What is an Exception Report?

An exception report is a document that states those instances in which actual performance deviated significantly from expectations, usually in a negative direction. It excludes all events in which actual performance was roughly as expected. The intent of this report is to focus management attention on just those areas requiring immediate action.

Examples of an Exception Report

As an example of an exception report, a report could point out those instances in which expenses were higher than the budget. As another example, a report could note where production levels were lower than the production plan. As yet another example, a report could identify those instances in which customer service personnel were unable to settle a customer’s complaint on the first contact. In all three cases, these reports identify specific instances in which there are issues that management should correct.