In order to make this approach work, I introduced a rule that EV cannot exceed PV, no matter what the AC. I received some excellent feedback on that rule, and although the math still works, I am now convinced that it only adds complexity. More importantly, it relies on AC as a proxy for the quantity of work completed, and thereby assumes that effort equals results. As Glen Alleman pointed out, this is a dangerous assumption. The issue of completeness is therefore left unresolved. How are we to know when a task is complete?
Tasks should have success criteria, in the form of well-defined outcomes. Unfortunately, project managers seem to focus more on task activities than on outcomes, perhaps because of pressure to meet schedule and budget constraints. In reality, activities lead to outcomes, and only upon receipt of an outcome is the project matured toward its objective. Therefore, it is not so much the activities that are important, but their outcome.
Outcomes can then be measured against expectations, and a determination made about the completeness of the task. Glen suggests physical evidence as a key indicator of completeness. I would amend this to say physical evidence which everyone agrees meets the task success criteria. Incomplete or low quality results may not sufficiently advance the project's maturity. For example, a requirements gathering effort that does not provide an understanding of the problem domain has not met its success criteria. Reaching a "requirements signed off" milestone therefore means that everyone agrees that the task has met its success criteria.