Professional Documents
Culture Documents
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1. Describe each of the six (6) steps of the accounting process required to record all of the
transactions that take place, and to organise and collate this information before finally
producing financial reports that are analysed and used in decision making.
Provide a description of each of the 6 steps:
• Transactions
• Journals
• General ledger
• Trial balance
• Balance day adjustments
• Accounting reports
Transactions: a monetary event that is documented as an entry in an entity's accounting
records and has a monetary impact on its financial statements.
Journals: is a thorough account that records all of a company's financial transactions and is
used for future account reconciliation and information transfer to other official accounting
records, such as the general ledger.
General ledger: is a financial data record-keeping system that includes debit and credit
account records that are validated by a trial balance.
Trial balance: is a bookkeeping worksheet in which the balances of all ledgers are added
together to provide equal debit and credit account column totals.
Balance day adjustments: is a correction that must be made at the conclusion of the
reporting period. These modifications are made to certain accounts so that the business's
health can be accurately depicted.
Accounting reports: They are collections of financial information produced from a company's
accounting records. These can be short, custom-made reports with specific aims in mind, such
as a detailed study of sales by region or the profitability of a certain product line.
2. In 50 words or more, explain how a revenue-received transaction with a credit balance has a
corresponding debit against an asset or liability account.
When comparing an income transaction with an asset or liability account, the debit and credit
balances are always the same. That a result, obligations are lowered in the same proportion
as assets are increased. The income account will be altered in the same way that the asset
and liabilities accounts were.
3. In 50 words or more, describe the difference between cash basis and accrual basis
accounting when recording transactions, producing financial reports.
4. Explain in 50 words or more the difference between the profit calculated in the trading
account compared with the profit calculated in the profit and loss account.
A trading account displays the results of trade activities such as buying and selling products.
The profit or loss of a corporation is seen on the balance sheet throughout time. The profit
and loss account shows the true earnings of the organization, whereas the business account is
part of the financial statements.
5. List at least four (4) of the financial regulatory requirements including the relevant
legislation that businesses must comply with.
1. Compliance with the Income Tax Assessment Act 1997.
2. On the declaration of economic activity, GST reporting and other taxation-related
matters are addressed.
3. Administration and reporting guarantee levy for superannuation.
4. Compliance with the Australian Accounting Standards AS/NZS.
6. Describe at least four (4) functions of the Australian Taxation Office in terms of the financial
management requirements of a business and in 50 words or more explain the Good and
Services Tax.
The Australian Taxation Office's responsibilities include managing Australia's large-scale
superannuation system, revenue collection, managing a range of community transfers and
benefits programs, and processing GST on behalf of the Australian states and territories.
The Goods & Services Tax (GST) is a value-added tax applied on the majority of goods and
services sold for domestic use. Consumers pay it, but enterprises that sell the goods and
8. In 50 words or more, explain why it is important when monitoring budgets to make balance-
day adjustments at the close of an accounting period, before preparing financial statements.
The budget should be reviewed on a regular basis to determine whether any changes are
required to improve the company's financial situation. As a result, it's critical to assess how
the company's budget is operating at the moment, as well as to detect any big concerns that
may occur in both the spending and earning areas.
9. Give at least three (3) reasons why work teams need access to budgets and financial plans
and in 50 words or less, outline the ways financial information can be shared effectively with
relevant stakeholders.
It's critical that the work team has access to budget information so that they may develop
methods to achieve the desired goals, understand what actions can and cannot be taken, and
have a holistic view of the company's development.
Financial reporting to all internal stakeholders of a corporation should be clear, simple, and
regular. It is a critical, yet often disregarded, component of long-term corporate success. The
management team and the board of directors are examples of internal stakeholders. Special
meetings or formal reports are two excellent ways to transmit this information.
10. Identify at least five (5) signs that team members are under-performing and may need
support in their role to manage finances for the organisation.
Failure to meet or exceed performance goals; an overload of seemingly simple chores;
disruptive behaviour that has a negative impact on co-workers; failure to complete or fulfill
the duties of the position satisfactorily; employees not meeting the minimum requirements
when performing their jobs are all signs that team members are underperforming.
The variance is computed by comparing budgeted income and expenses to actual revenue
and expenses, resulting in a revenue difference between the budget and actual revenue.
Evaluate source material relevant to the spending categories and collect documentation of
the difference to avoid overruns. If the variance has been validated, look for any seasonal
variables or ordering timeframes that may have contributed to it. Write down the reasons for
notifying your manager of the situation.
12. In 50 words or less for each, provide a description for the following types of resource data
commonly used by the work team for managing budgets and financial plans.
The bank account record stores all of the information you need to
keep track of your bank account, including account and routing
Bank account records numbers, current and minimum balances, bank data, adjustment
categories, and any notes you choose to associate with the account.
GST (Goods and Services Tax) is a single tax on the supply of goods
GST calculations and and services. GST credits are the GST you paid as a business expense
any credits when you manufactured your goods or provided your services.
They're referred to as Input Tax Credits.
Wage/salary books are books where you can keep track of the
Wages/salaries books
number of earnings and salaries you receive each week or fortnight,
(including PAYG,
as well as bank information, adjustment categories, and any notes
superannuation, etc.)
you want to link.
It's a way of keeping track of all the costs and income related with a
certain project. Projects include one-off customer projects, the
Job costing creation of new things, and the delivery of many products that will be
developed at the same time.
13. Using 50 words or less, outline the process of analysing and documenting resource data, and
making recommendations for improvement.
14. Outline at least four (4) advantages of using software programs or electronic spreadsheets
when monitoring and analysing budgets.
- This program organizes data in such a way that it's easy to identify and review each entry.
- When it comes to the veracity of the information presented, it is more dependable.
- Information can be accessed by stakeholders from any location.
- Creating reports and making financial decisions takes less time.
15. In 50 words or more, explain how planning, implementation and modifying contingency
plans is used to control financial risks for a business.
Contingency plans must be designed, implemented, and changed to control a company's
financial risks. The domain of business operations should be addressed in the creation of an
emergency plan since the environment impacts the number and severity of events' effects on
corporate activities. Financial consequences of the events, as well as financial indicators of
the company's long-term health, must be considered in the plan. The way a contingency plan
is implemented determines its effectiveness. If the strategy isn't correctly implemented, the
company will incur even more financial losses.
16. In 50 words or less, outline the advantages of regular reporting of budgets and financial
plans.
The following are some of the benefits of budgeting:
Orientation to planning
The act of generating a budget diverts management's attention away from day-to-day
operations and pushes it to consider the long term.
17. In 50 words or less describe the budgeting process of analysing and managing cash flow.
Budgets assist in the creation of cash predictions, which are subsequently used to calculate
cash flow and outflow. The company's goal is to bring cash flow into line with the budget so
that no further problems arise. A cash flow study of seasonal income and expenditures can
aid a company's planning for the future fiscal year.
The present revenue of the Income is predicted to increase from $150 million in 2018 to $262
million in 2023. If revenue isn't met, the remainder of the budget will suffer unless we keep an
eye on it. As a result, in order to reach sales targets, the goal could be to keep track of product
sales on a regular basis and invest in training/marketing (promotion). To ensure a long-term
growth scenario, the Expenditure's costs are presently rising at a lesser rate than profits. The
cost will climb if we don't keep it under control, reducing the amount of surplus available for
reinvestment. As a result, the advice is to keep focusing on ways to reduce costs without
sacrificing efficiency, allowing income to expand without incurring more costs. Sales and
expenses are likely to improve in the next years, resulting in continued profit growth. If nothing
is done, BizOps may stagnate or possibly lose money, exhibiting inefficiency or an unsustainable
marketing strategy.
Target $4.263.100
Shortfall based on above calculation $2.607.000 These items must increase by
Total of unchanged items $1.656.100 28.15% to meet shortfall of
$2.607.000 and meet revised target
Contingency budget
Contingenc
y budget
Calculations of Hools sales based on 30% increase for two months, then 60% for one month at 10%
lower.
Quantity sold per month based on previous quarter: 2500
Price/unit Quantity Sales Comment
Month 1 $70,00 3250 $227.500 Up to 30%
0
Month 2 $70,00 3250 $227.500 Up to 30%
0
Employees in BizOps must understand the importance of attaining financial goals. As a result,
salespeople must be familiar with the company's unique product line in Australia, as well as its
quality and innovation, highlighting how what we offer is an environmentally responsible
solution for our consumers. Since hools aren't selling well, a strategy to run a month-long
special promotion and discount sale has been devised. The target audience is at the center of
the marketing strategy, which is made up of four parts. The 4Ps are the acronym for these four
elements. The promotional mix includes promotional, personal sales, and sales promotion. It's
also critical to remind employees of the goal of workplace marketing, which in this case is to
persuade clients that our products and services are superior to those of competitors. To reach
the aim, the company would invest $3 million in Hool shares and offer a 10% discount on
commodities for ten days, as well as spend $30,000 on promotion. The discount would be equal
to a 10% discount off the regular sale price.
Short Report
- One method for calculating account profit and loss is to total all of your monthly revenue, add
all of your monthly expenses, and then remove expenses from total income to find the
difference. To cope with it, the first step is to develop an income statement to track profit and
loss. This will clearly display your profits and losses, as well as lead you in the right path for cost-
cutting.
- Budgeting entails allocating revenue and expenses so that funds are dispersed strategically.
Establishing a clear budget plan will make financial management and analysis much easier.
Keeping track of your spending with a budget is a basic method that can help you regulate and
evaluate how you spend money. To ensure that the company's budgeting expectations are met,
prepare the suitable employees for the budgeting role.
- The term "cash flow" refers to a method of managing earnings and results liquidity. Calculating
cash flow is similar to budgeting in that we must organize our revenues and expenditures to
understand how the money is distributed. Following that, we'll examine our spending and
compare it to our estimates as the first stage.
Cost accounting is used to record, analyze, and document all viable and fixed company costs. To
put it another way, in order to make a decision, he needs to be involved in each department
manager's financial statement at BizOps. This notion can help you figure out how much a
product or process costs so you can record the amount appropriately on a company's financial
statements. The main goal of supplying this data is to provide precise information to
accountants and help them understand how the budget was established. Accrual accounting is a
method of accounting in which revenue and expenses are recorded when the transaction occurs
rather than when payment is received or made. According to the matching principle, revenues
and expenses should be recognized in the same period. Another key concept to consider is the
double entry financial system, which states that every business transaction is recorded in at
least two accounts and aids in the creation of financial statements such as the profit and loss
statement and the balance sheet. Petty cash, which is a little sum of money kept on the
premises of a business or organization to satisfy minor expenses and needs, is another essential
idea.
Assets are the tangible and intangible value-owned goods possessed by the corporation.
For example, the location of BizOps' facility or a well-known industry brand name are
both good examples.
Costs incurred or necessary during the product development process are referred to as
expenses.
Equity refers to the portion of a company's total assets that is owned exclusively by its
shareholders or stockholders. Is a method of raising funds by selling stock. For example,
the basic accounting equation Assets = Liabilities + Owner's Equity might be recast as
Assets = Equities.
Staff email:
We need to talk about certain essential subjects related to some legislation and
requirements that you should all be aware of. The Australian Taxation Office is the first. To
be in agreement with it, you must endeavor to learn the following information: ensure that
tax invoice paper is checked, that the seller's name is always mentioned, that the seller's
Australian business number (ABN) is always used to avoid mistakes, that the date is
addressed to invoice documents, that a brief description of the items is included, and that
the percentage of each taxable item is included on the invoice.
GST collection, payment, and reconciliation: Since your firm is GST registered, you will report
and pay it once a year. Another crucial item to remember is that if you have a GST license
and earn up to $75,000 per year, you must pay GST. Always register for GST; this will allow
you to issue and receive invoices for business purchases and taxable sales, claim GST credits,
and, most importantly, account for GST in cash; and file activity reports or annual statements
with the Australian Taxation Office to reflect sales and company purchases.
When keeping financial records, you must adhere to the following auditing and record-
keeping principles: for tax purposes, you must keep your paperwork in an accessible format
(written or digital) for five years. We must preserve the following records as a company:
receipts and other documentation for any purchases and transactions conducted on your
behalf Tax bills, as well as documents connected to earnings and salaries. Documentation
relating to GST in any format. Any commercial assets, such as land, buildings, and office
equipment, as well as the costs of purchasing, selling, and maintaining them. Keep
Yours sincerely,
Manager of Financial Resource
Financial
Budget worksheets High 15 nov 10 oct 15 nov
Manager
Departmenta
Prepare predictions High 15 dec 20 nov 15 dec
l heads
Departmenta
Create a contingency budget High 20 dec 20 nov 20 dec
l heads
Project
Collect department’s budget High 25 dec 10 dec 25 dec
Manager
10
Complete board papers CEO High 10 jan/2022 20 dec
jan/2022
The financial management technique will now track up to 200 spending categories and 20
revenue categories. Department heads claim that responding to all of the inaccuracies in their
monthly budget report takes them a whole working day. It also aids activity organization by
forcing BizOps managers to investigate the relationships between their operations and
departments. As a result, I argue for effective budget and financial plan management, which
demands a deep awareness of a wide range of accounting principles, procedures, and details.
Mock-up examples:
Minor expense variances:
Executive briefing
Budgeting issues Recommendations
The department managers rarely have their Internal meetings must be held on a regular
preliminary budget projections submitted to basis, and all work must be finished within 14
the Budget Committee on time. Consequently, days of the Budget Committee's deadline.
the Budget Committee usually has to delay its
review of all of the subsidiary budgets by about
two weeks.
The two-week delay puts enormous pressure Employees who work on many projects
on the finance department as the production of should not be overworked and should stick to
the master budget overlaps with other the deadlines set for each job. To give higher
scheduled finance department tasks such as importance to those who are more
GST activity reporting, payroll preparation and important. Another strategy to avoid delays
asset register updates. and one activity interfering with another is to
hold a brainstorming session or meeting
where departments can analyze possible
scenarios and design solutions to avoid them.
Finally, before deciding on a specific day, the
key concept is to construct a shared
schedule.
The finance staff feel that the budget cycle It is vital to maintain information on the
should commence two weeks earlier, but if this cloud up to date and to have a workflow
were implemented it would clash with the strategy in place to avoid such conflicts.
stocktake period in the retail outlets. Another option is to allow longer periods of
time, but no more than one week.
Organizations should aim to make the most
efficient decisions possible, but this can only
be done if each change is thoroughly
evaluated in partnership with other
The BizOps budget plan assists the company and its divisions in managing operations, inventory
levels, mitigation plans, GST and plan needs, and more. Financial statements illustrate spending,
variances, budget comparisons, as well as growth and cutbacks. If there have been any changes,
show the proposals and their repercussions. The forecast predicts how much money will be
received, whereas the budget anticipates how much money will be received. For instance,
conditions fluctuate throughout the year, and the company must be able to respond to these
variations and understand their business implications. Making forecasts based on historical data
can lead to more proactive and successful actions. Improved accuracy and company
performance could be achieved by budgeting and forecasting in a variety of methods. One of
the most important changes to make is to use spreadsheet templates to collect data for budget
projections.