PRINCE2F People: organizations, teams, and leadership Practice Question
A project is forecast to exceed its stage cost tolerance. What should the Project Manager do?
⚠ Common exam trap
PeopleCert often tests the misconception that the Project Manager can adjust budgets within project tolerance even when stage tolerance is breached, but the correct action is always to escalate via an Exception Report when stage 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
In PRINCE2, when a project manager forecasts that a stage will exceed its stage tolerance, they must escalate the issue to the Project Board by raising an Exception Report. This is because the Project Manager has authority only within the agreed stage tolerance; exceeding it requires the Project Board to decide on corrective action, such as approving a revised plan or closing the project.
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
This is the correct escalation route when stage tolerances are forecast to be exceeded.
- ✗
Increase the stage budget within project tolerance
Why it's wrong here
The Project Manager cannot unilaterally increase the budget; changes to tolerances require Project Board approval.
- ✗
Continue and report in the next Highlight Report
Why it's wrong here
Continuing without immediate escalation violates the exception principle.
- ✗
Close the project as the Business Case is no longer viable
Why it's wrong here
The SRO decides on Business Case viability; a stage tolerance breach does not automatically close the project.
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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.