What Is Budget at Completion (BAC)? EDGEBIC Definition

Budget at Completion (BAC) is the total planned work for a job, captured at the moment the job is scheduled and held fixed as the baseline for every earned value comparison that follows. In EDGEBIC by User Solutions, BAC is measured in planned hours (the sum of every step's planned time) and, where labor and material rates are entered, in planned cost. Because BAC never moves once set, it is the honest yardstick a planner measures actual hours and forecast overruns against.

This entry belongs to the EDGEBIC glossary series. For the wider vocabulary of planning terms, see the manufacturing glossary. BAC is one input to the broader idea of earned value in manufacturing, which this entry links to for the full method.

How Budget at Completion Works

Every earned value calculation needs a fixed reference point, and BAC is it. When a job is scheduled, EDGEBIC records the planned hours of each routing step. Add them together and you have the Budget at Completion: the amount of work the job was expected to require. Nothing that happens on the shop floor afterward changes this number.

That permanence is deliberate. The schedule performance index and cost performance index both divide earned value by a moving figure (planned value and actual cost), but they are only meaningful because BAC anchors the top of the calculation. Earned value itself is BAC multiplied by the percent of work completed. If BAC crept up whenever a job ran long, earned value would rise to match, and the report would show a job that is always exactly on budget, which helps no one.

BAC also feeds the forecast. The estimate at completion projects the final hours by taking what has actually been spent and adding the remaining budgeted work adjusted by efficiency so far. Remaining work is BAC minus earned value, so a wrong or drifting BAC would poison the forecast. Keeping it frozen is what lets EDGEBIC say, halfway through a job, how it is likely to finish.

A Concrete Example

Take Job J-100 for product Widget A, a five-step routing.

The Budget at Completion is the sum of every step's planned hours:

• BAC = 8 + 12 + 24 + 4 + 2 = 50 hours

Now run the report with S1 to S3 complete and S4 half done. Actual hours so far are 10 + 11 + 30 + 4 = 55. Earned value caps completion at 100 percent, so EV equals BAC at 50 hours. The cost performance index is EV divided by actual cost, 50 divided by 55, which is 0.91. The estimate at completion is actual cost plus remaining budgeted work divided by that efficiency: 55 + (50 minus 50) divided by 0.91, which lands at 55 hours.

The story BAC makes visible: the job is physically on track (all completed steps finished), but at 55 forecast hours against a 50-hour baseline it will close 5 hours, or 10 percent, over. Without a frozen BAC, that overrun would be invisible.

How EDGEBIC Uses Budget at Completion

BAC appears as a column in EDGEBIC's Earned Value report, sitting beside earned value, planned value, actual cost, the two performance indices, and the estimate at completion. You reach it from the reports catalog and run it for a date range or a single job. See how to run the earned value report in EDGEBIC for the step by step.

Two behaviors are worth knowing. First, BAC respects the site-wide primary-hours-only rollup basis, so on routings with dependent parallel steps it counts the primary hours rather than double-counting mirrored siblings. Second, the report's own column glossary explains every field in plain language on the screen, so a supervisor who has never seen the acronym can read what BAC means without leaving the dialog.

BAC pairs directly with the estimate at completion, which is the forecast the baseline makes possible. Together they answer the two questions every job owner asks: what was this supposed to cost, and what is it going to cost now.