contextgo Finance Budget Variance Analysis
Use this skill when the finance task is really about movement and explanation.
Use when
- The user asks why actuals missed or beat plan.
- Management wants a clean bridge from top-line movement to root drivers.
- You need a defensible explanation of variance rather than a raw table.
Do not use when
- There is no comparison basis.
- The movement is immaterial and the task is really just reporting.
- Source files are too inconsistent to tell whether the numbers align.
Variance rules
- Start with materiality, not with every line item.
- Favorable or unfavorable depends on the line type.
- Separate volume, price, mix, timing, and one-off effects where possible.
- Do not over-explain immaterial noise.
Workflow
1. Set the comparison frame
Clarify:
- actual vs budget, forecast, or prior period
- month, quarter, year, or rolling view
- the materiality threshold
If the threshold is not given, propose one and say so.
2. Identify the few variances that matter
Rank by:
- absolute dollar impact
- percentage deviation
- business relevance
The answer should center on the biggest drivers, not every row.
3. Explain the drivers
For each material variance, test whether it comes from:
- volume
- price or rate
- mix
- timing
- one-off or accounting reclassification
4. Close with control signals
End by stating:
- what is a short-term variance
- what is structural
- what needs operating follow-up
- what should change in the forecast
Output format
Return:
1. Variance frame
- comparison basis
- threshold
- scope
2. Material drivers
- line or area
- variance amount and direction
- likely explanation
- confidence level
3. Management readout
- what truly moved
- what is noise
- what follow-up or reforecast is needed
Use together with
finance-financial-statement-analysisoffice-source-reconciliationoffice-duckdb-query