Assumptions That Expired
The supplier price you budgeted in January stopped being the price in April, and nothing in the accounts announces that on its own.
Home/Services/Accounting And Financial Reporting/Budget Vs. Actual Reporting
Find Out In June, Not Next February
Each period we put the plan and the result side by side and talk through the differences, which is the habit that changes how owners decide.
Budget Vs. Actual Reporting In Chillicothe, OH
A budget on its own is a document. A budget compared with reality every period is a management system, and the difference between the two is almost entirely about whether anybody looks.
The comparison is simple to produce and surprisingly hard to sustain, which is why it works well as part of an ongoing engagement rather than something an owner promises to do themselves.
- Plan against result, line by line, every period
- Variances ranked by size rather than listed alphabetically
- A written explanation of the ones that matter
- Cumulative position, so small drifts do not hide all year
- A note of which assumptions have stopped being true
Reading A Variance Properly
A number under budget is not automatically good news and over budget is not automatically bad. Costs under plan because you did less work than planned is a revenue problem wearing a cost problem's clothes.
So the useful version of this report explains the movement rather than colouring it red or green. Two numbers and a sentence beats a dashboard of arrows every time.
What The Comparison Surfaces
Drift You Would Not Notice
Three percent a month is invisible in any single period and material by the end of the year. Cumulative tracking is what catches it.
Wins Worth Repeating
Beating the plan somewhere specific is information. Knowing which part of the business did it is what makes it repeatable.
Adjusting The Plan Mid-Year
Sometimes the right response to a persistent variance is to change the plan rather than chase it. If a market moved, holding a budget written before it moved just produces months of meaningless reporting.
We will say when we think that point has arrived, and rebasing is a short piece of work rather than starting the whole budget again.
Work That Sits Next To This
The reports and engagements that usually sit alongside this one.
Ready To Talk About Budget Vs. Actual Reporting?
The first conversation is about your business and where it stands, not a pitch.