DECA Financial Consulting Practice Exam 2026 - Free DECA Financial Consulting Practice Questions and Study Guide

A budget variance refers to the difference between projected financial figures and the actual financial results over a specific period. It serves as a crucial indicator for individuals or organizations to assess their financial performance. By comparing what was expected (the budget) to what actually occurred, entities can identify areas where they may be over or under budget, allowing for better management and strategic decision-making.

This concept is fundamental for financial analysis, as it helps organizations understand discrepancies and adjust future budgets accordingly. Other choices do not capture this essence: they either focus on specific components of costs, profit, or liabilities, which are not directly related to the overall concept of a budget variance.