Financial Management: Manage Budget and Financial Plans Report

This report provides a comprehensive overview of managing budgets and financial plans. It begins by outlining fundamental accounting principles, including the business entity concept, cost principle, and consistency principle. The report then delves into the management of financial processes and controls within a business, detailing the features of internal control structures, the importance of effective financial record-keeping, and the financial management process itself. The report also examines corporate financial record-keeping and auditing, covering the records required under the Corporations Act, financial reporting requirements for large proprietary companies, and the timing of audits for small proprietary companies. It defines financial reports in the context of the Corporations Act, specifies the components of financial statements, and outlines the associated requirements. The report emphasizes how the financial management process supports and monitors employees and ensures compliance with relevant regulations, ultimately contributing to sustainable growth and improved financial health. This report, contributed by a student, is available on Desklib, a platform offering AI-based study tools and resources to students.

Running head: MANAGE BUDGET AND FINANCIAL PLANS
Manage budget and financial plans
Name of the Student:
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Table of Contents
1. Accounting principles............................................................................................................2
Describing and summarising the basic accounting principles:..................................................2
2. Management of financial processes and controls of a business.............................................2
2.1 Depicting features of internal control structures:.................................................................2
2.2 Mentioning the reason for effective financial record keeping procedure and processes:....3
2.3 Depicting the financial management process and mentioning how it supports and monitor
employees:..................................................................................................................................3
3. Corporate financial record keeping & auditing......................................................................4
3.1 Mentioning the records required to keep under the Corporations Act by an organisation:. 4
3.2 Mentioning the financial reporting requirements for a large proprietary company:............4
3.3 Depicting the timing when are small proprietary companies required to be audited:.........5
3.4 Mentioning the definition of Financial Reports in context of Corporations Act and stating
what should be included in financial statements:.......................................................................5
3.5 Mentioning requirements of the above depicted statements:...............................................5
Reference:..................................................................................................................................7

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1. Accounting principles
Describing and summarising the basic accounting principles:
There are the few basic accounting principles that need to be followed by an
organisation, which are business entity concept, the cost principle, and the going concern
concept. The business entity concept many states that businesses are a separate entity
altogether, where it cannot be compared by the owner as it is different from each other. This
mainly states that all the relevant personal transaction of the owner and assets should not be
included in the business (Zeff 2016).
The cost principle directly states that all the assets needs to be recorded at their actual
cost in the books of the organization. Lastly, the consistency principle Indicates that your
organisation should apply the same Accounting Principles from one period to another. this
mainly helps in reducing the manipulation and allow the organisation to compare the relevant
progress over the previous fiscal years (Singleton-Green 2016).
2. Management of financial processes and controls of a business
2.1 Depicting features of internal control structures:
The internal control structure mainly includes the relevant features such as control
environment, risk assessment process, information system, control activities, and monitoring
control. The identified internal control features mainly help in Financial Management process
that involves acquisition, flow, and processing of information. This mainly helps in
improving the efficiency and financial performance for the organisation. Moreover, it

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provides robust risk management process that could help in developing relevant contingency
plans, which could reduce the negative impact of external and internal environment.
2.2 Mentioning the reason for effective financial record keeping procedure and
processes:
The use of adequate financial Record Keeping procedures and process mainly allows
the organisation to reduce any kind of manipulation and error, which could be developed in
the preparation of financial report. Furthermore, the Record Keeping system allows the
organisation to identify all the relevant transaction conducted within the fiscal year and
determine its current financial condition. The procedures and process of the Record Keeping
lays out a relevant plan, which could directly be used by the accountants in preparing the
financial report (Asic.gov.au 2017).
2.3 Depicting the financial management process and mentioning how it supports and
monitor employees:
There is relevant Financial Management processes are mainly depicted as follows.
 Forming and communicating all the relevant objectives and goals
 Preparing an adequate financial and operational plan
 Providing relevant information to the manager regarding variances from target, this
could help in improving target performance.
 Providing relevant information to the stakeholders in form of financial report
 Taking relative steps to correct the undesirable practices of the organisation
 Adequately maintaining relevant business records with an effective internal control
system

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 Reducing the relevant chances of unexpected events by declining the exposure of risk
taken by the organisation
The identified Financial Management process mainly allows the organisation to
adequately achieve sustainable growth by complying with all the relevant regulations. In
addition, the process also helps in improving the financial condition of the organisation by
taking relevant steps in the improvement process. The Financial Management process also
helps in reducing the exposure of risk and developing relevant contingency plan, which could
help in reducing the impact of unexpected events (Asic.gov.au 2017).
3. Corporate financial record keeping & auditing
3.1 Mentioning the records required to keep under the Corporations Act by an
organisation:
Under Corporation Act the companies mainly need to prepare corporate report,
director’s report, and financial report. This report mainly comprise of different types of
features as the corporate report Cup States the Record Keeping process, the directors report
provide the declaration given by the director of the company and the financial report
comprises of Comprehensive income statement, balance sheet, and cash flow statement
(Asic.gov.au 2017).
3.2 Mentioning the financial reporting requirements for a large proprietary company:
The financial report of large proprietary company is mainly prepared in accordance
with the chapter 2M the Corporation Act. In addition, the financial reports me to be audited
unless conditions under ASIC Corporations are not met. In addition, the financial report
needs to be blocked with ASIC within 4 months. Moreover, the financial report also needs to

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be sent to the members with any four months of declaration of the annual report
(Austrade.gov.au 2017).
3.3 Depicting the timing when are small proprietary companies required to be audited:
Small proprietary company could only be audited if required by the director / ASIC
direction s301(2). In addition, under s293 it is mentioned that small proprietary companies
are required to prepare financial report, when 5% of the members vote for it. The overall
audit of the small proprietary companies also conducted if the member needs to evaluate the
financial performance (Asic.gov.au 2017).
3.4 Mentioning the definition of Financial Reports in context of Corporations Act and
stating what should be included in financial statements:
Financial report under section S295, mainly states that the overall transactional
condition of the organisation for the current fiscal year. Financial reporting mainly allows the
organisation to state its current financial condition to the Stakeholders. The financial
reporting system allows the investors to evaluate the trend in company’s financial
performance, which could help in detecting its current return generation capacity. In addition,
the financial report mainly consists of comprehensive income statement, cash flow statement,
and financial position statement. The identified financial statements would eventually help in
depicting the current profit level, cash level, and asset level of the organisation
(Austrade.gov.au 2017).
3.5 Mentioning requirements of the above depicted statements:
The financial report requirements are mainly identified as the financial service
regulator which needs to be complied by the organisation. Companies operating in Australia
needs to lodge financial reports with ASIC at the end of each financial year. Furthermore,

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these annual financial reports need to be audited for evaluating the actual financial
performance of the organisation. Moreover the financial statement needs to be prepared
according to the section 292 of the Corporation Act, where all disclosing entities need to be
provided in the annual report. In addition, Corporation Act 2001 mainly states that all the
companies is to comply with the accounting standard met by the requirements of international
financial reporting standards, which was adopted by Australia in 2005 (Asic.gov.au 2017).

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Reference:
Asic.gov.au. (2017). Lodgement of financial reports | ASIC - Australian Securities and
Investments Commission. [online] Available at:
http://asic.gov.au/regulatory-resources/financial-reporting-and-audit/preparers-of-financial-
reports/lodgement-of-financial-reports/ [Accessed 31 Aug. 2017].
Austrade.gov.au. (2017). Financial reporting in Australia - Austrade. [online] Available at:
https://www.austrade.gov.au/International/Invest/Guide-to-investing/Running-a-business/
Understanding-Australian-business-regulation/Financial-reporting-in-Australia [Accessed 31
Aug. 2017].
Singleton-Green, B., 2016. Discussion of “articulating accounting principles: Classical
accounting theory as the pursuit of ‘explanation by embodiment’”. Journal of Applied
Accounting Research, 17(2), pp.136-138.
Zeff, S.A., 2016. Forging accounting principles in five countries: A history and an analysis
of trends. Routledge.