When to use it
Use it to challenge progress reporting when planned value is positive.
Do not infer the finish date directly from this ratio or use it when planned value is zero.
- Define the scope, status date and units before collecting the inputs.
- Substitute the values into the formula and retain their units.
- Interpret the result against the assumptions and decide what evidence or action is needed next.
Formula & inputs
EV is earned value; PV is planned value. PV must be greater than zero.
Worked example
A delivery project has budget at completion of €900,000. At the same status date, planned value is €450,000, earned value is €360,000 and actual cost is €400,000. All values use the same scope and price basis.
The team has earned less budgeted work than planned. Activity dependencies still determine the finish.
Common pitfall
High-value non-critical work can conceal delay on a low-budget critical activity.
Source & related material
Standard quantitative technique; this explanation is by fannarmaximus. No single inventor is claimed. The arithmetic is computed from explicit inputs, not copied from an official sample question.