FNSACC504 - Prepare financial reports for corporate entities
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Financial Reports for Corporate Entities (FNSACC504)
Added on 2020-04-21
FNSACC504 - Prepare financial reports for corporate entities
Financial Reports for Corporate Entities (FNSACC504)
Added on 2020-04-21
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Prepare Financial Reports for Corporate EntitiesThis course is based on the nationally recognised unit of competency:●FNSACC504 Prepare Financial Reports for Corporate EntitiesIt covers the skills and knowledge required to prepare, document andmanage budgets and forecasts, and encompasses forecasting estimatesand monitoring budgeted outcomes. ASSESSMENT WORKBOOKParticipant Name:Learner ID/Username:
Assessment Workbook V: Prepare Financial Reports for Corporate Entities Assessment Workbook VPrepare Financial Reports for Corporate EntitiesV1.0 Produced 1 February 2016Copyright © 2016All rights reserved. No part of this publication maybe reproduced or distributed in any form or byany means, or stored in a database or retrieval system other than pursuant to the terms of theCopyright Act 1968 (Commonwealth).DateSummary of ModificationsMadeVersion1/02/16Version 1 produced followingassessment validationV1.0Page 1
Assessment Workbook V: Prepare Financial Reports for Corporate Entities Page 2
Assessment Workbook V: Prepare Financial Reports for Corporate Entities Getting StartedInstructionsThis workbook contains one (1) assessment comprised of:●Written Questions – A set of generic questions testing the student’sgeneral knowledge and understanding of the general theory behindthe unit.●Exercises - A set of exercises to test the student’s knowledge,analytical skills in problem solving and performing numericalcalculations.●Case Study – A hypothetical exercise to test the student’s knowledge,analytical skills in problem solving and performing numericalcalculations.Requirements for satisfactory completionFor a ‘satisfactory’ result in this task, all questions must be answered to a‘satisfactory’ standard. At Certificate IV level this means that:●Provide responses using complete sentences, making directreference to the question.●Specifically address all parts of the question providing exampleswhere appropriate.Instructions for how to proceed in each component of theassessment can be found at the start of each section.Competency Based AssessmentCompetency based assessment focuses on whether you are able toperform the task to the standard expected in the workplace. It relies onyou providing evidence that supports your claim of competence. Thisevidence is in the form of your completion of the assessments set for eachunit.Once you have submitted your completed assessments, your instructor willassess your submission to determine your competence. To be deemedPage 3
Assessment Workbook V: Prepare Financial Reports for Corporate Entities competent in each course, you are required to achieve a satisfactory resultfor all of the assessment components that make up that unit. Where a ‘notyet satisfactory’ judgement is made, you will be given guidance on steps totake to improve your performance and provided the opportunity to re-submit evidence to demonstrate competence. Once a ‘satisfactory’judgement has been made on all components for a unit, you will bedeemed ‘competent’ in that unit.SubmissionOnly submit your workbook once all activities inside are complete. Shouldyou have any questions regarding your assessments, or not understandwhat is required for you to complete your assessment, please feel free toask your instructor.Keep your answers succinct and make sure you are answering thequestion. Re-read the question after you have drafted up your responsejust to be sure you have covered all that is needed.Your final assessment result will either be ‘Competent’ or ‘Not YetCompetent’. When submitting your assessments please ensure that1. All assessment tasks within the workbook have been completed2.You have proof read your assessmentCandidate Declaration Submission of this workbook means you agree to abide by the terms of thecandidate declaration below.By submitting this work, I declare that:●I have been advised of the assessment requirements, have beenmade aware of my rights and responsibilities as an assessmentcandidate, and choose to be assessed at this time.●I am aware that there is a limit to the number of submissions that Ican make for each assessment and I am submitting all documentsrequired to complete this Assessment Workbook.●I have organised and named the files I am submitting according tothe instructions provided and I am aware that my assessor will notPage 4
Assessment Workbook V: Prepare Financial Reports for Corporate Entities assess work that cannot be clearly identified and may request thework be resubmitted according to the correct process.●This work is my own and contains no material written by anotherperson except where due reference is made. I am aware that a falsedeclaration may lead to the withdrawal of a qualification orstatement of attainment.●I am aware that there is a policy of checking the validity ofqualifications that I submit as evidence as well as thequalifications/evidence of parties who verify my performance orobservable skills. I give my consent to contact these parties forverification purposes.Written QuestionsThe following questions are divided into two categories.The first set of questions cover generic underpinning knowledge of basicproject management terms and concepts. These questions are all in a shortanswer format. The longer questions requiring creative thought processesare covered in the case studies assessment. You must answer allquestions using your own words.However you may reference yourlearner guide, and other online or hard copy resources to complete thisassessment.The second set of questions cover processes you would be likely toencounter in a workplace. Ideally you should be able to answer thesequestions based on the processes that are currently in place in yourworkplace. If this is not the case, then answer the questions based onprocesses that should be implemented in your workplace.If you are currently working in an accountancy role, you may answer thesequestions based on your own workplace. Otherwise consider what youshould do if you were working.Generic Questions and CalculationsVQ1: Describe two (2) advantages of trading as a corporate entity asopposed to a partnership. What is one (1) main disadvantage?Page 5
Assessment Workbook V: Prepare Financial Reports for Corporate Entities The two advantages of trading as a corporate entity as opposed to a partnership are as follows: (i)Liability Protection: One of the biggest advantage a corporation provides over the other business frameworks is the protection ofliability. The shareholders do not risk of losing their personal assets due to the debt of the firm, as the organizations are regarded as legal entities from the people who own them. The partnership owners and the sole proprietors on the other hand are held accountable for all the company debts and the legal accountabilities and are subject to losing the personal assets of the firm goes bankrupt or is caught up in expensive legal situations. (ii)Tax Benefits: The corporations enjoy certain tax advantages thatsole proprietorships and partnerships do not. The corporations must file the taxes separately from the shareholders. The owners of the corporation pay taxes on their salaries, dividends and bonuses which they earn from the corporation. On the otherhand, there are loopholes are are existent that eases the burdenof the paying the taxes as an individual shareholders and as a corporation. A corporation is not needed to pay tax on the earnings as a paid compensation to the shareholders and the employees and it can subtract the payments as a business expenditure. The corporate tax rate is generally lower than the personal rate of income tax. The owners of the sole proprietorships and partnerships pay the income taxes at general rates on the profits which they gain from their firms. The main disadvantage is as given below: Costs: One of the primary disadvantages of a corporation is the costs associated with functioning a corporate business. It costs the money to implement with the state where the business functions. After the initial fees of incorporation, the corporate firms even has ongoing fees related with it. The annual report fee can range up to $150 a year for every year the corporation exists after the initial incorporation filing. Page 6
Assessment Workbook V: Prepare Financial Reports for Corporate Entities VQ2: VQ2A List the three (3) characteristics that identify a small private company from a large private company.VQ2B How does a small proprietary company differ from a large proprietary company with respect to its reporting obligations?VQ2A The three characteristics that identify a small private company from a large private company are as follows: (i)Employees: Small private companies have the benefit of smaller teams of employees than the firms that function on a larger scale. The smallest businesses are functioned entirely by single individuals or the small teams. A larger small scale business can often get away with engaging fewer than one hundred employees by relying on the kind of business. (ii)Revenue and profitability: The small scale business revenue is usually lower than the firmsthat function on a larger scale. Smallbusiness are considered as the firms that bring in less than a distinct amount of revenue by relying on the kind of business. The maximum revenue allowance for the small business designation is set at $21.5 million per year for the service businesses. The lower amount of revenue does not necessarily interpret the lower profitability. The established small scale businesses often own their equipment and facilities outright which furthermore to the other factors aids in keeping the costs lower than the more leveraged businesses. (iii)Market Area: The small scale businesses function at a smaller area than the corporations and large private organizations. The small scale businesses serve as single communities like the convenience store in a rural township. The definition of small scale restricts the firms from serving areas much larger than a local area since growing beyond that would increase the scale ofthe operations of the small business and push it into a new classification. Page 7
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