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adverse variance

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adverse variance

In business, a difference between actual and budgeted spending or income that results in the organization having less money than planned.



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Chairman Richard Inglewood said: "Since the period end, the fertiliser market has become more difficult in terms of both volumes and prices and the group now anticipates, for fertilisers, a substantial adverse variance to the budget for the full year.
If monthly reported reserve reductions are below increases, this is an adverse variance that must be accounted for.
Suggestions that the adverse variances imply that the standards are wrong and need to be eased, or that the quality of the product will have to be compromised, must be countered.
 
 
 
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