Yet these pseudo-accurate estimates based on detailed calculations are no more accurate than estimates made in more general terms and covered with an appropriate range indicator. Achieving a detailed estimate for an $11 million-plus project to within -5 percent to +10 percent indicates a very careful estimating process in a stable, well-understood environment.
Attaching a precise number calculated to the nearest cent only raises stakeholder expectations about the degree of accuracy possible. And that leads to perceived "failure" when the stakeholder's unrealistic expectations are not realized.
Similar problems arise if a project is scheduled in hours, and the work extends for more than a few days. Planning a project over several months on an hourly basis produces a mass of inaccurate data once you get beyond the first few days. And again, when the project fails to achieve the degree of control over the future implied by the excessively detailed schedule, it will seem like it failed.
Pragmatic estimating at an appropriate level of detail sets realistic expectations. But beware: Your stakeholders may already have unrealistic expectations of what is possible from previous projects that "failed."
Dealing with this issue requires skills in managing upward -- a topic for a future post.