How does budget variance analysis help a sport event organizer?

• A. It forecasts attendance and revenue for next year.
• B. It measures staff performance during the event.
• C. It determines sponsorship levels.
• D. It tracks actual spend against the budget and informs corrections and forecasting.

Answer: (D)

Budget variance analysis focuses on comparing actual expenditures against the budget to control costs and improve financial planning. By identifying where spending diverges from what was planned, it shows whether costs are on track, over, or under, and explains why those variances occurred. This information lets event organizers take corrective actions—such as renegotiating contracts, adjusting staffing, cutting nonessential expenses, or reallocating funds—and refine forecasts for the remaining period or future events. In short, it directly connects actual spending to the budget and future budgeting decisions, making it the most relevant tool for financial management during and after an event. Other options describe forecasting attendance, evaluating staff performance, or setting sponsorship levels, which are not the primary purpose of variance analysis.