In this blog, In-Period Forecasting and Period-End Forecasting based on Actuals along with examples is explained. Before proceeding, please refer to the blog Forecasting in Commercial Project Management.
The following forecasting key figures are calculated in this blog:
- Estimate at Completion (EAC)
- Estimate to Complete (ETC)
Note: Key Figure values from all approved Change Requests will be considered and calculated as Plan Key Figure values. In this blog, Key Figure represents cost, revenue, and quantity based on resource type and forecast basis. Examples are focused on cost and quantity; however, revenue calculation is similar to cost except that commitments are not considered.
Overview: What's the Difference?
| Aspect | In-Period Forecasting | Period-End Forecasting |
| Forecast Period ETC | Compares Actual vs Plan; ETC = Plan − Actual (if Plan > Actual), else 0 | Always 0 |
| Revenue | Not applicable | Forecast for Revenue is also calculated |
Calculation Logic
Let us consider a financial plan across multiple periods. The calculation for each period is done based on the following logic:
When Forecasting has NOT been executed before
| Period | In-Period Forecasting | Period-End Forecasting |
| Before Forecast Period | ETC = 0 | ETC = 0 |
| Forecast Period | ETC = 0 if Actual ≥ Plan; ETC = Plan − Actual if Plan > Actual | ETC = 0 |
| After Forecast Period | ETC = Plan | ETC = Plan |
Note: Once Period-End Forecasting has been executed for a period, In-Period Forecasting can no longer be performed for that period. In-Period Forecasting will become available again when the next period opens.
When Forecasting HAS been executed before
| Period | In-Period Forecasting | Period-End Forecasting |
| Before Forecast Period | ETC = 0 | ETC = 0 |
| Forecast Period | ETC = 0 if Actual ≥ Plan; ETC = Plan − Actual if Plan > Actual | ETC = 0 |
| After Forecast Period | ETC remains unchanged from the last forecast run | ETC remains unchanged from the last forecast run |
EAC Formulas (applicable to both)
- EAC Quantity = Total ETC Quantity + Total Actual Quantity (up to Forecast Period).
- EAC Cost = Total ETC Cost + Total Actual Cost (up to Forecast Period) + Total Commitments (up to Forecast Period).
- EAC Revenue (Period-End only) = Total ETC Revenue + Total Actual Revenue (up to Forecast Period)
For quantity-driven Resource Types: if Rate (Forecast) of the current period is null, Rate (Cost) of the current period is used as the Forecast Rate.
Example
Consider a Financial Plan with a monthly breakdown from January to June for Resource Type Activity with plan/forecast basis set to Quantity.
Planned and Actual Quantities:
| Month | Planned Quantity (H) | Actual Quantity Posted (H) | Rate (Cost) | Cost (Plan) (EUR) |
| January | 100 | 80 | 10 | 1000 |
| February | 200 | 0 | 10 | 2000 |
| March | 300 | 0 | 10 | 3000 |
| April | 400 | 0 | 10 | 4000 |
| May | 500 | 0 | 10 | 5000 |
| June | 600 | 0 | 10 | 6000 |
First Forecast Run — Forecast Period: January (Actual = 80H)
For January (Forecast Period):
| ETC | In-Period Forecasting | Period-End Forecasting |
| Quantity (H) | 20 (Plan 100 > Actual 80 → ETC = 100 − 80) | 0 (always 0 at period-end) |
| Cost (EUR): ETC Quantity * Rate | 20 × 10 = 200 | 0 × 10 = 0 |
For February to June (Periods after Forecast Period):
Both In-Period and Period-End forecasting yield the same results here as Actual = 0 for all future periods:
| Month | ETC Quantity (H) | ETC Cost (EUR): ETC Quantity * Rate |
| February | 200 | 2000 |
| March | 300 | 3000 |
| April | 400 | 4000 |
| May | 500 | 5000 |
| June | 600 | 6000 |
ETC and EAC Summary — First Run:
| Calculation | In-Period Forecasting | Period-End Forecasting |
| Total ETC Quantity | 20+200+300+400+500+600 = 2020 H | 0+200+300+400+500+600 = 2000 H |
| Total Actual Quantity (upto Jan) | 80 H | 80 H |
| EAC Quantity | 2020 + 80 = 2100 H | 2000 + 80 = 2080 H |
| Total ETC Cost | 20200 EUR | 20000 EUR |
| Total Actual Cost (upto Jan) | 800 EUR | 800 EUR |
| Total Commitments | 0 | 0 |
| EAC Cost | 20200 + 800 + 0 = 21000 EUR | 20000 + 800 + 0 = 20800 EUR |
Second Forecast Run — Same Forecast Period (January), Additional Actuals Posted (Actual = 150H)
Updated Data:
| Month | Planned Quantity (H) | Actual Quantity Posted (H) | Rate (Cost) | Cost (Plan) (EUR) |
| January | 100 | 150 | 10 | 1000 |
| February | 200 | 0 | 10 | 2000 |
| March | 300 | 0 | 10 | 3000 |
| April | 400 | 0 | 10 | 4000 |
| May | 500 | 0 | 10 | 5000 |
| June | 600 | 0 | 10 | 6000 |
For January (Forecast Period):
| ETC | In-Period Forecasting | Period-End Forecasting |
| Quantity (H) | 0 (Actual 150 > Plan 100) | 0 |
| Cost (EUR): ETC Quantity * Rate | 0 | 0 |
For February to June:
| ETC (Feb–Jun) | In-Period Forecasting | Period-End Forecasting |
| Quantity (H) | Retained from last forecast run (200, 300, 400, 500, 600) | Retained from last forecast run (200, 300, 400, 500, 600) |
| Cost (EUR): ETC Quantity * Rate | Retained from last forecast run (2000, 3000, 4000, 5000, 6000) | Retained from last forecast run (2000, 3000, 4000, 5000, 6000) |
Both In-Period and Period-End forecasting yields the same ETC values for future periods in this run.
ETC and EAC Summary — Second Run:
| Calculation | In-Period Forecasting | Period-End Forecasting |
| Total ETC Quantity | 0+200+300+400+500+600 = 2000 H | 0+200+300+400+500+600 = 2000 H |
| Total Actual Quantity (upto Jan) | 150 H | 150 H |
| EAC Quantity | 2000 + 150 = 2150 H | 2000 + 150 = 2150 H |
| Total ETC Cost | 20000 EUR | 20000 EUR |
| Total Actual Cost (upto Jan) | 1500 EUR | 1500 EUR |
| Total Commitments | 0 | 0 |
| EAC Cost | 20000 + 1500 + 0 = 21500 EUR | 20000 + 1500 + 0 = 21500 EUR |
Both methods converge to the same EAC values in the second run because actual postings exceeded the plan for January — removing the only difference between the two approaches.
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