Some questions about Function Points:
1) Is it a reasonably precise way to do estimates? (I'm not unreasonable here, but just want to know compared to other estimation methods)
2) And is the effort required worth the benefit you get out of it?
3) Which type of Function Points do you use?
4) Do you use any tools for doing this?
Edit: I am interested in hearing from people who use them or have used them. I've read up on estimation practices, including pros/cons of various techniques, but I'm interested in the value in practice.
Mike Cohn in his Agile Estimating and Planning consider FPs to be great but difficult to get right. He (obviously) recommends to use story points-based estimation instead. I tend to agree with this as with each new project I see the benefits of Agile approach more and more.
1) Is it a reasonably precise way to do estimates? (I'm not unreasonable here, but just want to know compared to other estimation methods)
As far as estimation precision goes the functional points are very good. In my experience they are great but expensive in terms of effort involved if you want do it properly. Not that many projects could afford an elaboration phase to get the FP-based estimates right.
2) And is the effort required worth the benefit you get out of it?
FPs are great because they are officially recognised by ISO which gives your estimations a great deal of credibility. If you work on a big project for a big client it might be useful to invest in official-looking detailed estimations. But if the level of uncertainty is big to start with (like other vendors integration, legacy system, loose requirements etc.) you will not get anywhere near precision anyway so usually you have to just accept this and re-iterate the estimations later. If it is the case a cheaper way of doing the estimates (user stories and story points) are better.
3) Which type of Function Points do you use?
If I understand this part of your question correctly we used to do estimations based on the Feature Points but gradually moved away from these an almost all projects expect for the ones with heavy emphasis on the internal functionality.
4) Do you use any tools for doing this?
Excel is great with all the formulas you could use. Using Google Spreadsheets instead of Excel helps if you want to do that collaboratively.
There is also a great tool built-in to the Sparx Enterprise Architect which allows you to do the estimates based on the Use Cases which could be used for FP estimations as well.