In an earned value analysis, what are the ETC typical and atypical calculations?

Question

In an earned value analysis, what are the ETC typical and atypical calculations? And, what are the EAC typical and atypical calculations? When would you use each of these calculations? What is the difference between typical and atypical? Earned value analysis alone does not tell you everything about the status of a project. Explain how SV and other standard earned value calculations should be considered in conjunction with other measures and other data (like network diagrams) so that the project status is fully understood and so that an earned value analysis is not misinterpreted. As you answer, discuss the fact that Schedule typically refers to time, yet Schedule Variance SV is a dollar-based calculation

Explanation / Answer

Estimate To Complete (ETC) is the estimated cost required to complete the remainder of the project.

Estimate To Complete (ETC) is calculated and applied when the past estimating assumptions become invalid and a need for fresh estimates arises.

ETC is used to compute the Estimation at Completion (EAC).

Estimate At Completion (EAC) is the estimated cost of the project at the end of the project.

There are three methods to calcualte EAC

Variances are Typical - This method is used when the variances at the current stage are typical and are not expected to occure in the future.

Past Estimating Assumptions are not valid - This method is used when the past estimating assumptions are not valid and fresh estimates are applied to the project.

Variances will be present in the future - This method is used when the assumption is that the current variances will be continue to be present in the future.

The formula for calculation of the three methods are as given below:

AC + ( BAC -EV )

AC + ETC ( Estimate to complete )

AC + ( BAC- EV ) / CPI   

Budget At Completion (BAC) is the total budget allocated to the project.

Budget At Completion (BAC) is generally plotted over time. Say like periods of reporting ( Monthly, Weekly etc. )

BAC is used to compute the Estimate At Completion ( EAC ), explained in next section.

BAC is also used to compute the TCPI and TSPI

BAC is calculated using the following formula   

Variance At completion (VAC) is the variance on the total budget at the end of the project.

VAC is calculated using the following formula

VAC = BAC - EAC

The percentage of work which was planned to be completed by the Reporting Date. This is calculated using the following formula

VAC = BAC - EAC

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