> ## Documentation Index
> Fetch the complete documentation index at: https://docs.harboros.co/llms.txt
> Use this file to discover all available pages before exploring further.

# Variance analysis

> Understanding what moved and why.

Variance analysis answers one question: how are we doing against the plan? The Variance report walks your plan against your actuals, month by month, and shows exactly which line items — New business or Renewals — drove the difference. It's the view that holds up in front of a board, because it doesn't just say you're above or below plan; it says why.

## What you need first

A plan to compare against. Variance reads the monthly targets you set on the Plan screen — a New ARR target and a Renewal ARR target for each month. With no plan set, there's nothing to measure against, so this is the one workflow that depends on a setup step.

## What the report shows

For each month, the report puts your target next to your actual for two lines:

* **New** — [ARR](/get-started/glossary) from newly signed business.
* **Renewal** — ARR from contracts that renewed.

The actuals come straight from your contracts, and the split is automatic: a signed contract with no earlier contract behind it counts as New; one [linked to a predecessor](/concepts/lifecycle-model) counts as Renewal. You don't categorize anything by hand. Only confirmed contracts count, the same as everywhere else — see [Judgment is the gate](/concepts/judgment-is-the-gate).

## Reading it

The value is in the split. If you're behind plan, the report tells you whether **New** is lagging or **Renewal** is — whether the gap is a sales problem or a retention problem. And because it's month by month, you can see exactly when the gap opened rather than discovering it at quarter-end. Every figure traces back to the contracts behind it, so a number you'd defend in a board meeting is a number you can open up and show.

## Not the same as comparing snapshots

These are two different "what changed" views, and it's worth keeping them straight:

* **Variance** is plan vs actual — *are we on target?*
* A [snapshot comparison](/workflows/snapshots) is one date vs another — *what moved since last time?*

Use variance to judge performance against the goal you set; use a snapshot comparison to explain what shifted week to week.