B/(W): Difference between revisions
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== See also == | == See also == | ||
*[[Adverse]] | *[[Adverse]] | ||
*[[Favourable]] | |||
*[[Inflow/(outflow)]] | *[[Inflow/(outflow)]] | ||
*[[Mostly positive]] | *[[Mostly positive]] | ||
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*[[Variance analysis]] | *[[Variance analysis]] | ||
*[[YTD]] | *[[YTD]] | ||
[[Category:Risk_reporting]] | |||
Latest revision as of 13:37, 22 August 2019
Variance analysis - sign conventions.
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.
