Estimate at Completion (EAC) forecasts a project’s total cost using costs incurred to date and the estimated cost of remaining work.
Definition
EAC is a forecast of the total cost to deliver the project under a stated scope and set of assumptions. A common approach adds actual costs to date to an estimate of the cost to finish, while other approaches use performance trends or revised forecasts. Firms may include labor, subconsultants, reimbursable expenses, and other project costs differently, so comparisons require consistent definitions. Project managers update the estimate as progress, staffing, productivity, schedule, risks, or scope changes. EAC helps owners assess likely cost and margin against the fee, but it is only as reliable as its inputs and assumptions. It is not the contract amount, revenue recognized, or a guarantee of final cost. The estimate can change as new information becomes available, and a forecast should state its status date and basis so reviewers know what it represents.
How owners use it
- Compare forecast total cost with the project budget or fee to see where exposure may exist.
- Review EAC alongside the estimate to complete to understand how much cost is already incurred versus still expected.
- For example, $75,000 actual cost + $125,000 estimated remaining cost = $200,000 EAC.
- Update the forecast when scope, staffing, schedule, or productivity assumptions change.
