Construction Financial Glossary

Actual Cost of Work Performed (ACWP) Definition

Actual Cost of Work Performed (ACWP) is a key metric in Earned Value Management (EVM) (EVM) that represents the total cost incurred for completed work during a specific period. It is used to compare planned and actual costs to measure project performance.

How ACWP Affects Construction Project Tracking

By monitoring ACWP, project managers can assess whether a project is staying within budget or experiencing cost overruns. Comparing ACWP with Earned Value (EV) and Planned Value (PV) helps identify financial inefficiencies.

Using ACWP for Better Cost Control

    1. Track actual labor and material costs against project estimates
    2. Analyze variances between planned and actual expenditures
    3. Adjust resource allocation to maintain financial stability


Related Terms: Earned Value (EV), Cost Performance Index (CPI), Cost Variance (CV), Planned Value (PV)

FAQs

How is ACWP different from Planned Value (PV)?

A: ACWP reflects actual costs incurred, while PV represents the estimated budget for scheduled work.

What happens if ACWP exceeds Earned Value (EV)?

A: It indicates a cost overrun, meaning the project is spending more than planned for the completed work.

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