Free Template · Excel · Updated March 2026
Free Budget Variance Report Template
Excel Download
Compare planned and actual cost for every work package on your project. The template works out the variance in money and as a percentage, totals the whole project for you, and gives you a RAG status column so you can flag overruns before they grow.
Auto-calculates everything
Variance ($) and variance (%) columns are live formulas: enter budget and actual, everything else fills in.
12 pre-set work packages
Labour, hardware, software, travel, training, contingency and more: pre-labelled and ready to customise.
Auto-summing totals row
Violet totals row sums all work packages automatically. Overall variance percentage auto-calculates too.
Budget Variance Report
Free Excel template: instant download
Format
Excel (.xlsx)
Work packages
12 pre-labelled rows
Formulas
Variance $ + % auto-calc
Totals row
Auto-sums all categories
Compatible
Excel, Google Sheets, LibreOffice
Price
Free: no signup needed
No email required. Instant Excel download.
Quick answer
A budget variance report compares planned cost with actual cost for each work package and shows the difference in money and as a percentage. This free Excel template calculates variance automatically, totals the whole project and adds a RAG status column so you can flag overruns early.
This report compares your budget with what you have actually spent. It does not tell you whether you got enough work done for that money. For that, put your numbers into my free EVM calculator and check CPI and SPI.
01 · What's Included
What's in the budget variance report template?
The template is a single Excel sheet with a project details block, 12 work package rows and a totals row that adds itself up. The Variance ($) and Variance (%) columns are formulas. You type the budget and the actual, and the rest fills in.
✦
From my experience: On my projects in the UAE, I reviewed cost against budget every month, and this report was where problems showed up first: a variation the client had not approved yet, or a subcontractor claim nobody expected. Keep each note short and honest, and always say what you will do about the variance.
| Column | Field | Notes |
|---|---|---|
| WP ID | Work Package ID | Pre-filled WP-01 through WP-12. Customise to match your WBS numbering. |
| Work Package | Category Name | Pre-labelled: Labour (PM, Dev, Design, Test), Hardware, Software, Cloud, Travel, Training, Contingency, Management Reserve, Other. |
| Budget ($) | Planned Cost | Enter the approved budget for this work package. Formatted as currency. |
| Actual ($) | Actual Spend | Enter the actual cost incurred to date or for the period. Formatted as currency. |
| Variance ($) | Formula | Auto-calculated: Budget minus Actual. Positive = under budget. Negative = over budget. Shown in red brackets if negative. |
| Variance % | Formula | Auto-calculated: Variance ÷ Budget. Shows percentage over or under. Positive = under, negative = over. |
| Status | RAG Indicator | Enter 🟢 Green / 🟡 Amber / 🔴 Red manually based on your threshold rules. |
| Notes | Explanation | Free text. Explain the cause of any significant variance: essential for sponsor reports. |
The Totals Row
The totals row at the bottom adds up the Budget, Actual and Variance ($) columns for all 12 work packages. The total Variance % is (Total Budget minus Total Actual) divided by Total Budget. You see the overall cost position of the project at a glance, with no manual adding.
Adding more work packages: To add rows beyond the 12 pre-set categories, insert a row above the totals row (right-click → Insert Rows Above). Copy the formatting from an existing row. The totals formulas use SUM ranges that automatically expand to include inserted rows: no formula editing needed.
02 · How the Formulas Work
How is budget variance calculated?
The template uses two formulas. Change a Budget or Actual figure and both variance columns update straight away.
Variance ($)
= Budget − ActualPositive result = under budget (good). Negative result = over budget (concern). The template formats negative values in brackets to make overruns visually obvious: (5,000) means $5,000 over budget.
Variance (%)
= (Budget − Actual) ÷ BudgetShown as a percentage. +10% means you spent 10% less than budgeted. -8% means you are 8% over budget. The formula will not show an error if the Budget cell is blank.
Reading a Variance: Worked Example
✗ Over Budget: Labour
Budget$45,000
Actual$52,400
Variance($7,400): -16.4%
16.4% over on labour: note in the Notes column: "3 additional developer days due to scope change CR-004. Change budget to be adjusted."
✓ Under Budget: Software
Budget$12,000
Actual$9,800
Variance$2,200: +18.3%
18.3% under on software licences: note: "Negotiated volume discount. Saving to be reallocated to contingency."
Budget variance vs EVM Cost Variance: This template calculates simple budget variance: planned spend vs actual spend. For a more sophisticated analysis that accounts for how much work has been completed relative to cost, use our EVM Tracker template alongside this report. EVM's Cost Variance (EV − AC) is the industry standard for performance-based cost analysis and is tested heavily on the PMP exam.
How to fill it in: a construction example
This is an example only, based on a typical building project in the UAE, in AED. Look at the notes column more than the numbers. That is where most people go wrong.
| Work package | Budget / Actual | Variance | RAG and note |
|---|---|---|---|
| WP-03 Substructure | 1,200,000 / 1,290,000 | (90,000): -7.5% | Amber. Extra dewatering after higher groundwater was found. Variation submitted to the client. Owner: QS. |
| WP-06 MEP first fix | 800,000 / 720,000 | 80,000: +10.0% | Amber. Not a saving. Cable tray delivery is late, so the work has not been done yet. Cost will catch up next month. |
| WP-09 Site preliminaries | 300,000 / 297,000 | 3,000: +1.0% | Green. On plan. No action. |
Mistakes I see in budget variance reports
- Mixing rules for "actual": purchase orders one month, paid invoices the next. Pick one rule and write it at the top.
- Changing the Budget column without an approved change. Then the variance means nothing.
- Treating every under-spend as good news. Often it just means the work is late.
- Notes that only say "over budget". Say why, and what you are doing about it.
- Overwriting last month's file. Save a new copy each period so you can see the trend.
03 · How to Use
How do you use the budget variance report?
1
Fill in the metadata block
Enter the project name, PM name, reporting period (e.g. "March 2026" or "Week 12") and currency at the top. This makes every version of the report self-identifying: essential when sharing multiple period reports with sponsors.
2
Customise the work package names
The 12 starting categories (Labour, Hardware, Software and so on) are only a starting point. Replace them with your own WBS work packages or cost codes. Delete rows you do not need, or insert rows above the totals row if you need more.
3
Enter Budget figures from your approved project budget
Enter the approved budget for each work package in the Budget ($) column. These should match your signed-off project budget document or change control baseline. Do not change these figures mid-period: create a new version of the report for each reporting period instead.
4
Enter Actual figures from your finance system
Enter the actual costs from your finance or accounting system, not estimates. For labour, this is hours worked multiplied by the agreed rate. For goods and services, this is purchase orders raised or invoices paid. Variance and percentage columns calculate automatically the moment you enter the actual.
5
Set RAG status and add explanatory notes
Set the RAG status for each work package using your organisation's thresholds, for example Green within 5%, Amber 5 to 10%, Red over 10%. In the Notes column, explain any large variance. A good note gives the cause and the action, not just the number. Your sponsor wants to know "why" and "what next", not just "we are over".
6
Share with sponsor and finance team
Send the completed report as part of your monthly project status pack. Save each period's report separately: e.g. "Budget-Variance-Report-March-2026.xlsx". Never overwrite previous periods. This creates an audit trail showing how the project's cost position evolved over time.
04 · RAG Thresholds
Setting RAG Thresholds for Budget Variance
For the RAG column to mean anything, you need agreed thresholds: the percentage variance that turns a line Amber or Red. Many organisations use bands like these:
| RAG Status | Typical Threshold | What it Signals | Action Required |
|---|---|---|---|
| 🟢 Green | Within ±5% of budget | On track: normal variation | Monitor. No action needed unless trend is worsening. |
| 🟡 Amber | 5–15% over budget | At risk: approaching concern | Investigate cause. Identify corrective action. Inform PM and sponsor. |
| 🔴 Red | >15% over budget | Off track: action required | Escalate to sponsor. Raise change request if scope is driving cost. Formal recovery plan required. |
These thresholds vary by organisation. Some use tighter bands (±3% / 3–8% / over 8%) for high-scrutiny projects. Agree your specific thresholds with the sponsor and finance team before the project starts and document them in your project status report.
Under Budget Isn't Always Good
A large under-spend can mean planned work has not been done, not that you are saving money. If you are 20% under budget halfway through, check the schedule too. If you are also ahead, good. If not, the under-spend is probably late work, and the cost will hit you later.
PMP exam tip: A simple budget variance compares planned spend with actual spend. It does not tell you how much work you got for that money. Earned value fixes this: Cost Variance is CV = EV minus AC. Exam questions often test whether you can tell these apart. See our EVM guide for a full walkthrough.
05 · FAQ
Budget Variance: 4 Common Questions
A budget variance report compares budgeted cost with actual cost, one work package at a time. It shows the variance in money and as a percentage, so you can see where you are over or under budget and by how much. Most teams produce it monthly and share it with the sponsor and finance as part of normal reporting.
Budget variance is the budget for a work package minus the actual cost so far. Positive means you spent less than planned. Negative means you spent more. It is related to, but not the same as, Cost Variance (CV) in Earned Value Management, which compares the value of work actually done with what you spent.
Budget variance is simply Budget minus Actual Spend. Cost Variance in earned value is Earned Value (EV) minus Actual Cost (AC). CV is more useful because it looks at how much work is really complete. You can be under budget and behind schedule at the same time, and EVM will show that. For full EVM analysis, use our EVM Tracker template alongside this report.
Monthly works for most projects. On high-risk projects with weekly reporting, every two weeks is common. What matters most is doing it on the same schedule every time, so trends are easy to see. Go through it in your monthly review with the sponsor and finance, ideally next to the status report.
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