Hi Krati,
Exception Reports are used to display where data does not exist and are built by using Cross Filters.
For example, you can create reports that inform you of customers whose contracts are nearing expiration and who need to be touched for renewal. You can trigger a report to inform you when inventory drops below a set amount, or when a support case takes longer than a specific period of time to reach resolution. These are only a few of many exception reports that can be created for business process tracking. Think about the parameters you can set on your business processes and how you might create some key exception reports to better manage those processes.