PRINCE2F PRINCE2 Practices Practice Question
A project is forecast to exceed its cost tolerance. What should the Project Manager do?
⚠ Common exam trap
Many exam-takers confuse a Highlight Report (for routine within-tolerance reporting) with an Exception Report (for escalation when tolerances are forecast to be exceeded), leading them to choose Option B instead of C.
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Raise an Exception Report to the Project Board
In PRINCE2, when a project is forecast to exceed its cost tolerance, the Project Manager must escalate the issue to the Project Board by raising an Exception Report. This is because tolerances are delegated authority limits, and exceeding them requires the Project Board to decide on corrective action, such as approving a revised plan or adjusting tolerances. Option C is correct as it directly follows the PRINCE2 principle of management by exception.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Revise the Project Plan to reduce costs in later stages
Why it's wrong here
The PM cannot unilaterally change the plan; must escalate first.
- ✗
Issue a Highlight Report noting the overrun
Why it's wrong here
Highlight Reports are for progress, not for tolerance breaches; Exception Report is needed.
- ✓
Raise an Exception Report to the Project Board
Why this is correct
Correct action when tolerance is forecast to be exceeded.
- ✗
Request additional funds from the Executive informally
Why it's wrong here
Formal escalation via Exception Report is required.
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JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This PRINCE2F practice question is part of Courseiva's free PeopleCert certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the PRINCE2F exam.