Invoice Variance Cost Leak Calculator

Estimate how much money leaks from invoice variances—and how much you can recover by tightening controls.

Educational only. This is not accounting advice.

Processed in-browser. Nothing is stored.

Inputs

Number of invoices processed monthly

$

Typical invoice value

%

How far off invoices are from expected (overbilling, errors)

%

% of variance you catch and fix before payment

Optional: Model Improvements

%

Lower is better

%

Higher is better

Results

Enter inputs and click Calculate

How to use this tool

  1. 1Enter your invoice volume and average invoice size.
  2. 2Enter the "typical variance %" (how far off invoices are from expected).
  3. 3Enter your correction success rate: what % of the variance do you actually recover or prevent from being paid?
  4. 4Optionally model improvements: lower variance % or higher recovery rate.
  5. 5Review results and copy/download the summary.

What the results mean

Variance happens for normal reasons (errors, scope creep, pricing drift).

Leakage happens when variance isn't caught before payment.

You don't need perfection—small improvements at scale become real dollars fast.

Example (sanity check)

If 200 invoices/month × $1,500 avg × 2% variance × 50% recovery:

Gross Leakage

$72,000/yr

200 × $1,500 × 2% × 12

Recovered

$36,000/yr

$72,000 × 50%

Net Leakage

$36,000/yr

Money actually lost

Common pitfalls

  • Confusing "variance" with "disputes" (variance can be silent)
  • Assuming recovery happens automatically (it usually doesn't)
  • Not separating: price variance, quantity variance, scope/change order variance
  • Letting exceptions become the norm

Change log

v1.0 (2026-01): Latest release