Assessment Cover Sheet

This document is to be used as a cover page for each individual assessment. This document must be attached to the assessment. All
sections must be completed along with a signature from both the student and assessor. This document links with the Unit Feedback Sheet
and Assessment Record.

Student Name: Trainer Name: Christa Moonean

Qualification Code and Name: SIT50416- Diploma of
Unit Code and Name: SITXFIN004- Prepare and Monitor Budgets
Hospitality
Assessment 1: Short Answer Due Date: 11.03.18 Date Submitted:
Conditions of Assessment / Requirements for Competency: Self-paced assessment, students must complete all tasks and
questions.
Adjustments to assessment required for individual learning outcome required: YES NO
Explanation: i.e. Oral question & answer.

Statement of Authenticity
 I acknowledge that I understand the requirements to complete the assessment tasks
 The assessment process including the provisions for re-submitting and academic appeals were explained to me and I
understand these processes
 I understand the consequences of plagiarism and confirm that this is my own work and I have acknowledged or
referenced all sources of information I have used for the purpose of this assessment

Student Signature: Date:

Assessment: Penalties, fees and descriptions

Late submission Fee $50 per assessment
This Unit Outline prescribes when each assessment is due for this Unit of Competence. If you submit your assessments late you will be
required to pay the Late Submission Fee.

Re-Assessment Fee $100 per assessment

If a student has submitted an assessment and has not fulfilled all necessary criteria and receives a not achieved result for assessment
outcome; student will be required to re-do assessment. Above fee per assessment must be paid before submitting work to Trainer for
marking.

Plagiarism (Academic dishonesty) $200 per assessment

Students found copying, cheating or completing another students work will be deemed as being academically dishonest. Trainer’s
discretion will be used in the overall outcome of the offence, penalties will incur per assessment.

Re-sit Unit: Full unit fee**

If student is re-scheduled to attend full unit re-sit inclusive of delivery of knowledge and assessment criteria, student require Trainer
facilitation for completion of unit requirements full unit fee will apply.

Assessment 1 Assessment Dates: Assessment Outcome:

Attempt 1 Submission Date: Feedback Date: Satisfactory Not Satisfactory
Attempt 2 Submission Date: Feedback Date: Satisfactory Not Satisfactory

RE ASSESSMENT REQUIRED: YES NO

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Assesssment Guidelines What will be assessed

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 The purpose of this assessment is to assess your underpinning knowledge to complete the tasks outlined in
the elements and performance criteria for this unit of competency and relating to the following aspects:

 types of budgets:
o cash budgets
o cash flow budgets
o departmental budgets
o event budgets
o project budgets
o purchasing budgets
o sales budgets
o wage budgets
o whole of organisation budgets
 budget terminology
 specific industry sector and organisation:
o role and nature of budgets
o budget formats, budget performance and financial reports
o financial reporting procedures and cycles
o features and functions of accounting software programs used to prepare and monitor budgets
 internal and external factors that impact on budget development:
o growth or decline in economic conditions
o human resource requirements
o new legislation or regulation
o organisational and management restructures
o organisational objectives
o scope of the project
o shift in market trends
o significant price movement for certain commodities or items
o supplier availability and cost
 budget preparation and monitoring practices and techniques:
o sources and contents of data required for budget preparation:
 competitor research
 customer or supplier research
 declared commitments in areas of operation
 financial information from suppliers
 financial proposals from key stakeholders
 income and expenditure for previous time periods
 departmental, event or project budgets
 grant funding guidelines or limitations
 management policies and procedures
 organisational budget preparation guidelines
 performance information from previous periods
o techniques for making budget estimates
o common reasons for deviations and budget deviation management.

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Place/Location where assessment will be conducted
AILFE Room 9

Resource Requirements
Pen, Paper or computer.

Instructions for assessment including WHS requirements

Answer the questions for this assessment below.
You are required to address all questions to achieve competence. Your trainer will provide you with instructions
for time frames and dates to complete this project.
Once completed, carefully read the responses you have provided and check for completeness. Your trainer will
provide you with feedback and the result you have achieved.

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Assessment 1

Your task: Answer each question below.

1. Name 4 business factors you might consider when researching a budget.

Response
1. the historical performance of the business
2. management's view of the future
3. competitors' offerings and price levels
4. departmental views and issues

2. Describe how the following sources of data can be used for budget preparation.

Response
Competitor research –
Competitor researches are useful for establishing opportunities for your business and also threats that your
business might face. Try to find out what products and services your competitors are offering, what their
pricing strategy is and their future plans, whenever possible.

Customer or supplier research –

Important for any business to understand their customers and supplier as this will ensure provision of
services applicable to the clientele.

Declared commitments in areas of operation –

If each of department head have a commitment made need to be taken into account when preparing the
budget as they will limit what else that department can do.

Financial information from suppliers –

Suppliers are contacted by the relevant Department Head to ensure that the expenses recorded in the
budget will reflect current pricing.

Financial proposals from key stakeholders –

Vision of the owner where they want to take the business in short term and long term. The budget prepared
will reflect their wishes and needs.

Performance data/information from previous time periods –

This data is taken from the financial statements of previous periods, particularly the Profit and Loss
Statement. This can compare the business with the previous business figure.

Departmental, event or project budgets –

Grant funding guidelines or limitations –

Grant funding may be available for your business, depending on the State and Country your business is

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located in, as well as the types of business you are running

Management policies and procedures –

Business relies on policies and procedures , budgeting is no different. Budget preparation should discuss the
process to be followed by management including who is responsible, who should be involved, what steps
must be carried out and what the overall goal is.

Organizational budget preparation guidelines –

Specify how the budget should be prepared. Guidelines will vary between types and sizes of business as well
as with the different expectations of management and owners.

3. Explain how the following internal factors can impact on budgets.

Response
Management restructure –
Impact budgets as the new management team may run things differently than the old team and will have
different priorities for expenditure.

Human resources requirements –

Impact on budgets as each new staff member required will add additional expenditure to the budget, such
as wages, superannuation and worker compensation insurance .

New projects and business objectives –

Funds will need to be diverted from their usual place to cover the new project. The impact will depending
on how large of the project fund need .

Changes in commodity or service prices –

Change supplier or availability of certain items can impact the profit ratio. Adjustment based on the new
requirements.

4. Explain how the following external factors can impact on budgets.

Response
Legislation and regulations –
Changes in legislation can affect the business both operationally and financially. Depend on the new
government set up the law and regulation will affect the budget ,example: many TH&E workers are
immigrants, if government change the number accepted into country ,hospitality definitely facing the
staffing problem.

Changes in the global economy –

May limit travel both domestically and internationally. People will not spend the money on luxuries, and
holiday will no longer be affordable.

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Market trends –
May need to change the offering to attract more customers to move with the trends.

5. How does involving staff “from the bottom up” in the budgeting process, help the business?

Response
The bottom-up approach ensures that all staff is involved in the preparation of the budget, which means
they will work harder to achieve the budget than they would if it were just handed down by management
using a top-down approach.

6. What does the process of preparing a draft budget usually involve?

Response
The estimates you have made for revenue and expenses should be entered into the budget using the
software available at your place of work. Collated all data and put all data together to create a draft
budget. Must understand the policies and procedure of what the workplace requirements.

7. How does breaking the budget down into groups, departments, or income and expense categories help
colleagues?

Response
Read and understand the budget information
Filter out irrelevant data
Analyse the effect of projected expenses and revenue on their department

8. Name 3 people (job roles) you would circulate the draft budget to for feedback or approval:

Response
1. Owner

2. Upper management

3. Staff

9. The budgeting process requires strong negotiation skills. Why is it important to convince staff of the
achievability of the budget?

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Response
It is important to convince staff of the achievability of the budget, cause it might be affected the whole
company budget if any department spend over the budget, so the company may face the cash flow
problem.

10. A staff member suggests a change or alteration to the budget. List 3 aspects you need to consider to ensure
any changes would have no negative impacts:

Response
• Whether the additional costs are justified.
• The effect of the costs on the bottom line.
• Potential service provision issues.

11. In most businesses/industries, when must the budget be complete?

Response
End of the financial year, for next financial year.

12. What information should department managers include in their monthly reports?

Response

Any budget variances as well as an overall picture of the running of the department.

13. How often should the budget be compared to the actual accounting results?

Response

Montly

14. Name and describe 5 financial reports you might generate from your accounting system to check your
budget against actual income or expenditure.

Response
1. Budget vs Actual

2. Sales Report

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3. Departmental Reports

4. Profit and Loss Statement

5. Cashflow Statement

15. Every revenue and expense item on the Profit and Loss Statement should be compared to what?

Response
the figure of the budget sated

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16. When revenue variances occur, why is talking to staff a good way to help identify and find options to address
the issue?

Response
Often the staff on the front line will have more of an idea of the reasons for the variance and will be able to
give suggestions for improvement.

17. List 3 factors that can cause variances in staff budgets.

Response
1. Efficiency of staff

2. Using too much casual labour

3. Needing to ‘pay out’ a staff member who leaves

18. Why is monitoring your budget progressively throughout the year so important?

Response

So that you can catch any variances in time. If you do not realise that there are issues early enough, then
you will not be able to adjust your strategies to compensate.

19. How can you collect information to help create future budget plans?

Response
Reports are produced by the business for certain time, analysis the information and create the future
budget.

20. Name an accounting program you can use to help manage budgets.

Response
• Xero
• MYOB
• Cashwhiz
• Quickbooks

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21. Explain each of the following types of budgets:

Response
Cash budget/Cashflow budget – this forecast of the casflow of the business. The statement show physical cash
in and out of the business and separate financial statement from the balance sheet and profit and loss
statement .

Departmental budget – the budget for each department will be like a mini profit and loss statement and will
show monthly as well as annual target.

Event budget –used for single events such as conferences. When quoting a potential customer, the budget
must like a mini profit and loss format, include the revenue break down .

Project budget – it is prepared prior to a new project commencing, have to state the cost and benefit to allow
the management to decide viable of the project.

Purchasing budget –Known as expenses budget, projected expenditure of the business.

Sales budget – known as revenue budget, it projected sales either In unit sold or revenue amount.

Wage budget – it shown in each department budget, it will combined all wages which total wages for the
business.

Master budget –the budget for the entire business . include profit and loss; balanced sheet budgets and
projected cash flow.

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