Robust project cost control requires active monitoring, analysis, and explanation of variances. Researching both positive and negative variances shows that management is not merely checking whether costs are below budget, but is understanding why actual results differ from expectations. Favorable variances can indicate omitted work, timing delays, underuse of resources, or inaccurate estimates, while unfavorable variances may indicate overruns, scope creep, inefficiency, or poor planning. A compiled and approved budget is only a planning control. Costs being precisely within budget may be unusual and does not prove strong control.
Allocating cost estimates correctly supports planning but not ongoing control. Internal audit should assess cost baseline monitoring, variance analysis, escalation, and corrective action. Therefore, Option C is correct.