A Control Account is a management control point where scope, budget, actual cost, and schedule are integrated and compared to earned value for performance measurement. It provides a structured way to track project performance at key milestones.
Key Aspects of a Control Account
- Used in Earned Value Management (EVM) – Helps assess project cost and schedule performance.
- Integrates Multiple Metrics – Combines scope, budget, schedule, and actual costs.
- Provides Performance Visibility – Allows for better project forecasting and variance analysis.
- Defined Within the Work Breakdown Structure (WBS) – Each control account aligns with a specific portion of project scope.
Control Account in Earned Value Management (EVM)
| Metric | Description |
|---|---|
| Planned Value (PV) | The budgeted cost for work scheduled at a given point. |
| Earned Value (EV) | The budgeted cost for work actually completed. |
| Actual Cost (AC) | The total cost incurred for the completed work. |
| Cost Variance (CV) | Difference between EV and AC, measuring cost performance. |
| Schedule Variance (SV) | Difference between EV and PV, measuring schedule performance. |
Example Scenarios
Construction Project
A bridge construction project sets up a control account for foundation work, tracking budgeted costs vs. actual expenditures to detect overruns early.
Software Development
A software implementation project defines control accounts for front-end development, back-end development, and testing, ensuring that each phase meets financial and timeline expectations.
Manufacturing
A vehicle production program uses control accounts to monitor materials, labor, and assembly costs, ensuring that production stays within budget.
Why Control Accounts Matter
- Enhance Project Oversight – Provide structured checkpoints for financial and schedule tracking.
- Enable Performance Measurement – Support variance analysis through Earned Value Management (EVM).
- Improve Forecasting – Identify cost or schedule issues before they escalate.
- Facilitate Better Decision-Making – Allow managers to take corrective action when variances occur.
See also: Earned Value Management (EVM), Work Breakdown Structure (WBS), Cost Variance (CV), Schedule Performance Index (SPI).