15 · EVM — Forecasting (EAC/ETC/VAC/TCPI)

POSTER 15

Section 5 · Earned Value Management — Forecasting

EVM Forecasting: EAC · ETC · VAC · TCPI

Performance to date predicts the finish. EAC forecasts the total cost, ETC the cost of what's left, VAC the projected over/under, and TCPI the efficiency you must now sustain to hit a target. Pick the EAC formula that matches your assumption about the remaining work.

Visual Map — Choosing Your EAC (assumption → formula)

Assumption about the remaining work	EAC formula	Reading
Current variance was a one-off / atypical	EAC = AC + (BAC − EV)	finish the rest at the budgeted rate
Current cost efficiency continues (the default)	EAC = BAC ÷ CPI	today's CPI holds to the end
Both cost & schedule pressure continue	EAC = AC + (BAC − EV) ÷ (CPI × SPI)	schedule drag worsens cost
Original estimate is no longer valid	EAC = AC + bottom-up ETC	re-estimate the remainder

The Forecasting Family

BAC: Budget at Completion — the baseline total (the plan).
EAC: Estimate at Completion — forecast total cost.
ETC: Estimate to Complete — cost of the remaining work.
VAC: Variance at Completion — projected over/under at the end.
TCPI: To-Complete Performance Index — efficiency needed from here.

Core Formulas

ETC = EAC − AC
what's left to spend

VAC = BAC − EAC
+ under · − over at end

TCPI = (BAC − EV) ÷ (BAC − AC)
to still hit BAC

TCPI = (BAC − EV) ÷ (EAC − AC)
to hit the new EAC

Worked Example (same numbers)

From Poster 14	Value
BAC / EV / AC	100 / 40 / 45
CPI / SPI	0.89 / 0.80
EAC = BAC/CPI	$112.5k
ETC = EAC−AC	$67.5k
VAC = BAC−EAC	−$12.5k
EAC (cost×sched)	≈ $129k
TCPI→BAC	1.09

Reading TCPI

TCPI = work remaining ÷ funds remaining.
Compare to your CPI: TCPI 0.89 vs CPI 0.89 = on track.
Here TCPI 1.09 > CPI 0.89 → you must run better than you ever have → the BAC is likely unrecoverable.
Response: re-baseline, de-scope, or accept the overrun.

Exam Concepts

ETC = EAC − AC; VAC = BAC − EAC.
EAC = BAC/CPI is the default "current-trend" forecast.
Know all four EAC formulas & their assumptions.
TCPI > 1 (and > CPI) = must tighten up; recovery is hard.

Executive View

EAC & VAC answer the board's question: "Where will we land?"
TCPI tells you if a recovery target is realistic before you promise it.
Forecasts trigger re-baselining & funding decisions.

Industry Example

Capital Project

The $100k line upgrade now forecasts $112.5k (EAC) with a −$12.5k VAC. TCPI 1.09 says recovery to budget is unlikely → present a re-baseline + a de-scope option.

Memory Hooks

BAC=plan · EAC=forecast · ETC=what's left · VAC=the surprise.
"ETC peels AC off EAC."
If TCPI > CPI, you're in trouble.

60-sec Review 4 EAC formulas + assumptions ETC and VAC formulas Both TCPI formulas TCPI vs CPI meaning Recompute EAC from CPI

PMI Visual Wall · Poster 15 · EVM — Forecasting (EAC/ETC/VAC/TCPI) · original instructional design · A3 landscape