Managing and Running a Small Business
VerifiedAdded on 2023/01/09
|16
|4356
|22
AI Summary
This report discusses the considerations of small business or social enterprise needs when planning and allocating resources, CRM and its main areas, transnational development and its benefits and drawbacks, and the development of an annual monthly cash flow forecast. It also covers break-even analysis and interpretation of financial statements. The subject is Managing and Running a Small Business, and the course code is Unit 29. The college/university is not mentioned.
Contribute Materials
Your contribution can guide someone’s learning journey. Share your
documents today.
Unit 29 Managing and
Running a Small
Business
Running a Small
Business
Secure Best Marks with AI Grader
Need help grading? Try our AI Grader for instant feedback on your assignments.
Table of Contents
INTRODUCTION................................................................................................................................3
TASK 1.................................................................................................................................................3
P1 Briefly discuss considerations of small business or social enterprise needs to address when
planning and allocating resources to achieve business objectives ..................................................3
TASK 2 ................................................................................................................................................5
P2 Explain CRM & analyse main areas within customer resources management, provide benefits
& drawbacks of each area................................................................................................................5
P3 Discuss about transnational development. What are the benefits and Drawbacks of business
developing transnationally? Then implement SWOT analysis on the idea developing
transnationally..................................................................................................................................6
TASK 3.................................................................................................................................................7
P4 Develop annual monthly cash flow forecast showing fixed and variable costs.........................7
P5 Discuss how break even analysis is applied to organisation......................................................9
P6 Examine Interpretation on key financial statements of a company for contribution in
successful management..................................................................................................................11
TASK 4 ..............................................................................................................................................12
P7 Explain briefly legislation & regulations that have impact on small businesses.....................12
CONCLUSION..................................................................................................................................13
REFERENCES...................................................................................................................................14
Books & Journal:...........................................................................................................................14
INTRODUCTION................................................................................................................................3
TASK 1.................................................................................................................................................3
P1 Briefly discuss considerations of small business or social enterprise needs to address when
planning and allocating resources to achieve business objectives ..................................................3
TASK 2 ................................................................................................................................................5
P2 Explain CRM & analyse main areas within customer resources management, provide benefits
& drawbacks of each area................................................................................................................5
P3 Discuss about transnational development. What are the benefits and Drawbacks of business
developing transnationally? Then implement SWOT analysis on the idea developing
transnationally..................................................................................................................................6
TASK 3.................................................................................................................................................7
P4 Develop annual monthly cash flow forecast showing fixed and variable costs.........................7
P5 Discuss how break even analysis is applied to organisation......................................................9
P6 Examine Interpretation on key financial statements of a company for contribution in
successful management..................................................................................................................11
TASK 4 ..............................................................................................................................................12
P7 Explain briefly legislation & regulations that have impact on small businesses.....................12
CONCLUSION..................................................................................................................................13
REFERENCES...................................................................................................................................14
Books & Journal:...........................................................................................................................14
INTRODUCTION
Business sector is increasing with rise in competition and it gives rise to economy as well as
growth. Small business within the market are developing and making the opportunity available
others to start new business. Fruition Consultants Ltd, a tax consultant firm in Aldgate East,
headquartered in UK. The firm provide services related to accounts, tax, audits to the clients
according to need & requirement. This report comprises of consideration of small and social needs
for allocation of resources, processes of CRM, business developing transnationally, annual cash
flow, break even analysis, interpretation of financial statements and key legislation as well as
regulation. The main purpose of this report is to carry out stages which are required for managing
small business.
TASK 1
P1 Briefly discuss considerations of small business or social enterprise needs to address when
planning and allocating resources to achieve business objectives
In UK economy, large, small and medium businesses contribute and are major reason for
the growth of economy. In year 2018, business sector grew by 3.5 % with major proportion of
small businesses and firms (Sedzro, 2017). In market, each businesses have different needs
according to their specification or uses. Resource allocation is is necessary which is to be done with
proper considerations. It is defined as assigning or right resources to their right places with motive
of carrying out the functions and operations effectively. It is important to use resources in efficient
manners so that they can be used in future perspectives. By properly allocating of resources , it is
easier to fulfil the business needs. Small as well as social enterprise both provide 70% contribution
to the development of economy of UK. This is the reason why growth rate of these enterprises is
increasing in market.
In context of Fruition Consultants Ltd, it is independent small business which also requires
various resources such as capital, manpower, tools etc. There are several elements which are needed
by entity and are mentioned below-
Flexibility- It is also crucial resource which is required organisation because it help in
achieving of objectives properly. Flexibility is defined as making changes in enterprise without
facing problem or issue (Traina, 2018). By using this, it is easier to follow the market trends in
effective way. In reference with chosen firm, by adopting this resource it is possible to make
changes. It is used with correct consideration so that goals are achieved properly. If it is not used in
organisation, then subordinates won;t be able to work in correct way.
Business sector is increasing with rise in competition and it gives rise to economy as well as
growth. Small business within the market are developing and making the opportunity available
others to start new business. Fruition Consultants Ltd, a tax consultant firm in Aldgate East,
headquartered in UK. The firm provide services related to accounts, tax, audits to the clients
according to need & requirement. This report comprises of consideration of small and social needs
for allocation of resources, processes of CRM, business developing transnationally, annual cash
flow, break even analysis, interpretation of financial statements and key legislation as well as
regulation. The main purpose of this report is to carry out stages which are required for managing
small business.
TASK 1
P1 Briefly discuss considerations of small business or social enterprise needs to address when
planning and allocating resources to achieve business objectives
In UK economy, large, small and medium businesses contribute and are major reason for
the growth of economy. In year 2018, business sector grew by 3.5 % with major proportion of
small businesses and firms (Sedzro, 2017). In market, each businesses have different needs
according to their specification or uses. Resource allocation is is necessary which is to be done with
proper considerations. It is defined as assigning or right resources to their right places with motive
of carrying out the functions and operations effectively. It is important to use resources in efficient
manners so that they can be used in future perspectives. By properly allocating of resources , it is
easier to fulfil the business needs. Small as well as social enterprise both provide 70% contribution
to the development of economy of UK. This is the reason why growth rate of these enterprises is
increasing in market.
In context of Fruition Consultants Ltd, it is independent small business which also requires
various resources such as capital, manpower, tools etc. There are several elements which are needed
by entity and are mentioned below-
Flexibility- It is also crucial resource which is required organisation because it help in
achieving of objectives properly. Flexibility is defined as making changes in enterprise without
facing problem or issue (Traina, 2018). By using this, it is easier to follow the market trends in
effective way. In reference with chosen firm, by adopting this resource it is possible to make
changes. It is used with correct consideration so that goals are achieved properly. If it is not used in
organisation, then subordinates won;t be able to work in correct way.
Employees- These are also needed by entities as they are work force who are able to
complete the give task on time period. Manpower also assist in increasing performance as well as
productivity of the enterprise which is beneficial for growth. Thus, selected entity have employees
but need more skilled staff more attracting more clients.
Assets- It is resource which can be owned, controlled to produce value for something which
is owned by enterprises. They are in physical form such as vehicles, real estate, furniture etc.
Without use of these assets, it is not possible to accomplish goals or objectives. In relation with
selected entity, to grow their small business they require assets with appropriate allocation. Without
use of assets, it is not possible to implement or initiate business activities (Forno, 2019).
Human Resource- This is crucial asset's of entity as they are the one who regulates and
formulates all policies as well as procedures. They are also considered as base of enterprise who
hire efficient and skilled employees for company. They manage employee & management & are
also responsible for developing work environment practices.
Financial resources- Then comes the financial resources which are essential to run the
business functions. In every corporation, there is need as well as requirement of capital at every
aspect. No company can run their activities without using financial resources. This is because to run
functions as well as operations, there always need of money so that necessary materials are
acquired. Therefore selected corporation use their financial resources in such a way that they are
used with optimum level (Pedwell, 2016).
Therefore, after analysing the above stated paragraph it has been seen that resources are
integral part of business without which core activities of firm cannot be carried out. It depends
upon the resources to give priority to which one. Moreover, allocating them is not easy & manager
or supervisors make assure that they are adopted with appropriate considerations so that it is easier
to attain objectives.
TASK 2
P2 Explain CRM & analyse main areas within customer resources management, provide benefits &
drawbacks of each area.
CRM is also known as Customer Relationship Management which refers to process by
which customer data is driven, accessed and managed by the firm. It is unpins sales management,
deliver customer insights by integrating with social media. This is helpful in achieving trust of end
users that their data era safe. Therefore, in relevance with Fruition Consultants Ltd. They also use
complete the give task on time period. Manpower also assist in increasing performance as well as
productivity of the enterprise which is beneficial for growth. Thus, selected entity have employees
but need more skilled staff more attracting more clients.
Assets- It is resource which can be owned, controlled to produce value for something which
is owned by enterprises. They are in physical form such as vehicles, real estate, furniture etc.
Without use of these assets, it is not possible to accomplish goals or objectives. In relation with
selected entity, to grow their small business they require assets with appropriate allocation. Without
use of assets, it is not possible to implement or initiate business activities (Forno, 2019).
Human Resource- This is crucial asset's of entity as they are the one who regulates and
formulates all policies as well as procedures. They are also considered as base of enterprise who
hire efficient and skilled employees for company. They manage employee & management & are
also responsible for developing work environment practices.
Financial resources- Then comes the financial resources which are essential to run the
business functions. In every corporation, there is need as well as requirement of capital at every
aspect. No company can run their activities without using financial resources. This is because to run
functions as well as operations, there always need of money so that necessary materials are
acquired. Therefore selected corporation use their financial resources in such a way that they are
used with optimum level (Pedwell, 2016).
Therefore, after analysing the above stated paragraph it has been seen that resources are
integral part of business without which core activities of firm cannot be carried out. It depends
upon the resources to give priority to which one. Moreover, allocating them is not easy & manager
or supervisors make assure that they are adopted with appropriate considerations so that it is easier
to attain objectives.
TASK 2
P2 Explain CRM & analyse main areas within customer resources management, provide benefits &
drawbacks of each area.
CRM is also known as Customer Relationship Management which refers to process by
which customer data is driven, accessed and managed by the firm. It is unpins sales management,
deliver customer insights by integrating with social media. This is helpful in achieving trust of end
users that their data era safe. Therefore, in relevance with Fruition Consultants Ltd. They also use
Paraphrase This Document
Need a fresh take? Get an instant paraphrase of this document with our AI Paraphraser
CRM so that they are able to manage their clients data in proper manner. Manager of entity make
ensures that CRM is maintained in such a was that problem do not occur during the process.
Portfolio Analysis- This a framework which is used by entities to examine the customer
value & market structure (Hatch, 2017). Through this, it is easy for corporation to segment their
their customers in the basis of variables such as demographic, psycho graphic etc.
Benefits- By use of this tool, end users decisions can be influenced in proper manner. As
it guides businesses to understand the end users needs and analysis properly. With help of this
analysis, products are categorized & well organised to gain insight of customers.
Drawbacks- These doesn't give a detailed information about market strategies and also
doesn't provide credentials about changes nature of portfolio.
CLM- It refers to Customer Life Cycle Management in which measurement of customer
related metrics, which indicate progress of business (Ervural, 2018). It is life cycle which is
concerned with aim of managing end user, influencing their purchasing decision etc. are being
focused as well as carried out systemically with procedure. This assist in understanding the
consumers, their feedbacks regarding company;'s products, credentials etc. Through this,
Benefits- With help of this tool, customer analytics are enhanced as this CLM assist in
understanding the pattern needs, ineffective processes, R& D opportunities etc.
Drawbacks- To carry or implement this life cycle a deep level of market research is to be
carried out so that credentials are occupied appropriately.
Therefore, the specified paragraph depicts that there areas where CLM is used with proper
analysis such as CLM, portfolio analysis. By examining CLM, customer driven data is being
managed appropriately. It also develop positive relationship between both end users as well as
corporation.
P3 Discuss about transnational development. What are the benefits and Drawbacks of business
developing transnationally? Then implement SWOT analysis on the idea developing transnationally.
Transnational development refers to process of enterprises of making the business
international and running their functions as well as operations globally. This strategy is being
adopted with aim of accessing large share of market & customers so that profitability of business
increases. By going with this, it is possible for companies to enlarge their level for activities across
the globe. In this, import and export of goods, products or services is done with motive of
achieving higher development and overall growth. This is less suitable for small business as they
do not have capital to go internationally or will be difficult for them to manages the process.
ensures that CRM is maintained in such a was that problem do not occur during the process.
Portfolio Analysis- This a framework which is used by entities to examine the customer
value & market structure (Hatch, 2017). Through this, it is easy for corporation to segment their
their customers in the basis of variables such as demographic, psycho graphic etc.
Benefits- By use of this tool, end users decisions can be influenced in proper manner. As
it guides businesses to understand the end users needs and analysis properly. With help of this
analysis, products are categorized & well organised to gain insight of customers.
Drawbacks- These doesn't give a detailed information about market strategies and also
doesn't provide credentials about changes nature of portfolio.
CLM- It refers to Customer Life Cycle Management in which measurement of customer
related metrics, which indicate progress of business (Ervural, 2018). It is life cycle which is
concerned with aim of managing end user, influencing their purchasing decision etc. are being
focused as well as carried out systemically with procedure. This assist in understanding the
consumers, their feedbacks regarding company;'s products, credentials etc. Through this,
Benefits- With help of this tool, customer analytics are enhanced as this CLM assist in
understanding the pattern needs, ineffective processes, R& D opportunities etc.
Drawbacks- To carry or implement this life cycle a deep level of market research is to be
carried out so that credentials are occupied appropriately.
Therefore, the specified paragraph depicts that there areas where CLM is used with proper
analysis such as CLM, portfolio analysis. By examining CLM, customer driven data is being
managed appropriately. It also develop positive relationship between both end users as well as
corporation.
P3 Discuss about transnational development. What are the benefits and Drawbacks of business
developing transnationally? Then implement SWOT analysis on the idea developing transnationally.
Transnational development refers to process of enterprises of making the business
international and running their functions as well as operations globally. This strategy is being
adopted with aim of accessing large share of market & customers so that profitability of business
increases. By going with this, it is possible for companies to enlarge their level for activities across
the globe. In this, import and export of goods, products or services is done with motive of
achieving higher development and overall growth. This is less suitable for small business as they
do not have capital to go internationally or will be difficult for them to manages the process.
Advantages-
Generates higher profit- This help companies to generate more profit with better
opportunities. Transnationally business development makes it possible for Fruition
Consultants Ltd to make money at global level.
Availability of resources- When business is developed at transnational level, it is easier
for company to get the required resources and also they can use them in efficient manner.
Makes entity international- This idea of becoming transnationally makes organisation
internationally through which they get recognition from worldwide end users. It also give
them opportunity to come in partnership or joint venture other companies (Robinson, 2017).
Disadvantages-
Risk- This strategy is riskier because huge capital is required and chances of uncertain
events are more. Managers have to be careful of external environment which can affects the
business at depth.
SWOT Analysis- It is a tool which is used by entity to determine the effects of internal
environment and implement strategic planning (Williams, 2016). To implement this tool
effectively, market research is required to be adopted so that information is gained regarding the
environment. It is time consuming process and which requires information regarding market,
competitors and their adopted strategy.
Strength
Developing business transnationally
assist company to access larger share of
market (Khansalar, 2017).
Fruition Consultants Ltd. Will be able to
expand their services with new ideas in
new locations and new clients.
Weakness
Main weak point of this developing
transnationally is that because of
requirement of huge capital it become
difficult to adopt this strategy.
Resources are required at larger scale
when going with this strategy.
Opportunity
Enterprise have the opportunity to get
recognized in other countries.
Threat
With increase in competition, there many
other businesses who have been adopting
Generates higher profit- This help companies to generate more profit with better
opportunities. Transnationally business development makes it possible for Fruition
Consultants Ltd to make money at global level.
Availability of resources- When business is developed at transnational level, it is easier
for company to get the required resources and also they can use them in efficient manner.
Makes entity international- This idea of becoming transnationally makes organisation
internationally through which they get recognition from worldwide end users. It also give
them opportunity to come in partnership or joint venture other companies (Robinson, 2017).
Disadvantages-
Risk- This strategy is riskier because huge capital is required and chances of uncertain
events are more. Managers have to be careful of external environment which can affects the
business at depth.
SWOT Analysis- It is a tool which is used by entity to determine the effects of internal
environment and implement strategic planning (Williams, 2016). To implement this tool
effectively, market research is required to be adopted so that information is gained regarding the
environment. It is time consuming process and which requires information regarding market,
competitors and their adopted strategy.
Strength
Developing business transnationally
assist company to access larger share of
market (Khansalar, 2017).
Fruition Consultants Ltd. Will be able to
expand their services with new ideas in
new locations and new clients.
Weakness
Main weak point of this developing
transnationally is that because of
requirement of huge capital it become
difficult to adopt this strategy.
Resources are required at larger scale
when going with this strategy.
Opportunity
Enterprise have the opportunity to get
recognized in other countries.
Threat
With increase in competition, there many
other businesses who have been adopting
this strategy and can get down the new
entries easily.
After a brief analysis of above matter, it has been examined that transnationally developing
business is crucial to gain profit and expand business at larger scale. To use this strategy, proper
market research is to be done so that decisions are taken in proper manner. Then, with help of
SWOT Analysis, it is easier to analyse whether to adopt this strategy or not.
TASK 3
P4 Develop annual monthly cash flow forecast showing fixed and variable costs
Cash Flow- It is accounting statement which is used by enterprise to analyse the cash flow
during the time period (Melander, 2017). With help of cash flow, it is easy to examine the
movement of money within the business. In this, all transactions are recorded and analysed so that
financial position of firm is known. In relevance with selected entity, they as it is tax consultant firm
they prepare their cash flow with proper analysis.
Budgeting, planning and forecasting
Budgeting It refers to financial plan which is prepared with aim of analysing the
controlling or managing of money flow (Riccardi, 2018). Planning is defined as process of
implementing plan regarding the activities that are required to accomplish goals. Forecasting refers
to technique of making future predictions depending upon the past or present form of data. These
components are essential to used in business as it help them to make decisions appropriately. They
are used by company so that accounting & auditing is done with correct measures. The given
organisation have skilled employees which have knowledge in accounting through they which they
are able to manage and maintain all accounts of business.
. Below is the cash flow and table showing Balance sheet, CFS and P& L Account of Fruition
Consultants Ltd-
Year 2018 (value in £) 2019 (value in £)
Fixed assets 120 220
Stock 30 45
Debtors 80 65
Bank 30 35
entries easily.
After a brief analysis of above matter, it has been examined that transnationally developing
business is crucial to gain profit and expand business at larger scale. To use this strategy, proper
market research is to be done so that decisions are taken in proper manner. Then, with help of
SWOT Analysis, it is easier to analyse whether to adopt this strategy or not.
TASK 3
P4 Develop annual monthly cash flow forecast showing fixed and variable costs
Cash Flow- It is accounting statement which is used by enterprise to analyse the cash flow
during the time period (Melander, 2017). With help of cash flow, it is easy to examine the
movement of money within the business. In this, all transactions are recorded and analysed so that
financial position of firm is known. In relevance with selected entity, they as it is tax consultant firm
they prepare their cash flow with proper analysis.
Budgeting, planning and forecasting
Budgeting It refers to financial plan which is prepared with aim of analysing the
controlling or managing of money flow (Riccardi, 2018). Planning is defined as process of
implementing plan regarding the activities that are required to accomplish goals. Forecasting refers
to technique of making future predictions depending upon the past or present form of data. These
components are essential to used in business as it help them to make decisions appropriately. They
are used by company so that accounting & auditing is done with correct measures. The given
organisation have skilled employees which have knowledge in accounting through they which they
are able to manage and maintain all accounts of business.
. Below is the cash flow and table showing Balance sheet, CFS and P& L Account of Fruition
Consultants Ltd-
Year 2018 (value in £) 2019 (value in £)
Fixed assets 120 220
Stock 30 45
Debtors 80 65
Bank 30 35
Secure Best Marks with AI Grader
Need help grading? Try our AI Grader for instant feedback on your assignments.
Total 230 340
Creditors 130 150
Bank overdraft 80 50
Total 670 905
Working capital 30 80
Profit and Loss Account at the year ended
2018 2019
Sales 40 60
Cost of sales 20 17
Gross profit 20 43
Overheads 8 9
Net. Profit 12 34
Cash flow Statement
Cash budget
for the year
Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year
Beginning cash balance 28000 30250 31550 29650 28750
Budgeted cash receipts 13400 37550 64690 92370 118170
Total cash available 41400 67800 96240 122020 146920
Cash distributed
Direct material 1500 1050 1650 1500 1550
Creditors 130 150
Bank overdraft 80 50
Total 670 905
Working capital 30 80
Profit and Loss Account at the year ended
2018 2019
Sales 40 60
Cost of sales 20 17
Gross profit 20 43
Overheads 8 9
Net. Profit 12 34
Cash flow Statement
Cash budget
for the year
Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year
Beginning cash balance 28000 30250 31550 29650 28750
Budgeted cash receipts 13400 37550 64690 92370 118170
Total cash available 41400 67800 96240 122020 146920
Cash distributed
Direct material 1500 1050 1650 1500 1550
Direct labour 1300 660 850 850 680
Overhead 500 650 630 700 670
Selling and distribution 550 750 740 800 760
Total cost use 3850 3110 3870 3850 3660
Cash surplus/ deficit 37550 64690 92370 118170 143260
Therefore, from the above examined paragraphs and table it has been seen that it is crucial
for small businesses to produce CFS so that cash are used in most effective way. Also, this helps
them to make decisions properly with correct measures. So, it is duty of manager to make assures
that everything is being done in with applied knowledge of accounting. Moreover, these assist in
elimination of risk or challenges up to some extent. Budgeting, planning and forecasting are
important components of accounts which are to be adopted with effective measures and
understanding (Sedzro, 2017).
P5 Discuss how break even analysis is applied to organisation
Break Even Analysis ( BEA)- This is a tool which is adopted by corporation with of
determining when profit or sales ratio will increase, or when they will be change in their cost.
(Vettraino, 2020) By using this, companies are able to calculate their marginal of safety based on
revenues or cost. Moreover, it helps in determining the different price levels of business through
sales is affected. It is critical task because in this calculation is to be done at all levels. It is time
consuming procedure which is to be carried out with appropriate measures and assumptions.
It is calculated as-
Break even quantity= TFC/ (P -AVC)
TFC= Total fixed cost
AVC= Average variable cost
P- Price
Advantages-
Measure profit- When BEA is adopted by company, it helps in measuring profit of the
company according to the different sales and variables. Moreover, by measuring profit it
helps them to analyse whether the ration are correct or not which have been determined.
Overhead 500 650 630 700 670
Selling and distribution 550 750 740 800 760
Total cost use 3850 3110 3870 3850 3660
Cash surplus/ deficit 37550 64690 92370 118170 143260
Therefore, from the above examined paragraphs and table it has been seen that it is crucial
for small businesses to produce CFS so that cash are used in most effective way. Also, this helps
them to make decisions properly with correct measures. So, it is duty of manager to make assures
that everything is being done in with applied knowledge of accounting. Moreover, these assist in
elimination of risk or challenges up to some extent. Budgeting, planning and forecasting are
important components of accounts which are to be adopted with effective measures and
understanding (Sedzro, 2017).
P5 Discuss how break even analysis is applied to organisation
Break Even Analysis ( BEA)- This is a tool which is adopted by corporation with of
determining when profit or sales ratio will increase, or when they will be change in their cost.
(Vettraino, 2020) By using this, companies are able to calculate their marginal of safety based on
revenues or cost. Moreover, it helps in determining the different price levels of business through
sales is affected. It is critical task because in this calculation is to be done at all levels. It is time
consuming procedure which is to be carried out with appropriate measures and assumptions.
It is calculated as-
Break even quantity= TFC/ (P -AVC)
TFC= Total fixed cost
AVC= Average variable cost
P- Price
Advantages-
Measure profit- When BEA is adopted by company, it helps in measuring profit of the
company according to the different sales and variables. Moreover, by measuring profit it
helps them to analyse whether the ration are correct or not which have been determined.
Forecasting- Another advantage is that through use of this tool, forecasting is done in
effective way by company by examining the changes in sales price. Forecasting is done
with aim of examining position of products/business in future.
Financial position- Through use of this tool, it is possible to analyse and determine the
financial position of firm. This helps in carrying out the decision making effectively.
Optimum use of money- With help of break-even analysis, resources & money of
management is used in optimum way which also leads to reducing wastage of resources.
This is also helpful in determining the resources which are used or not.
Disadvantage-
Assumptions- This is based on assumptions and does not give always correct results of
business and other processes (Traina, 2018). Any wrong assumption might disrupts the
business environment as changes have to be made again.
Time consuming- It is time consuming process as it is difficult to prepare charts and
graphs. Because if not done properly, wrong assumptions will be made which will be issue
in future period of time.
Calculation based- It is based on calculation and any error might cause a issue to the
predictions. To use this tool, employees with background in economics or accounts are
required with good knowledge.
In relevance with selected entity, they apply this by properly examining the profit and sales
of the company. So, it is possible to make decisions regarding the company's information which are
related to accounting. Through use of BEA, errors are identified and changes are made which is
beneficial for enterprise. Variable & fixed cost are to be known for proper accomplishment of
results.
P6 Examine Interpretation on key financial statements of a company for contribution in successful
management
Financial statements are essential which are to be implemented and prepared with high
level of understanding and expertise. By properly preparing or developing financial statements, they
help in determining of financial position of entity. In country, small business gives a boost to the
enterprise and productivity. The ratio of these types of businesses is increasing at rapid scale.
Moreover, when preparing such statements accounting knowledge is to be used at depth so that all
process is carried out effectively. There are numerous statements which are adopted and used by
Fruition Consultants Ltd. And are discussed below-
Balance Sheet- This financial statement which refers to recording and assigning of
company's accounts at their right place (Forno, 2019). It is important to prepare as it give a insight
effective way by company by examining the changes in sales price. Forecasting is done
with aim of examining position of products/business in future.
Financial position- Through use of this tool, it is possible to analyse and determine the
financial position of firm. This helps in carrying out the decision making effectively.
Optimum use of money- With help of break-even analysis, resources & money of
management is used in optimum way which also leads to reducing wastage of resources.
This is also helpful in determining the resources which are used or not.
Disadvantage-
Assumptions- This is based on assumptions and does not give always correct results of
business and other processes (Traina, 2018). Any wrong assumption might disrupts the
business environment as changes have to be made again.
Time consuming- It is time consuming process as it is difficult to prepare charts and
graphs. Because if not done properly, wrong assumptions will be made which will be issue
in future period of time.
Calculation based- It is based on calculation and any error might cause a issue to the
predictions. To use this tool, employees with background in economics or accounts are
required with good knowledge.
In relevance with selected entity, they apply this by properly examining the profit and sales
of the company. So, it is possible to make decisions regarding the company's information which are
related to accounting. Through use of BEA, errors are identified and changes are made which is
beneficial for enterprise. Variable & fixed cost are to be known for proper accomplishment of
results.
P6 Examine Interpretation on key financial statements of a company for contribution in successful
management
Financial statements are essential which are to be implemented and prepared with high
level of understanding and expertise. By properly preparing or developing financial statements, they
help in determining of financial position of entity. In country, small business gives a boost to the
enterprise and productivity. The ratio of these types of businesses is increasing at rapid scale.
Moreover, when preparing such statements accounting knowledge is to be used at depth so that all
process is carried out effectively. There are numerous statements which are adopted and used by
Fruition Consultants Ltd. And are discussed below-
Balance Sheet- This financial statement which refers to recording and assigning of
company's accounts at their right place (Forno, 2019). It is important to prepare as it give a insight
Paraphrase This Document
Need a fresh take? Get an instant paraphrase of this document with our AI Paraphraser
rationale to investors for investing the money in respective business. In reference with given
corporation, they prepare there balance sheet with help of detailed credentials and separate all
accounts with their respective places. In this, it is prepared with separate accounts and sub-accounts
are placed accordingly.
Cash Flow- It is process or statement of determining cash inflow and outflow with motive
to determine the cash sheet of firm (Pedwell, 2016). It is done via analysing fixed and variable cost.
In this, whether the cash is available within the company or not is known. This assist them in using
of cash or managing expenses. It is compulsory part of company;s financial report since 1987. It is
of different types for example- cash operating activities, investing and financing activities. It rely
on the enterprise to prep[are which one depending upon the situations. It's crucial to analyse that the
CFS is different from income statement & balance sheet because it does not include the amount of
future incoming and outgoing cash that has been recorded on credit. The selected firm, manager of
company cross checks all the inflow of cash and vice versa.
Profit and loss account- These are also essential to be focused as they are the statements in
which they summarizes cost, expenses revenue during specific interval (Hatch, 2017). They depicts
the corporations ability to generate profit by reducing cost, or by increasing revenue. These are
prepare in every on quarterly or annually. Furthermore, comparison is also done with various
accounting periods such as operating cost, R& D spending etc. These determine business
performance and progress at depth. Probably, P& L are prepared at end of accounting periods.
After analysing given matter, it is seen that from the interpretation these three are used by
businesses to determine their position in market. Then, it is necessary for them to use with correct
analysis so that all transactions are are recorded & can be used whenever there is requirement.
These assist in determining of results which are needed to examine portfolio of cash in business.
TASK 4
P7 Explain briefly legislation & regulations that have impact on small businesses
Legislations are the laws that or body that makes the laws or processed them. Regulations
are those which refers to on going process of monitoring or enforcing law (Ervural, 2018). These
are to be adopted and followed by business so that all activities are carried out legally. These are
important as they protects the citizen from any illegal actions also protect their rights in society.
Both legislation as well as regulations are necessary to be examined so that small businesses find it
easier to run their operations. Furthermore, legal teams are hired by companies so that they are able
to follow all laws which are related to their business, impact of legislations is deeper and which
corporation, they prepare there balance sheet with help of detailed credentials and separate all
accounts with their respective places. In this, it is prepared with separate accounts and sub-accounts
are placed accordingly.
Cash Flow- It is process or statement of determining cash inflow and outflow with motive
to determine the cash sheet of firm (Pedwell, 2016). It is done via analysing fixed and variable cost.
In this, whether the cash is available within the company or not is known. This assist them in using
of cash or managing expenses. It is compulsory part of company;s financial report since 1987. It is
of different types for example- cash operating activities, investing and financing activities. It rely
on the enterprise to prep[are which one depending upon the situations. It's crucial to analyse that the
CFS is different from income statement & balance sheet because it does not include the amount of
future incoming and outgoing cash that has been recorded on credit. The selected firm, manager of
company cross checks all the inflow of cash and vice versa.
Profit and loss account- These are also essential to be focused as they are the statements in
which they summarizes cost, expenses revenue during specific interval (Hatch, 2017). They depicts
the corporations ability to generate profit by reducing cost, or by increasing revenue. These are
prepare in every on quarterly or annually. Furthermore, comparison is also done with various
accounting periods such as operating cost, R& D spending etc. These determine business
performance and progress at depth. Probably, P& L are prepared at end of accounting periods.
After analysing given matter, it is seen that from the interpretation these three are used by
businesses to determine their position in market. Then, it is necessary for them to use with correct
analysis so that all transactions are are recorded & can be used whenever there is requirement.
These assist in determining of results which are needed to examine portfolio of cash in business.
TASK 4
P7 Explain briefly legislation & regulations that have impact on small businesses
Legislations are the laws that or body that makes the laws or processed them. Regulations
are those which refers to on going process of monitoring or enforcing law (Ervural, 2018). These
are to be adopted and followed by business so that all activities are carried out legally. These are
important as they protects the citizen from any illegal actions also protect their rights in society.
Both legislation as well as regulations are necessary to be examined so that small businesses find it
easier to run their operations. Furthermore, legal teams are hired by companies so that they are able
to follow all laws which are related to their business, impact of legislations is deeper and which
make it difficult for them to initiate something new. There are several types of regulations which
are mentioned below-
Consumer law- This is law which was introduced with aim of protecting consumers interest
and their rights whether if any unpractised done to them. With the help of this law, it is easier to
analyse if consumers are being cheated or mistreated by sellers through any case. In relevance with
selected entity, they assures that all clients or customers are treated well and also they are being
provided with better services (Robinson, 2017). Under this law, if misleading of information or any
customer is ill treated then they may file a case against those sellers.
Employment law- This is the law which depicts or regulates the relationship between both
employer as well as employees. Under this, this guides the minimum requirements which are to be
given by employer and minimum or average salary for their work.
Data Protection- This is act in which it states that information and data of every customer is to
be protected. Under this, it is duty of corporation to safe and secures the personal data of every
customer. Thus, selected firm uses advance technology and online management system to protect
the credentials of every clients so that trust stays in between both parties.
Therefore, legislations & laws help businesses to run their functions legally so that issues
do not occurs during process (Williams, 2016).
are mentioned below-
Consumer law- This is law which was introduced with aim of protecting consumers interest
and their rights whether if any unpractised done to them. With the help of this law, it is easier to
analyse if consumers are being cheated or mistreated by sellers through any case. In relevance with
selected entity, they assures that all clients or customers are treated well and also they are being
provided with better services (Robinson, 2017). Under this law, if misleading of information or any
customer is ill treated then they may file a case against those sellers.
Employment law- This is the law which depicts or regulates the relationship between both
employer as well as employees. Under this, this guides the minimum requirements which are to be
given by employer and minimum or average salary for their work.
Data Protection- This is act in which it states that information and data of every customer is to
be protected. Under this, it is duty of corporation to safe and secures the personal data of every
customer. Thus, selected firm uses advance technology and online management system to protect
the credentials of every clients so that trust stays in between both parties.
Therefore, legislations & laws help businesses to run their functions legally so that issues
do not occurs during process (Williams, 2016).
CONCLUSION
After a brief analysis of above report, it has been seen that managing small business is not
easier and required deep level of market research. The present report gives a brief knowledge about
how the small and social enterprises are being managed and contribute to economy. Moreover,
discussions have been made about, financial statements, legislations, regulations, allocation of
resources. Then further, transnational business is also explained and CRM with detailed concept.
So, social as well as small enterprises are to be managed as they develops country's economy at
wider level.
After a brief analysis of above report, it has been seen that managing small business is not
easier and required deep level of market research. The present report gives a brief knowledge about
how the small and social enterprises are being managed and contribute to economy. Moreover,
discussions have been made about, financial statements, legislations, regulations, allocation of
resources. Then further, transnational business is also explained and CRM with detailed concept.
So, social as well as small enterprises are to be managed as they develops country's economy at
wider level.
Secure Best Marks with AI Grader
Need help grading? Try our AI Grader for instant feedback on your assignments.
REFERENCES
Books & Journal:
Sedzro, 2017. Allocation of resources using a microgrid formation approach for resilient electric
grids.IEEE Transactions on Power Systems,33(3), pp.2633-2643.
Traina, 2018. Is aggregate market power increasing? production trends using financial
statements.Production Trends Using Financial Statements (February 8, 2018).
Forno, 2019. Protest, Social Movements, and Spaces for Politically Oriented Consumerist Actions
—Nationally, Transnationally, and Locally. In The Oxford Handbook of Political
Consumerism.
Pedwell, 2016. De-colonising empathy: Thinking affect transnationally.Samyukta: A Journal of
Womens Studies,16(1), pp.27-49.
Hatch, 2017. The cost effectiveness of vancomycin for preventing infections after shoulder
arthroplasty: a break-even analysis.Journal of shoulder and elbow surgery,26(3), pp.472-
477.
Ervural, 2018. An ANP and fuzzy TOPSIS-based SWOT analysis for Turkey’s energy
planning.Renewable and Sustainable Energy Reviews 82, pp.1538-1550.
Robinson, K.M., 2017. Can We Afford That?: One Library’s Transition to a Data-Rich Acquisitions
Environment for E-Resource Budgeting and Forecasting.Technical Services Quarterly,34(3),
pp.257-267.
Williams, 2016. The status of budget forecasting.Journal of Public and Nonprofit Affairs,2(2),
pp.127-160.
Khansalar, 2017. Cash flow disaggregation and prediction of cash flow.Journal of Applied
Accounting Research,18(4), pp.464-479.
Melander, 2017. The effect of cash flow on investment: an empirical test of the balance sheet
theory.Empirical Economics,53(2), pp.695-716.
Riccardi, L., 2018. Main Legislations and Regulations. InIntroduction to Chinese Fiscal System(pp.
123-297). Springer, Singapore.
Vettraino, 2020. A worldwide perspective of the legislation and regulations governing sentinel
plants.Biological Invasions,22(2), pp.353-362.
Books & Journal:
Sedzro, 2017. Allocation of resources using a microgrid formation approach for resilient electric
grids.IEEE Transactions on Power Systems,33(3), pp.2633-2643.
Traina, 2018. Is aggregate market power increasing? production trends using financial
statements.Production Trends Using Financial Statements (February 8, 2018).
Forno, 2019. Protest, Social Movements, and Spaces for Politically Oriented Consumerist Actions
—Nationally, Transnationally, and Locally. In The Oxford Handbook of Political
Consumerism.
Pedwell, 2016. De-colonising empathy: Thinking affect transnationally.Samyukta: A Journal of
Womens Studies,16(1), pp.27-49.
Hatch, 2017. The cost effectiveness of vancomycin for preventing infections after shoulder
arthroplasty: a break-even analysis.Journal of shoulder and elbow surgery,26(3), pp.472-
477.
Ervural, 2018. An ANP and fuzzy TOPSIS-based SWOT analysis for Turkey’s energy
planning.Renewable and Sustainable Energy Reviews 82, pp.1538-1550.
Robinson, K.M., 2017. Can We Afford That?: One Library’s Transition to a Data-Rich Acquisitions
Environment for E-Resource Budgeting and Forecasting.Technical Services Quarterly,34(3),
pp.257-267.
Williams, 2016. The status of budget forecasting.Journal of Public and Nonprofit Affairs,2(2),
pp.127-160.
Khansalar, 2017. Cash flow disaggregation and prediction of cash flow.Journal of Applied
Accounting Research,18(4), pp.464-479.
Melander, 2017. The effect of cash flow on investment: an empirical test of the balance sheet
theory.Empirical Economics,53(2), pp.695-716.
Riccardi, L., 2018. Main Legislations and Regulations. InIntroduction to Chinese Fiscal System(pp.
123-297). Springer, Singapore.
Vettraino, 2020. A worldwide perspective of the legislation and regulations governing sentinel
plants.Biological Invasions,22(2), pp.353-362.
1 out of 16
Related Documents
Your All-in-One AI-Powered Toolkit for Academic Success.
+13062052269
info@desklib.com
Available 24*7 on WhatsApp / Email
Unlock your academic potential
© 2024 | Zucol Services PVT LTD | All rights reserved.