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Earned value (earned value: A measure of the cost of work performed up to the status date or current date. Earned value uses your original cost estimates saved with a baseline and your actual work to date to show whether the actual costs incurred are on budget.) analysis is a method for measuring project performance. It indicates how much of the budget (budget: The estimated cost of a project that you establish in Project with your baseline plan.) should have been spent, in view of the amount of work (work: For tasks, the total labor required to complete a task. For assignments, the amount of work to which a resource is assigned. For resources, the total amount of work to which a resource is assigned for all tasks. Work is different from task duration.) done so far and the baseline cost (baseline cost: The original project, resource, and assignment cost as shown in the baseline plan. The baseline cost is a snapshot of the cost at the time when the baseline plan was saved.) for the task (task: An activity that has a beginning and an end. Project plans are made up of tasks.), assignment (assignment: A specific resource that is assigned to a particular task.), or resources (resources: The people, equipment, and material that are used to complete tasks in a project.).

At the root of earned value analysis are three key values:

• The budgeted cost of individual tasks as they are scheduled in the project plan, based on the costs of resources assigned to those tasks plus any fixed costs associated with the tasks. This is the budgeted cost of work scheduled (BCWS) (BCWS: The earned value field that shows how much of the budget should have been spent, in view of the baseline cost of the task, assignment, or resource. BCWS is calculated as the cumulative timephased baseline costs up to the status date or today's date.). BCWS is the baseline cost up to the status date (status date: A date that you set [rather than the current date] for reporting the time, cost, or performance condition of a project.) you choose. Budgeted cost values are stored in the baseline fields, or, if you've saved multiple baselines, in Baseline1 through Baseline10 fields.
• The actual cost required to complete all or some portion of the tasks, up to the status date. This is the actual cost of work performed (ACWP) (ACWP: Shows actual costs incurred for work already performed by a resource on a task, up to the project status date or today's date.). Normally, Microsoft Office Project 2003 correlates actual costs with actual work.
• The value of the work performed by the status date, measured in currency. This is literally the value earned by the work performed, and is called the budgeted cost of work performed (BCWP) (BCWP: The earned value field that indicates how much of the task's budget should have been spent, given the actual duration of the task. Note that Project calculates BCWP at the task level differently than at the assignment level.). This value is calculated for each individual task, but analyzed at an aggregate level (typically at the project level).

Earned value analysis is always specific to a status date you choose. This may be the current date, or any date before the current date.