B/(W): Difference between revisions
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''Variance analysis'' | |||
Better/(Worse). | |||
A label and sign convention in financial reporting. | |||
It is designed to aid the interpretation of differences or changes, by specifying a consistent convention. | |||
Under the B/(W) convention, good news is denoted by a POSITIVE number. | |||
Good news is also known as a 'favourable variance'. | |||
Under the (B)/W | For example, a cost saving or an income improvement. | ||
A common example is a better actual result, compared with an earlier forecast. | |||
Under the B/(W) convention NEGATIVE numbers are bad news, 'worse'. | |||
Bad news is also known as an 'adverse' variance. | |||
=====(B)/W convention===== | |||
Sometimes the opposite convention is used. | |||
This is the (B)/W convention. | |||
Under the (B)/W convention - positive numbers are worse, i.e. adverse. | |||
Under the (B)/W convention NEGATIVE (bracketed) numbers are better and favourable. | |||
Revision as of 19:39, 12 May 2017
Variance analysis
Better/(Worse).
A label and sign convention in financial reporting.
It is designed to aid the interpretation of differences or changes, by specifying a consistent convention.
Under the B/(W) convention, good news is denoted by a POSITIVE number.
Good news is also known as a 'favourable variance'.
For example, a cost saving or an income improvement.
A common example is a better actual result, compared with an earlier forecast.
Under the B/(W) convention NEGATIVE numbers are bad news, 'worse'.
Bad news is also known as an 'adverse' variance.
(B)/W convention
Sometimes the opposite convention is used.
This is the (B)/W convention.
Under the (B)/W convention - positive numbers are worse, i.e. adverse.
Under the (B)/W convention NEGATIVE (bracketed) numbers are better and favourable.