The concept of factor analysis
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In order for the obtained results to japan phone number be reliable, it is necessary to compare the indicators on different scales, determine the correlation of the obtained values, establish their differences and similarities. The main tasks of factor analysis:
Identification of existing indicators.
Selecting parameters to perform a complete analysis.
Classification of indicators.
Establishing the relationship between the result values and the factors.
Identification of the influence of specific phenomena.
Assessing the role of each value.
Using a factor model.
It is necessary to conduct a study of each factor on which the final result depends.
When is factor analysis necessary?
Some entrepreneurs believe that it is necessary to look for reasons for unsatisfactory performance only when the plan is not fulfilled, and if the profit exceeds the planned indicators, then everything is fine and there is no need for additional analysis.
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But this is wrong - the reason must be established in the case of overfulfillment of the plan as well. Maybe there was a single large order, and it will not happen again, or maybe it was a matter of erroneous planning (the plan was initially underestimated).
Also, factor analysis of profit can be used to compare the results of an enterprise's activities over different time periods.
Knowing why profit differs from planned or from previous periods’ figures, the manager will understand what needs to be changed in business management and what to pay attention to.
When is factor analysis necessary?
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In practice, it is impossible to obtain a profit that corresponds to the plan down to the last penny. There will always be discrepancies in one direction or another. In order not to waste time on unnecessary work, it is necessary to define the boundaries, when going beyond which the deviations should be analyzed. Two options can be used:
Take into account absolute deviation (for example, over 15,000 rubles).
Take into account the relative deviation (for example, more than 5% of the planned profit amount).
Qualitative criterion. If an organization is engaged in various types of activities and one of them is not of great importance to the founders, then the analysis of deviations in profit from this work is either not carried out at all, or is done if the difference is too high (for example, more than 30% of the plan). This approach can be used if management accounting is carried out separately for each area.