EVA - Earned Value Analysis

 

Important Terms

Planned Value (PV)

Budgeted Cost of Work Scheduled (BCWS) – The total budget allocated to perform a task within a specific period.

Actual Cost (AC)

Actual Cost of Work Performed (ACWP) – The actual expenditure incurred on work completed up to a given point in time.

Earned Value (EV)

Budgeted Cost of Work Performed (BCWP) – The budgeted cost for the work actually completed at a given point in time.

Rate of Performance (RP)

The percentage of work completed relative to the work scheduled.

Performance Measurement Baseline (PMB)

Budgeted Cost of Work Scheduled (BCWS) for each time period, covering the entire project duration.

• PMB provides a structured budget plan aligned with project phases and work schedules.

Calculations

Earned Value (EV)

$$EV = PV \times RP$$

Schedule Variance (SV)

$$SV = EV - PV$$

Cost Variance (CV)

$$CV = EV - AC$$

Cost Performance Index (CPI)

$$CPI = \frac{EV}{AC}$$

Schedule Performance Index (SPI)

$$SPI = \frac{EV}{PV}$$

Budget at Completion (BAC)

$$BAC = \text{Total of PV at the end of the project}$$

Estimate at Completion (EAC)

Projection of total cost at project completion:

$$EAC = AC + \frac{(BAC - EV)}{CPI} = \frac{BAC}{CPI}$$

Estimate to Completion (ETC)

Estimate of remaining work to be completed:

$$ETC = EAC - AC$$

Variance at Completion (VAC)

$$VAC = BAC - EAC$$

Interpretation

• Negative CV → Actual cost exceeds the planned cost for work done (Over budget).
• Negative SV → Work took longer than planned (Behind schedule).
• CPI = 1 → Actual cost matches planned cost.
• CPI < 1 → Actual cost exceeds planned cost (Over budget).
• CPI > 1 → Actual cost is lower than planned cost (Under budget).
• SPI = 1 → The project is on schedule.
• SPI < 1 → The project is behind schedule.
• SPI > 1 → The project is ahead of schedule.