Compare periods and calculate the variance
Memwa calculates the change between periods or scenarios and identifies the material account, amount, and direction.
Financial analysis
Explain the material change behind the number.
Memwa starts with period financials, the trial balance, transaction detail, schedules, contracts, and accounting policy. It calculates the variance, traces the source rows, and prepares a financial summary and meeting questions.
Alder Junction, Q1 2026
Reported revenue includes a $48,000 cutoff question.
Alder received the Northstar deposit on March 28. The executed contract permits cancellation before the April 15 kickoff, and the client packet records no March work or deliverable.
The approved book policy keeps refundable or unearned upfront payments deferred until the earning event. The analysis below shows the reported books beside proposed figures and carries the $48,000 difference through the financial summary.
Reported books
$452,500
Total reported revenue
- Revenue
- $452,500
- Direct costs
- $118,450
- Gross profit
- $334,050
- Gross margin
- 73.8%
- Operating expenses
- $233,340
- Net income
- $100,710
Proposed adjusted view
$404,500
Revenue if the deposit remains deferred at March 31
- Revenue
- $404,500
- Direct costs
- $118,450
- Gross profit
- $286,050
- Gross margin
- 70.7%
- Operating expenses
- $233,340
- Net income
- $52,710
The $48,000 variance carries through revenue, gross profit, and net income; gross margin moves from 73.8% to 70.7% in the proposed figures.
Analysis path
Calculate the variance, then open the rows behind it.
Open the rows behind it
Move from the summary to the transaction, schedule, contract, or policy supporting the number.
Separate fact from proposal
Keep reported results intact. Show any proposed adjustment as a separate proposed view with its rationale and source.
Prepare the financial summary and meeting questions
Summarize the variance, source rows, reported and proposed figures, and unresolved drivers for the accountant and client.
Files used
Use signed terms and approved policy to explain the number.
The owner email calls the deposit nonrefundable. It does not override the executed contract or the approved book policy.
- Reported books
- Q1 profit and loss and trial balance
- Payment timing
- March bank activity and bank statement
- Contract terms
- Executed Northstar Agency contract
- Book treatment
- Approved revenue-recognition policy
- Context only
- Client email discussing the deposit
What the firm gets
A financial summary that connects the change to its source rows.
The summary shows the period comparison, variance calculation, reported and proposed figures, source rows, and meeting questions. The reviewer decides whether the explanation and proposed figures are right.