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EVM Glossary
By National Aeronautics and Space Administration (NASA)

Actual Cost of Work Performed (ACWP). The costs actually incurred and recorded in accomplishing the work performed within a given time period.

Actual Direct Costs (ADC). Those costs identified specifically with a contract, based upon the contractor’s cost identification and accumulation system as accepted by the cognizant Defense Contract Audit Agency (DCAA) representatives (See Direct Costs ).

Administrative Contracting Officer (ACO). The individual within the Contract Administration Office (CAO) responsible for ensuring that the functions described in DFAR 242.302 are completed by the contractor in accordance with the terms and conditions of the contract.

Advance Agreement (AA). An agreement between the contractor and the Contract Administration Office concerning the application of an approved integrated management system to contracts within the affected facility.

Allocated Budget. (See Total Allocated Budget)

Applied Direct Costs (ADC). The actual direct costs recognized in the time period associated with the consumption of labor, material, and other direct resources, without regard to the date of commitment or the date of payment. These amounts are to be charged to work in-process when any of the following takes place:

  • Labor, material, or other direct resources are actually consumed.
  • Material resources are withdrawn from inventory for use.
  • Material resources are received that are uniquely identified to the contract and scheduled for use within 60 days.
  • Major components or assemblies that are specifically and uniquely identified to a single serially numbered end item are received on a line flow basis.

Apportioned Effort (AE). Effort that by itself is not readily divisible into short-span work packages but which is related in direct proportion to measured effort.

Authorization to Proceed (ATP). Official authority for the contractor to begin work. Usually issued by the procuring contracting officer.

Authorized Work. That effort which has been definitized and is on contract plus that effort for which definitized contract costs have not been agreed to but for which written authorization has been received.

Baseline. (See Performance Measurement Baseline).

Bill of Material (BOM). A listing of material items required to complete the production of a single unit. When actual or expected prices are applied, it becomes the Priced Bill of Material (PBOM).

Budget at Completion (BAC). The sum of all budgets established for the contract. (See Total Allocated Budget).

Budgeted Cost for Work Performed (BCWP). The sum of the budgets for completed work packages and completed portions of open work packages, plus the applicable portion of the budgets for level of effort and apportioned effort.

Budgeted Cost for Work Scheduled (BCWS). The sum of the budgets for all work packages, planning packages, etc., scheduled to be accomplished (including in-process work packages), plus the amount of level of effort and apportioned effort scheduled to be accomplished within a given time period.

Contract Budget Base (CBB). The negotiated contract cost plus the estimated cost of authorized unpriced work.

Contract Administration Office (CAO). The organization assigned responsibility for ensuring that the contractor complies with the terms and conditions of the contract.

Contract Data Requirements List (CDRL). A compilation of all data requirements which the contractor is obligated to submit to the government.

Contract Work Breakdown Structure (CWBS). The complete work breakdown structure for a contract, it includes the DoD approved work breakdown structure for reporting purposes and its discretionary extension to the lower levels by the contractor, in accordance with MIL-HNDBK 881(latest version) and the contract work statement. It includes all the elements for the hardware, software, data or services which are the responsibility of the contractor.

Contractor. An entity in private industry which enters into contracts with the Government. In this guide, the word also applies to Government-owned, Government-operated activities which perform work on major defense programs.

Contractor Performance Measurement (CPM) Monitor. That person within the CAO assigned responsibility for ensuring the proper and continuing implementation of the approved integrated management system on contracts where its application is required.

Cost Account (C/A). A management control point at which actual costs can be accumulated and compared to budgeted cost of work performed. A cost account is a natural control point for cost/schedule planning and control since it represents the work assigned to one responsible organizational element on one contract work breakdown structure (CWBS) element.

Cost Accounting Standards (CAS). Established by the Cost Accounting Standards Board (CASB) to ensure consistent and proper accounting for direct and indirect costs applied to government contracts.

Cost Performance Report (CPR). A contractually required report, prepared by the contractor, containing information derived from the internal system. Provides status of progress on the contract.

Cost/Schedule Status Report (C/SSR). A performance measurement report established to capture information on smaller contracts.

Defense Contract Audit Agency (DCAA). The organization tasked with monitoring a contractor’s design and implementation of an acceptable accounting system.

Direct Costs. Any costs that may be identified specifically with a particular cost objective. This term is explained in the Federal Acquisition Regulation (reference (ff)).

Earned Value Management System Guidelines (EVMS). The set of 32 statements established by DoD 5000.2R, Part 11, Section B, which define the parameters within which the contractor’s integrated cost/schedule management system must fit.

Estimate at Completion (EAC). Actual direct costs, plus indirect costs allocable to the contract, plus the estimate of costs (direct and indirect) for authorized work remaining.

Estimate to Complete (ETC). That portion of the EAC that addresses total expected costs for all work remaining on the contract.

Indirect Costs. Costs which, because of their incurrence for common or joint objectives, are not readily subject to treatment as direct costs. This term is further defined in FAR 31.203.

Initial Compliance Review. A government review done at a contractor’s facility to assess contractor application of EVMS principles.

Integrated Management System (IMS). The contractor’s system and related sub-systems implemented on major contracts to establish a relationship between cost, schedule and technical aspects of the contract, to measure progress, accumulate actual costs, analyze deviations from plans, forecast completion of contract events and incorporate changes to the contract in a timely manner.

Letter of Delegation (LOD). A document assigning contract administration functions from one CAO to another, usually in a prime-subcontractor relationship.

Level of Effort (LOE). Effort of a general or supportive nature which does not produce definite end products.

Management Reserve (MR). An amount of the total allocated budget withheld for management control purposes rather than designated for the accomplishment of a specific task or set of tasks. It is not a part of the Performance Measurement Baseline.

Negotiated Contract Cost (NCC). The estimated cost negotiated in a cost-plus-fixed-fee contract or the negotiated contract target cost in either a fixed-price incentive contract or a cost-plus-incentive-fee contract.

Organizational Breakdown Structure (OBS). A functionally oriented division of the contractor’s organization established to perform the work on a specific contract.

Overhead. (See Indirect Cost.)

Performance Measurement Baseline (PMB). The time-phased budget plan against which contract performance is measured. It is formed by the budgets assigned to scheduled cost accounts and the applicable indirect budgets. For future effort, not planned to the cost account level, the performance measurement baseline also includes budgets assigned to higher level CWBS elements, and undistributed budgets. It equals the total allocated budget less management reserve.

Performing Organization. A defined unit within the contractor’s organization structure, which applies the resources to perform the work.

Planning Package (P/P). A logical aggregation of work within a cost account, normally the far-term effort, that can be identified and budgeted in early baseline planning, but is not yet defined into work packages.

Post-acceptance Review. A government review performed on a specific element of the contractors EVMS system, that has displayed a lack of discipline in application or no longer meets the intent of the EVMS Guidelines.

Procuring Activity. The subordinate command to which the Procuring Contracting Officer (PCO) is assigned. It may include the program office, related functional support offices, and procurement offices.

Replanning. The redistribution of budget for future work. Traceability is required to previous baselines and attention to funding requirements needs to be considered in any replanning effort.

Responsible Organization. A defined unit within the contractor’s organization structure which is assigned responsibility for accomplishing specific tasks.

Responsibility Assignment Matrix (RAM). A depiction of the relationship between the Contract Work Breakdown Structure elements and the organizations assigned responsibility for ensuring their accomplishment.

Significant Variances. Those differences between planned and actual performance which require further review, analysis, or action.

Summary Effort Control Package (SECP). The summary level of the WBS and/or OBS where budgets are held for far-term efforts, not able to be identified to functional and/or WBS entities at the cost account level.

Total Allocated Budget (TAB). The sum of all budgets allocated to the contract. Total allocated budget consists of the performance measurement baseline and all management reserve. The total allocated budget will reconcile directly to the contract budget base. Any differences will be documented as to quantity and cause.

Undistributed Budget (UB). Budget applicable to contract effort which has not yet been identified to CWBS elements at or below the lowest level of, reporting to the Government.

Variance at Completion (VAC). The difference between the total budget assigned to a contract, WBS element, Organizational entity or cost account and the estimate at completion. It represents the amount of expected overrun or underrun.

Work Breakdown Structure (WBS). A product-oriented family tree division of hardware, software, services, and other work tasks which organizes, defines, and graphically displays the product to be produced as well as the work to be accomplished to achieve the specified product.

  • Project Summary Work Breakdown Structure (PWBS). A summary work breakdown structure (WBS) tailored to a specific defense material item by selecting applicable elements from one or more summary WBSs or by adding equivalent elements unique to the project in accordance with MIL-HNDBK 881 (latest revision).
  • Contract Work Breakdown Structure (CWBS). The complete WBS for a contract, developed and used by a contractor within the guidelines of MIL-HNDBK 881 (latest revision) and according to the contract’s work statement. The CWBS includes the levels specified in the contract and the contractor’s extension.

Work Package (W/P). Detailed jobs, or material items, identified by the contractor for accomplishing work required to complete the contract. A work package has the following characteristics:

  • It represents units of work at levels where work is performed.
  • It is clearly distinguished from all other work packages.
  • It is assigned to a single organizational element.
  • It has scheduled start and completion dates and, as applicable, interim milestones, all of which are representative of physical accomplishment.
  • It has a budget or assigned value expressed in terms of dollars, man-hours, or other measurable units.
  • Its duration is limited to a relatively short span of time or it is subdivided by discrete value milestones to facilitate the objective measurement of work performed
  • It is integrated with detailed engineering, manufacturing, or other schedules

Work Package Budgets. Resources which are formally assigned by the contractor to accomplish a work package, expressed in dollars, hours, standards or other definitive units.

With permission from NASA. The EVM section on NASA’s website can be found here.

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