ASSESSMENT TASK TWO

Portfolio and Roleplay

Instructions

• The purpose of this assessment task is to review existing financial information

and prepare and implement budgets for the following financial year.
• You must complete this task by the due date set by your trainer and assessor.
• You will need access to the following resources to complete this task:
o Grow Management Consultants Case study information
o Appendices and templates provided by your assessor
o Business technology and office equipment including computer with MS Office
Suite (or similar) and internet access
o Space/technology for meetings and presentations
• You must provide your responses in your own words. You can refer to the Learner
Guide, Case Study Scenario or other sources when preparing evidence, but you are
not allowed to copy sentences and/or paragraphs directly from these sources. If
your responses found to have been copied directly from learner guide, case study
scenario or other sources, your result for this task will be Not Satisfactory.
• You will complete the research and documentation type of activities at home in your
own time and the practical type (role-plays and presentations) activities in simulated
assessment environment under the assessor’s supervision.
• After completing the activities, you must submit evidence as per the ‘Evidence
Submission Checklist’ by the due date. For observation type activities, your assessor
records your performance using a checklist, so you do not need to submit anything
unless the activity asks you specifically.

Scenario

You are the General Manager at Grow Management Consultants and are required to review
existing financial information and prepare budgets for the following financial year based on
your review. In your General Manager role, you are also required to review existing financial
software to ensure that it is meeting the company’s needs.

You are then required to meet with the management team (your assessor) to discuss the
budgets you have prepared for the upcoming financial year, as well as to confirm reporting
 requirements and financial delegations as documented in the financial management policy
and procedure.

Carefully read the case study Grow Management Consultants (Appendix 1) and then
complete the following activities.

Activities

1. Prepare a financial performance report 2019-2020

Analysis of the Profit and Loss Statement for the 2019-2020 Fiscal Year:

Overall, the income streams performed well; however, there was a incurred loss for the period. The
net profit for the year amounted to $797,125, while total expenses were $817,590. The Gross
Profit/Net Sales figure stood at $1,614,720.

Specific observations:

1. Income from workshops amounted to $45,000, falling short of the projected $75,000. This
resulted in a 40% loss in income from workshops.

2. Income from publications reached $15,000, surpassing the budgeted amount of $10,000 by
$5,000, resulting in a profit.

3. There were notable discrepancies between the actual and budgeted figures for publications and
workshops. These disparities may be attributed to the lower attendance at workshops, with clients
showing a preference for consulting services.

4. An analysis indicates a need for more e-books and improved marketing strategies. However, the
costs associated with workshops and e-book production were high. The e-book production resulted
in a loss due to the writer costs, and the workshop expenses were also excessively high.

In light of these findings, it is essential to revisit our strategic goals and priorities. Consideration
should be given to optimizing workshop expenses, enhancing marketing efforts for e-books, and
exploring ways to attract a larger audience to workshops. This assessment underscores the
importance of aligning our future financial strategies with a more accurate understanding of income
streams and cost management.
Analysis of Workforce and Potential Solutions:

1. Optimizing the Workforce: It is crucial to review the efficiency and allocation of our workforce.
This might involve redistributing tasks or reorganizing teams to ensure that human resources are
utilized to their maximum potential.

2. Hiring Additional Consultants: To address the discrepancies between actual and budgeted
figures in workshops and publications, it might be prudent to bring in additional consultants who
can help boost attendance and improve the quality of workshops and publications. However, the
associated costs should be carefully evaluated to ensure that it's a cost-effective solution.

Cash Flow Statements Analysis for 2019-2020 Financial Year:

Upon analyzing the cash flow statements, it is evident that there are no significant cash flow issues.
The income generated from consulting and executive services appears to be robust and stable,
providing financial stability to the organization.

Review of Financial Software:

The business is considering three financial software options: Xero, QuickBooks, and MYOB. Here's
a brief review of each, highlighting their advantages and disadvantages:

1. Xero:
- Advantages: Xero is known for its user-friendly interface and cloud-based accessibility. It offers
excellent collaboration features, making it easy for multiple team members to work on financial data
simultaneously. It also integrates well with various other business software.
- Disadvantages: Some users find it relatively more expensive compared to other options, and it
may lack certain advanced features that larger businesses require.

2. QuickBooks:
- Advantages: QuickBooks is widely used and has a reputation for its robust features, making it
suitable for both small and large businesses. It offers a wide range of accounting tools and
customizable reports. The software is also known for its customer support.
- Disadvantages: QuickBooks can have a steeper learning curve for beginners. Some users find
it less intuitive than other options.
3. MYOB (Mind Your Own Business):
-Advantages: MYOB is another popular choice, known for its simplicity and ease of use. It offers
features for both accounting and payroll, making it suitable for small to medium-sized businesses.
- Disadvantages: MYOB might not have the extensive feature set that larger enterprises require.
Some users find it lacks advanced capabilities.

The choice of financial software should depend on the specific needs and size of the business, as
well as the budget available for software expenses. Consideration should also be given to the
compatibility of the chosen software with the company's existing systems and the level of support
and training required for staff to effectively use the software.

2. Develop budget forecasts for financial year 2020-2021

Develop budget forecasts, ensuring that the analysis of the previous year’s data and
future plans as indicated in the business plan is taken into account in determining
projected income and expenditure.

Use the Budget Forecast tab from 7a. Grow Management Consultant Financial
report Excel Sheet to guide your work.

Ensure that your budget includes the estimated income and costs for the conference
and e-book to be implemented in 2021 in the document Costs and Income.

Assume a 5% increase in all general costs, as well as a 10% increase in income for
consulting and executive recruitment service. Input costs and income for the
conference and e-book as set out in the Costs and Income data.

3. Develop report on key financial compliance requirements and liabilities for tax

Develop report on key financial compliance requirements and liabilities for tax so that
financial risks are managed in relation to the misappropriation of funds and recording
of transactions, you are also required to outline reporting requirements and financial
delegations as outlined in the company’s Finance Policy and Procedures (Appendix
4), as well as research and report on the company’s compliance requirements and
tax liabilities.

Research and report on the business’ key financial compliance requirements and
liabilities for tax.
The report should explain:
GST reporting requirements (the company is required to report quarterly)
 PAYG withholding obligations
PAYG income tax instalment
Payroll tax obligations (state government)
Superannuation entitlements and requirement to comply with legislation
regarding frequency of payment, choice of fund and reporting to staff.

When it comes to reporting and paying Goods and Services Tax (GST) in Australia, there are
different options based on the size of your business and its GST turnover. Here's an overview of
the available options:

1. Quarterly GST Reporting:

- If your GST turnover is less than $20 million and you haven't been instructed to report GST
monthly, you can choose to report and pay GST quarterly.

2. Full Reporting Method:

- If your GST turnover is $10 million or more, you are required to use the full reporting method.
- Under the full reporting method, you calculate, report, and pay your GST amounts on a
quarterly basis.
- You provide detailed information on your Business Activity Statements (BAS).
- You can choose between the accounts method or the calculation worksheet method to calculate
your GST amounts for your BAS.

3. Simpler BAS:
- You have the option to use Simpler BAS even when reporting quarterly if either of the following
conditions applies to your business:
- Your GST turnover is less than $10 million, but you have aggregated turnover greater than $10
million in either the previous year or the current year.
- You mainly make input-taxed supplies as your primary business or enterprise activity.

What is Simpler BAS?

Simpler BAS is an easier way to report your GST on your BAS. It reduces the amount of detailed
GST information you need to provide. Instead of reporting various GST categories separately, you
only need to report Total Sales and GST on Sales. It simplifies the reporting process for
businesses that meet the criteria.

Please note that GST reporting requirements can change over time, and it's essential to stay
updated with the latest information and consult with the Australian Taxation Office (ATO) or a
qualified tax advisor to ensure compliance with the current regulations that apply to your specific
business situation.

The reporting requirements for GST (Goods and Services Tax) in Australia differ based on the size
of your business and the method you use. Here's a breakdown of what you need to report for both
the standard (full reporting) method and the Simpler BAS reporting method:

1. Full Reporting Method (GST Turnover of $10 Million or More) If your GST turnover is $10
million or more, you must report the following amounts on your activity statement each quarter:
- G1 Total Sales
- G2 Export Sales
- G3 Other GST-Free Sales
- G10 Capital Purchases
- G11 Non-Capital Purchases
- 1A GST on Sales
- 1B GST on Purchases

- You have the flexibility to use either the accounts method or the calculation worksheet method
to determine your GST amounts.

- If you have obligations or entitlements related to Wine Equalisation Tax (WET), Luxury Car Tax
(LCT), or Fuel Tax Credits (FTC), you must also report these amounts each quarter using the
relevant labels (1C, 1D, 1E, 1F, 7C, or 7D) on your BAS.

2. Simpler BAS Reporting Method (GST Turnover Less Than $10 Million):
- If your GST turnover is less than $10 million, you are generally required to use the Simpler
BAS reporting method, unless you are on GST instalments.

- Under the Simpler BAS reporting method, you report less information on your quarterly BAS,
but you still calculate and pay your GST amounts quarterly.

- You only need to report amounts at the following labels on your Simpler BAS form each
quarter:
- G1 Total Sales
- 1A GST on Sales
- 1B GST on Purchases

- You do not need to report amounts at the following labels:

 - G2 Export Sales
- G3 Other GST-Free Sales
- G10 Capital Purchases
- G11 Non-Capital Purchases

Using the Simpler BAS method simplifies the reporting process for businesses with a GST turnover
of less than $10 million, as it reduces the amount of detailed GST information that needs to be
provided on the BAS.

It's important to ensure that you follow the appropriate method and accurately report your GST
information to remain compliant with Australian tax regulations. If you have specific questions or
need further guidance, it's advisable to consult with the Australian Taxation Office (ATO) or a
qualified tax advisor.

The information you've provided pertains to different methods for reporting and paying Goods and
Services Tax (GST) in Australia, as well as the reporting requirements for specific tax obligations
(Wine Equalisation Tax, Luxury Car Tax, and Fuel Tax Credits) when using different reporting
methods. Here's a summary of the key points:

4. Conduct meeting with Principal Consultant and Senior Managers

Role play Scenario

Assume that the Principal Consultant has approved your budget for the upcoming financial year,
2020 – 2021. You are now required to meet with the Senior Managers to communicate the budgets
you have developed.

Conditions

Your assessor will play the role of Senior Managers and you will play the role of General Manager.

Your assessor will prepare the environment for the meeting.

The meeting starts when your assessor (Senior Managers) welcomes you to the meeting.

Before attending the meeting, have the following copies ready:

The budget that you have developed.

The Financial Policy and Procedures. You will be required to explain key reporting
requirements to the Managers attending the meeting, as well as financial delegations.
Review this document and highlight the relevant passages.

Your report on key financial compliance requirements and liabilities for tax
 At the meeting, you are required to:

Discuss the budget you have developed and the rationale for the budget figures.

Discuss the amounts allocated to activity, including the conference and the e-book.

Explain that there will be no more workshops conducted.

Provide an outline of the financial policy and procedure. to ensure that roles and
responsibilities are understood and risks of misappropriation of funds/incorrect recording of
financial transactions is minimised.
Explain the company’s key financial compliance requirements and tax liabilities.

Explain financial decisions and outcomes clearly and uses listening and questioning
techniques to exchange information and obtain agreement

Meeting should take no more than 15 minutes.

Meeting Scenario:

Senior Manager 1: Good afternoon, everyone. Thank you for joining this meeting. Today, we have our
General Manager here to discuss the budget for the upcoming financial year, 2020-2021. Please proceed.

General Manager: Thank you for having me. I'm pleased to inform you that the Principal Consultant has
approved the budget for the next financial year. I'll go over the key points of the budget and address any
questions or concerns you may have.

First, let's discuss the budget I've developed. The overall budget for the upcoming year is based on a
comprehensive analysis of our financial needs and goals. We've considered all departmental requirements,
cost projections, and anticipated revenue. Our primary focus is on ensuring financial stability while allowing
room for growth and investments in key areas.

Now, regarding the allocation of funds for specific activities, we've designated a substantial amount for the
annual conference. Given its importance in networking and business development, we believe it's a strategic
investment. Additionally, we've allocated a significant portion to e-book development, recognizing the
increasing demand for digital resources in our industry.

I should also mention that we won't be conducting any more workshops in the upcoming year. This decision
is based on a review of past performance and a strategic shift towards more cost-effective methods of
knowledge sharing and training.

To ensure financial governance, it's important to understand our Financial Policy and Procedures. The policy
outlines key reporting requirements, roles, and responsibilities, and financial delegations. This document is
crucial for maintaining transparency and accountability within the organization. I recommend reviewing the
relevant passages to ensure we're aligned with our financial policies.

Furthermore, it's essential that we comply with key financial regulations and are aware of our tax liabilities. I
have prepared a report on our compliance requirements and tax liabilities, which I will share with you. This
will provide a clear overview of our obligations and help us avoid any unexpected financial issues.

In conclusion, I've explained the budget, its allocations, and our decisions for the upcoming year. I encourage
you to ask any questions or express any concerns you may have at this time.

Senior Manager 2: Thank you, General Manager, for the thorough explanation. We'll take some time to
review the budget and the relevant documents, and then we can discuss further.
Evidence Submission Checklist

Evidence to be submitted Have I completed this?

Financial performance report 2019-2020 🖵

Budget forecast 🖵

Report on key financial compliance requirements and liabilities 🖵