Sign In
  • Question

    How is it that the Cost Variance (CV) is sloping down, the CVcum is a negative number and getting worse yet the Cost Variance Percent (CV%) is sloping up getting better still a negative but the percent is getting closer to zero.


    It is possible for the cost variance to worsen in terms of absolute dollar value and still see the CV% increase.  This is because the CV% is dependent on the ratio of the CV in dollars to the value of the BCWP or earned value (CV%=CV/BCWP * 100).  If the CV increases at a slower rate than the BCWP increases, the CV% will rise because the CV is a smaller proportion of the cumulative cost variance.  See the included table and graphs for an example.
    (cumulative)  Apr  May  Jun  Jul  Aug  Sep     
    BCWP  $100.00  $120.00  $150.00  $160.00  $200.00  $300.00     
    ACWP  $110.00  $135.00  $160.00  $185.00  $230.00  $335.00     
    CV  -$10.00  -$15.00  -$10.00  -$25.00  -$30.00  -$35.00  cost variance is terms of dollars is worsening 
    CV%  -10% -13% -7%  -16% -15% -12% CV % is improving because CV as a percentage of BCWP-cum is lower
    Please see the Excel file at for explanatory graphs if you want a visual representation. 

    Open full Question Details