What Is an Acceptable Budget Variance

the majority of companies set an acceptable tolerance level for variances from actual to budget (for revenue, expenses, eBIt and cash flow) of +/- 5–10%.

What is a good budget variance?

A favorable budget variance is any actual amount differing from the budgeted amount that is good for the company. Meaning actual revenue that was more than expected, or actual expenses or costs that were less than expected.

What is an ideal variance?

The ideal cost variance is when your ACWP matches your BCWP; however, this is almost impossible to achieve. Cost variances can be positive or negative, depending on how closely your ACWP matches up to your BCWP. The purpose of knowing your cost variance is to help you track your finances as your project progresses.