Budget Columns of the EPS Table
Annual Discount Rate field
The interest rate associated with the cost of an investment from your commercial bank or another funding source.
Valid values are 0 to 100. This rate is used to calculate Total Spending Plan (Present Value) and Total Benefit Plan (Present Value).
For example, an annual growth rate of an investment such as 4.75% can be used as an annual discount rate. This rate is used when a future value is assumed and you are trying to find the required net present value.
Current Budget field
The current budget for the project or EPS.
Calculated as Original Budget plus the sum of the approved budget changes from the budget log.
Current Variance field
The difference between the current budget and the total spending plan. This value does not aggregate.
Calculated as Current Budget minus Total Spending Plan.
Distributed Current Budget field
The sum of all budgets that were assigned to control accounts during baseline planning. These budgets are allocated for work and planning packages.
Calculated as the sum of the Current Budget values from one level lower. This value does not aggregate.
Independent ETC Labor Units field
The user-entered estimate to complete total labor.
Independent ETC Total Cost field
The user-entered estimate to complete total cost.
Net Present Value field
The difference between the present value (PV) of the future cash flows from an investment and its investment cost.
Present value of the expected cash flows is computed by discounting them at the required rate of return or discount rate. Positive net present value (NPV) is an indicator of projects that should be pursued.
Calculated as Total Benefit Plan (Present Value) minus Total Spending Plan (Present Value).
Original Budget field
The estimate of the total amount you require for the selected project or EPS, including all contributed funds.
Payback Period field
An estimate of the length of time that will transpire before net profits recover the initial and periodic costs of an investment to carry out the selected project.
It is calculated using projections depending on the timescale you select and the number of work days in a standard work week in the project calendar since the first time period in which a spending amount was entered for this project or the Project Start Date, whichever occurred earliest. Payback Period is calculated as the length of time that transpires before the cumulative value of income minus costs, usually negative when a project is just beginning, first exceeds zero.
Because it is based on cumulative values, it can be computed using the difference between present values (adjusted using the discount rate) or non-adjusted values for (Total Spending Plan) + Total Benefit Plan; the results will be the same. It is the point in time where the Spending Plan (PV) curve crosses the Benefit (PV) curve.
Proposed Budget field
The proposed budget for the project or EPS.
Calculated as Original Budget plus the sum of the approved and pending budgets from the budget log.
Return on Investment field
A calculation of the expected return or benefit over and above the investment costs of a project or portfolio expressed as a percentage.
Calculated as the Net Present Value divided by the Total Spending Plan (Present Value).
For example, a project is expected to cost 1.0 million dollars with a total benefit of 1.2 million dollars. Its Net Present Value is $200,000. The Return on Investment is 20%.
Total Funding field
The total amount contributed to the project from funding sources.
Unallocated Budget field
The difference between the total current and distributed current budget.
Calculated as Total Current Budget minus Distributed Current Budget.
Last Published Wednesday, July 10, 2024