EVM Data Reliability

As we describe in chapter 20, an EVM system should be validated to ensure that, among other things, it provides reliable data for managing the program and reporting its status. Before using EVM data, analysts should ensure that the data are reliable by

• requesting a copy of the EVM system compliance letter showing the contractor’s ability to satisfy the 32 guidelines;

• requesting a copy of the IBR documentation and final briefing to see what risks were identified and what weaknesses, if any, were found;

• determining whether EVM surveillance is being done by qualified and independent staff; and

• determining the financial accounting status of the contractor’s EVM system to see whether any adverse opinions would call into question the reliability of the accounting data.

In addition to these tasks, auditors should perform a sanity check to see if the data are reasonable. For example, the auditor should review all WBS elements in the cost reports to determine whether there are data anomalies (chapter 19 describes several measures for EVM data anomalies). Despite the fact that EVM data anomalies should be rare and fully explained in variance analysis reports, we have found programs that submit reports with these types of errors.