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Consider the Columns:
Analyzing Budget Variance
Susan J. Penner, RN, MN, MPA, DrPH, CNL
2013
Why think about the columns?
• Key question for interpreting budget
reports is “Compared to what?
• Budget columns often h...
Table 1. Nursing Unit Expense Budget
Variance
20 staffed beds, June 2013 ($
Budget thousands).
Actual

Current Prior YTD
I...
Table 1. Nursing Unit Expense Budget
Variance
20 staffed beds, June 2013 ($
thousands).
Budget Actual

Current Prior YTD
I...
Table 1. Nursing Unit Expense Budget
Variance
20 staffed beds, June 2013 ($
thousands).
Budget
Item
June
2013
Days in time...
Table 1. Nursing Unit Expense Budget
Variance
20 staffed beds, June 2013 ($
thousands).
Budget
Item
June
2013
Days in time...
Table 1. Nursing Unit Expense Budget
Variance
20 staffed beds, June 2013 ($
thousands).

Budget
Item
June
2013
Days in tim...
Table 1. Nursing Unit Expense Budget
Variance
20 staffed beds, June 2013 ($
thousands).
Budget Actual

Current Prior YTD
I...
Table 1. Nursing Unit Expense Budget
Variance
20 staffed beds, June 2013 ($
thousands).
Budget
Item
June
2013
Days in time...
Key Points to Remember
• Compare
– To budget targets
– To past performance

• Consider
– Is the variance favorable or unfa...
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Nursing Unit Budgets: Consider the Columns

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See: Penner, Susan J. (2013). Economics and Financial Management for Nurses and Nurse Leaders, 2nd ed. New York: Springer Publishing Company. http://www.springerpub.com/product/9780826110497#.UOtV2axCrTo

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Nursing Unit Budgets: Consider the Columns

  1. 1. Consider the Columns: Analyzing Budget Variance Susan J. Penner, RN, MN, MPA, DrPH, CNL 2013
  2. 2. Why think about the columns? • Key question for interpreting budget reports is “Compared to what? • Budget columns often help in comparing – Actual performance to budget targets – Current performance to past performance
  3. 3. Table 1. Nursing Unit Expense Budget Variance 20 staffed beds, June 2013 ($ Budget thousands). Actual Current Prior YTD Item June June Variance YTD 2013 2012 2013 2013 Days in time period 30 30 -181 182 Productive $ 200 $ 220 -$20 $ 1,248 $ 1,257 Non-productive $ 50 $ 53 -$3 $ 312 $ 309 Total Personnel $ 250 $ 273 -$23 $ 1,560 $ 1,566 Supplies $ 25 $ 26 -$1 $ 153 $ 144 Overhead $ 10 $ 10 $0 $ 60 $ 60 Total Non-personnel $ 35 $ 36 -$1 $ 213 $ 204 Total Expenses $ 285 $ 309 -$24 $ 1,773 $ 1,770
  4. 4. Table 1. Nursing Unit Expense Budget Variance 20 staffed beds, June 2013 ($ thousands). Budget Actual Current Prior YTD Item June June Variance YTD 2013 2012 2013 2013 Days in time period 30 30 -181 182 Productive $ 200 $ 220 -$20 $ 1,248 $ 1,257 Non-productive $ 50 $ 53 -$3 $ 312 $ 309 Total Personnel $ 250 $ 273 -$23 $ 1,560 $ 1,566 Supplies $ 25 $ 26 -$1 $ 153 $ 144 Overhead $ 10 $ 10 $0 $ 60 $ 60 Total Non-personnel $ 35 $ 36 -$1 $ 213 $ 204 Total Expenses $ 285 $ 309 -$24 $ 1,773 $ 1,770
  5. 5. Table 1. Nursing Unit Expense Budget Variance 20 staffed beds, June 2013 ($ thousands). Budget Item June 2013 Days in time period 30 Productive $ 200 Non-productive $ 50 Total Personnel $ 250 Supplies $ 25 Overhead $ 10 Total Non-personnel $ 35 Total Expenses $ 285 Actual Current Prior YTD June Variance YTD 2013 2012 2013 30 -181 182 $ 220 -$20 $ 1,248 $ 1,257 $ 53 -$3 $ 312 $ 309 $ 273 -$23 $ 1,560 $ 1,566 $ 26 -$1 $ 153 $ 144 $ 10 $0 $ 60 $ 60 $ 36 -$1 $ 213 $ 204 $ 309 -$24 $ 1,773 $ 1,770
  6. 6. Table 1. Nursing Unit Expense Budget Variance 20 staffed beds, June 2013 ($ thousands). Budget Item June 2013 Days in time period 30 Productive $ 200 Non-productive $ 50 Total Personnel $ 250 Supplies $ 25 Overhead $ 10 Total Non-personnel $ 35 Total Expenses $ 285 Actual Current Prior YTD June Variance YTD 2013 2012 2013 30 -181 182 $ 220 -$20 $ 1,248 $ 1,257 $ 53 -$3 $ 312 $ 309 $ 273 -$23 $ 1,560 $ 1,566 $ 26 -$1 $ 153 $ 144 $ 10 $0 $ 60 $ 60 $ 36 -$1 $ 213 $ 204 $ 309 -$24 $ 1,773 $ 1,770
  7. 7. Table 1. Nursing Unit Expense Budget Variance 20 staffed beds, June 2013 ($ thousands). Budget Item June 2013 Days in time period 30 Productive $ 200 Non-productive $ 50 Total Personnel $ 250 Supplies $ 25 Overhead $ 10 Total Non-personnel $ 35 Total Expenses $ 285 Actual Current Prior YTD June Variance YTD 2013 2012 2013 30 -181 182 $ 220 -$20 $ 1,248 $ 1,257 $ 53 -$3 $ 312 $ 309 $ 273 -$23 $ 1,560 $ 1,566 $ 26 -$1 $ 153 $ 144 $ 10 $0 $ 60 $ 60 $ 36 -$1 $ 213 $ 204 $ 309 -$24 $ 1,773 $ 1,770
  8. 8. Table 1. Nursing Unit Expense Budget Variance 20 staffed beds, June 2013 ($ thousands). Budget Actual Current Prior YTD Item June June Variance YTD 2013 2012 2013 2013 Days in time period 30 30 -181 182 Productive $ 200 $ 220 -$20 $ 1,248 $ 1,257 Non-productive $ 50 $ 53 -$3 $ 312 $ 309 Total Personnel $ 250 $ 273 -$23 $ 1,560 $ 1,566 Supplies $ 25 $ 26 -$1 $ 153 $ 144 Overhead $ 10 $ 10 $0 $ 60 $ 60 Total Non-personnel $ 35 $ 36 -$1 $ 213 $ 204 Total Expenses $ 285 $ 309 -$24 $ 1,773 $ 1,770
  9. 9. Table 1. Nursing Unit Expense Budget Variance 20 staffed beds, June 2013 ($ thousands). Budget Item June 2013 Days in time period 30 Productive $ 200 Non-productive $ 50 Total Personnel $ 250 Supplies $ 25 Overhead $ 10 Total Non-personnel $ 35 Total Expenses $ 285 Actual Current Prior YTD June Variance YTD 2013 2012 2013 30 -181 182 $ 220 -$20 $ 1,248 $ 1,257 $ 53 -$3 $ 312 $ 309 $ 273 -$23 $ 1,560 $ 1,566 $ 26 -$1 $ 153 $ 144 $ 10 $0 $ 60 $ 60 $ 36 -$1 $ 213 $ 204 $ 309 -$24 $ 1,773 $ 1,770
  10. 10. Key Points to Remember • Compare – To budget targets – To past performance • Consider – Is the variance favorable or unfavorable? – What causes the budget variance? – Can the variance be controlled?

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