Tag Archive
Variance Reporting Of Budgeting
When you consider that budgeting is nothing more than the best possible informed guess about the future, you have to expect some variance to arise. It’s inevitable. But it is not a sign of failure. The variance itself is not the problem. Variances can be positives if used correctly-to discover and reverse unfavorable trends. When [...]
Budgeting With an Assumption Base
It would be unreasonable to expect people to spend weeks preparing a document that will never be looked at. If you are a leader of your company, you certainly would not want to waste employee time and effort in a meaningless exercise. If you are a department manager, there is certainly more pressing work to [...]
Determining Reporting Periods
One point you must address in setting budget variances report¬ing policy is frequency. Should you report monthly variances only, or year to date? The argument in favor of month variance reporting is that you won’t need to repeat explanation from previous periods. This is true. But year-to-date reporting still makes more sense. Under the monthly [...]
