What is a Actual versus Budget Payroll Variance Report?

Payroll variance reports are considered monthly analysis tools and are used by finance and HR managers to review potential significant variances in actual employee compensation compared to the budget. Some of the main functionality in this type of report is that it it groups employees in two main categories and presents the actual salaries with a comparison to the budget and displays the difference. The two employee categories are: 1) Classified salaries with subsections for permanent and temporary positions, and 2) Unclassified salaries with subsections for permanent and temporary positions. You find an example of this type of report below.

Purpose of Actual to Budget Payroll Variance Reports

Universities and colleges use Actual to Budget Payroll Variance Reports to easily detect major differences between budgeted and actual compensation. When used as part of good business practices in a Financial Planning & Analysis (FP&A) department, a higher education institution can improve its budget accuracy and it can address any unplanned hiring or compensation discrepancies, and it can reduce the chances that the major variances goes undetected.

Actual to Budget Payroll Variance Report Example

Here is an example of a Actual versus Budget Payroll Variance Report.

Higher Education Reporting - Actual versus Budget Payroll Variance Analysis

Higher Education Reporting – Actual versus Budget Payroll Variance Analysis

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Who Uses This Type of Report?

The typical users of this type of report are: HR managers, CFOs, budget officers, department managers.

Other Reports Often Used in Conjunction with Actual to Budget Payroll Variance Reports

Progressive Financial Planning & Analysis (FP&A) departments sometimes use several different Actual to Budget Payroll Variance Reports, along with  budget accuracy reports, detailed monthly payroll reports, HR and Payroll dashboards, financial statements and other management and control tools.

Where Does the Data for Analysis Originate From?

The Actual (historical transactions) data typically comes from management systems or enterprise resource planning (ERP) systems like: Microsoft Dynamics 365 (D365) Finance, Microsoft Dynamics 365 Business Central (D365 BC), Microsoft Dynamics AX, Microsoft Dynamics NAV, Microsoft Dynamics GP, Microsoft Dynamics SL, Sage Intacct, Sage 100, Sage 300, Sage 500, Sage X3, SAP Business One, SAP ByDesign, Acumatica, Netsuite and others.

In analyses where budgets or forecasts are used, the planning data most often originates from in-house Excel spreadsheet models or from professional corporate performance management (CPM/EPM) solutions.

What Tools are Typically used for Reporting, Planning and Dashboards?

Examples of business software used with the data and ERPs mentioned above are:

  • Native ERP report writers and query tools
  • Spreadsheets (for example Microsoft Excel)
  • Corporate Performance Management (CPM) tools (for example Solver)
  • Dashboards (for example Microsoft Power BI and Tableau)

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