counted twice, claimed for changes that were volume, or reported in full when no budget fell. This template has a claim form that works from the baseline and result to an annual value, 20 checks in five groups answered Yes, No or N/A with evidence, a decision of accept, return or reject with a reason code, a claims register that stops the same loss being claimed twice, and a six-month sustainment check. The Excel version also tracks accepted hard cash against a target month by month. The numbers and thresholds are conventions to agree with your own finance team.

Free to use: print it, copy it and edit it for your team. Enter your name and work email once to download.

Page 1 of the project savings validation checklist — Savings claim form20 validation checksAccept, return or reject with codesClaims registerSix-month sustainment checkWorked example

Filled-in Project savings validation checklist: a made-up changeover claim returned once — The same sheet filled in with the worked example (page 4 of the PDF, illustrative numbers). Open full size (opens the picture in a new tab)

When to use it

When to use a savings validation checklist

Before a project's savings go into a report, a bonus, a business case or a number given to the board.
When projects overlap, such as several attacking the same line, and a loss could be claimed twice.
When finance and the improvement team disagree about what counts, and you need one standard they can both sign.
To separate hard cash from time freed and cost avoided, so the three are never added together.
Not as a business case for a new project. For that, use the cost-benefit analysis or the CapEx request; this is the check on the result afterwards.

How to fill it in

1
Write the claim
Describe the loss attacked and the perimeter. Enter the baseline and the result with their periods and sources, and the agreed cost per unit. The form works out the annual saving and the payback.
2
Classify the saving
Hard cash falls from a named budget line. Soft savings free time or capacity but remove no cost until it is used or taken out. Cost avoidance is a cost that would have happened and did not. Agree the class with finance.
3
Answer the 20 checks
Go through the baseline, the perimeter, the result, the type and size, and the sustain-and-decide groups. Each is Yes, No or N/A, with a line of evidence. Any No means the claim goes back.
4
Decide and give a reason code
Finance and the sponsor accept, return or reject the claim and sign it. Use a reason code for a return, a reject or an adjustment, such as no baseline evidence or a double count.
5
Log it in the register
Every claim goes in the register with its outcome and validated value. Check the register before accepting a new claim, so the same loss, line or period is not claimed twice.
6
Check it holds for six months
Enter the KPI's saving each month for six months and compare it with the expected monthly figure. A slip triggers an action; a saving that has not held is reported as at risk.

What finance checks

The 20 checks on the project savings validation checklist

Five groups, from the baseline to the decision. On page 2 each check is answered Yes, No or N/A with a line for the evidence; a No sends the claim back, and the decision carries a reason code.

Baseline

What the loss was before the project

1The baseline period is written down and long enough to cover normal variation, such as twelve months or a full seasonal cycle
2The baseline value comes from a named source, such as a ledger, a system report or a log, that someone outside the project can open
3The baseline is adjusted for changes in volume, product mix and price, so the project is not credited with them
4The unit and the cost per unit are agreed with finance and are the standard rate, not a best case

Perimeter

What the saving covers, and what it does not

5The area, line, product and period the saving applies to are written down
6No other project, price change or budget cut claims the same loss, checked against the register of claims
7Costs that rise because of the project, such as extra labour, spares, energy or maintenance, are netted off
8The saving does not depend on a change in another department that has not agreed to it

Result

What changed, and why

9The result period is long enough to show the change is stable, and its value and source are recorded
10The difference between baseline and result is explained by the project's actions, not by volume, mix or a one-off event
11The annual value is calculated by a method finance accepts, shown line by line
12The one-off costs, such as equipment, trials, training and outside help, are recorded against the project

Type and size

What kind of saving it is, and whether it is big enough to report

13The saving is classed as hard cash, soft (time or capacity freed) or cost avoidance, and finance agrees the class
14A hard saving names the budget line or cost centre that falls, and by how much
15The annual value meets the minimum set for a reported saving
16A KPI with an owner shows the saving every month

Sustain and decide

Whether the gain will hold, and who decides

17The standard, setting or control that holds the gain is in place and the people affected are trained
18The KPI is reviewed every month for six months, with an action when it slips
19A reviewer outside the project has checked the evidence
20The decision (accept, return or reject), with its reason code, is signed by finance and the project sponsor

A filled-in example

Illustrative, not a benchmark

An invented changeover project on press 7 claims a saving, and the claim goes through the gate.

The baseline is 1,100 hours of changeover in six months and the result is 780 hours: 320 hours saved, at a standard $100 an hour, or $64,000 a year.
In round 1 the claim is returned at the check for double counting: $13,000 of the labour saving was already claimed by another project.
With that removed the claim is $51,000, hard cash from the overtime budget, above the minimum for a reported saving and with a KPI on the shift board.
Six months later the KPI held in five of six months. In month 5 it fell to 85% when the night shift stopped using the staged tool cart, and an action brought it back.

The project is accepted at $51,000 hard cash, not $64,000. The register also shows a rejected claim with no baseline evidence and a soft saving kept out of the hard cash total.

Common mistakes

Counting the same loss twice
Two projects on one line can both claim the same labour or scrap. A register checked before acceptance is the cheapest protection.
Crediting the project with volume or mix
If output rose and cost per unit fell, check how much was the project and how much was the volume. Adjust the baseline before you claim.
Adding soft savings to hard cash
Time freed is not money saved until it is used for output or taken out of the cost base. Report hard, soft and avoidance as separate lines.
Ignoring what the project costs
A saving net of extra labour, spares or energy is smaller than the gross figure. Net them off, and record the one-off costs against the project.
Reporting once and never checking
Many gains fade within months. A six-month check on the KPI turns a claim into a saving that is still there.

Download the template

Free to use: print it, copy it and edit it for your team. Enter your name and work email once to download.

Run this template in LeanSuite

In LeanSuite the Loss and Cost Management System ranks each loss by what it costs, KPI Builder tracks your cost KPIs against targets, and the Glidepath report shows closed, projected and carried-over savings against target month by month.

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