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Estimate At Completion

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Karthick ThangaveluMember for 18 years 7 months
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I am having toubles calculating estimate at completion. I know the formula and the ways to calculate it, but the difficulty i am facing with it is that, the actual values i get from our cost reporting software is too low. the reason for it being too low is that, a subcontract activity gets paid 45 days after the claim is made, which increases the CPI for that month, this leads to a low overall Estimate to complete. Is there any other way to calculate it????? have any of you faced a similar situation.

thanks in advance
Karl
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  1. 0
    Darren Kosa ·
    #1
    Hi Karl,

    Two options for you.

    Option 1 - Ensure that the 45d payment period is used as a basis of estimate and incorporated into your baseline so that BCWP and ACWP remain in sync.

    Option 2 - Determine the point at which costs have been incurred and use an accrual so that when the payment criteria is met, costs are then recorded as actuals.

    Regards,

    Darren
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  2. 0
    Samer Zawaydeh ·
    #2
    Dear Karl,

    When you have a high CPI it mean that you have cost savings and you should be happy.

    When you mention that you are getting paid after 45 days that mean that you are using the Budget Cost for Work Scheduled (BCWS), whereas you should be concentrating on the Work Performed charts only. These charts do not refer to the time that you are getting paid.

    With kind regards,

    Samer
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