(B)/W: Difference between revisions
imported>Doug Williamson m (Categorise.) |
imported>Doug Williamson (Identify sign convention context.) |
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''Variance analysis''. | ''Variance analysis - sign conventions''. | ||
(B)/(W) is an abbreviation for (Better) / Worse. | (B)/(W) is an abbreviation for (Better) / Worse. | ||
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*[[Inflow/(outflow)]] | *[[Inflow/(outflow)]] | ||
*[[Mostly positive]] | *[[Mostly positive]] | ||
*[[Sign convention]] | |||
*[[Variance]] | *[[Variance]] | ||
*[[Variance analysis]] | *[[Variance analysis]] | ||
Revision as of 13:16, 21 August 2018
Variance analysis - sign conventions.
(B)/(W) is an abbreviation for (Better) / Worse.
This is 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 NEGATIVE (bracketed) 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 POSITIVE 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 - negative numbers are worse (adverse).
Under the B/(W) convention POSITIVE numbers are better and favourable.
