Contingency Reserve Calculator
Advanced risk management with EMV analysis and comprehensive reserve planning
EMV probability assessment
Contingency calculation
Management reserves
Risk reduction strategies
Risk and Reserve Parameters
Total project baseline cost without reserves
Based on probability-weighted risk impact
For unknown risks and opportunities
Risk Assessment
Understanding Contingency Reserves
Reserve Fundamentals
What are Contingency Reserves?
Funds set aside to address identified risks and uncertainties. These reserves are budgeted specifically for known risks that have been quantified and analyzed.
EMV-Based Calculation
Expected Monetary Value = Probability × Impact. This statistical approach quantifies the expected loss from each risk, allowing data-driven reserve sizing.
Management vs Contingency
Contingency: For identified risks
Management: For unknown risks and strategic opportunities
Best Practices
Reserve Sizing
• Use multiple calculation methods for validation
• Consider project complexity and team experience
• Adjust for project phase and risk maturity
• Review industry benchmarks and standards
Risk Management
• Implement active risk monitoring and mitigation
• Regular risk assessment updates are essential
• Document all reserve usage with justification
• Maintain transparent stakeholder communication
Governance
• Establish clear approval processes for reserve usage
• Maintain detailed risk registers and documentation
• Regular reporting to stakeholders and sponsors
• Ensure audit trail and compliance requirements