A retaining-wall package on a hillside road shows negative cost variance. What does that mean for the associate reading the report?
Select an answer to reveal the explanation.
Short Explanation
Negative CV on the retaining wall means the dollars spent outran the value earned—over budget for the work done. It is not a secret code for being ahead on time or for automatic quality passes.
Full Explanation
A retaining-wall package on a hillside road with negative cost variance means the cost of work performed exceeds earned value, indicating a cost overrun versus earned work. Associates reading civic control reports should translate the sign into that plain meaning without inventing schedule or quality conclusions. Negative CV is a cost story first.
Negative CV does not equal positive SV or prove the wall is ahead of schedule; SV uses planned value, not the CV sign. Quality acceptance is not automatic because overruns occurred; spending more does not prove thorough inspection. Negative CV also does not force the schedule baseline to be shorter than one day remaining—that claim is unrelated.
Exam caveat: CAPM tests isolation of CV meaning from SV and quality inferences. One metric, one question answered.
Operational check: confirm AC > EV for the wall package, quantify the overrun, separate any SV reading with PV, and bring cost-recovery options to the change/control forum without assuming schedule status from CV alone. Ask for the companion SV and a short cost-driver note whenever negative CV appears. Associates who report CV in isolation invite misread schedule or quality stories.