# AI variance analysis - prompt pack
Akshan Kumar | akshankumar.com | Version 1.0 | 29 October 2026

Use with Variance-Practical-Pack.xlsx. This is a fictional September 2026 case.
The workbook uses INR; the worked guide uses INR lakh (1 lakh = 100,000).
Use only data you are authorised to share, in an approved AI environment.

## 1. Check the data before explaining it

Act as an FP&A analyst preparing a monthly finance review. Read the attached workbook, including Inputs management notes E01-E06. If you cannot read formulas, calculated values or all tabs, say exactly what is unavailable and ask for the relevant exports. Do not guess missing values.

First confirm the period, currency, units, product scope, revenue basis and definitions of contribution and EBITDA. Verify required inputs are numeric, budget total units are positive, and budget and actual use comparable product families. Check source reconciliations in Drivers!C31:D36 and bridge residual Review!C29 to INR 0.01. If a control does not reconcile, show the difference and request resolution before drafting final commentary.

Return a concise data-quality review. Explicitly distinguish absent data from a genuine zero. Do not treat successful arithmetic reconciliation as proof of completeness or correct accounting cutoff.

## 2. Prepare a supported variance analysis

Use the verified workbook. Follow its bridge convention rather than choosing a new decomposition. Fixed-mix units = actual total units x budget product share. Revenue: volume = (fixed-mix units - budget units) x budget price; mix = (actual units - fixed-mix units) x budget price; price / realisation = actual units x (actual price - budget price).

For contribution, apply volume and mix to budget unit contribution, use the same price effect, and calculate material and conversion effects as minus actual units x (actual unit cost - budget unit cost). Bridge contribution to EBITDA using fixed overhead and SG&A. Positive bridge effects increase profit. In the P&L, variance is actual less budget; a positive expense variance is overspend. Show margin differences in percentage points.

Show a reconciled revenue bridge and EBITDA bridge in INR lakh. Retain full precision in calculations. Use a review threshold of INR 1 lakh OR 10% of absolute budget, as an illustrative starting point, and state it. A zero budget makes percentage variance unavailable, not zero. Include smaller offsets needed to reconcile the bridge and qualitative issues involving accounting cutoff. Rank the three largest adverse EBITDA drivers by absolute impact.

For each main explanation, use these headings: (a) calculated fact with sheet/cell reference, (b) explanation reported in a management note with note ID, (c) what remains unconfirmed, and (d) evidence to request. Do not equate lower total variable cost with efficiency, average realised price with a pure price increase, or unit material cost with supplier inflation. Do not assume October recovery or weak customer demand. Do not invent source references.

## 3. Challenge the draft

Review the draft as a sceptical finance director. Identify unsupported causal claims, double-counted bridge effects, wrong variance signs, inconsistent units, misleading margin percentages and missing source-control differences. Distinguish a mathematically explained variance from a validated business cause.

Test these claims explicitly: "sales fell because demand weakened"; "material inflation reduced profit"; "lower total conversion cost shows better productivity"; "the custom-panel shortfall will reverse in October". For each, state supported / partly supported / unsupported and why. No invented certainty score.

Return corrections and up to five questions that could change the management decision. Preserve unresolved issues in the final commentary.

## 4. Draft the management commentary

Using the verified calculations and corrected analysis, write no more than 220 words for the monthly management review. Cover revenue, EBITDA, the largest quantified profit drivers, the custom-panel issue and the main evidence gap. Separate known results from reported explanations. Use INR lakh and percentage points. Cite workbook ranges or note IDs compactly.

Then give up to three proposed actions in a table: issue, evidence required, proposed accountable role, proposed due date relative to the review, and decision the evidence will support. Roles and deadlines are recommendations, not agreed commitments. Do not claim a recovery amount or forecast revision without evidence. Do not issue purchase orders, change prices, post journals or send messages.

## Practice challenge

Change Inputs!F7 from 98,000 to 99,000. Revenue and EBITDA should each improve by INR 0.90 lakh, all else equal. Confirm that the price effect changes, other EBITDA effects remain unchanged, and every bridge still reconciles. Restore the input. Then delete one required unit-cost input: the affected result must be unavailable rather than quietly assume zero. Re-enter the original value before using the file.
