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Budget Variance
A budget variance is the difference between an approved plan and actual results for the same scope and period.
A budget variance is the difference between an approved or expected plan and what was actually accomplished or spent for the same scope and period. A variance can be favorable or unfavorable depending on the measure and the decision being made.
An owner review could compare actual property income or expense with the approved budget, identify the cause, state whether the change is timing or a lasting change, and record the next action. DOE guidance treats variance as a deviation from a baseline that should be tracked and mitigated, without imposing a Coastline threshold.
Source: U.S. Department of Energy: Project Management Lexicon of Terms.
Frequently Asked Questions
Is every budget variance a problem?
No. A variance is a signal to investigate. Timing, approved scope changes, market conditions or an incorrect assumption can produce a variance; the record should explain the cause and response.
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