PRINCE2F PRINCE2 Processes Practice Question
A project is forecast to exceed its stage cost tolerance. What is the Project Manager's first action?
⚠ Common exam trap
Many candidates think they can 'fix' the overrun internally or report it later, but PRINCE2 mandates immediate escalation via an Exception Report when tolerance is forecast to be exceeded.
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
According to PRINCE2, when a project manager forecasts that stage costs will exceed the agreed stage tolerance, the first action is to raise an Exception Report to the Project Board. This is because the project manager must escalate the deviation immediately, as they do not have authority to exceed tolerance without board approval. The Exception Report informs the board of the situation and options, allowing them to decide on corrective action.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✓
Raise an Exception Report to the Project Board
Why this is correct
The PM must escalate immediately.
- ✗
Continue the stage and report the overrun in the End Stage Report
Why it's wrong here
Waiting until the end violates management by exception.
- ✗
Request a change to the project budget from the Senior User
Why it's wrong here
Only the Project Board can authorise tolerance changes.
- ✗
Proceed with the next stage early to save time
Why it's wrong here
This does not address the cost overrun.
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Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
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