Irish Calculators
Business

Project Cost Performance Index Calculator

Compare earned value with actual cost to calculate CPI and cost variance. Actual cost must be positive for the index, and both amounts must cover the same work and status date.

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How the calculation works

Measure project cost performance by comparing earned value with actual cost for the same work. The cost performance index expresses value earned per unit spent, while cost variance shows the difference in budget currency.

CPI = earned value / actual cost. Cost variance = earned value − actual cost.

  1. Align scope and timing

    Use one budget baseline and status date. Earned work and actual expenditure must cover comparable activities before their ratio can describe cost performance.

  2. Calculate the cost index

    Divide earned value by actual cost. One means the amounts match; below one means less budgeted value earned per unit of cost, and above one means more.

  3. Calculate cost variance

    Subtract actual cost from earned value. A negative result shows the included actual cost exceeds the budgeted value earned, while a positive result shows the reverse.

Worked example: Over budget

Sample inputs demonstrate the method. They are not a forecast or product offer.

The first example has €80,000 earned value and €100,000 actual cost. Dividing gives CPI of 0.8. Subtracting actual cost from earned value gives a negative cost variance of €20,000.

Earned value (EV)
80000
Actual cost (AC)
100000

Expected result

Cost performance index
0.8
Cost variance
-€20,000.00
Worked example: Efficient cost performance

Sample inputs demonstrate the method. They are not a forecast or product offer.

Earned value (EV)
120000
Actual cost (AC)
100000

Expected result

Cost performance index
1.2
Cost variance
€20,000.00

Understanding your result

The index and variance describe performance to the measurement point. They do not automatically predict final project cost or the efficiency of all remaining work.

An index of 0.8 means €0.80 of earned budget value for each €1 of actual cost. It should not be casually relabelled a 20% cost overrun, because that alternative statement uses a different denominator.

Questions you might have

Does CPI automatically predict the estimate at completion?

No. Forecasting final cost requires assumptions about remaining work. This calculator reports observed cost performance only.

Choosing the right inputs

Earned value (EV)
Use the budgeted value of completed work at the status date. This is not planned value, customer revenue or the amount invoiced.
Actual cost (AC)
Enter positive actual cost incurred for that same scope and status point. Delayed cost recording can make performance appear better than the underlying position.

Common mistakes to avoid

  • Do not confuse this project CPI with a consumer price index or an inflation rate.
  • Do not use planned value as earned value merely because both figures come from the project budget.

Assumptions to check

  • Use amounts in one currency and one reporting period. Results are labelled EUR; the arithmetic also works for another consistent currency.
  • EV and AC must cover the same work and status date. Actual cost must be positive to calculate CPI.

Sources and method

Read our calculation and testing approach.