variance at completion (VAC)
A forecast of the final budget surplus or shortfall, calculated as the difference between the Budget at Completion (BAC) and the Estimate at Completion (EAC). In practice: VAC = BAC - EAC; positive means expected surplus, negative means expected overrun.
Key Points
- Indicates how far over or under budget the project is expected to be at completion based on current forecasts.
- Formula: VAC = BAC - EAC.
- Positive VAC = surplus; negative VAC = deficit; zero VAC = on budget at completion.
- VAC changes as EAC is updated and pairs with metrics like CV to understand trends and final outcomes.
Example
A project has BAC = 1,000,000 and the latest EAC = 1,080,000. VAC = 1,000,000 - 1,080,000 = -80,000, indicating the project is forecast to finish 80,000 over budget.
PMP Example Question
A project has a BAC of 500,000 and an updated EAC of 470,000. Which metric and value best expresses the expected final budget position?
- CV = 30,000
- VAC = 30,000
- EAC = 30,000
- SV = 30,000
Correct Answer: B — variance at completion (VAC)
Explanation: VAC = BAC - EAC = 500,000 - 470,000 = 30,000, a positive value indicating a projected budget surplus at completion.
