Budget Variance Analysis Skill

Produces a complete variance analysis from numbers through to root cause explanation and management commentary.

Required Inputs

• Actuals and budget figures (paste as table or describe line by line)
• Period (month / quarter / YTD)
• Materiality threshold (e.g. £10k or 5%)
• Known reasons for variances (if any)
• Audience (CFO / board / management / auditor)

Output Structure

1. Variance Summary Table

Line Item	Budget	Actual	Variance £	Variance %	F/A
Revenue
Cost of Sales
Gross Profit
Opex
EBITDA

F = Favourable | A = Adverse

2. Material Variance Commentary

For each variance above threshold:

[Line item] — £[amount] F/A ([%])

• Root cause: [Specific explanation — not "timing" without detail]
• Permanent or timing? Will this reverse next period?
• Management action: What is being done
• Forecast impact: Does this change full-year outlook?