EV Management Terms
| Term | Description | Interpretation |
|---|---|---|
| PV (BCWS) | Planned Value (Budgeted Cost of Work Schedule) | What is the estimated value of the work planned to be done? |
| EV (BCWP) | Earned Value (Budgeted Cost of Work Performed) | What is the estimated value of the work actually accomplished? |
| AC (ACWP) | Actual Cost (Actual Cost of Work Performed) | What is the actual cost incurred? |
| BAC | Budget at Completion | How much did you BUDGET for the TOTAL JOB? |
| EAC | Estimate at Completion | What do we currently expect the TOTAL project to cost? |
| ETC | Estimate to Complete | From this point on, how much MORE do we expect it to cost to finish the job? |
| VAC | Variance at Completion | How much over or under budget do we expect to be? |
Earned Value Management Formulas & Interpretation
| Name | Formula | Interpretation |
|---|---|---|
| Earned Value (EV) | Total Estimated Cost * % Complete | Amount of budget earned so far based on physical work accomplished, without reference to actual costs |
| Cost Variance (CV) | EV – AC | NEGATIVE is over budget POSITIVE is under budget |
| Schedule Variance (SV) | EV – PV | NEGATIVE is behind schedule POSITIVE is ahead of schedule |
| Cost Performance Index (CPI) | EV / AC | I am getting _____ cents out of every $1 |
| Schedule Performance Index (SPI) | EV / PV | I am progressing at ___% of the rate originally planned |
| Estimate At Completion (EAC) Note: There are many ways to calculate EAC |
BAC / CPI | As of now how much do we expect the total project to cost $_____. Used if no variances from the BAC have occurred |
| AC + ETC | Actual plus a new estimate for remaining work. Used when original estimate was fundamentally flawed | |
| AC + BAC – EV | Actual to date plus remaining budget. Used when current variances are atypical | |
| AC + (BAC – EV) / CPI | Actual to date plus remaining budget modified by performance. When current variances are typical | |
| Estimate To Complete (ETC) | EAC – AC | How much more will the project cost? |
| Variance At Completion (VAC) | BAC – EAC | How much over budget will we be at the end of the project? |