GAO Cost Estimating and Assessment Guide (March 2009)

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Long Description: For the purposes of this guide, a cost estimate is the summation of individual cost elements, using established methods and valid data, to estimate the future costs of a program, based on what is known today. The management of a cost estimate involves continually updating the estimate with actual data as they become available, revising the estimate to reflect changes, and analyzing differences between estimated and actual costs—for example, using data from a reliable earned value management (EVM) system. The ability to generate reliable cost estimates is a critical function, necessary to support the Office of Management and Budget’s (OMB) capital programming process. Without this ability, agencies are at risk of experiencing cost overruns, missed deadlines, and performance shortfalls—all recurring problems that our program assessments too often reveal.
Web Site Address: http://www.gao.gov/cgi-bin/getrpt?GAO-09-3SP
Benefit/Value: This manual describes the GAO's position on how cost estimating and EVM interrelate at the program level. Therefore is it targeted at lead cost estimators, EVM analysts, project managers and business finance managers. The book is not specifically designed for DoD efforts, but understanding how GAO approaches the topic of cost estimation and EVM can still be helpful.
Keywords: Cost estimation, EVM, earned value, cost analysis,