Skip to content
Sign inRegister

PM

Planning and Operational variances (part 1) - Variance analysis - ACCA Performance Management (PM)

34 Comments

  1. Elias
    Hello Sir. I also want to express my gratitude for your amazing lectures, thank you very very much.

    I do have a question. I am taking the PM Exam on March 2026 is this up to date?
  2. John MoffatTutor
    Thank you for your comment, and yes - the lectures are up to date for the March 2026 exams.
  3. Annabel
    Hi John,
    What do you mean when you say that you save 16,000 for the expenditure planning variance? Thanks!
  4. darshan
    That the manager responsible for buying the materials , has done a good job and apparently saved us $16000
  5. Leigh
    Hi John - I am sitting the June 2024 exam, hoping the study guides & lectures are all still current? As others have said, your tuition and the notes are excellent, thank you, I'm really enjoying PM
  6. John MoffatTutor
    Yes - the syllabus is not changing and so all of our notes and lectures are still valid :-)

    (And thank you for your comment - I hope that you continue to enjoy PM :-) :-) )
  7. Shann
    Hi Sir, with this material when is the latest would you recommend sitting the exam?
  8. John MoffatTutor
    You should take the exam as soon as you feel fully prepared for it. The syllabus will not be reviewed again by the ACCA until after the June 2025 exams.
  9. NUR DZAFRINA ZAHRRA
    hi sir, im sitting for december 2023 exam, is this still can be refer?
  10. John MoffatTutor
    Yes - the lectures are all up to date for the current syllabus.
  11. Hamza Lad
    Good morning! Sir. Is market size and market share variances relevant to the upcoming March 2023 exams? Based on your lectures and notes on variance analysis you've not tackled anything on these.

    Do you recommend that I read and practice on these subtopics?
  12. Sasha
    Hi, I'm sitting this exam in March 2023. Is this still the best method to use currently?

    You're very good at making complicated things easy to understand so thank you!
  13. Sasha
    sorry i posted it twice as it said I had already written a comment like this on my previous post!
  14. Sasha
    Hi, firstly thank you so much for your lectures. You clearly have done this for many years and therefore are able to make things SO clear when you explain them down to the words you choose and the way you break things up so well.

    I'm sitting this exam in March 2023. Is this still the best method to use currently?

    Thanks again!
  15. John MoffatTutor
    The lectures are all up-to-date for the current syllabus (which will not change until after the June 2023 exams).
  16. Kamran
    Dear John,

    Would it be right to say about Planning and Operational variance that Planning variance compares the standard budget with flexed budget. And the operational variance compares the flexed budget with the actual performance.
  17. John MoffatTutor
    No, it would not be right. The flexed budget is only the original budget adjusted for the actual level of activity. With planning and operational variances we revise for changes in the standard costs etc..
  18. Hermela
    hello sir I am really thankful because i get open tuition,
    the lecture is really digestible , however as usual I have a question,
    1,why planning and operational variance sum is compared to variance analysis and how it is related with accessing the mangers problem or operational problem?
  19. John MoffatTutor
    One of the main reasons for doing variance analysis is to see how well (or badly) managers are doing their job. As an example, if the purchasing manager is paying more than was budgeted for materials then it looks bad. However, if the reason is that the supplier increased prices it is not fair to blame the purchasing manager. Operational variances compare what was actually paid with what they should realistically have paid (after taking account of the increase in prices) rather than what was originally budgeted.
  20. Jatin
    Hello Sir!
    I wanted to ask why are we comparing the actual cost with the revised cost in Operational Variance, as the actual cost is the one which has been occurred where as the revised cost is the one which has been found after the production has been taken place. Can you please tell me what is the reason for this comparison?

    Thanks in advance.
    Jatin
  21. John MoffatTutor
    The revised cost is the new standard cost and is revised because for whatever reason the original budgeted cost was not realistic. For example, it could be as simple as suppliers have increased their prices. We separate planning and operational variances in order to identify anything that has gone wrong in operations.
  22. Ibrahim
    Dear John,

    How are you?
    I hope you are great.
    Thank you for your nice informative lecture lesson.
  23. John MoffatTutor
    Thank you for your comment :-)
  24. Elisha
    Wow, interesting and easy to digest.
    Thank you.
  25. John MoffatTutor
    Thanks for the comment :-)
  26. Karim
    Hi, with reference to example 1, in operational variance calculation for usage, why did not use the revise change in price per kg rather than the standard price per kg? Since we have been knowledge that the price has been changed.
  27. Karim
    Same issue in example 2.. please advise.
  28. John MoffatTutor
    Some people prefer to do that. However the current examiner prefers it the way that I show it in my lectures - keeping the two things completely separate.
  29. hardik
    Can there be a question for preparing graphs for other topics?
  30. John MoffatTutor
    No - you cannot be asked to actually draw any graphs in the exam, but you can be tested that you understand them.
  31. 007sk
    Any response to khussaini quest on the use of revised and standard price ?
  32. John MoffatTutor
    I will answer him now, but I do not always see comments posted here. That is why we have the Ask the Tutor Forum where questions are always answered within 24 hours!
  33. alie2018
    Thanks for this brilliant lecture. For planning and operational variance we compare the original budget with the revised budget.
  34. alie2018
    Planning = original budget Vs revised budget
    Operational = actual performance Vs revised budget

Leave a comment