AHIC Diploma of Accounting Assessment - FNSACC501 - Term 1, 2024

This document contains solutions to an accounting assessment for the Diploma of Accounting course, focusing on the unit FNSACC501. The assessment covers various aspects of financial and business performance information. It includes discussions on business expenses and tax legislation, trust allowances, forecast returns, and adherence of NFP sector organizations to government financial policies. The assessment also involves a loan repayment calculation, identifying business performance objectives, defining GPFRU's, and discussing state and territory charges. Additionally, the assignment analyzes a client information form (CIF) to address client objectives and financial options for business performance information. It concludes with a forecast versus actual report for an operational project, and identifies stages of financial management and agreed criteria for return analysis. This assignment provides comprehensive insights into financial accounting principles and practical applications.

Assessment Details
Qualification Code/Title Diploma of Accounting
Assessment Type Assessment -2 Time allowed
Due Date Location AHIC Term / Year
Student Details
Student Name 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: _____/______/__________
Assessor Details
Assessor’s Name
RESULTS (Please
Circle) SATISFACTORY NOT SATISFACTORY
Feedback to student:
.........................................................................................................................................................................................
.........................................................................................................................................................................................
.........................................................................................................................................................................................
.........................................................................................................................................................................................
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 appeal rights.
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.
Signature: ________________________________________
Date: ______/_______/___________
Instructions to the Candidates
 This assessment is to be completed in class supervised by assessor.
 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 aspect of this assessment, please ask for clarification from your assessor.
 Please refer to the College re-submission and re-sit policy for more information.
 If you have questions and other concerns that may affect your performance in the examination please inform the assessor
immediately.
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 1 of 21
Unit of Competency
National Code/Title FNSACC501-Provide Financial and Business Performance Information

Project 1
Part 1
1. How are business expenses treated in regard to tax legislation? Discuss in 30 to 50 words.
Answer: For the purpose of tax deductible expenditure expenses are generally considered to
be ordinary, necessary and reasonable expenses that assist in earning business income. therefore,
business expenses can be subtracted from the income of the company prior to considered for
taxation.
2. What allowance in tax legislation is there for businesses that are managed on behalf of a
trust? Discuss in 80 to 100 words.
Answer: A trust can be defined as the structure that where the trustee executes the business on
behalf of the trust members or beneficiaries. The benefits that are available to the trust are as
follows;
a. Reduction in the liability particularly if the corporate is the trustee
b. A benefit is provided for the protection of the assets
c. A benefit is provided relating to the flexibility of the asset and distribution of income
3. Describe forecast returns and set up and describe a simple table over several years for
similar amounts. Discuss in 50 to 80 words.
Answer: Forecast returns is the use of the historic information to determine the future
trends. The forecasting model is used to cope up with the uncertainty future. For a data that is
simple over the period of several years constructing portfolio should be adopted in choosing the best
available model to forecast the class of asset returns.
4. Describe (150 to 180 words) how NFP sector organisations adhere to government financial
policies where the preparation of statutory returns are required.
Answer: The NFP sector organizes and prepares the report in respect of the general
government sector financial reporting under the AASB 102 Inventories, AASB 116 property plant and
equipment’s AASB 138 intangible assets. Disclosure requirements in regard to the whole of the
government and GGS financial reporting are stated under the 1049. The non-for profit subsidiary is
anticipated to keep their information to facilitate the preparation for the disclosure of the financial
statements with the non-for profit entities are required to present their financial disclosure in the
non-for profit consolidated financial statements. The segment reporting by the Non-for-profit
governments must be addressed in the AASB 1049 and AASB 1052 instead of reporting in AASB 8. In
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 2 of 21

respect of the government compliance the non-for-profit entities are primarily concerned with the
achievement of the objectives instead of generation of the profit. Disclosure needs concerning the
whole of the government and GGS financial reporting must adhere with the AASB 1049 for the
preparation of the statutory returns.
5. Your client is XYZ company. After discussions it is identified they require a spreadsheet
summarising the repayment amounts and current balance for a long-term loan of $500,000
to be repaid over eight years at a rate of 10% per annum. They are interested in business
information that will show the amount they need to repay each year.
Show the calculations required for the loan.
Prepare the spreadsheet for the loan. Include a summary section to comment on the table.
Round the initial opening balance of the loan up to the nearest dollar and round up to
present values in whole dollars.
Answer:
Periods (Payments) Per Year 12
Option A: Solve for the PAYMENT
Loan Amount $ 5,00,000.00
Annual Interest Rate 10.000%
Term of Loan (in Years) 8
Monthly PAYMENT $ 7,587.08
Yearly Payments $ 91,044.98
Total Interest $ 2,28,359.88
6. List the four categories that client’s business performance objectives can be set up as.
Answer: The four categories of clients business performance objectives that can be set are as
follows;
a. Customer oriented objectives
b. Strategic Market Objectives
c. Financial focussed objectives
d. Employee growth objectives
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 3 of 21

7. What does GPFRU’s mean? List three potential users.
Answer: GPFRU’s represents general purpose of financial reporting which is issued all through the
year to assist the investors and creditors in the process of their decision making.
Three potential users of the GPFRU’s are as follows;
a. Current and potential investors
b. Lenders
c. Other creditors
8. What type of clients can expect state and territory charges? Discuss in 50 to 80 words.
Answer: Clients that are included in the state and territory taxes comprises of the following;
a. Not-for-profit companies
b. Employers that are held accountable for payroll tax whose total Australian wages goes past
the tax-free threshold limit.
c. Non-for-profit societies, clubs and religious institutions
9. How can the amount of taxes and charges on land be calculated? Discuss in 50 to 80 words.
Answer: Land tax is yearly amount of tax on land. It is based on the land that is owned from June 30
and it is computed on the unimproved value of the land that is determined by the valuer-general.
Land tax is computed based on the aggregated taxable value of the land held in the ownership at the
midnight of 30 June.
10. What practices should these businesses and those who pay Commonwealth taxes complete?
Discuss in 80 to 100 words.
Answer: Practices that businesses and those paying commonwealth taxes should complete are as
follows;
a. Ensuring that the adequacy of material is maintained
b. General and administrative practices must be considered to make sure that the statement of
tax return is based on the ground of non-applicability of the penalty.
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 4 of 21

c. General and administrative practices must be established by making appropriate
communications comprising of the wide range of the issues for the taxpayers
d. To improve the certainty of the taxpayers by making the advice of the tax office more
reliable and legally binding on the commissioner.
Part 2
1. Use the supplied CIF to answer the questions listed.
a. Where can information about client objectives be found?
b. Describe (80 to 100 words) how the Type of business section on the supplied CIF is
relevant to the client’s legal and financial requirements, explain how this is important to
taxation.
ABC Financial Management
Client Information Form
Surname Citizen
First name John
Employment title Manager
Other key staff
Type of business Building services Sole proprietor
Financial
information sought
Provide ongoing financial management especially in the reduction of annual
income tax and checking goods and services tax (GST) and other legislative
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 5 of 21

reports.
Size Four full-time or equivalent staff.
Business assets $550,000 Tools, vehicles, building inventories
Revenue $ 1 Million
Expenses $ 680,000
Cash flow –$50,000
Number of years
operating
Current
information
Internal reports by part-time administrative staff. Includes fortnightly payroll
and payment of accounts and banking.
Answer to a:
The information of the client objectives can be found under the section of “financial information
sought” that defines the objectives of clients for the financial services sought.
Answer to b:
As evident from the section of type of business that is supplied on the CIF, it can be stated that
financial information that is sought by the clients is stated for the business services undertaken by
the sole proprietor. The services includes the information that is sought by the client in the areas of
management particularly in the areas of reduction of taxation that is paid annually and keeping a
check on the goods and service tax with other relevant legislative reports.
2. You have had discussions with the client who has explained that you were recommended
through a colleague in the NFP sector who you have been providing acquittal services to.
Describe the different types of financial options that are available for different clients related
to the provision of business performance information. Discuss in 150 to 180 words.
Answer: The types of financial options that are available for the clients associated to the provision of
the business performance information are as follows;
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 6 of 21

a. Assessing the needs of the clients: Financial options and procedures must be discussed with
the clients in order to develop appropriate plans for the provision of the information and the
attainment of the client’s goals. Additionally, the progress of the plans must be reviewed
constantly against the agree criteria and results should be clearly communicated to the
client.
b. Analysing the data: Analysis must be undertaken to make sure that the consistency of the
analysis is present with the business of clients and personal objectives. Advice relating to
the reliability and accuracy of the data must be sought from appropriate authorities and
sources in compliance with the organizational procedures. Additionally, advising the clients
to assess the financial potential of the business and its future funding requirements.
c. Preparation of the advice: Advising the clients with the realistic view of the business financial
performance and compliance along with the issues of the taxation and comparisons of the
options.
3. Prepare an example of a forecast versus actual for XYZ company for an operational project.
Include columns to show forecast returns versus actual on a multi period report. Include a
summary section.
Answer:
INCOME Actual Budget Difference
Operating Income
Category 1 25,000 20,000 5,000
Total Operating Income 25,000 20,000 5,000
Non-Operating Income
Interest Income 2,500 2,250 250
Rental Income 3,500 3,150 350
Gifts Received 1,250 1,125 125
Donations 750 675 75
Total Non-Operating Income 8,000 7,200 800
Total INCOME 33,000 27,200 5,800
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 7 of 21

EXPENSES
Operating Expenses
Accounting and Legal 3,250 2,925 325
Advertising 1,250 1,125 125
Depreciation 550 495 55
Dues and Subscriptions 750 675 75
Insurance 1,050 945 105
Interest Expense 1,200 1,080 120
Maintenance and Repairs 250 225 25
Office Supplies 500 450 50
Payroll Expenses 650 585 65
Postage 125 113 13
Rent 900 810 90
Research and Development 750 675 75
Salaries and Wages 3,000 2,700 300
Taxes and Licenses 350 315 35
Telephone [phone]
Travel 250 225 25
Utilities 2,000 1,800 200
Web Hosting and Domains 120 108 12
Total Operating Expenses 17,145 15,431 1,715
Non-Recurring Expenses
Furniture, Equipment and Software 2,000 2,000
Gifts Given 500 500
Total Non-Recurring Expenses 2,500 - 2,500
Total EXPENSES 19,645 15,431 4,215
Net Income Before Taxes 13,355 11,770 1,586
Income Tax Expense 2,000 2,500 (500)
NET INCOME 11,355 9,270 2,086
4. At what stage of financial management would you discover that the actual rates of returns are
significantly lower than those returns forecasted? Discuss in 30 to 50 words.
Answer: Under the stages of the financial management in final reporting stages a financial
reporting manager can discover the variances occurred after analysing the actual returns derived
from the budgeted returns.
5. What would be the agreed criteria and what other steps would need to be taken? Discuss in 30
to 50 words.
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 8 of 21

Answer: The agree criteria and other steps that is required to be taken for significant fall in the
return includes the following;
a. Using the high impact marketing to improve the business returns
b. Monitoring the events that could change the landscape of the business
c. Setting appropriate planning tools to ensure sufficient returns is generated.
6. You work for ABC financial management. Your client is XYZ company. The CEO contacts you
directly on the 1st July, thanking you for the satisfaction of current objectives in line with the
financial plan. Current objectives are reporting annual financial reports including preparing the
BAS.
The client asks that this now ceases as the finance officer will take over the duties. The client
asks that you prepare a manual to assist the finance officer in their new duties. The client also
asks that you now assist with preparing for and recording monthly governance board meetings.
a. Prepare a quarterly financial management questionnaire for the current quarter to
show the current and proposed new objectives as if they had been discovered as a
result of the quarterly questionnaire process.
b. Prepare a file note to properly record the main points of your phone call with the
CEO.
Answer: Answer A:
Questionnaire:
a. Discussion of organizational strategies following the completion of BAS in order to enhance
the governance board meetings.
b. Discussion relating to the development of the organizational strategies in order to
contribute to the financial and accounting information to establish the functional objectives
in accordance with the organizational objectives.
Answer to B:
File Note:
Dear Client,
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 9 of 21

Thank you for allowing our company to represent you in this matter. We are enclosing the main
point that was made during the phone call with the CEO which are as follows;
a. Analysis and recommendations relating to the strategic thinking
b. Creation of financial for strategic thinking and objectives.
c. Keeping record of the gross income
d. Preparation and presentation of the financial report of the organization associated semi-
annually.
7. Your client contact is the finance officer of XYZ company. They phone you briefly on 1.10.20xx
and say that the financial position detail report contains too much detail. They also state that
there is no explanation for the changes in financial position even though they know that
several new desks were purchased in the previous quarter because they recorded them on the
asset register. Prepare a file note to show how the feedback will be incorporated into services
to the client.
Answer:
File Note:
Dear Client,
I would like express my gratitude for allowing our company to represent you in this matter. I would
like to bring this into your notice that I appreciate your time to discuss this position in further detail.
We are giving you a brief summary of the report regarding the purchase of the new asset that was
incorporated in the purchase register of the earlier quarter. Additionally, I would also like to draw
your kind attention towards my application that your feedback has been considered and we would
be incorporating the asset purchased in the in the purchase register for better understanding of the
financial reports.
Thanking You
8. Your client is XYZ company. They phone you on 15.11.20xx and question what has caused them
to pay higher than normal GST. Your investigation shows that the income amount included the
previous year’s income. Record a file note to implement improved customer services.
Answer: File Note:
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 10 of 21

Dear Client,
We are grateful for choosing our company in order to allow us to present in the matter relating to
the payment of higher amount of GST than the normal amount paid by you. According to our
investigations of the books of accounts we found that the figure of sales that was reported by you
also included the income of the previous year. As a result this led to the income being overstated
with higher amount of GST.
We advise you to reconcile the figures of sales before lodging for GST returns. We hope that your
concern has been addressed relating to the higher payment of GST.
Thank You
9. Consider the two sets of financial data shown.
GEF Organisation BAS Summary Sheet
Prepared by the Financial Officer
For the period ending 30.9.20xx
GST Received on income $2,500
GST Paid on expenses $2,500
Plus PAYG on wages $10,000
GST Payable/ (Receivable) $10,000
From the ATO
GEF Organisation BAS Summary Sheet
Prepared by the Financial Officer
For the period ending 30.12.20xx
GST Received on income $100,000
GST Paid on expenses $2,500
Plus PAYG on wages $10,000
GST Payable/ (Receivable) $107,500
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 11 of 21

From the ATO
a. What would be of interest to the financial manager responsible for preparing the BAS
based on the reports? Discuss in 30 to 50 words.
b. For what reason would this be of interest? Discuss in 30 to 50 words.
c. What steps should the financial manager take in this scenario? Discuss in 50 to 80
words.
Answer: Answer a:
The interest of the financial manager that is responsible in the preparation of the BAS is that it would
help the business in timely lodgement of the tax requirements. The activity statement would help in
meeting the tax obligations of the business depending upon the frequencies and dependencies.
Answer b:
The reasons for interest of the financial manager in the preparation of the BAS would help in
meeting goods and service tax obligations. Additionally, it will help the business in goods and service
tax GST. Additionally, it helps in meeting the obligations of the pay as you go instalment together
with PAYG withholding and other tax matters.
Answer c:
Concerning the steps that are involved with the financial manager includes the lodging of the BAS
either with the help of electronically or with the help of the nil lodgement on the phone.
Additionally, the financial managers can pay electronically either with the help of mail or in person
that are at the Australian post.
10.Use the following information to prepare a bank reconciliation for KLM company.
Closing account balance 30.6.20xx, $68,000
Unpresented cheques:
Number 100 $5,000
Number 101 $5,000
Number 102 $3,000
Number 103 $4,000
KLM Bank Statement extract
Australian Harbour International College, 114-120 Castlereagh Street, Sydney NSW 2000, Australia
|RTO NO: 41338 | CRICOS Provider Code: 03449J
Filename FNSACC501-Provide Financial and Business Performance
Information
Version 3.0/ July 2017 Review Date: Aug
2018
Page 12 of 21