Most project managers will add some contingency reserves to their budgets to offset the negative financial impacts of realized risks. But how those reserves are allocated and returned varies between practitioners.
Allocation could be as a single lump sum/line item in the budget (e.g. not time sequenced) or defined for each key milestone or phase in the project (e.g. time sequenced).
Contingency amounts might also be given back to funding authorities over the life of the project as the risks they relate to expire or they might be preserved till the very end of the project.
I've got a poll running for one week to understand how contingency reserves were handled on your last project.
