New Software: Depends the Requirement

Generally new software is usually developed as a result of customer equipment which may be an internal or an external organization identifying a need. The next step is to specify how the software will fulfill the equipment; specifically, what new functionality will be developed. This is the Main 'scope' of the project. The project plans are drawn up, based on the estimates for developing and delivering the specified functionality, and an end date is agreed.

Development starts and the project seems to be progressing well. But then the customer realises that there are additional requirements they forgot to mention, or extra elements of functionality that they need. Often, adding these extras will cause the project duration to be extended, resulting in missed deadlines and increased costs, leading to erosion of margin on the project and potentially customer dissatisfaction and loss of credibility due to late delivery.
It is important that a functional specification is produced at the outset, written in terms that the customer can understand. For example, a walk-through of the process that the software will support, perhaps illustrated with mocked-up screen shots, will help to clarify how the new system will work from the user's point of view.

The functional specification must be agreed and signed by the customer, and should include a Scope Statement. This states that only the functionality which is explicitly described in the specification is included in the project scope, and that anything not described is 'outside scope.