Importance of Financial Management Systems in Business Operations

This assessment focuses on the importance of financial management systems in business operations and how they contribute to ongoing business performance and planning. It also covers topics such as budgeting, resource allocation, and financial analysis. The assessment is part of the BSBFIM601 Manage finances unit in the BSB61215 Advanced Diploma of Program Management qualification.

T-1.8.1
Details of Assessment
Term and Year 2, 2019 Time allowed 7 Weeks
Assessment No 1 Assessment Weighting 100%
Assessment Type Portfolio of
Due Date Week 7 Room TBA
Details of Subject
Qualification BSB61215 Advanced Diploma of Program Management
Subject Name Financial Management
Details of Unit(s) of competency
Unit Code (s) and
Names
BSBFIM601 Manage finances
Details of Student
Student Name
College Student ID
Student Declaration: I declare that the work
submitted is my own, and has not been
copied or plagiarised from any person or
source.
Signature: ___________________________
Date: _______/________/_______________
Details of Assessor
Assessor’s Name
Assessment Outcome
Results Competent Not Yet Competent Marks / 100
FEEDBACK TO STUDENT
Progressive feedback to students, identifying gaps in competency and comments on positive improvements:
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________
______________________________________________________________________________________
Student Declaration: I declare that I have been
assessed in this unit, and I have been advised of my
result. I am also aware of my right to appeal and the
reassessment procedure.
Signature: ____________________________
Date: ____/_____/_____
Assessor Declaration: I declare that I have
conducted a fair, valid, reliable and flexible
assessment with this student, and I have provided
appropriate feedback
Student did not attend the feedback session.
Feedback provided on assessment.
Signature: ____________________________
Date: ____/_____/_____
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Purpose of the Assessment
The purpose of this assessment is to assess the student in the following
learning outcomes:
Competent
(C)
Not Yet
Competent
(NYC)
1.1 Review and analyse previous financial data to establish areas which have
generated a profit or loss
1.2 Undertake research to review reasons for previous profit and loss
1.3 Review business plan to establish critical dates and initiatives that will
require or generate resources in the next financial cycle
1.4 Analyse cash flow trends
1.5 Review statutory requirements for compliance and liabilities for tax
1.6 Review existing software and its suitability for financial management
2.1 Use previous financial data to determine allocations for resources
2.2 Make informed estimates of new items for inclusion in budget
2.3 Prepare budgets in accordance with organisational requirements and
statutory requirements
3.1 Circulate budgets and ensure managers and supervisors are clear about
budgets, reporting requirements and financial delegations
3.2 Manage risks by checking there are no opportunities for misappropriation of
funds and that systems are in place to properly record all financial transactions
3.3 Review profit and loss statements, cash flows and ageing summaries
3.4 Revise budgets, as required, to deal with contingencies
3.5 Maintain audit trails to ensure accurate tracking and to identify discrepancies
between agreed and actual allocations
3.6 Ensure compliance with due diligence
4.1 Ensure structure and format of reports are clear and conform to
organisational and statutory requirements
4.2 Identify and prioritise significant issues in statements, including comparative
financial performances for review and decision making
4.3 Prepare recommendations to ensure financial viability of the organisation
4.4 Evaluate the effectiveness of financial management processes
Assessment/evidence gathering conditions
Each assessment component is recorded as either Competent (C) or Not Yet Competent (NYC). A student
can only achieve competence when all assessment components listed under “Purpose of the assessment”
section are recorded as competent. Your trainer will give you feedback after the completion of each
assessment. A student who is assessed as NYC (Not Yet Competent) is eligible for re-assessment.
Resources required for this Assessment
 Computer with relevant software applications, access to internet and weekly eLearning notes
Instructions for Students
Please read the following instructions carefully
 This assessment has to be completed In class At home
 The assessment is to be completed according to the instructions given by your assessor.
 Feedback on each task will be provided to enable you to determine how your work could be improved.
You will be provided with feedback on your work within two weeks of the assessment due date. All other
feedback will be provided by the end of the term.
 Should you not answer the questions correctly, you will be given feedback on the results and your gaps
in knowledge. You will be given another opportunity to demonstrate your knowledge and skills to be
deemed competent for this unit of competency.
 If you are not sure about any aspects of the assessment, please ask for clarification from your assessor.
 Please refer to the College re-assessment for more information (Student Handbook).
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ASSESSMENT BRIEF
In this assessment task, you will use your skills and knowledge to undertake budgeting,
financial forecasting and reporting and to allocate and manage resources to achieve the
required outputs for the business unit. You work will also include contributing to financial bids
and estimates, allocating funds, managing budgets and reporting on financial activity.
The assessment is divided into three parts and weight allocations as below:
PART A: WRITTEN REPONSES – 25%
PART B: MANAGE FINANCES PROJECT ON A SIMULATED WORK ORGANISATION – 65%
PART C: PRESENTATION OF AUSTRALIAN HARDWARE FINANCIAL ANALYSIS – 10%
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PART A: WRITTEN REPONSES – 25%
Instructions: This part of the assessment comprises the knowledge testing required for the unit
BSBFIM601. This part includes 8 questions and you must respond to all. Use the spaces below to
respond to the questions. Weights and marking allocations are in the marking allocating table.
Question 1. Planning for financial management. (2 marks)
Explain why it is necessary for all business organisations to have effective financial
management systems and explaining how the information held in financial management
systems contribute to ongoing business performance and business planning.
In a business environment, the financial management of the company helps effectively in performing
the activities of the business effectively. The financial management system refers to the different tools
which are applied by the business in order to appropriate manage the finances of the business. In
addition to this, financial management system effectively deals with all the revenue and expenses
which is incurred by the business while conducting the operations of the business. The reason due to
which financial management system are considered to be important as important decisions related to
source of finance, application of finance and revenue generation are taken with the information which
is provided by different tools which are used in financial management. Moreover, finance managers
can check the flow of cash into and out of the business which helps in determining the liquidity
position of the business.
The financial management system effectively provides information regarding the sources of finance
and how much capital a business would be requiring. In addition to this, financial management also
guides the management of the business as to how the funds are to be used by the business and in
which activities the management of the company should make their investments. The financial
management system. In addition to this, the management can also rely on financial management
practices for reducing the costs which are associated with the business so that it can enhance tbe
profits of the business.
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Question 2. Establishing budgets and allocated funds. (3 marks)
a) What is a Budget?
b) What data might inform a new budget?
c) How does analysis of previous financial data assist projected resource estimates and
allocations?
a. A budget can be defined as a financial [plan which is formulated by the management of the
company for getting appropriate estimate regarding the income and expenses which the
business would be incurring in the near future. In other words, budgets are forecasts of
expense and income which the business anticipates to be getting from operations. This is a
tool which is effectively used in the planning process of the business and are generally
prepared for a 1-year period. The budgets are prepared on the basis of some estimation,
market survey results, business trends.
b. In a new budget which is formulated by the management of the company estimated revenue
and expenses of the business are provided in an appropriate manner. The estimates which
are presented in the budgets are mainly forecasts of the business and the same is based on
the trends of the business. The new budget can be effectively shows estimates for different
area of performance of the business.
c. In order to prepare a budget of a business, the management of the company considers
previous years actual performance in order to identify the trends of the business. The budget
which is prepared by the business is for planning as well as controlling the activities of the
business. The budget sets targets for the business which is considered by employees of the
business in order to achieve the goals of the business.
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Question 3. Implement Budgets. (4 marks)
a) How do profit and loss statements cash flow and using aging summaries contribute to
new budgets?
b) How can you ensure that managers and supervisors in the organisation understand
the budget and understand their reporting requirements with regard to financial
management?
c) Budgets are used to identify and track discrepancies between agreed and actual
allocations. Explain.
d) How do budgets contribute to analysis of existing financial management approaches?
a. The profits and loss statements of the business effectively shows the income and expenses of
the business. It is to be noted that the profits which can be generated by the business is
shown appropriately in the profit and loss statement of the business. The age debtors budget
estimates the credit sales of the business and the same affects the estimation of total revenue
which can be generated by the management of the company.
b. The budget which is prepared by the management of the company needs to be
communicated with all the departments of the business so that all the departments of the
business follows the plan which is laid out by the management of the company. The financial
management practices of a business can only be effective if the same are communicated in
the business. The manager can communicate the budgets and its elements by conducting a
meeting with the departmental heads. The managers can also alternatively mail the budget to
different departments and ask for clarification in case of any doubt arises.
c. The process of budgeting is also used by the management of the company for controlling the
activities of the business and also for measuring variances which can occur between
budgeted estimate and actual performance. A budget helps the management to identify the
weakness in the operation process of the business. On the basis of the same, the managers
of the business can take corrective actions in the business. Therefore, it can be said that the
management of the company can use budgeting process for the purpose of controlling the
activities of the business.
d. A budget is used for planning and forecasting of revenue and expenses of the business which
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the business anticipates would be generated in future period. The budgets also provide an
idea to the management regarding how much capital would be required by the business.
Therefore, it can be said that the financial management would not be possible if budgets are
not prepared by the business in terms of deciding the source of capital which is to be used by
the business and also for allocation of the funds to appropriate resources so that the business
is able to generate income.
Question 4. Explain financial probity. (3 marks)
Financial probity can be defined as the set of code or ethics which needs to be followed by financial
experts while engaged in the process of reporting. A business needs to maintain financial probity in
the operations of the business so that a level of integrity, honesty and objectivity can be maintained in
the financial management process.
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Question 5. List at least 10 forms of legislations and conventions (Australian, international
and/or local) that could apply to financial management. (3 marks)
The ten regulations which can be applied to financial management practices are appropriately listed
below:
 Privacy Act 1988
 Fair Work Act 1994
 Minimum Age convention, 1973
 Equal Remuneration convention, 1951
 Charter of Budget Responsibility Act 2007
 Financial Management and Audit Regulations 2013
 Public Account Regulations 2014
 Treasury (Borrowing) Act 2016
 Unclaimed Money Act 2015
 Financial Management and Audit Act 1990
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Question 6. Personnel working in the financial services division of a company need to
understand and be able to explain principles of accounting and financial systems (Accounting
and Financial Information Systems- AIS and FIS). What are accounting and financial
management systems and how do they assist business operations (2 marks)
An accounting financial information system effectively helps the management of the company to
collect, store, analyse and report on the financial information of the business. On the basis of such
information major business decisions are undertaken by the management of the company in order to
ensure that the management of the company is able to take appropriate decisions for the business.
On the other hand, financial information system is software which are used by the business for the
purpose of tracking of data and also is related to accounting process for the same.
The data which is collected by the management of the company can be used effectively for taking
major decisions for the business which are considered to be appropriate considering the data which is
presented in the costing records of the business.
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Question 7. Explain the requirements for each of the following: (3 marks)
a. Goods and Services Tax
b. Company Tax
c. PAYG
a. As per the provisions which is stated under the GST rulings, an individual would be applicable
to Goods and Service tax if the business or the individual has a GST turnover is of $ 75,000
or more. The individual would be subjected to GST provisions. In addition to this, the
individual also needs to maintain certain documents so that activities of the business can be
supported and tax liabilities of the business can be maintained.
b. As per the provisions which is stated by ATO, Corporate taxes would be applicable to a
business if the aggregate turnover in the concerned period is less than $ 10 million than a
concessional rate of 27.5% is applicable on the business and the management of the
company needs to incur the same.
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c. As per provisions which is stated in relations PAYG is a deduction which is made from the
salary income of an individual during a period so that the same can be accumulated. This is a
scheme which effectively reduces the tax liability of the business.
Question 8. Scenario for audit reporting. (5 marks)
You have been asked to act as a project manager to assist with data collection, provide data,
ensure that any other assistance is provided and collaborate with regard to writing the audit
report
During the year the organisation transacted a number of mergers and acquisitions. You have
been asked to pay special attention to the acquisitions and to check the due diligence
processes. You also need to determine whether any changes and adjustments need to be
made to the current budgets.
Explain what all this means and how you will manage the process.
In answering those questions, you will need to also address the following questions:
a. What is an internal audit?
An internal audit is an investigation into the books of accounts, internal control process and other
policies which is followed by the business with a view to appropriately determine whether the
information which is presented showing an accurate view or not. The internal control process
effectively helps business organizations to identify weaknesses in internal control system and thereby
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allowing the business to improve the business structure. Internal audit process is also used for
detecting whether there is any incidence of frauds in the business.
b. How does it mitigate the risk of management frauds?
The process of internal audit effectively identifies the risks which are associated with the business and
thereby formulates strategies so that the business is able to appropriately improve the business
structure. The internal audit process effectively identifies any discrepancies in the financial statement
and thereby gives businesses an opportunity for rectifying the situation.
c. Are there particular statutory requirements that should be followed?
The internal audit process of the business effectively follows relevant auditing standards, APES 110
which is related to Professional code of conduct for the business and relevant accounting standards
which are applicable to the business.
d. What does due diligence mean in terms of finances and financial reporting?
Due Diligence refers to the research which must be conducted by the auditor before entering into an
audit agreement with the client. It also refers to the ability of the business to appropriately carry out
procedures in order to ensure that the financial statements of the business is showing an accurate
view of the financial position of the business.
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e. What reports might be prepared for the ATO?
The management of the company needs to prepare income tax report, GST annual return.
Fringe Benefit returns, PAYG withholding annual report. These reports are required to be
prepared by the management of the company as per the direction of the ATO.
PART A: MARKING TABLE (for trainer use only)
The assessor needs to use judgment in providing marks for the tasks based on learner performance.
Question/Task Number Marks Allocated Marks received
Q1 2
Q2 3
Q3 4
Q4 3
Q5 3
Q6 2
Q7 3
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Q8 5
Total
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PART B: MANAGE FINANCES PROJECT – 65%
SIMULATED WORK ORGANISATION & BRIEF ON THE FINANCE PROJECT
This is a series of practical and theory activities that will enable you to demonstrate skill and
knowledge – and produce end products suitable for use in the workplace. In this PART, you are
required to work on a finance management project to determine the financial condition for “Australian
Hardware” the simulated case study below. Click on the icon that includes the information on the
Simulated Work Organisation.
CONTEXT
In the simulated organisational context you will assume responsibility as a newly hired finance manger
of the simulated workplace environment who leads a team of finance. Your trainer will act as your
supervisor in this simulated work task. You will be progressively completing all the tasks relating to
planning for financial management; reviewing profit and loss statements; cash flows and aging
summaries; reviewing and revising the budget of this organisation, allocating funds, communicating
with your team and other stakeholders, meet compliance requirements and analysing the
effectiveness of existing financial management by providing your own recommendations.
To demonstrate competency you will need to complete all the tasks assigned to you in relation to your
personal development portfolio.
What is required?
You are required to explore the simulated organisational documents (CoffeeVille) or use your own
workplace documents, analyse the various situations mentioned within the tasks and respond to those
tasks. You are also required to
 plan for financial management
 read and review profit and loss statements, cash flows and aging summaries
 prepare, implement and revise a budget which aligns with the business plan, is based on
research and analysis of previous financial data and cash flow trends, and meets all
compliance requirements
 contribute to financial bids and estimates
 establish a budget and allocate funds in accordance with statutory and organisational
requirements
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 communicate with other people including: reporting on financial activity and making
recommendations, identifying and prioritising significant issues, ensuring managers and
supervisors are clear about budgets
 analyse the effectiveness of existing financial management approaches including reviewing
financial management software, managing risks of misappropriation of funds, ensuring
systems are in place to record all transactions, maintaining an audit trail and complying with
due diligence
Various stakeholders in this context (for the simulated organisation Australian Hardware)
 Finance Manager – You
 Owner/Supervisor – Your trainer
 Customers, employees and other stakeholders – Your fellow classmates
There are no specific word limits on your Finance Project but it must follow the structure illustrated
next and the complete all the tasks within the template provided. It must also include all screenshots
and appendix attachments mentioned within the tasks.
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FINANCIAL ANALYSIS
PROJECT FOR
AUSTRALIAN
HARDWARE
Prepared by:
Position:
Date:
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STRUCTURE, TABLE OF CONTENTS & MARKING ALLOCATIONS
(For trainer use only)
CONTENT / TASK DETAILS MARKS
ALLOCATED
MARKS
RECEIVED
1. INTRODUCTION OF THE BUSINESS 8
2. STATUTORY REQUIRMENTS OF THE BUSNIESS 8
3. REVIEW AND MAKE JUDGEMENT ON FINANACIAL
STATEMENTS
10
4. BUDGET REVISION 5
5. RECOMMEND CHANGE IN BUDGET 10
6. FINANCIAL SOFTWARE 10
7. ENSURE DUE DILLIGENCE 10
8. OTHER RECOMMENDATIONS 4
APPENDIX 1 (presentation slides) N/A N/A
TOTAL 65
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1. INTRODUCTION OF THE BUSINESS (8 marks)
The company which is considered for this assessment is Australian Hardware ltd which provides
hardware, garden ware and home appliances to the resident of Australia. The company is known to
be a big company which follows effective policies for the purpose of achieving the goals of the
business. The company is known for providing the best quality of products which are not available in
the market. This makes the operations of the business unique and therefore allows the management
of the company to generate appropriate revenue for the business.
The mission statement of the company shows that the business that the management of the
committed towards handling the operations of the business in an effective manner. The management
of the company focuses on providing customers and tradespeople with value through everyday low
prices, product quality, expert service. The mission statement shows that the management of the
company aims to provide the quality products to the customers and in the process also aims to
achieve growth in the operations of the business. Australia Hardware ltd effectively focuses on
satisfying the customers of the business and thereby building up brand reputation in the market. The
management of the company also has established code of ethics and conduct so that the employee
work in the business following ethical standards.
2. STATUTORY REQUIRMENTS OF THE BUSNIESS (8 marks)
List and explain the application of statutory and legislative requirements as they apply to financial
management within the business operation.
The management of the company has established an appropriate policy for the financial management
of the business. As per the current policy, the finance manager is responsible for preparing the
budgets and also for giving approval to different finance manager regarding the application of funds
which is utilized by the business. All the projects which the business is currently undertaking would be
reviewed by finance manager on bimonthly basis so that there is financial viability in the project which
is undertaken by the business. The legislative and statutory implications which are available on the
business are listed below:
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 Privacy Act 1988: As per this act, the management needs to ensure that the information
relating to the client are not disclosed in any way to other parties. Therefore, the management
of the company needs to maintain the information relating to finance and also name for the
parties.
 Charter of Budget Responsibility Act 2007: The legislation effective deals with the
responsibility of the management of the company while preparing the budgets of the
business. The legislation deals with sound fiscal management policies of the business in an
effective manner.
 Financial Management and Audit Regulations 2013: The financial management and audit
was introduced so that proper financial management practices are followed in the business.
The financial management regulations provides a guideline to businesses for appropriate
presenting of financial information.
3. REVIEW AND MAKE JUDGEMENT ON FINANACIAL STATEMENETS (10 Marks)
In this section review and analyse the profit and loss statements, cash flows and aging summaries
and make a judgment on actual and projected forecasts. Did you find any significant issues? Does it
meet all compliance requirements and liabilities for tax? explain your answer.
Performance Area Performance Objectives Any significant issue Compliance
Requirement
Financial
Performance
overall
As per the budget which
is prepared by the
management of the
company, the objective of
the business is to
enhance the sales of the
business by lowering the
As per actual results, the
costs of the business are
shown to be significantly
which is a matter of
concern for the
management of the
The management
needs to adhere to
relevant accounting
standards for
preparing the income
statement which
shows financial
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profits of the company company performance of a
business.
Profit and loss
statement
The profitability has
significantly reduced
during the period as per
the profit and loss
statement which shows a
fall in profitability of the
business
The fall in the profits of
the business is a major
concern which needs to
be rectified by the
management in order to
generate appropriate
profits in the long run.
The management
needs to adhere to the
requirements of the
conceptual framework
for appropriately
showing profit and loss
of the business.
Cash flow The cash flow statement
is prepared to
appropriately show the
cash inflows and cash
position of the business.
The overall net cash from
all activities is shown to
be lower which is due to
the drawings made by the
partners which can be a
concern in the long run.
The management of
the company needs to
adhere to conceptual
framework for
formulating the cash
flow statement of the
business.
Aging Summaries The aged debtor’s
summaries show the
credit sales which is made
by the business during the
period
The concern in this, is the
debtor period which is not
appropriate and the
management of the
company needs to make
necessary amendments
so that the same can be
improved.
The aged debtor
summary is formulated
by the management
following general
format which is
followed in the
business.
4. BUDGET REVISION (5 Marks)
Revise the budget. You may wish to use a table or display the revised sections of the budget. Once
completed with the revision, explain why do you think it aligns with the business operation plan?
Account July Aug Sept Oct Nov Dec Jan Feb Mar April May June Total
Income
Timber sales $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $480,
Hardware
sales
$35,000 $35,000 $35,000 $35,000 $35,000 $35,000 $35,000 $35,000 $35,000 $35,000 $35,000 $35,000 $420,
Professional
fees
$30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $360,
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Total income $105,000 $105,000 $105,000 $105,000 $105,000 $105,000 $105,000 $105,000 $105,000 $105,000 $105,000 $105,000 $1,260,
Cost of sales
Timber
purchases
$30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $360,
P urchases
$20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $240,
Total cost of
sales
$50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $600,
Gross profit $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $660,
Expenses
Marketing $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $60,
Depreciation
expense $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $72,
Insurance $5,000 $0 $0 $0 $0 $0 $5,000 $0 $0 $0 $0 $0 $10,
Superannuat
ion
$1,036 $1,036 $1,036 $1,036 $1,036 $1,036 $1,036 $1,036 $1,036 $1,036 $1,036 $1,036 $12,
Wages and
salaries $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $96,
Workers'
compensatio
n $400 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $
Account July Aug Sept Oct Nov Dec Jan Feb Mar April May June Total
Rent $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $120,000
Telephone $100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $1,200
Electricity $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $6,000
Gas $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $6,000
Water $100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $1,200
Total
expenses
$36,636 $31,236 $31,236 $31,236 $31,236 $31,236 $36,236 $31,236 $31,236 $31,236 $31,236 $31,236 $385,232
Operating
profit
$18,364 $23,764 $23,764 $23,764 $23,764 $23,764 $18,764 $23,764 $23,764 $23,764 $23,764 $23,764 $274,768
Other income $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other expenses
Interest
expense
$2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $24,000
Training $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $18,000
Total other
expenses $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $42,000
Net profit /
(loss)
$14,864 $20,264 $20,264 $20,264 $20,264 $20,264 $15,264 $20,264 $20,264 $20,264 $20,264 $20,264 $232,768
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T-1.8.1
5. RECOMMEND CHANGE IN BUDGET (10 Marks)
Are there any changes you would like to add or extract from the budget? Analyse the data you would
use to inform the budget and why the data will be relevant. Who else will you involve in developing the
budget?
Recommended
Changes
Objective of Change How it can contribute to
financial management
People
Involved
1. Change in
estimates of
sales and
revenue
The budget which is prepared by
the management needs to be
more realistic as the same is not
consistent with the policies
which is followed in the
business.
This would provide an
appropriate picture of the
financial position of the
business and thereby
contribute to the business.
Finance
Manager
2. Reduction in
Costs
The budgets which is prepared
aims to reduce the costs of the
business which is shown to be
high and the same affects the
profitability of the business.
Financial management
practices would be affected
as reduction in cost would
mean low cash outflows
which would increase
financial efficiency of the
business.
Departmental
Managers.
3. Growth in
Sales
The management of the
company has not considered the
fact there might be growth in
sales which would enhance the
sales revenue of the business.
This would mean that there
is more inflow of cash as
well as more profit
generating chance for the
business.
Departmental
Managers.
4.
6. FINANCIAL SOFTWARE (10 marks)
Does the organisation use the appropriate financial software for this organisation based on their size,
revenue and operational plan? If not give recommendations of which software is more applicable for
this business. Did you use any software packages/programs to develop this report?
As per the current situation, the management of Australian Hardware uses Xero for accounting and
generation of reports. However, it is to be noted that the management of the company needs to switch
to MYOB software so that the software can appropriately handle the accounting data which is
available to the business. The software of MYOB is very popular in the market and effectively helps
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T-1.8.1
businesses which are trying to expand the operations of the business effectively. The management of
the company can switch to MYOB as the software is highly efficient as well as the software take less
time for processing financial information of the business.
7. ENSURE DUE DILLIGENCE (10 marks)
Is there any risk of misappropriation of funds? Does the organisation have a sound audit trail system
to ensure complying with due diligence?
The analysis of the case of Australian Hardware, the management of the company does not face the
risks of misappropriation as the business has an appropriate internal control regarding all the
departments of the business. In addition to this, the business has sound audit system which assist the
business in appropriately managing the operations of the business in a systematic manner. Therefore,
it can be said that due diligence has been applied in the case which is presented above.
8. OTHER RECOMMENDATIONS (4 marks)
Are there any other recommendations to ensure financial viability of the organisation you want to
make and what are they?
Recommended
Changes
Objective Significant Issues People
Involved
/Time frame
1. Maintenance
of proper
control
The management needs to
maintain proper control over the
activities of the business.
Inappropriate supervision of
the activities of the
business affects the
operational process of the
business.
2 weeks
2. Proper
Employee
The management of the
company also aims to provide
Inefficiency in the work can
affect the productivity of the
4 weeks
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T-1.8.1
Training proper training to the employees
of the business so that proper
skills are developed of the
employees.
business which should also
be considered by the
business.
3.
4.
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T-1.8.1
PART C: PRESENTATION OF AUSTRALIAN HARDWARE FINANCIAL
ANALYSIS – 10%
In PART C, you are required to prepare a presentation to communicate and consult with relevant
stakeholders on the organisation’s financial analysis report findings and discuss the critical issues
such as organisational details, business strategies, marketing strategies and analysis, operational
plan, and financial plan.
Present the key points of the report verbally in order to demonstrate your communication skills as well
as the ability to explain your recommendations on budgets, financial analysis findings and deal with
questions.
 Your presentation will be a PowerPoint presentation of 15-20 slides using the critical elements
of the presentation structure. You may not use more than 20 slides.
 Include a list of reference or sources that you may have used to prepare the presentation.
 Marking weights for the presentation is within the marking criteria table below.
 You are also required to attach the presentation slides at the end of the assessment as
APPENDIX 1.
MARKING CRITERIA TABLE
The learner will be assessed on the following Marks Allocated Marks received
Explain organisational mission, vision and objectives 1
Explain the statutory requirements 1
Review and judgement on financial performance 1
Revision on budgets 1
Recommendations on changes on budget 1
Review on financial software 1
Financial forecasts and strategies 1
Ensure due diligence 1
Other recommendations 1
Slides submission 1
TOTAL MARKS 10
Comments by Trainer & Assessor
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T-1.8.1
APPENDIX 1
Attach Presentation Slides in this section.
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