Should you certify this payment application?
A payment application is a claim about progress with a number attached, and the headline percentage is the part hardest to argue with. Earned value prices what you have actually verified and sets it against what has been invoiced, so the answer stops being a judgment call and becomes arithmetic you can show.
Work Intermediate Project Health Pro engine
After you install, this is the model to open.
Should I Certify This Payment Application?
- In your spreadsheet, click the Sortia icon in the strip of icons down the right-hand edge. No strip? Click the arrow at the bottom-right to open it. You can also use Extensions, then Sortia, then Open Sortia.
- Click Start from a template and put that name in the search box.
- Pick the card with that name and click Load this template. It arrives on a new tab with real numbers already in it.
This one runs on a Pro engine, and every free install includes five full-quality runs on your own numbers, shared across all five Pro engines rather than five for each. After that, Pro is $199/year.
The answer
The Actual Cost column here is invoiced value rather than internal spend, so read cost performance as money leaving the building against work you can stand behind on this package:
- Verified complete
- 56.6% earned value of $628,000
- Already invoiced
- 73.9% actual cost of $820,000
- Cost performance (CPI)
- 0.766 $192,000 of negative cost variance
- Gap to the vendor claim
- $110,500 of value they see and you cannot
The vendor opened at 60% complete asking for 70% of the money, and the headline sounded reasonable. Rolled up, your assessor can verify 56.6% while 73.9% has already been invoiced, a cost variance of -$192,000 and a CPI of 0.766. Two lines carry it: containment invoiced at $175,000 against 75% verified, and switchgear at $170,000 against 50%. Rerun with the vendor's own claimed percentages and earned value rises to $738,500 with a CPI of 0.901, so the $110,500 difference between the two runs is the number to take into the valuation meeting. The engine rolls the lines into package totals rather than scoring each one, so the line-by-line judgment stays with you.
The model
Eight contract lines from a single vendor package at this month's valuation: the contract value of each line, what the baseline says should be done by now, what your own assessor has physically verified, and what the vendor has invoiced to date.
| Design and coordination drawings | $90,000 - 100% planned - 100% verified - $90,000 invoiced |
| Equipment procurement and delivery | $260,000 - 100% - 95% - $260,000 |
| Containment and cable pulling | $180,000 - 90% - 75% - $175,000 |
| Switchgear installation | $210,000 - 70% - 50% - $170,000 |
| Controls and integration | $150,000 - 50% - 30% - $105,000 |
| Commissioning | $120,000 - 15% - 5% - $20,000 |
| Testing and certification | $60,000 - 10% - 0% - $0 |
| As-built documentation and training | $40,000 - 0% - 0% - $0 |
Once it is in your sheet
- The model arrives with real numbers in it and runs as it stands, so you can press the button first and understand it second.
- Change the numbers to yours. The sheet marks which cells are inputs and which hold formulas, and most labels carry a note explaining the row.
- Press the run button at the bottom of the panel. It is labeled for the tool you are in, and the result lands on its own tab, with a written reading of it beside the figures.
Never used Google Sheets? Start here goes the whole way, in seven steps, and assumes nothing.
Next question
- Is the startup equity worth the pay cut?
- Two reps closed the same number. Who ranks first?Rank the Leaderboard, Ties and All
- Is there a typo dragging your average up?Catch the Outlier Entry
- One group is wild, one is steady. Is the gap real?Manual vs Automated, Tested Fairly
- When the level shifts, how fast does your forecast follow?A Forecast That Trusts Recent Weeks
- What happens to the plan when reps leave?Will the Sales Team Make the Number?
Every model like this one, and the method behind them: Schedule risk analysis.