Reference no: EM132374426

Manage Finance Case Study Assessment -

Assessment overview - This unit describes the skills and knowledge required to undertake budgeting, financial forecasting and reporting and to allocate and manage resources to achieve the required outputs for the business unit. It includes contributing to financial bids and estimates, allocating funds, managing budgets and reporting on financial activity.

It applies to individuals who have managerial responsibilities which include overseeing the management of financial and other resources across a business unit, a series of business units or teams, or an organisation. It covers all areas of broad financial management. In a larger organisation this work would be supported by specialists in financial management.

Instructions for this assessment This is a case study assessment and it will be assessing you on your knowledge and performance of skills required by the unit.

This assessment is in 2 parts:

1. Case study 1 - Houzit Pty Ltd - Budgets and Business Plan

2. Case Study 2 - Houzit Pty Ltd - Monitoring and Reporting

Part 1: Case Study Houzit Pty Ltd - Budgets and Business Plan

To complete this part of the assessment, you will be required to read the Case Study Scenario attached.

Once you have read the information, you are required to complete your written responses to questions 1 - 9 in the spaces provided in this document. Please ensure you take note of the volume of response requirement where indicated.

Part 1: Case Study Houzit Pty Ltd - Budgets and Business Plan - Short answer

1 (a) Identify the percentage increase in Sales for 20X1 - 20X4 for the business.

1(b) For the 20X4 year calculate the percentage sales that were earn in each quarter.

2. Identify the following:-

a) Identify two areas that have assisted in generating a profit for the business

b) Two areas of loss and comment on the trend in these areas

3. a) The General Manager has asked you to prepare a Sales Budget by department so that the Department Managers can be clear regarding targets and expectation. Develop the Sales Budget for each department for the year 20X5 and break the budget down into quarters as per the guidelines in the case study.

b) Who would you circulate the Sales Budget to?

c) Who would be expected to report against this budget and in what timeframe?

4. Develop a Profit Budget for the year 20X5 and break down the figures for each quarters as per the guidelines in the case study.

5. Develop a GST Cashflow Analysis Budget for the year 20X5 and break down according to quarters.

6) i) List and define the 10 basic accounting principles and conventions .

ii) Discuss how two of these principles and conventions affect Houzit Pty Ltd.

7) Discuss each of the following taxes and how they affect Houzits budget and business plan.

a) Goods and Services Tax

b) Company Tax

c) Pay as you go (PAYG) Tax

8) Comment on the effectiveness of the existing software and it suitability for financial management.

9) Review the financial management practices for the business and comment on their effectiveness in:-

a) Complying with due diligence

b) Providing adequate audit trails

Part 2: Case Study Scenario - Houzit Pty Ltd - Monitoring & Reporting

To complete this part of the assessment, you will be required to read the Case Study Scenario below.

Once you have read the information, you are required to complete your written responses to questions 1 - 6 in the spaces provided in this document. Please ensure you take note of the volume of response requirement where indicated.

Part 2: Case Study Houzit Pty Ltd - Monotoring and Business Reporting - Short answer

1. Complete an actual-to-budget variance report, using the figures (actual) and template provided

Houzit Pty Ltd Profit Variance report Quarter 1 -20X5
	Qtr 1 Budget	Qtr 1 Actual	Variance	F or UF
Sales		$2,663,209
- Cost of Goods Sold		$1,412,184
Gross Profit		$1,251,025
Gross Profit %
Expenses
- Accounting Fees		$3,000
- Interest Expense		$25,000
- Bank Charges		$380
- Depreciation		$42,500
- Insurance		$3,315
- Store Supplies		$790
- Advertising		$120,000
- Cleaning		$3,325
- Repairs & Maintenance		$11,305
- Rent		$653,780
- Telephone		$3,100
- Electricity Expense		$5,245
- Fringe Benefits Tax		$7,000
- Superannuation		$38,998
- Wages & Salaries		$410,500
- Payroll Tax		$22,372
- Workers' Compensation		$8,210
Total Expenses		$1,358,820
Net Profit (Before Tax)		-$107,795
Income Tax		-$32,339
Net Profit		-$75,457
Net Profit %

2. Analyse 20X5 information of actual results and complete the following:-

a) Identify three significant variances and provide possible reasons why these may have occurred. Prepare a recommendation for each of these variances which could improve the financial viability of the organisation.

b) Calculate the Gross profit ratio and Net profit ratio.

3) i) & ii)Write a Communication Report for Management in which you advise whether the budgeted Sales figure, Gross Profit, Total Expenses and Net Profit were realised. Identify three areas of significant variance and identify a contingency plan for each of these variances which could improve the financial viability of the organisation.

iii) Identify in your report the possible risk of misappropriation of funds.

iv) Advise any internal controls that may be implemented to reduce the risk.

5) You are advised that Trade debtors have risen from the $975,000 at the end of 20X4 to $1,967,000 at the end of 20X5. You are provided with the following Debtors Ageing Summary. Briefly explain if the level of debtors is a concern and if so why? Also list two processes the business could implement to improve debt collection in the future.

6) Advise the board members of the company of how it can improve on financial probity for the organisation.

Attachment:- Manage Finance Assignment File & Case Study.rar