 In this presentation we will take a look at cost variance analysis. First we'll take a look at the process of the cost variance analysis. It'll look similar to the budgeting process. We'll go through the cycle of the cost variance analysis. We'll have the preparation of the standard cost performance report. So we'll put together in essence the standard, which you can think of of the expectations similar to the budget, but this with the cost variance. Then we'll compare the actual cost with the standard costs. So once the time period has then passed, we could take a look at the actual costs, what actually happened, compare them to the standard costs. Then we can investigate the variances or differences, of course, by asking for explanations. We're going to say, hey, here's the variances. Here are the differences. What are the reasons? Why do we have these differences? And that, of course, will help us to correct problems that cause unfavorable variances. And we may look into the favorable variances as well. So note that