Variances: the agenda, not the verdict
導入済み| English | 意味 |
|---|---|
| variance/ˈveərɪəns/ | In budgeting, the difference between a planned or expected financial value and the actual result. |
| usage variance | usage variance |
| price variance | price variance |
| favourable variance/ˈfeɪvərəbl ˈveərɪəns/ | favourable variance |
| flexible budget | The baseline. |
"Costs were up" is not a finding
- July's flour bill exceeded plan by £213. The variance 差异 tree splits it: £108 usage (the kitchen), £105 price (purchasing) — same total, two causes, two owners.
- Variances decompose gaps; they do not assign blame. They start inquiries, not end them.
The leaves of the tree
- Standard: 0.25 kg per meal at £2.40/kg. July: 4,020 meals, 1,050 kg used (standard allows $4{,}020 \times 0.25 = 1{,}005$ kg), paid £2.50/kg.
- Usage variance 数量差异 $= (1{,}050 - 1{,}005) \times 2.40 = £108$ adverse ✓. Price variance 价格差异 $= (2.50 - 2.40) \times 1{,}050 = £105$ adverse ✓. Total £213 ✓ — the leaves sum by identity.
Standard 0.25 kg/meal at 2.40; actual 1,050 kg for 4,020 meals. The usage variance?
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Standard kg $= 4{,}020 \times 0.25 = 1{,}005$; $(1{,}050 - 1{,}005) \times 2.40 = £108$ adverse - the kitchen's leaf.
Actual price 2.50/kg against 2.40 standard on 1,050 kg. The price variance?
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$(2.50 - 2.40) \times 1{,}050 = £105$ adverse - purchasing's leaf.
Check the identity: total materials variance from the two leaves?
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$108 + 105 = £213$ - the leaves sum to the total by construction, which is the audit of the arithmetic itself.
Ownership, then conversation
- The £108 belongs to the kitchen (yield, training, recipe drift); the £105 to purchasing (supplier, grade, timing).
- The leaves can trade: the buyer's cheaper flour (favourable price) can thicken the sauce (adverse usage). Fold them into one number and nobody owns anything.
Whose leaf is it, and is it a finding?
Route variances to their owners and judge materiality, controllability and offsets.
A favourable materials price variance can still be bad news because:
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Favourable means below-standard cost - the question is what the saving cost. Read leaves in pairs.
Match each variance to its owner.
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Ownership is why the tree exists - a folded number owns nothing.
A 4 adverse variance on a 20,000 materials budget deserves its own investigation.
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Materiality first: 4 is 0.02 percent. Variances below the threshold are noted, not chased - attention is a budget too.
Favourable is not virtuous
- Favourable variance 有利差异 means below-standard cost or above-standard revenue — not "good". Cheap flour can be expensive: quality refunds, rework, lost customers.
- Three questions before judging ANY variance: is it material, is it controllable by its owner, is it offset elsewhere?
Flexible-budget sales variance: 3,700 actual vs 4,000 planned at CM 3.40?
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$(3{,}700 - 4{,}000) \times 3.40 = £1{,}020$ adverse (negative). Before judging: the three-day strike explains most of it.
Why flex the budget before computing the volume variance?
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The flexible budget restates the plan at actual volume - the fair baseline. Then the variance means something about execution, not about the forecast.
Volume variances flex first
- The flexible budget 弹性预算 restates the plan at ACTUAL volume: July sales 3,700 vs plan 4,000 at CM £3.40 → volume variance £1,020 adverse ✓.
- But the three-day supplier strike explains most of it — a diagnosis, not a performance. Flex the budget before you judge the manager.
Three variance slips
- Varying against the static budget when volume moved — the flexible budget is the baseline.
- Summing leaves into one number and delegating it to nobody.
- Reading favourable as virtue — cheap can be expensive.
Recap
- Usage × standard price; price gap × actual quantity; leaves sum to total.
- Every leaf has an owner; every owner gets the conversation, not the verdict.
- Flex the budget before judging the volume variance.