Manage Budgets and Financial Plans

Manage budgets and
financial plans

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
TASK 1 ...........................................................................................................................................3
TASK 2 ...........................................................................................................................................8
TASK 3 .........................................................................................................................................11
TASK 4 .........................................................................................................................................13
TASK 5..........................................................................................................................................15
CONCLUSION..............................................................................................................................18

INTRODUCTION
The term budget can be defined as an estimation of revenues and expenses so that
available financial resources can be used in an effective manner. The aim of project report is to
understanding about role of budgets and financial plans for companies. The project report is
categorised into four tasks and each of them consists different kinds of activities. Such as first
part consists information about principles of accounting, GST etc. As well as second task covers
information regards to marketing budget and task three about update in marketing budget. While
task four includes analysis of profit & loss account and in the end part of report aged debtor
summary is covered.
MAIN BODY
TASK 1
1. Principle of double entry book keeping system.
Double entry book keeping system- It is a kinds of bookkeeping system in that each
financial entry of an account needs a corresponding and opposite entry to different account.
Principle- The basic principle of this accounting is that every debit has a corresponding credit. In
broad sense, total value of debits must be equal to total value of credits.
2. Principle of cash accounting along with advantages and disadvantage.
The basic principle of this accounting is that amount which is received in a time period
are necessary to be recorded in that time period. As well as expenses are needed to be recorded
in the period in that they are paid.
Advantage- The key benefit of this accounting is that it is simple to use. In addition, business
entities can identify income & expenses when it is received or paid.
Disadvantage- It does not focus to track actual date of sale and purchase.
3. Principle of accrual accounting along with advantages and disadvantage.
The principle of this accounting is that financial transactions should be recorded in the
time period in that they incur, instead of period of occurring cash flows.

Advantage- It helps in better business analysis because under this matching of expenses and
revenues is done in an effective manner.
Disadvantage- One of they drawback of this accounting is that it needs more judgement and
projections.
4. Explain the two accounting principles on which the calculation and reporting of deprecation is
based.
 Cost principle- As per this principle the deprecation expenses needs to be reported on the
income statement and the amount of assets requires to be based on original cost of assets.
 Matching principle- This principle needs that the assets' cost must be allocated to
deprecation expenditure during life of assets.
5. Three key features of A New Tax System (GST) Act 1999.
 It is resulted in unintended consequences in some cases.
 This helps in applying a common tax rate that reduce complexity.
 It did not consists small value exclusions.
6. Explanation of the four main taxation and superannuation obligations for a business.
 Pay as you go- The PAYG is a mechanism which permits to make payment of tax
liabilities in instalments.
 Goods and service tax- It is a tax of 10% obligatory on goods, services and other
commodities sold in Australia.
 Tax obligations for paying staff- The managers of companies should be aware of tax
obligations when paying to staff, withholding tax and superannuation.
 Consider getting an ABN for business- ABN benefits in managing tax and obligations as
well as used as reference by Australian Taxation office.
7. According to GST legislation, list four items that do not attract GST.
 Sheep and goats (Live, HSN Code-0104)
 Live swine (HSN Code-0103)
 Live assess, mules and hinnies (HSN Code-0101)