BSBFIM501 Manage Budgets and Financial Plans: YouFood Limited

This report presents a master budget for YouFood Limited, including targeted sales based on market assessment. It details projected costs, proposes a profit structure, and addresses organizational financial procedures, such as cash sales and regulatory compliance. The report summarizes activities, including payment policies and transportation costs, and outlines a plan for budget modifications and a contingency plan for unforeseen circumstances. It also covers basic accounting principles, ATO requirements, financial record keeping, auditing techniques, and budgeting processes. Furthermore, it identifies performance activities, observations on accounting techniques, and solutions for issues like product wastage and fuel costs, culminating in a modified budget for 2018.

Running head: BUDGET
Budget
Name of the Student:
Name of the University:
Authors Note:

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BUDGET
Table of Contents
Section 1:....................................................................................................................................2
Section B:...................................................................................................................................5
Section C:...................................................................................................................................7
Reference..................................................................................................................................11

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BUDGET
Section 1:
Introduction:
In the content of the report, a master budget for the YouFood Limited is drafted. In the
contents of the master budgets, the targeted sales of the company are also drafted based on
the assessment of the market.
Audience:
The budget is prepared for the CEO, production manager, Sales manager, and sales teams.
Master Budgets:
The presented master budget will elaborate the various projected cost of the organization and
the will identify a proposed profit structure. The master budget will hold the sales and other
expenses of the business for the current financial year (Maskell et al. 2016). In addition to
that, if the audience has any queries then ask for clarifications. From the following
questionnaires
 The contents are not relevant
 There is an inadequacy in the statement
 The sources and assumptions of the amounts
 Others.
Budget:
The budget for You Foods
For the Year 2018
Particulars Amounts

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BUDGET
Sales
Sales For Q1 56985
Sales For Q2 56984
Sales For Q3 45698
Sales For Q4 64235
Other 0
Total Income 223902
Less: Expenses
Cost Of Sales 89561
Operating Expenses 1500
Transportation 27569
Accounting and Legal 500
Advertising 20000
Depreciation 5635
Insurance 136
Maintenances and Repairs 230
Payroll Expenses 6000
Warehouse Rent 5000
R&D 10000
Taxation and Licence 2365
Telephone 550
Fuel Cost 5000
Travel utilities 1000
Web Housing And Maintained 300
Security 1200
Total 176545.8
Non-Recurring Expense
Furniture, Equipment, and software 250
Others
Total 250
Total Expense 176796
Budgeted Profit 47106
Organisational Requirement:
From the organisation financial procedure, it is identified and understood that the
1. The company makes all the sales in cash.

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BUDGET
2. In addition to that as the company is engaged in the food industry, it requires fulfilling
some safety and other regulations that make the cost of the company a bit higher.
3. Another financial indicator for the company is the cost of delivery as this is a B2C business
model business (Barr and McClellan 2018).
4. The cost or warehouse and the kitchen of the company are payable at the end of12-month.
5. The accounts of the company are prepared on the applicable accounting standards and the
taxation will be withheld under the provisions of their ITAA 1997.
Summary of the activities.
As there all the sale of the company is made in cash or banking transaction, therefore,
no available debtors are presented in the current moment. In addition to that, the current
payment policies to the creditor or the suppliers of the YouFood are paid for 4 weeks (Drever
et al. 2015).
Secondly, the current atmosphere of the company is not located a particular of, rather
it is delivering the foods that are placed online direct from the kitchen to the customers place
therefore the cost of transportation is very high.
Further, the company does not have its own premises, therefore; the company has
acquired a rented place for warehousing and for essential cooking of the orders. The financial
accounting and the management accounting are prepared in accordance with the requirements
of the company (Rogulenko et al. 2016).
Changes in the plan:
If there are requirements for any change in the budget or the accounting policy then at
first, the problematic areas are to be identified and the modification will be made after finding
all the information if there are many flows in the budget then it should be redrafted. It may

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take up to 10 days (Crutzen et al. 2017). In this period, a contingency plan also will be
drafted.
Section B:
1. Aspects of basis accounting Principal:
For the preparation and presentation of the various accounting transaction, some
inherent accounting principles are required to be followed. The basic accounting
principles are described hereunder:
 Economic entity assumption: this assumption segregates the business owner
from its business. In accounting, the owner and the business are separate
entities. This legalises the existence of the business a separate legal entity as a
distinct person (Miller 2018).
 Going Concern Principal: the going concern principal assumes that the
business will exist for a long period that means that the business is not going
to stop the business in the near future.
 Accrual basis of accounting: in the accrual basis of accounting the business
transaction is recorded on the accrual basis, there are two types of permissible
accoutring recording techniques cash basis and accrual basis. In cash basis, the
accounting transactions are recorded only when the cash transaction is
received or paid (Alviniussen and Jankensgard 2015). This technic is followed
by small entities. The general principal states that the accounting is to be done
on the accrual method of transaction, where the actual transaction is more
important than the cash possession of the transaction. The accounts are to be
dealt at the transaction date irrespective of the cash received of payments.
2. As per the ATO's requirements, all the transactions or the information are to be
reported to the Australian taxation office are as follows:

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 Cash book
 Invoices.
 Assets for CGT purpose
 Financial statements
 Others
3. Financial record keeping:
The financial record keeping means the preparation and presentation of the financial
transactions, the financial transaction is to be documented in the prescribed sequenced
orders rather it can be said the financial documents are the representations of the
transaction of the business, individual and others (Smith et al. 2015). The financial
documents are to be recorded in accordance with the accounting principal and
accounting standards. Further, the type of the business will vary the presentation of
the financial documents. In addition to that, the financial, the recording will be based
on the nature and activities of the business.
 Financial Auditing:
The auditing is processes that describe and comment on the viability of the
financial statements whether they are true or not. The true effect will
commence when the accounts are prepared based on appropriate AAS. In
addition to that, the auditing process will be conducted based on auditing
standards. The auditing is required to determine the accuracy of the accounting
and the discloser requirement for the preparation of the financial stamens are
adequate or not (Rubin 2016).
 Budgeting technical:
Budgeting is the process that created a pre-plan for the collection and spending
of money. The collection plan and sending plan is regarded as budgets.

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BUDGET
Concisely it can be said budgeting is the process where the management
predetermines the process all collection of the funds from various sources like
making sales of goods or service or getting cash inflows from other sources.
Moreover, the budget empowers more important for its spending. As the
income is not relatively assessable but a proper expenditure, planning can be
developed based on the knowledge (Kireeva 2016). There are many types of
budgets like sales budges, purchase budgets and others. There is another type
of budget that is called "Master Budget” that refers to the collection of the
funds and making the expenditure. This envelopes the proper costing and cash
reformation structure of an entity.
For a successful budgeting, the following points are to be considered:
 Understand the organizational needs
 Assess the markets
 Get the information related to the budget from reliable sources.
 Redefine the sources that are contributory and adequate or not.
 Define the costs
Section C:
Performance Activity:
Introduction: In the contents of the report, the various observation of the accounting
techniques and the information of the business activities are identified. The reliable assertion
and modification of the budgets are made with the assertions of the regulation. In addition to
that, a contingency plan is developed for the modification and the budget (Réka et al. 2014).
Observation:

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In the practical observation, it is ascertained that a large portion of the perishable
products are wasted daily and the company has nor regulated any provisions for that. Further,
in the proposed budget the fuel costs are not adequate it is approximately 15% higher because
of the increased price (Suomalainen et al. 2015). Another observation located in the study of
the accounts is that the sales for the last quarter will be affected due to the current market
slow down. Instead of the above, the company has to arrange for the preparation o and
presentation of the record as per the instruction of the ATO. Further, it is observed that there
are some flaws in the accounting of the inventory and stocktaking. The cost of administrative
and security are lower.
Solution:
For the above-identified problems that company has to make suitable arrangement for
the redrafting, the budges as they are some significant and important required changes are to
be dealt. Further for the reporting propose to the Australia Taxation Office (Kireeva 2016). A
contingency plan is drafted for the changes in ten marketing behaviour and the increase i9n
the cost as this will affect the profitability of the YOU FOOD. The contingency plan will
consist the technic to increase the sales in the slowdown in the Q 2 and Q 3.
Implementation:
The above-stated plans are implemented in the commencement of the quarter 2. For
the slowdown in the quarter 2 and quarter 3, the company initiated provisional discounts
options and promoted the business offerings. In addition to that, a major portion of the of the
advertisement cost is allocated for this slow down period to boost the sales.
Monitoring:

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BUDGET
Next step after the implication is monitoring and controlling the business activities
that are implemented so that the contingency plan works well. The monitoring is required for
controlling the changes in the performance.
Conclusion:
In the reported contents, the business activities that are identified for the appropriate
changes are ascertained and make a suitable adjustment in accordance with the required
legislation and the changes are initiated in accordance with the contingency planning. This
report develops an utmost idea of the organizational goals and requirements. All the
adjustment are made for the betterment of the proposed master budget. The implosion of the
accounting and the reporting are made in accordance with the accounting standards. Further,
all practicing activities often contingency plan is monitored and controlled.
The budget for You Foods( modified)
For the Year 2018
Particulars Amounts
Sales
Sales For Q1 56985
Sales For Q2 56984
Sales For Q3 5128.2
Sales For Q4 57811.5
Other 0
Total Income 176908.7
Less: Expenses
Cost Of Sales 70763
Operating Expenses 1500
Transportation 27569
Accounting and Legal 500
Advertising 20000
Depreciation 5635
Insurance 136
Maintenances and Repairs 230
Payroll Expenses 6000
Warehouse Rent 5000
R&D 10000

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BUDGET
Taxation and Licence 2365
Fuel Cost 5750
Telephone 550
Travel utilities 1000
Web Housing And maintains 300
Security 1200
Total 158498.48
Non Recurring Expense
Furniture, Equipment And software 250
Others
Total 250
Total Expense 158748
Budgeted Profit 18160

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Reference
Alviniussen, A. and Jankensgard, H., 2015. Enterprise risk budgeting: bringing risk
management into the financial planning process.
Barr, M.J. and McClellan, G.S., 2018. Budgets and financial management in higher
education. John Wiley & Sons.
Crutzen, N., Zvezdov, D. and Schaltegger, S., 2017. Sustainability and management control.
Exploring and theorizing control patterns in large European firms. Journal of cleaner
production, 143, pp.1291-1301.
Drever, A.I., Odders‐White, E., Kalish, C.W., Else‐Quest, N.M., Hoagland, E.M. and Nelms,
E.N., 2015. Foundations of financial well‐being: Insights into the role of executive function,
financial socialization, and experience‐based learning in childhood and youth. Journal of
Consumer Affairs, 49(1), pp.13-38.
Kireeva, E.V., 2016. Effective management of personal finance. Современные тенденции
развития науки и технологий, (5-7), pp.5-7.
Maskell, B.H., Baggaley, B. and Grasso, L., 2016. Practical lean accounting: a proven
system for measuring and managing the lean enterprise. Productivity Press.
Miller, G., 2018. Performance based budgeting. Routledge.
Réka, C.I., Ştefan, P. and Daniel, C.V., 2014. TRADITIONAL BUDGETING VERSUS
BEYOND BUDGETING: A LITERATURE REVIEW. Annals of the University of Oradea,
Economic Science Series, 23(1).
Rogulenko, T., Ponomareva, S., Bodiaco, A., Mironenko, V. and Zelenov, V., 2016.
Budgeting-Based Organization of Internal Control. International Journal of Environmental
and Science Education, 11(11), pp.4104-4117.