Manage Budget and Financial Plans Assignment
Added on - 21 Apr 2020
Running head: MANAGE BUDGET AND FINANCIAL PLANSManage budget and financial plansName of the Student:Name of the University:Author’s Note:
1MANAGE BUDGET AND FINANCIAL PLANSAnswer to task 1:The budget of Black helmet Motorcycle Company is prepared by assuming that therewould be increase in total Australian market and share of on road segment is expected to remainstable. There will be fluctuation in sales revenue of both the products. Sales volume for both theproducts that is Roadster and trailer will be achieved with assumed price of $ 5200 and $ 3700.Sales revenue budget of company is prepared by considering various factors such as currentsituation of market, costs and readiness of sales team. When looking at the market situation, it isessential for company tom consider several aspects of market as the performance of organizationis considerably affected (Chenet al.2014). Demand of products is also influenced by marketreaction.The development of budget will be done by adopting top down approach that enablescomplete control over allocation of budget by streamlining accounting process of business.Appropriate financial allowance for the promotion of budget is determined by uppermanagement. Some of the critical factors that should be considered while developing budgetinvolves control spending, cooperation of sales team and external factors such as marketconditions (Fullertonet al.2013).Answer to task 2:Part C:Category -Market,Operationalor FinancialThe Risk - WhatCan Happen?Source - HowCan itHappen?Impact - IfRisk OccursPotentialTreatmentOptionsMarket Risk-Demand ofconsumers-Taste andpreferencesThis particularrisk is externalto company andthis happensMarket riskswould impactthe forecastedvalue and thereCompany isrequired to conductmarket researchbefore arriving at
2MANAGE BUDGET AND FINANCIAL PLANSpatterndue to changingmarket scenariodriven byfactors such asinflation rateandgovernmentmeasures.could be widevariation inactual andbudgetedfigures.the forecastedvalue. It should takeinto considerationseveral factors andinvestment shouldbe made in researchand development.Financial risk-Fraud-Errors inpreparingfinancialstatement-ImproperdisclosurefinancialstatementThis type ofrisk mightoccur due toperformance ofauditor orfinancemanagers.Involvement ofmanagers infraudulentactivities wouldenhanceoccurrence ofsuch risks.Financial risksmight lead toformation ofundesirable keyperformanceindicators.Formation offinancial statementshould be done asper the standard tominimize thechance of improperdisclosures andauditors should beemployed forverifying accountsand minimizingerrors.Operationalrisk-Insufficientinternalcontrol ofcompanyThis type ofrisk mightoccur due tolack of internalcontrol systemof organization.Operationalrisk mightweaken theinternal controlsystem further.There should beproper designing ofinternal controlsystem andanalyzing the causeof deficiency.Answer to task 4:Requirement 1:The revenue comparative statement of JH Shoe Company depicts the actual and budgetedquantity, price and revenue for the full year budget. Current performance of organization versusfuture is explained by budgeted value and actual value. In order to gain an understanding of thevalue and accordingly talking future actions, it is required to have an understanding of thereasons behind positive or negative variances. From the statement, it can be seen that total actualquantity produced is lower than budgeted quantity by $ 3500. This represents negative variance.