INSTRUCTIONS
QUARTERLY BUDGET ANALYSIS
Your Pro Forma Cash Flow Statement is of no value to you as a business owner unless there is some means to evaluate the actual performance of your company and measure it against your projections.
			
WHAT IS A QUARTERLY BUDGET ANALYSIS?
A quarterly budget analysis is the financial analysis tool that is used to compare your projected cash flow statement  with your business's actual performance.  Its purpose is to let you know whether or not you are operating within your projections and to help you maintain control of all phases of your business operations.  When your analysis shows that you are over or under budget in any area, you need to determine the reason for the deviation and implement changes for the future that will enable you to get back on track.
			
Example:  If you have budgeted $1,000 in advertising funds for the first quarter and you find that you have actually spent $1,600, the first thing you should do is look at the sales that have occurred as a result of increased advertising.  If they are over projections by an amount equal to or more than the $600, your budget will still be in good shape.  If not, you will have to find expenses in your budget that can be revised to make up the deficit.  You might be able to take a smaller draw for yourself or spend less on travel.  You might even be able to increase your profits by adding a new product or service.
			
It should be clear at this point that the correct process to keep you from running out of operating capital in the middle of the year is to make yearly projections, analyzed at the end of each quarter, and then to revise your budget based on that analysis and current industry trends.  You will not have any information to input into nos. 3 and 6 below until you have been in business at least one quarter.
			
HOW TO DEVELOP A QUARTERLY BUDGET ANALYSIS
The Quarterly Budget Analysis needs the following seven columns:     
1.	Budget Item: The list of budget items is taken from headings on the Pro Forma Cash Flow Statement. All items in your budget should be listed. However, in this instance they are separated into Income Statement Items and Non-Income Statement Items. 
2.	Budget This Quarter: Fill in the amount budgeted for current quarter from your Pro Forma Cash   Flow Statement.
3.	Actual This Quarter: Fill in actual expenditures or receipts for quarter.
4.	Variation This Quarter: The amount spent or received over or under budget will automatically be calculated by Automate Your Business Plan 6.0.
5.	Year-To-Date Budget: Fill in amounts budgeted from beginning of year through and including current quarter (from cash flow statement).
6.	Actual Year-To-Date: Fill in the actual amount spent or received from the beginning of year through the current quarter.
7.	Variation Year-To-Date:  The amount spent or received over or under budget will automatically be calculated from the start of the year through  the current quarter.
     In addition to overall budget deviations, Automate Your Business Plan will also calculate
     your Income Statement deviations and your Non-Income Statement  deviations.