The difference between budgeted and actual figures. Variances are often expressed as a percentage. They are calculated by subtracting the budgeted figure from the actual figure and dividing the difference into the budgeted figure, and multiplying the result by 100. Variances may be due to factors that are outside a business’s control – for example – increased costs and / or reduced demand and, thus, reduced sales arising from a rise in interest rates. Others are a result of failings within the organisation. All significant variances should be investigated to identify the cause, and the findings from such an investigation used to inform decision-making.