Close & reporting
Variance analysis
A closer look at why a number moved: price, volume, timing or a one-off, decomposed against the prior period and your budget so a variance on a report becomes an answer instead of a question, checked against your July to June financial year.
Management report
Illustrative client · August 2026
AUD
| Line | Aug | Jul | |
|---|---|---|---|
| Revenue | 142,380 | 131,904 | +10,476 |
| Cost of sales | (51,260) | (48,115) | (3,145) |
| Gross profit | 91,120 | 83,789 | +7,331 |
| Payroll | (46,300) | (45,900) | (400) |
| SoftwareNoted | (6,480) | (5,490) | (990) |
| Rent | (8,000) | (8,000) | 0 |
| Other operating | (9,215) | (9,870) | +655 |
| Net income | 21,125 | 14,529 | +6,596 |
Reviewer's note
Software is up on last month after two seats were added mid-month. Revenue includes one milestone invoice that will not repeat next month.
Illustrative. An example of the document, not a client's figures.
Decomposing the number
A variance is broken into price, volume, mix and timing effects where the data allows, compared side by side against both the prior period and the budget, with root-cause notes on the largest movements each month. A short list of items worth a follow-up conversation comes with every report rather than a wall of numbers.
Common AU-specific movers
The 12% compulsory super contribution rate and the Payday Super cash-timing shift effective 1 July 2026 are both flagged separately from a genuine cost blowout, since a payroll-timing effect and an actual cost increase need different responses. Company tax provisioning is checked against the 25% base rate entity rate or the 30% standard rate depending on your turnover and passive income, so a tax-line variance is explained by the right driver.
Useful at any size
Even a small business benefits from knowing whether a cost jumped because of price, volume or a one-off item rather than assuming the worst. Variance analysis explains what budget-versus-actual only shows: the gap.
Delivery
Built into your monthly close and checked in senior review, with no separate engagement fee. See budget vs actual for how the two reports work together.
Where it stops
We explain the drivers behind a variance from the accounting side of the business. Decisions about pricing, hiring or spending in response to what the analysis shows stay with you and whoever else runs the business.
Questions
Frequently asked questions: Variance analysis
Can variance analysis flag a payroll or super timing issue specifically?
Yes. A payroll-timing effect, such as the Payday Super cash-timing shift, is called out separately from a genuine cost increase.
Does variance analysis cover company tax provisioning too?
Yes. We check the provision against the 25% base rate entity rate or the 30% standard rate depending on your turnover and passive income, so a tax-line variance is explained correctly.
Does variance analysis separate a super or payroll timing effect from a real cost increase?
Yes, a payroll-timing effect such as Payday Super's shift to per-payday contributions is flagged separately from an actual increase in cost.
How often is variance analysis delivered?
Typically alongside the monthly close, though it can run quarterly instead if that matches your reporting rhythm, agreed during onboarding rather than fixed to one schedule for every business.
What is not included in variance analysis?
We flag and explain variances against budget or prior period; deciding the corrective action is a management call, not something we direct.
Is variance analysis only useful for large companies?
No. Even a small business benefits from knowing whether a cost jumped because of price, volume or a one-time item.
How is this different from budget vs. actual?
Budget vs. actual shows the gap. Variance analysis explains what caused it.
Who reviews the work before it reaches us?
Every deliverable under variance analysis is reviewed by a senior reviewer before it reaches you. You keep access to the underlying file at every stage, so nothing about the work happens somewhere you cannot see it.
What is included in variance analysis?
Variance analysis covers variance decomposed into price, volume, mix and timing where the data allows and prior-period and budget comparisons shown side by side. The exact scope is agreed and set out in writing before work starts, so you know precisely what is and is not covered before the first deliverable arrives.
Related services
- Close & reportingBudget vs. actualActual results lined up against the budget every month, with the gap explained in plain language rather than left for you to work out on your own.
- Close & reportingManagement reportsMonthly profit and loss, balance sheet and cash flow packaged with a plain-English narrative so the numbers explain themselves before anyone has to ask a question.
Industries
Next step
Talk to the team that would run your books
A short call covers your setup, your software and what a first month would look like. You get a written scope and price after it.