Your answers for task 1:

BSBFIM501 Manage budgets and financial plans

Answers for task 1

Task A
The Sales General Manager, Sam Gellar, has asked you to review the master budget and
cost centre budgets prepared by the Senior Accountant. She would like you to meet with
her to discuss whether the budget projections are achievable, accurate, understandable and
fair.

Sales cost centre expense budget:-

Sales Centre A Sales Centre B Sales Centre C

Commissions $20,000 $20,000 $20,000

Wages $100,000 $100,000 $100,000

Telephone $3,000 $3,000 $3,000

Office supplies $1,000 $1,000 $1,000

The spending limit is an estimation and setting parameters to act in a concurring manner as like
such estimation or parameters. The financial limit is set up to guide the tasks of the association.
It is an approach to keep a beware of the exercises of the considerable number of administrators
just as staffs alongside the difference report. In the present situation, the capacity to design the
monetary administration draws near and overseeing assets productively is the fundamental
fixing.
The general spending plan of an association, ought to be partitioned into private spending plan
for various divisions. In any case, these ought to be assembled, so detailed spending plans are
under the duty of one individual. It ought to likewise be clear who is capable and responsible for
each spending limit, to evade disarray.
The spending ventures that the business will gain $1000000 net benefit for the coming monetary
year. The financial backing is reachable because, from the past organisation execution, the
organisation figured out how to accomplish offers of $1000000 in one quarter. This shows it
attainable for the organisation has a net benefit of $1000000 in a money related year.
The monetary allowance is basic yet not comprehensive. One can without much of a stretch
necessarily realise what the projections mean; however, it difficult to conceptualise in light of the
absence of reference. There are no rates of past execution to show what the organisation earned
Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

in the previous money related year. This along these lines makes the projections less persuading
as it ought to be for the individuals who don't approach past execution.
According to the ATO enactment and bookkeeping standards, the bookkeeping will be done on
the accural premise, for example, bookkeeping exchanges ought to be recorded in the
bookkeeping time frames when they happen, as opposed to in the periods when there are
incomes related with them.
The monetary allowance isn't reasonable because it accepts that deals and costs will be
equivalent in all quarters. The subsequent quarter has the most noteworthy offers of which are
significant for support and fix. This is unique concerning different quarters where the business is
30% less to Q2. Along these lines, the ace spending plan isn't reasonable by expecting equivalent
deals and cost in all quarters.
As per the crucial bookkeeping rule of reasonability, the cost allotment will be made on a
reasonable reason for the cost focuses as indicated by their deals.

Negotiation:-

• The understandability of the ace spending plan ought to be improved. The

bookkeeper ought to have shown past budgetary year real execution in the present
spending projection for simple comprehension. This will empower administrators
who don't approach past money related data conceptualise on the reachability of the
current spending plan.

• The ace spending plan requires to be directed to have net benefit before the charge
that mirrors the goal of the organisation of $1000000. This will expand the precision
of the financial limit and guarantee is dependent on the target of the organisation.

• It not sensible to extend that deals and expenses for all quarters in the financial year
will be equivalent. Hence, the projections ought to be increasingly practical by
utilising past quarter deals and cost to extend the current budgetary year spending
plan.

In rundown, the ace spending plan ought to be revamped based on Accural guideline of
bookkeeping. This will empower the organisation to assess all the more precisely on deals and
expenses to be brought about. It is always recommendable to overestimate the cost and disparage
deals.
Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

Task B:-

Contingency Plan
Company Name: Big Red Bicycle Pty ltd
A person developing the plan: Sales Manager Sales Centre A

Risk Identified: There is a negative financial atmosphere that is probably going to influence
the organisation deals by 20% beneath the anticipated deals volume. This will severely impact
the physical benefit of the organisation.

Strategies/ Activities to minimise the By when By Whom

risk

Enhance efficiency: This will limit costs Start of Q1 Production

in the association. manager and
operations manager

Reduce the number of bikes transported Start of Q1 Operations

to the market: Completed items to be put manager
away in the organisation distribution centre
until the economy is ideal. This will
diminish the expense of shipping to the
market and leasing the extra room

Reduce promotional activities: This will Q1 and Q2 Sales General

spare the organisation assets that are Manager
dispensed for promoting and publicising.
Diminishing special exercises when the
economy is negative is legitimate because
a couple of clients bear to purchase items.

Not to hire more employees Q1 Humana resource

management

Prepare an intermediary budget: The Q1 and Q2 Accountant

delegate spending will empower the
organisation to utilize the least assets when
the economy is ominous.
Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

Answers for task 2:

Scenario
Big Red Bicycle Pty Ltd is a bike producer situated in Bendigo, Victoria.

The organisation produces bikes which it offers to retailers in the local Australian market.

As indicated by organisation vital plans, the organisation expects to accomplish a net benefit before assessment of $1,000,000. The
central dangers to this objective are:

● Poor deals because of the monetary downturn

● Increases in costs, for example, wage costs.

Notwithstanding Australian activities, the organisation is thinking about assembling abroad to exploit diminished expenses. The
organisation is additionally considering expanding its item range to lessen introduction to reduced offers of one item.

My Role:

I am the director of offers group A.

I have to deal with my business colleagues.

Task A

A Round table gathering was held with the colleague from the Sales Team A. In this gathering, all the significant part of the financial
backing has been recognised to them.

I get the budgetary data for the middle A from the ranking director. The general dispensed spending plan for the inside An is 124,000
(AUD) which is additionally remote into seventy-five per cent.

The fundamental goal of the organisation is to accomplish a net benefit of $1000 000 preliminary assessment which is available
dependent on the spending limit. We'll need to focus ourselves and the vast majority of the costs on the business office even though
without the collaboration of all offices we would be not able to do anything.
Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

The colleague should work deliberatively to accomplish the general monetary goal of the organisation.

The Company expects to win a net benefit before assessment of $1000000. Second, the organisation needs to limit its expenses and
wastage to build its net revenues.

To diminish the cost we might want to make all the more abroad and differentiate our item run. We would need to do the majority of
the fixes and support work before the second quarter as this is expected to set up the expectable deals rate. We have raised the
commission of the business group from 2% to 2.5% which expected to spur the group and was the object of our past dealings.

Notes:-

• Effective advertising
• Customisation of items
• Increase efficiency
• Effective administration
• Budgeting
Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

Task B

Dear Bill,

I have an errand for you which should remain done at the earliest opportunity. We need you to follow costs and negligible money all
through the financial year.
This obligation should be made as per our provisions and techniques, which are displayed underneath.

It will be ideal if you utilise Microsoft Excel to track and present us those costs.

As you referenced to me before that you not mindful how to utilise recipe and capacities to total segments or columns of figures, I will
attempt to disclose that to you.

You can utilise AutoSum capacity to whole any numbers in a section or line. Click on an unfilled cell under segment with numbers.
Or on the other hand, if you need to aggregate range, click void one beside the privilege of a column of numbers, and afterwards click
AutoSum.

You can likewise utilise basic equation. Snap-on an unfilled cell under segment with numbers and enter

=A1+A2+A3+A4 (where A1 to A4 are your segment cells). To entirety the columns, you need to do the comparative thing
=A2+B2+C2+C4.

The Petty Cash Policy:

This is a modest quantity of cash which is kept available and used to pay for moderate amounts owed, instead of composing checks. It
is typically doled out to a frivolous money overseer – representatives should then allude to this individual on the off chance that they
have to utilise little money or be repaid for an organisation cost they have paid for out of their pocket. At the point when the negligible
money support gets low, the caretaker can demand to get the money for a check to top it up. The explanation behind little money is
that it is less complicated than the composition, marking and getting the money for checks for minor exchanges. For instance, consider
paying a conveyance man costs due on conveyance (these can be under a dollar) – it does not merit recording this individual exchange
independently – in this manner, recording little transfers on the whole as trivial money makes the bookkeeping procedure less
difficult. The overseer should work in any case track singular trivial money use by giving unimportant money vouchers for every
exchange, total with a receipt and receipt. These vouchers and the measure of money to hand should continuously rise to the first
Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

reserve. They ought to likewise keep a negligible money daybook to track frivolous money exchanges after some time. Due to the
effectiveness with which unimportant money can be pushed, it should be held under close checking.

Reason for the arrangement

To disclose methodology to be followed comparable to follow unimportant money.

The approach

Huge Red Bicycle keeps up a frivolous money framework to permit approved workforce to pay for little uses regarding business
movement.

Method

1. One colleague is approved to dispense frivolous money with one interchange if there should arise an occurrence of ailment or
crisis.

2. Petty money is to be protected secure secured.

3. Receipts for money must be given.

4. Receipts must be recorded daily.

5. Amounts over $800 must be banked.

6. Small money costs will be recorded as different cost.

Record keeping prerequisites

Spending plans must be observed and gave an account of, to guarantee that they are meeting desire and to recognise any issues that
need correcting.
Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

Checking and detailing procedures should cover the accompanying:

➢ Set timetables and cutoff times for testing and setting up of spending plans

➢ Having a framework to guarantee the information is exceptional and precise

➢ Reports ought to be made accessible for to the board

➢ Reports ought to be done at any rate month to month

➢ Data ought to be inputted into your records consistently, to take into account better budgetary arranging

➢ Reports ought to be created as quickly as time permits to guarantee they are applicable

➢ Reporting ought to occur from the base up – it ought to include:

• actual consumption

• forecasted consumption

• expected changes

The authoritative arrangements require keeping records for all the spending variety and deviations of costs repayments with the real
costs. The following of negligible money will be recorded appropriately and routinely. Bill should keep up legitimate records of
frivolous money in the negligible sales register. The reports required by ATO and for GST consistency should be kept with
government forms.
 Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

Answers for task 3:

Budget and Actual Performance

Revenue FY Q1 Q2 Q3 Q4
% Absolute Budget Actual Budge Actua Budge Actua Budge Actual Budge Actua
Variance % t l t l t t l
5%
Commissio 5%
n
-2% 60000 60300 15000 15075 15000 15075 15000 15075 15000 15075
Direct 0 0 200000 200000 50000 50000 50000 50000 50000 50000 50000 50000
wages fixed

Sales -1% 1% 3000000 2950000 75000 73750 75000 85060 75000 700500 75000 72073
00 0 0 0 0 0 0 5
Cost of 5% 5% 400000 420000 10000 11000 10000 10500 10000 102500 10000 10250
goods sold 0 0 0 0 0 0 0

Gross profit -8% 8% 2340000 2050000 58500 58466 58500 60500 58500 570460 58500 46700
0 0 6 0 0 0 0 0 4

-4% 4% 1401500 1301500 340567

 Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

Total 35037 36037 35037 40067 35037 35037 36037

expenses 5 5 5 5 5 5 5
Net profits -3% 3% 938500 930500 23462 25062 23462 23062 23462 234625 23462 23062
(Before 5 4 5 5 5 5 5
interest and
tax

Income Tax -6% 6% 234625 230625 58656 49625 58656 60656 58656 55657 58656 57453
5
Net profit -15% 15% 703875 603875 17596 16569 17596 11606 17596 165695 17596 16965
9 5 9 9 9 9 0

Spending Variance Report

The spending variety report is set up by ascertaining the contrast between the arranged figure and the precise figure. It can help in
organising, following just as controlling commonly spending and subsidising process.
The above report shows that the planned marketing projection surpasses the original marketing projection by $200, 000. In this way,
we can say that the spending change for deals isn't right as the real deals information is lesser than the underlying anticipated figure.
The difference report likewise uncovers that the planned value of the gross benefit surpasses the precise total benefit figure by $175,
000 that is by 8%. The result of the gross profit isn't as projected and in this way uncovers an unfavourable fluctuation.
Consequently, the change report likewise shows that there is a significant contrast in the real costs and the planned costs.
The report additionally uncovers that the planned figure of net benefit before intrigue and duty surpasses the real number by $196,000
that is roughly 24%. So it is additionally ominous for the business as the outcomes don't meet the desires.
The planned net benefit proportion is 24.7% that is more prominent than the genuine figure of 14.29%
Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

Revised contingency plan

Contingency Plan
Company name: Big Red Bicycle Pty Ltd
The person developing the plan:
Name: Tom Copeland Position: Managing Director

Risk identified: Benefit for FY over 10% not precisely planned

Strategies/activities to minimise the risk By when By whom

Produce quarterly fluctuation reports to recognise Q2 PR
salary/consumption and benefit setbacks over 10%.

Execute deals preparing/instructing. Q2 PR

Acquaint client reward program with increment deals Q2 PR

Investment of representatives in essential budgetary Q2 PR

leadership

Increment consideration towards wastage, water and Q2 PR

power, paper and crude materials
Your answers for task 1:
BSBFIM501 Manage budgets and financial plans

Modified contingency implementation plan

Risk identified: Benefit for FY over 10% not precisely planned

Activity Monitoring activity and date Person/s

Monitor variance. Completion of variance report: Q2. PR

Analyse the report to identify issues. Management report: Q2. PR

Email to warn employees of risk to Monitoring of variance report PR

professions. results: Q4.

Email to announce the rise of commission Monitoring of variance report PR

from 2% to 2.5%. results: Q3.

Email to inform employees that overtime will Monitoring of variance report PR

no longer be approved. results: Q3.

Email to inform employees of mandatory Monitoring of variance report PR

sales skills training: set program. results: Q3.

Email customers and employees about the Monitoring of variance report PR

customer recompence program. results: Q4.

Voluntary training conducted. Monitoring of variance report PR

results: Q3.

Modifying procedures to reduce occupancy Monitoring of variance report PR

costs results: Q3.
Your answers for task 1:
BSBFIM501 Manage budgets and financial plans