On problems of using earned value method for analysis of project status
The paper deals with a systematical review of the EVA (Earned Value Analysis) Method which is recommended as a tool for tracing schedule and budget deviations from the Project Baseline in a lot of theoretical sources. The paper shows that a direct interpretation of positive/negative Cost/Schedule Variance as a sign of Cost Saving/Overdraft or Advance/Lag in Schedule is generally speaking incorrect. The author emphasizes that for an adequate use of that method it is necessary to have at least an agreement what term Actual Costs really means which can be treated either from Cash Method point of view or from Accrual Method standpoint. Also the author criticizes the existing approaches based on the EVA Method to forecast future project expenses.