You are on page 1of 6



Q1: List four types of financial data you should review.

 Budgets, forecasts and variances
 Cash flow/profit and loss reports
 Market valuations
 Business plan

Q2: What type of budget would you refer to if you wanted to analyse revenue, cost of sales and expenses
For the business in a specific period?
 Sales budget
 Profit and loss(P&L)budget
 Cash budget
 Master budget
 Operational budgets

Q3: List four possible external factors that could contribute to profit or loss.

Q4: You’re preparing to establish budgets. List three questions you might ask yourself when reviewing the
Business plan prior to budget preparation.
 Are there critical dates in the plan to be aware of?
 What business initiatives require financial resources in the next financial cycle? Do you have the
financial resources required?
 Are there any initiatives that you know will generate financial resources in the next financial

Q5: You’re preparing to establish budgets. List three questions you might ask yourself when reviewing
. Cash flow trends prior to budget preparation

 Do previous records indicate a trend in cash flow?

 Are there peak periods in which the establishment is known to generate greater cash flow than
others? If so, why and how does this affect the next financial cycle?
 Does cash flow have an impact on other budgets, in particular the expenses budget? Have you
allowed for this?

Q6: List four areas of legislation that impact on the preparation of budgets and other financial documents.
 Work health and safety (WHS)
 Industrial relations
 Insurance
 Contracts

Q7: What is the minimum amount of superannuation that must be paid to comply with statutory

9.5% of the employees’ ordinary times earnings each quarter until 30th June 2021 .

Q8: What website or department can you refer to for more information about compliance with FBT, CGT?
And GST requirements?
Australian Taxation Office (ATO),
Q9: What is SBR software and how does it improve efficiency?
Standard Business Reporting(SBR) help your tax returns or BAS and allows you to lodge statements
directly to the ATO.

Q10: Sutherland Resort purchases 12 bottles of 2004 Grange Hermitage wine for $8,470 GST inclusive.
 Calculate the GST amount.

Q11: You receive payment for goods and services totalling $882,200 including GST of $80,200. All
Expenses for the same period that required the payment of GST were $23,560 (excluding wages
And interest expense.
 Calculate the GST liability.
GST liability= GST collected – GST paid
GST liability= $80,200 –$2,356
GST liability=$77,844

Q12: What are bilateral and regional trade agreements?

bilateral and regional trade agreements typically seek to reduce trade barriers between partner
countries by determining purchase guarantees, removing tariffs, import quotas and other trade
barriers. Parties to be agreement are given preferential treatment when facilitating trade and
establishment commercial relationships.

Q13: There are eleven different terms used to indicate different situations regarding the purchase,
Movement and shipping of goods internationally. What is the name of this collective group of terms?
International Commercial Terms(INCOTERMS)

Q14: List four tips for choosing the right financial software for your business.
 Know what financial data you need to collect and report on.
 See if there are products on the market which will make this process easier, quicker or more
cost-effective for you and your employees.
 Develop procedures that explain when and how the technology should be used.
 Trial any new software programs before implementing them across all departments.

Q15: List four questions you might ask yourself when reviewing software.
 Does the software calculate all payroll requirements?
 Does the software track stock, orders, quotes?
 Does the software allow for multiple users?
 Does the software


Q1: List four statutory requirements to consider when preparing budgets.

 Delegated authorities
 Internal control procedures
 Limits on volumes and types of financial transactions
 Reporting periods

Q2: What is a sales budget?

Sales budgets are forecasts of income/revenue targets to be achieved from the sale of the
business’s goods or services.

Q3: What is a profit and loss budget?

The profit and loss budget summarizes the anticipated revenue and expenses for a budget period,
usually a fiscal quarter or year.

Q4: List three reasons why it’s important to record resource allocation.
 To track performance
 To analyse efficiency and productivity.
 To manage costs and cash flow

Q5: List four sources of data you might use to determine allocations for resources.

 Income and expenditure for previous time periods

 Previous departmental, event or project budgets
 Customer or supplier research: price trends, customer spending patterns
 Competitors research: what the opposition is doing

Q6: You’ve decided to make a new service available at your workplace. This will require an increase in the
number of employees. Which areas of your budget are likely to be affected?

 Wages and salaries

 Payroll tax
 superannuation
Q1: Why is it important to circulate budgets to other managers and supervisors?
To circulate and ensure managers and supervisors are clear about their responsibilities, reporting
requirements and financial delegations.

Q2: List four financial risk situations that could occur if you don’t have an effective risk management
 Breaching contracts
 Not paying the correct amount of tax
 Being underinsured
 Record keeping errors
 Failing to maintain and/or secure records

Q3: List five ways you can prevent misappropriation of funds at your workplace
 Implement internal control systems. You’ll learn more about this shortly.
 Monitor suspicious behaviour in the workplace.
 Test any systems you put in place to make sure there are no loopholes for manipulating funds.
 Have a second person authorise large transactions and amounts.
 Spot-check accounting records.

Q4: A colleague asks you the following question. ‘What does a positive expense variance mean?’ How
would you respond?

You have not spent as much as planned and saved money.

Q5: Which of the following situations is favourable?

(a) Actual marketing expenses below budget
(b) Actual profit and loss below budget
(c) Actual sales results below budget
(d) Actual purchasing expense above budget

(a) Actual marketing expenses below budget

Q6: Why is it important to review cash flows?

A cash flow budget helps businesses plan when they will receive cash so they can coordinate their
payments. Careful planning is required so you don’t drain all financial resources and place the
business in jeopardy.
Q7: List two operational issues you might develop a contingency plan for.
 Equipment breakdown
 Power failure

Q8: Your budgeted variable costs were $60,000 and the actual variable costs were $50,000. What must
You do to analyse the discrepancy?

‘flex the budget at the end of the period in order to make a valid comparison’ between the figures.
This means changing the budget in response to changes in sale and expenses. You alter the format
of the budget from a flexible budget to a flexible budgets by modifying it to reflect the changed

Q9: What four principles must you follow to ensure an accurate and reliable audit trail?

 Research thoroughly before making an estimate.

 Record all of the assumptions that were made.
 Learn from and record you mistakes
 Be systematic

Q10: What is meant by ‘due diligence’?

Due diligence is the steps and effort you take to avoid committing an offence. It’s the process and
care you take to ensure you implement effective systems and processes and minimise the likelihood
of a breach occurring due to complacency, ignorance or miscommunication.

Q11: List four qualities needed to demonstrate financial probity.

 Responsible
 Morally and ethically
 Integrity
 honesty


Q1: List five different report formats you might use for reporting financial information.
 Audit reports
 Profit and loss statements
 Balance sheets
 Cash flow statements
 Electronic forms

Q2: A colleague asks you the following question. ‘Should I include diagrams with my financial report?
I don’t know how formal my report should be. Can you tell me what format to use?’
How do you respond?

A report should provide clear, concise and relevant information. It should be easy for the reader to
understand and enhance their ability to make decisions and take corrective action.
Ensure the format of the data and any analysis conforms to organisational and statutory
requirements. The format should be appropriate to the formality of the report as well as the type and
amount of information can be more clearly represented pictorially using graphs, charts and other
A report doesn’t need to be in a totally written format. Often financial and statistical information can
be more clearly represented pictorially using graphs, charts and other diagrams.

Q3: Outline the three steps for prioritising significant issues you identify in financial statements.
 Identify the issue and related problems for the business.
 Rank these problems with regards to how serious the consequence would be if you failed to
address them and in consideration of the immediate resources you have available.
 Make recommendations to management about which issues to address first and, ideally, what
the business can do to improve the situation.

Q4: You’ve identified a cash flow issue. What type of recommendations do you make to senior?
You are going to make recommendations about how to manage cash flow over the period of concern
and how to minimise expenditure during this period.

Q5: When is an organisation’s financial management processes considered effective?

When the business achieves and maintain a healthy level of growth and profitability.