BSBFIM601 Assessment BSB60215 Advanced Diploma Of Business

Free Sample

BSBFIM601 Assessment BSB60215 Advanced Diploma of Business

Final Assessment

This final assessment is for the unitBSBFIM601 Manage Finances- Release 1

An assessor will review the work you have completed and determine if you have satisfied the assessment requirements for this unit.

Submitting Assessments

You must submit your completed assessments to your assessor. Instructions on what to submit are detailed in each assessment task.

Each assessment task you submit must have a signed cover sheet. Otherwise the assessment will not be accepted. Cover sheets are provided for each of the assessment tasks.

When assessments have been completed, your assessor will provide you with feedback.

When all assessments are completed and assessed, your assessor will provide you with a Record of Outcome.

If you believe your assessment result is not right, you should discuss this with your assessor. They will direct you to your Student Handbook and/or Acknowledge Education’s Policies and Procedures which will have information about how to appeal an assessment result.

Assessment Cover Sheet

This document must be signed by the student for each assessment completed. Submission of Assessments will not be accepted for marking/review without a completed and signed Assessment Cover Sheet.

Qualification Title	BSB60215 Advanced Diploma of Business
Unit Code	BSBFIM601
Unit Title	Manage Finances
Student Name
Student ID
Student Email
Assessor Name
Campus	? Melbourne? Sydney? Perth
Due Date
Submission Date
Assessment Task	Task 2: Project Report

Student Agreement:

By signing this Agreement, I confirm that I understand the Assessment Submission Guidelines, as detailed in the Student Handbook and Acknowledge Education’s policies and procedures. In particular:

The work submitted is my own and does not contain another person’s material represented in my work.
I understand that I must acknowledge in an appropriate manner all information and sources of assistance used in my assessment work.
I have followed all submission, presentation and file name guidelines outlined in the submission guidelines. I am aware that if I do not follow the required guidelines, this could result in my assessments being returned not assessed by my trainer/assessor.
I understand that I must not receive undue assistance or the unauthorised help of others in the preparation of my assessment work.
I will not allow other students to access or copy in whole or any part of my assessment work.
I understand that if I am dissatisfied with the way I have been assessed or with my result, I have the right to appeal as detailed in the Student Handbook and Acknowledge Education’s policies and procedures.

Student Declaration:

I hereby declare that I have read the above statement and that all the material I submit for assessment is entirely my own and meets all of the college’s assessment requirements.

Student Signature
Date

Assessment Task 2: Project

By correctly completing the project you will demonstrate that you have the required skills and knowledge toundertake budgeting, financial forecasting and reporting and to allocate and manage resources to achieve the required outputs for the business unit. It includes contributing to financial bids and estimates, allocating funds, managing budgets and reporting on financial activity.

This project requires you to work independently. You can participate in group discussions with other students, share ideas or opinions, but you cannot submit an identical project report with other students.

You need access to the case study and project instructions to complete this task. You may also access a learner guide, the internet and/or other resources.

You must satisfactorily complete all sections of the assessment and submit these to your assessor, ask your assessor to clarify any aspect you are unsure about in this assessment task. You may be asked to explain your responses if the assessor needs any clarification.

Required Resources

You will need to have access to relevant legislation, standards and codes, industry practices, MS-Office Excel Spreadsheet and student book resources.
Financial Management Software – Microsoft Excel
Simulated Business Board Room (Acknowledge Education, College Classroom)/Access to an LCD projector/computer/USB

Evidence

You must submit the completed assessment cover sheet and your assessment by online submission within the allocated time.
Ensure you keep a copy of your submitted work. Assessments submitted without completed cover sheet will not be accepted.

When and where will this assessment take place?

This assessmentwill be undertaken in a simulated business environment (Acknowledge Education, College Classroom)/in a classroom/at home – to be discussed with the assessor.
Your assessor will provide you with the due date, which can be recorded in the assessment plan.
Your assessor may also specify the length of time allowed and the expected word count, if applicable.

What if the assessment is not suitable?

If you are unable to complete the project in the way described here, you may need to discuss an alternative method for completing it with your assessor.

What happens if your answers are not satisfactory?

If any of the assessment responses are not satisfactory, your assessor will provide you with feedback. You may need to resubmit some or all the assessment tasks. Your assessor will explain the details for your reassessment.
In most cases you will be allowed a maximum of three attempts.
If you are not satisfied with your assessment result, you have the right to lodge an appeal. Ask your assessor or contact the Course Coordinator for more information.

Case Study

Case Study -

Stott’s Pty Ltd

You have recently been appointed as the financial manager of Stott’s Pty Ltd. You having been a store manager for the past three years. Stott’s Pty Ltd is a 15-store retail chain located in Brisbane. Stott’s is the leading homewares retailer, catering to the growing need for furnishing new and renovated dwellings in the greater Brisbane area.

The assortment on offer of bathroom fittings, bedroom fittings, mirrors and decorative items together with the recently added lighting fixtures has positioned Stott’s as a leader in homewares retailing in Australia. Stott’s has grown over the past five years from a single store to the current chain. Stott’s prides itself on superior after sales service which has been a key reason for the continued growth in sales and corresponding profit increases. Today Stott’s employs over 150 staff.

Stott’s Pty Ltd is a proprietary limited company (ACN 33 777 666 55) registered with the Australian Securities and Investment Commission-ASIC. The registered address is with Stotts solicitors (Big Brother & Sons Lawyers, 535 Queen Street, Brisbane, QLD 4000) and the principle place of business is 505 Boundary Street Spring Hill Brisbane QLD 4000.

Computer software requirement

The current accounting information system, Microsoft Excel, has not adequately provided sufficient analysis of revenue and expenditure and has made it difficult to make informed estimates of future profits. Estimates have relied on the ‘gut feel’ of the experienced traders on the board and of the senior managers. The board sees the need to apply more analysis to past results that they believe could be done with the introduction of state-of-the-art computer software.

Stott’s Pty Ltd wants to upgrade their existing accounting system which will manage the company accounts more efficiently in the long run. They request that the new system you recommend to them to be compliant with all legislative and statutory requirements for small to medium businesses.

None of Stott’s products are GST free however the accounting information system records the GST collected as well as the input tax credits earned on the purchases of stock and assets. These amounts are reported and paid in accordance with the business activity statement (BAS) schedule determined by the Australian Tax Office.

They have 100 fulltime and 50 part-time staff, but only 10 of the staff will have or need access to the financial system. Some staffs are paid on a salary sacrifice arrangement that attracts fringe benefits tax. The staff with access to the financial system want software that is a single purchase with no ongoing license fees, and a plan to keep using if for the next 3–5 years, while the organisation continues to grow. They are anticipating that within five years they will have over 250 full-time staff, and at least 20 staff will require access to the financial system by then.

The payroll system deducts withholding tax from the employees and remits this along with the firm’s pay as you go (PAYG) instalment each quarter as reported on the firm’s business activity statement. Income tax return for the company and its annual statement is completed by the firm’s accountant. Taxes and fees due are paid by the due dates. Financial records are kept at Stott’s principle place of business.

Stott’s have just upgraded their computers and have five new desktop PCs which will be used by the finance staff. They are current (for 2011) specification machines with i5 CPUs and 4Gb RAM each, and all have Windows 7 Professional and Norton’s 360 installed with the professional version of Microsoft Office Small Business as well. Other staff will use their machines at various times, so it is important that the software requires a login to access data and that data stored by the software cannot be accessed in any other way.

Corporate Structure

Jim Schneider, the CEO, has asked you to prepare some financial budgets for the 2011/12 financial year as a preliminary overview of the financial year ahead. He asked you to first prepare a 12-months budget and then break it up over the four quarters. The areas he is particularly interested in seeing is:

Sales budget for 2011/12 by department by quarter.
Profit budget (including detailed expenses) for 2011/12 by quarter.
The cash flow result per quarter of the GST after adjusting the GST collected by the allowable GST tax credits.
The anticipated aged debtors summary at the end of each quarter.

The CEO wants to be given all the budgets except for the aged debtors budget which the accountant and accounts receivable clerk can monitor. The CEO produced a summary of the current business plan that covered the budget year to highlight some of the key goals, objectives and strategies he would like incorporated into the budget.

After going through the business plan summary, the CEO gave you the previous year’s financial reports and asked you to speak with the accountant Celina Patel to get some of the figures and detailed expectations for the coming year.

You arrange a meeting with Celina Patel, Stott’s accountant, and she gives you the following insight into the historical expense relationships and the current statutory compliance liabilities.

Sales and profit budget information

Celina explained that the only budget she monitors on a day-to-day basis is the cash flow budget and the store manager is primarily responsible for the sales budget.

These are the notes you take at the meeting:

The overall sales for 2011/12 target set by the business plan should be apportioned across the quarters in the same % as was achieved in 2010/11.
This was:

Qtr 1	Qtr 2	Qtr 3	Qtr 4	2010/11
3,142,822	3,771,386	4,085,668	4,714,232	15,714,108

Cost of goods sold is the inverse of the gross profit rate determined by the business plan and is determined by the quarterly sales budget.
Accounting fees have been negotiated for the year at a fixed amount of $10,000 to be paid in equal amounts each quarter.
The interest charges on the bank loan are anticipated at a reduced amount of $84,508 due to an agreed repayment of some of the loan principal. This is to be paid in equal amounts each quarter.
Bank charges are expected to be the same as 2011and paid in equal amounts each quarter.
Celina has requested that a new expense (store supplies) be recognised in the new budget that was previously included in with the cleaning expense amounts. Store supplies in the 2009/10 results was $3,500 of the cleaning expense and $3,605 of the 2010/11 result. Cleaning expense will then be lower but identify the real labour costs involved in the cleaning expense.
Depreciation is expected to be the same as 2011and allocated in equal amounts each quarter.
Advertising is to be apportioned to each quarter based on the business plan.
The following expenses are expected to increase by the determined inflation rate in the business plan summary:

Insurance – apportioned in equal amounts each quarter.

Store supplies – is calculated for to each quarter using the same % as determined by the sales for each quarter.

Cleaning – is calculated for each quarter using the same % as determined by the sales for each quarter.

Repairs and maintenance – apportioned in equal amounts each quarter.

Rent – apportioned in equal amounts each quarter.

Telephone – is calculated for to each quarter using the same % as determined by the sales for each quarter.

Electricity – is calculated for to each quarter using the same % as determined by the sales for each quarter.

Fringe benefits tax is expected to be the same as 2011and paid in equal amounts each quarter.
Wages and salaries are calculated for each quarter using the same % as determined by the sales for each quarter.
The statutory requirements are:

superannuation is 9.5 % of wages and salaries for each quarter
payroll tax is 4.75% of wages and salaries for each quarter
workers compensation is 2% of wages and salaries for each quarter
company tax is 30% of net profit before tax for each quarter.

Stott’s Pty Ltd
Statement of Financial Performance For 12 months ended 30 June, 20XX
Profit & Loss Actuals	2007/08	2008/09	2009/10	2010/11
Revenue
Sales	12,474,336	13,472,315	14,550,100	15,714,108
– Cost Of Goods Sold	6,860,901	7,409,773	8,002,555	8,799,900
Gross Profit	5,613,465	6,062,542	6,547,545	6,914,208

Expenses
– Accounting Fees	5,500	6,500	8,500	9,000
– Interest Expense	45,000	65,000	96,508	90,508
– Bank Charges	1,200	1,300	1,580	1,600
– Depreciation	170,000	170,000	170,000	170,000
– Insurance	12,500	12,500	12,500	12,875
– Store Supplies	-	-	-	-
– Advertising	50,000	100,000	280,000	280,000
– Cleaning	12,560	15,652	18,700	19,261
– Repairs & Maintenance	40,250	52,600	60,000	61,800
– Rent	2,465,000	2,465,000	2,465,000	2,538,950
– Telephone	9,862	12,523	14,000	14,420
– Electricity Expense	22,500	23,658	25,000	25,750
– Luxury Car Tax	-	-	12,400	-
– Fringe Benefits Tax	26,000	26,000	26,000	28,000
– Superannuation	148,500	160,737	166,500	171,495
– Wages & Salaries	1,649,998	1,785,965	1,850,000	1,905,500
– Payroll Tax	78,375	84,833	87,875	90,511
– Workers’ Compensation	33,000	35,719	37,000	38,110
Total Expenses	4,770,245	5,017,987	5,331,563	5,457,780
Net Profit (Before Tax)	843,220	1,044,554	1,215,982	1,456,428
Income Tax	252,966	313,366	364,795	436,928
Net Profit	590,254	731,188	851,188	1,019,499

Stott’s Pty Ltd
Statement of Financial Position As at 30 June, 201X
	2009/10	2010/11
Assets
Current Assets
– Cash On Hand	50,000	55,000
– Cheque Account	144,842	160,314
– Deposits Paid	950,000	950,000
– Trade Debtors	850,000	975,000
– Merchandise Inventory	1,530,000	1,430,000
Total Current Assets
Fixed Assets
– Motor Vehicles At Cost	500,000	500,000
– Motor Vehicles Accum Dep	( 100,000 )	( 125,000 )
– Furniture & Fixtures At Cost	1,950,000	2,250,000
– Furniture & Fixtures Accum Dep	( 650,000 )	( 770,000 )
– Office Equip At Cost	400,000	400,000
– Office Equip Accum Dep	( 90,000 )	( 115,000 )
Total Fixed Assets	2,010,000	2,140,000
Total Assets	5,534,842	5,710,314
Liabilities
Current Liabilities
– MasterCard	17,800	14,860
– Trade Creditors	780,000	679,000
– GST Collected	1,455,010	1,571,411
– GST Paid	( 943,125 )	( 987,626 )
– Superannuation Payable	100,000	120,000
– Luxury Car Tax Payable	20,920	-
– income Tax Payable	364,795	436,928
– PAYG Withholding Payable	65,000	44,872
Total Current Liabilities	1,860,400	1,879,445
Long-Term Liabilities	-	-
– Bank Loans	1,608,459	1,508,459
Total Liabilities	3,468,859	3,387,904
Equity
– Owner/Shareholder’s Equity	500,000	500,000
– Retained Earnings	850,000	1,565,982
– Dividends Paid	( 500,000 )	( 1,200,000 )
– Current Year Earnings	1,215,982	1,456,428
Total Equity	2,065,982	2,322,410

Internal auditor

Carl Kerns is one of the directors of the board. Carl said that as a board member they are given the profit and cash flow budgets. He was appointed by the board to conduct an internal audit of operations to look for weaknesses in the internal control system. His report uncovered the following processes that he believed needed to be strengthened.

While the overall customer base is increasing from year to year, there may be internal control issues relating to how these new customers are secured.
Some discounts that were being given to customers were recorded as a net amount on the invoices and gave no indication of the discount from standard prices.
Some cash registers in the stores were not reconciling the cash in drawer with the register printout.
Not all timesheet overtime amounts were being authorised by the line manager.
Service invoices for some items of equipment were not signed or linked to a purchase order. There was no check that the work had actually been carried out.
Not all assets in the stores had unique codes fixed to the asset.
There was minimal feedback lines of communication from the shop floor to head office, particularly when an error in the budgeting report process was recognised.
Debtor reconciliations were not done monthly and sometimes not at all.
In busy times the cashiers that operated the registers were also asked to do their own reconciliations and banking. Sometimes the cash was held in the store for a day or two.
Job roles were not clearly defined so that responsibilities and liability can be identified.
There was little rostering of duties and cash receipts were not pre-numbered.

Of particular concern to Carl was the directive given by the board to ensure that audit trails were created and maintained. These included:

Signing the timesheets for employees under the authority of a department manager.
Maintenance of a numbered cash receipts book.
Using sequenced cheques as a systematic way of evidencing all monies paid out.
Ensuring proper coding of evidenced transactions against appropriate general ledger account and cost centre.
Ensuring reconciliations between company books and third-party bank statements are performed.
Establishing procedures including pre-authorisation and checking mechanisms for work-related meal expenses.

GST cash flow budget

Statutory requirements for GST are 10% of the recorded amounts in sales. The only capital purchase planned for the year is the luxury car for the chairman. Those expense payments on which 10% GST was paid include the following:

Cost of goods sold:

accounting fees

insurance

store supplies

advertising

cleaning

repairs and maintenance

rent

telephone

electricity expense.

The GST amount payable each quarter is the difference between the GST collected from sales and the GST paid – format as per policy and procedures. (template)

CASH FLOW ANALYSIS – GST	2011/12	Qtr 1	Qtr 2	Qtr 3	Qtr 4
GST Collected	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
Less GST Paid	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
GST Payable	Calculation	Calculation	Calculation	Calculation	Calculation

Debtors ageing budget

The historical records show that the debtors balance at the end of each quarter is usually about 20% of the quarter’s sales. At any time in the debtors balances 1% of the total debtors is overdue 90 days and over, 5% is 60 days overdue, 10% is 30 days overdue and the balance of the total debtors is current. The aged debtors’ budgets are only distributed to the accountant and the accounts receivable clerk.

Appendix 2: Stott’s budgeting policy and procedures

Budget development process

The standard process for developing budgets will follow the following steps:

Establish the budget objective.

Gather prior period data.

Discuss prior period information and anticipated changes in the budget period withstakeholders.

Research relevant external information.

Incorporate identified trends to determine assumptions and parameters.

Prepare budgets in standard formats.

Submit budgets for approval.

Budget objectives

Stott’s prepares budgets to meet various company objectives. Budgets are prepared:

for a specific expansion of the business activities:

business case to be prepared covering a cost-benefit analysis, market research report and summary profit and investment expectations

to outline a specific debt reduction initiative:

company-wide summary of profit expectations, planned debt and equity funding arrangements, CAPEX plans summarised

annually to cover the next financial year:

for the 12-month period from the beginning to the end of the financial year
budget to include four quarter milestones in line with seasonal trends identified from prior year data
initial preparation includes a preliminary overview of the financial year ahead
sales budget for next year to be prepared by department by quarter
profit budget (including detailed expenses) for the next year to be prepared by quarter
cash flow effect of the GST payable per quarter to be prepared (scheduled compliance payment date is the 21st day after the end of the quarter)

To satisfy the statutory requirements relating to the current and short-term solvency of the company:

three monthly rolling forecast of cash flows to be prepared

To qualify the strategic plans for the next 3–5 years planning cycle:

profit and CAPEX budget to be prepared.

Budget variances and schedules

Key performance indicators that should be closely monitored and reported on include variances to:

total sales

gross profit (GP) %

wages and salaries as a % of total sales

total expenses as a % of total sales

net profit in dollars

net profit as a percentage.

Budget variances will be reported using the standard format provided in this policy and procedures document.
Budget variances must be completed within five working days of quarter end.
Actual results for the month will be provided by the accounting information system.
An analysis of the variance between the actual and the budget must include $ and % variance.

Report with explanations and recommendations to be complete within seven working days ofquarter end and be given to the CEO.

Analysis and investigation of variances will include the following priority:

Establish the primary causes for variances to key performance indicators of total sales, gross profit % and net profit $.

Establish reasons for those individual items in the variance report that represent the greatest $ variance.

Establish reasons for those individual items in the variance report that represent the greatest % variance.

Schedules relating to compliance due dates must be prepared and monitored by the accountant. Managers supplying information to the accountant regarding the compliance schedule must submit it at least five working days prior to the due date deadline.

Standard formats

The following formats will be used when preparing Stott’s budgets and variance reports.

Sales and profit budgets (Template)

PROFIT BUDGET	2011/12	Qtr 1	Qtr 2	Qtr 3	Qtr 4
Revenue	-	%	%	%	%
Sales	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Cost of Goods Sold	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
Gross Profit	Calculation	Calculation	Calculation	Calculation	Calculation
Gross Profit %	Calculation	Calculation	Calculation	Calculation	Calculation
Expenses
– Accounting Fees	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Interest Expense	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Bank Charges	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Depreciation	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Insurance	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Store Supplies	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Advertising	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Cleaning	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Repairs & Maintenance	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Rent	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Telephone	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Electricity Expense	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Luxury Car Tax	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Fringe Benefits Tax	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Superannuation	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Wages & Salaries	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Payroll Tax	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
– Workers’ Compensation	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
Total Expenses	Calculation	Calculation	Calculation	Calculation	Calculation
Net Profit (Before Tax)	Calculation	Calculation	Calculation	Calculation	Calculation
Income Tax	Calculation	Calculation	Calculation	Calculation	Calculation
Net Profit	Calculation	Calculation	Calculation	Calculation	Calculation

GST Cash flow budget (Template)

CASH FLOW ANALYSIS – GST	2011/12	Qtr 1	Qtr 2	Qtr 3	Qtr 4
GST Collected	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
Less GST Paid	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
GST Payable	Calculation	Calculation	Calculation	Calculation	Calculation

Aged debtors (Template)

AGED DEBTORS BUDGET	TOTAL	Qtr 1	Qtr 2	Qtr 3	Qtr 4
Sales	x,xxx	x,xxx	x,xxx	x,xxx	x,xxx
% Debtors Sales		%	%	%	%
Total Debtors	%	Calculation	Calculation	Calculation	Calculation
Current	%	Calculation	Calculation	Calculation	Calculation
30 Days	%	Calculation	Calculation	Calculation	Calculation
60 Days	%	Calculation	Calculation	Calculation	Calculation
90 Days	%	Calculation	Calculation	Calculation	Calculation

Appendix 3: Scenario

The CEO of Stott’s Pty Ltd, Jim Schneider, explained that he prefers to discuss the budgets with all senior managers prior to their distribution in order to ensure a corporate view of the strategic plans. He then meets with each group separately, along with the relevant senior manager, to answer questions and concerns about their particular area. Eventually the budgets will be printed in hard copy and bound as well distributed as an electronic spreadsheet.

Upon completion of the budgets, you meet with Jim and another manager to provide an overview of the information contained within the budgets, the budget notes, and recommendations regarding the internal controls, to prepare him for the meetings with the senior managers. To clarify his understanding of the information, Jim asks you a series of questions.

Questions – CEO – Stott’s College - Jim

1. Please Identify the current statutory requirements for tax compliance and list and calculate the tax liabilities for Stott’s Pty Ltd under taxation legislation.

2. Please Identify the current compliance requirements and liabilities for this organisation under the Corporations Act 2001.

3. Please review commercially available financial management software to select the most suitable software for Stott’s Pty Ltd.

Jim would like you to ensure you diagnose software options by comparing two commercially available software titles against the capabilities of the existing technology for the organisation and against the prioritised requirements and outline the reasons that lead you to this recommendation.

4. Please explain how you can apply the following principles of accounting in developing the budgets required for this task:

a.matching principle

b.account groups

c.time periods.

5. Please Explain and discuss the implications of probity when preparing and revising budgets.

6. Please list the critical dates and initiatives that will require or generate resources for Stott’s Pty Ltd in the next financial cycle.

7. Please list the items you would recommend for inclusion in the budgets for Stott’s Pty Ltd.

<p dir

Get Assignment Help Now...!

Number of pages/words

+61-4-8002-4016

EMAIL ADDRESS
info@myassignmentmart.com

Free Sample