Added value

Success Problem

What is the difference between added value and earned value?

Impact

The value added is only a part of the earned value!

Recommendation

In the broader sense the value added is the contribution to the project inputs gained through the project execution. From the accounting point of view the added value is the sum of all costs and profits minus the value of inputs, gained from external sources (intermediary consumption). The added value incorporates the wages and social costs, financial costs, depreciation costs, pretax profit and value added tax.

Category

• Cost & Finance