# Variance Analysis in Finance (incl price/volume/mix)

Analysis of absolute, relative and %-based measures including volume, price and mix impact on Sales, Costs and Margin

Updated on Sep, 2023

Language - English

30-days Money-Back Guarantee

Training 5 or more people ?

## Course Description

Variance analysis is an important part of any profession related to finance. Companies constantly measure their actual results against plans, forecasts, past periods, competitors, etc. Such comparisons inevitably lead to differences and deviations that need to be explained. These deviations are most often related to the elements of the Profit & Loss report (P&L) and Cashflow compared with Plan and Previous year.

At first glance this is a purely technical exercise, however actually variance analysis has a significant impact on the management of the organization and the quality of decisions made. A high-quality variance analysis allows to answer such questions as:

- WHAT happened?

- WHY did this happen?

- HOW does this affect the future?

The last question obviously leads to the need to develop tactical solutions or refine the strategy

Having mastered the skills of variance analysis, a financial specialist will be able to go beyond the technical role of a "calculator", become a business partner in his/her area of responsibility and make a significant contribution to business decision-making

During this course, you will learn how to conduct a variance analysis of:

- absolute values (revenue/cost/gross profit/net profit, etc.)

- relative measures (average price per 1 kg; cost per 1m, etc.)

- measures expressed as a % (% of gross/net profit)

- mix of various kinds (geography, products, customers, SKUs, ingredients of the recipe, etc.)

- total P&L from Revenue to Net earnings, as well as visualize the result using the Waterfall chart

The course is of particular value for employees of companies with a wide range of raw materials, semi-finished products and finished products (manufacturing and retail)

### Goals

What will you learn in this course:

Students will gain the following competences:

• Variance analysis of absolute measures (revenue, cost, gross margin etc.)

• Variance analysis of relative measures (average selling price per 1 kg, average production cost per 1 meter etc.)

• Variance analysis of indicators expressed as % (% of gross profit, % of net earnings etc.)

• Mix analysis (products/customers/SKU/ingredients/lines, etc.) on financial performance

• Variance analysis of variable and fixed costs

• Analysis of energy costs in a manufacturing company

• Labor cost analysis

### Prerequisites

What are the prerequisites for this course?

Basic knowledge of enterprise economy and accounting essentials

## Curriculum

Check out the detailed breakdown of what’s inside the course

Introduction; about a lector; comparison bases
7 Lectures
• Introduction 02:32 02:32
• Lector introduction 01:43 01:43
• Importance and relevance of the course 04:29 04:29
• Comparison with the plan (budget) 02:39 02:39
• Comparison with the previous period 02:29 02:29
• Comparison with competitors and industry benchmarks 02:04 02:04
• Comparison of the forecast vs previous forecast 02:53 02:53
Variance analysis of Gross profit (price/volume/mix)
13 Lectures
Fixed and Variable costs
6 Lectures
Variance analysis of Net earnings and its presentation
3 Lectures

## Instructor Details

Alexey Leontyev, ACMA CGMA

Finance management

Hello,

I am a finance professional with more than 10 years in financial divisions of large multinationals - Mars, Nestle, Faurecia, Deceuninck

I started as an intern and worked across teams, industries and technologies

Today I am a CFO and share my knowledge and best practices through on-line courses

## Course Certificate

User your certification to make a career change or to advance in your current career. Salaries are among the highest in the world.