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(EVM-1280) LOE and AE Earned Value Calculation

Primary Author: Mr Paul E Goldhorn

Audience Focus: Intermediate
Application Type: Application
Venue: 2013 AACE International Annual Meeting, Washington, DC, USA

Abstract: Level of Effort and Apportioned Effort accounts can be troublesome when it comes to calculating earned value. Due to the nature of these accounts there are usually no tangible deliverables to be estimated or earned as the schedule advances. LOE accounts generally earn value based on a schedule of values prepared at the start of the project. If the forecast completion date of the project changes the earning method for the LOE accounts may not be adjusted to reflect this change. AE accounts usually earn value at the same rate at which the discrete works progress, however, this is rarely the case. Support activities ebb and flow with the progress of the project. This paper presents a simple, reliable method by which earned value for LOE and AE accounts can be calculated providing greater credibility in the EAC calculations.