Reference no: EM133171859

BSBFIN601 Manage organisational finances

Assessment 1: Short Answer Questions

Question 1
Complete the table below.
a. Identify the four phases of reviewing a financial statement to monitor your profits and losses.
b. Briefly explain how each phase is conducted to establish and review your profits and losses.

Question 2
Complete the table below.
a. Identify at least four ethical standards for financial probity in businesses.
b. Identify at least one workplace task that will allow you to demonstrate adherence to each identified standard.

Question 3

Complete the table below.
a. Identify at least three financial declarations a business can make to ensure financial probity.
b. Briefly describe the conditions that indicate the need to make each identified financial declaration.

Question 4
Answer the questions about the following principles of accounting and financial systems.

a. Recognition of revenue
Describe when revenue is earned.

b. Recognition of expenses
Describe when an expense is occurred.

c. Accrual accounting
Explain why transactions are recorded as they occur even if payment has not yet been received by the workplace/organisation.

d. Going concern
Explain why it is always assumed that an organisation will continue to operate for the foreseeable future.

e. Monetary unit
Explain why items in a financial system must have a monetary value.

Question 5
Complete the table below.
a. For each specified function of financial management software, identify at least two workplace tasks that are accomplished by financial management software.
b. Briefly describe the purpose of each identified workplace task in the management of finances in your workplace/organisation.

Question 6
Complete the table below.
a. Identify the three sections of a financial budget.
b. Briefly describe the information contained in each identified section.
c. Briefly explain how this information is used by an organisation to monitor its finances.

Question 7
Answer the following questions about Australian Tax Office (ATO) requirements on Goods and Services Tax (GST).
a. Identify the six business categories that are required to register for GST.
b. List the six actions the ATO requires a business qualified for GST to do.
c. Identify how much time a business has to register for GST after qualifying.

Question 8
Answer the following questions about Australian Tax Office (ATO) requirements on Company Tax.
a. Briefly explain how you can determine the amount of company tax your workplace/organisation is required to pay.
b. Briefly explain the difference in the company tax that an Australian resident company and a non-resident company is subject to.

Question 9
Answer the following questions about Australian Tax Office (ATO) requirements on Pay As You Go (PAYG).
a. Briefly explain the difference between PAYG instalments and PAYG withholding.
b. Complete the table below.
i. Identify the two ways a business can pay PAYG instalments.
ii. Briefly describe how a business can use each identified way to pay PAYG instalments.
c. Identify the four payments tax is withheld from under PAYG withholding.

Assessment 2: Practical Assessment

Project Overview
This workplace project assessment requires you to manage finances for at least one organisation or work area. While doing so, you must review previous financial statements; prepare, implement and revise a budget; contribute to financial bids and estimates; communicate with other people; and analyse the effectiveness of existing financial management approaches.
This assessment is divided into five tasks:
• Task 1: Review Financial Statements and Software
• Task 2: Develop Budgets
• Task 3: Confirm Management Literacy on Budgets, Reporting, and Delegations
• Task 4: Review and Analyse Financial Information
• Task 5: Report on Finances
This project requires you to complete the assessment tasks in a workplace or simulated environment where the conditions are typical of those in a working environment in this industry.
Each task comes with a set of instructions. You are to follow and perform these instructions while being observed by the assessor and/or submit any required documentation.
Before starting this assessment, your assessor will discuss with you these tasks, including instructions and guidance for satisfactorily completing them.

You are required to:
• Complete the tasks within the time allowed, as scheduled in-class roll.
• Review previous financial statements
• Prepare, implement and revise a budget that aligns with the business plan; is based on research and analysis of previous financial data and cash flow trends; and meets compliance, statutory and organisational requirements
• Contribute to financial bids and estimates
• Communicate with other people, including reporting on financial activity and making recommendations; and ensuring that managers and supervisors understand key elements of relevant budgets
• Analyse the effectiveness of existing financial management approaches, including reviewing financial management software; managing risks of misappropriation of funds; ensuring systems are in place to record all transactions; maintaining and audit trail; and complying with due diligence.

Task 1: Review Financial Statements and Software

This task will require you to determine:
A. if the workplace/organisation's business plan for the current financial year is on target to be met based on an analysis of financial reports; and
B. suitability of financial management software for use in the workplace/organisation.
This task is divided into two parts:
Part A. Review Financial Statements
To complete this task, you must:
• Access and review statutory requirements for business taxes.
• Identify at least two statutory requirements for:
o Business tax compliance
o Business tax liabilities

• Access and review the workplace/organisation's:
o Profit & Loss Statement for the previous two financial years
o Cash Flow Statement for the previous two financial years
o Cash Flow Forecast for the current financial year
• Identify the Net Profit/Loss from the Profit & Loss Statement for both the financial years and assess their key reasons (drivers).

• Identify the monthly and quarterly Net Cash Flow trends for the current financial year from the Cash Flow Statements and forecast.

• Access and review the workplace/organisation's business plan for the current financial year that has yet to be implemented.
• Analyse at least two initiatives and one critical date for each initiative in the business plan to assess if they will be met based on your review of the profits/losses and cash flow trends.

• Complete Table A in the following pages with the information identified. You will need this later to develop a budget in Workplace Project Task 2.

Part B. Review Financial Software
To complete this task, you must:
• Identify the existing financial management software used by the workplace/organisation.

• Identify if the existing financial management software is being used to record all transactions.

o Identify any transactions that are conducted by the workplace/organisation, which are not being recorded by the existing financial software.
o Identify the system(s) being used for recording these transactions.
• Identify at least two alternative financial management software which are not used by the workplace/organisation.

• For both, existing and alternative software:
o Identify at least two strengths and two weaknesses.
o Identify at least two threats that the financial management software poses to financial management.
o Determine the suitability of the financial management software for financial management in the workplace/organisation, based on analysis of their respective strengths, weaknesses, and threats posed.

Complete Table B in the following pages with the information identified.

Review Workplace Project Task 1 - Assessor's Checklist before starting this task. This form outlines the following:
• Resources you are required to access to complete the task.
• All criteria your submission must address to satisfactorily complete this task.
You assessor will discuss these resources with you, and the criteria outlined in this form prior to this assessment.
Submit your workbook responses for this task to your assessor before starting with the next task.
You must also submit the following as supplementary evidence:
• A copy of the statutory requirements for business taxes that were reviewed.
• A copy of the workplace/organisation's documents that were reviewed:
o Profit & Loss Statements for the previous two financial years.
o Cash Flow Statements for the previous two financial years.
o Cash Flow Forecast for the current financial year.
o Business plan that has yet to be implemented.
o Transaction recording policies and procedures.

Task 2: Develop Budgets
This task will require you to develop a Profit & Loss budget and a Cash Flow budget using the data gathered in Workplace Project Task 1, in compliance with statutory and organisational requirements.
The budgets will be circulated later in Workplace Project Task 3.
Use your workplace/organisation's template to complete this task.
To complete this task, you must:
• Review the data and information gathered in Workplace Project Task 1. This includes:
o Profit & Loss Statement of the workplace/organisation for the previous two financial years.
o Cash Flow Statement of the workplace/organisation for the previous two financial years.
o Cash Flow Forecast for the current financial year.
o The workplace/organisation's business plan for the current financial year, with relevant initiatives and month-wise revenue and spending planned for the current financial year.
• Access and review the statutory requirements for financial management.
• Access and review your workplace/organisation's financial policies & procedures, which reflect the organisational compliance requirements for developing a budget.
• Identify all the initiatives planned for the current financial year from the business plan.
• Identify the planned month-wise revenue and spending for each initiative.
• Develop the following:
o Profit & Loss budget
o Cash Flow budget

Review Workplace Project Task 2 - Assessor's Checklist before starting this task. This form outlines the following:
• Resources you are required to access to complete the task.
• All criteria your submission must address to satisfactorily complete this task.
You assessor will discuss these resources with you, and the criteria outlined in this form prior to this assessment.
Review the template you will use to complete this task. If you are using a template from your workplace/organisation, discuss with your assessor to ensure that the template covers all requirements that apply to this task.
Submit the completed Profit & Loss budget and Cash Flow budget to your assessor. Include any supplementary documents/sources used to create the budgets, such as:
• Organisational documents such as:
o Policies & procedures for developing a budget.
o A business plan for the current financial year, with relevant initiatives and month-wise revenue and spending planned for the current financial year.
• Printed or online sources relevant tostatutory requirements for financial management, including government websites.

Task 3: Confirm Management Literacy on Budgets, Reporting, and Delegations
This task will require you to circulate the budgets you completed in Workplace Project Task 2 to atleast two managers and two supervisors in the organisation. You will also need to verbally explain (and confirm that they have understood) the budgets, reporting requirements, and financial delegations.
This task is divided into two parts:

Part A. Circulate budgets
To complete this task, you must:
• Prepare the information you have from Workplace Project Task 2.
• Identify at least two managers and two supervisors in the organisation to whom you will circulate the budgets.
• Circulate the following documents that you have from Workplace Project Task 2 to the identified managers and supervisors:
o Current-year Business Plan
o Profit & Loss budget
o Cash Flow budget

Part B. Discuss budgets, reporting, and delegations with managers and supervisors
Your assessor will observe your discussion with the managers and supervisors.
You will be assessed on your practical skills to:
• Explain information in the budgets you prepared in Workplace Project Task 2 to the managers and supervisors.
This includes:
o Explain all the initiatives planned for the current financial year from the business plan.
o Explain the planned month-wise revenue and spending on each activity.
o Explain your recommended budgeting decisions and outcomes, including:
• The Profit & Loss budget
• The Cash Flow budget
• Discuss the following:
o Organisational reporting requirements
• Confirm with the managers and supervisors that:
o They understand the budgets
o They understand the organisational reporting requirements
o They understand their individual financial delegations
o There are no opportunities for misappropriation of funds
• Select and use appropriate conventions and protocols when communicating with supervisors and managers.
• Use listening and questioning techniques to exchange information and obtain agreement.
Before starting this task, you must:
• Review the following documents:
o Current-year Business Plan
o Profit & Loss budget
o Cash Flow budget
o Your workplace/organisation's financial policies & procedures, which reflect the organisational compliance requirements for:
• Financial reporting requirements
• Financial delegations
• Misappropriation of funds
• Review the following forms:
o Workplace Project Task 3 - Assessor's Checklist
o Workplace Project Task 3 - Observation Form
These forms outline the following:
• Resources you are required to access to complete the task.
• All criteria your submission must address to satisfactorily complete this task.
• All practical skills you need to demonstrate to satisfactorily complete the observation task.
You assessor will discuss these resources with you, and the criteria outlined in these forms prior to this assessment.
Submit evidence of circulation of budgets to managers and supervisors. Evidence must be at least one of the following:
• Email correspondence
• Business letter
• Memo
Submit evidence of your discussion with the managers and supervisors.
Evidence must be any of the following:
• Meeting minutes
• Video/audio recording of the meeting conducted with the managers and supervisors

Task 4: Review and Analyse Financial Information

ASSESSMENT INSTRUCTIONS

This task will require you to review financial performance information and conduct variance analysis to identify the causes of variance between budgeted allocations and actual performance. You will also be required to identify and manage the risks of misappropriation of funds arising from the identified causes of variances.
Use your workplace/organisation's template to complete this task, or use the generic Budget Variance Analysis template and generic Financial Transaction Risk Management Plan template provided at the Bounce Fitness site.
This task is divided into two parts:
Part A. Review Financial Performance Information and Conduct Budget Variance Analysis
To complete this task, you must:
• Access and review the following financial information from your workplace/organisation for the current financial year-to-date.
The financial information must be for the period from 1 July to the most recent completed month of the current financial year.
o Profit & Loss Statement (P&L) and budget allocations
o Cash Flow Statement and budget allocations
o Ageing Summaries for accounts receivable (AR) and accounts payable (AP)
These are listings of unpaid invoices and other receivables/payables grouped by their due dates. This is done to estimate which invoices are overdue for payments and by how many days.
o Audit trail reports for the Profit & Loss Statement and Cash Flow Statement
An audit trail is the documented flow of transactions. It shows how a source document (e.g. an invoice) was translated into an accounting entry and inserted into the financial statement.

• Complete the Budget Variance Analysis template. You must:
o Calculate the variances between the budget allocations and actual year-to-date performance for the line items in the Profit & Loss Statement. Then interpret the variances as favourable or unfavourable.
Line items must include at least:
• Total Revenue
• Total Cost of Goods Sold/ Cost of Sales
• Gross Profit
• Total Operating Costs
• Operating Profit
• Net Profit
o Calculate the variances between the budget allocations and actual year-to-date performance for the line items in the Cash Flow Statement. Interpret the variance for Cash from Operating activities as favourable or unfavourable.
Opening and Closing Cash Balances should reconcile with Total Cash increase/decrease during the period.
Line items must include at least:
• Cash from Operating activities
• Cash from Investing activities
• Cash from Financing activities
• Total Cash
o Identify discrepancies between the budget allocations and actual performance as follows:
• At least two discrepancies using audit trail reports.
• At least two discrepancies using ageing summaries for accounts receivable (AR) and accounts payable (AP).
o Recommend revisions that will align the discrepancies with the budgeted allocation for their respective line items.

Part B. Identify and Manage the Risks of Misappropriation of Funds
To complete this task, you must:
• Access and review the organisational risk management policies and procedures related to due diligence of the organisation's financial processes.
• Complete the Financial Transaction Risk Management Plan template.
o Identify at least two discrepancies between the budget allocations and actual performance which cannot be fully explained using the audit trail reports and hence require further investigation.
For example, the discrepancy may be traced in the audit trail report to a funds transfer to an external party without sufficient information on the party or the purpose of transfer.
o Identify the following risk management components to manage the risk of misappropriation of funds for each discrepancy you have identified.
Any transaction that you have identified as needing further investigation to explain it fully can be potentially fraudulent and open to misappropriation of funds.
Your ratings for the aspects below must correspond with the organisational risk management tools specified in the organisational policies and procedures. If your organisation does not have risk management tools, your responses must correspond with the risk rating matrices provided in the generic Financial Transaction Risk Management Plan template.
• Risk Description
• Risk Assessment. This includes:
- Likelihood (L)
- Impact (I)
- Risk Rating (R)
- Priority Level
- Control Measure

Review Workplace Project Task 4 - Assessor's Checklist before starting this task. This form outlines the following:
• Resources you are required to access to complete the task.
• All criteria your submission must address to satisfactorily complete this task.
You assessor will discuss these resources with you, and the criteria outlined in this form prior to this assessment.
Review the templates you will use to complete this task. If you are using a template from your workplace/organisation, discuss with your assessor to ensure that the template covers all requirements that apply to this task.
Submit the completed Budget Variance Analysis and Financial Transaction Risk Management Plan to your assessor. Include any supplementary documents/sources used to complete this task, such as:
• A copy of the following workplace/organisation's documents that were reviewed for the current financial year-to-date:
o Profit & Loss Statement and budget allocations.
o Cash Flow Statement and budget allocations.
o Ageing Summaries for accounts receivable (AR) and accounts payable (AP)
o Audit trail reports for the Profit & Loss Statement and Cash Flow Statement
• A copy of the organisational risk management policies and procedures related to due diligence of the organisation's financial processes.

Task 5: Report on Finances
ASSESSMENT INSTRUCTIONS

This task will require you to prepare a draft report containing financial recommendations based on your review of organisational financial processes and statements, in accordance with organisational and statutory financial reporting requirements. You will also be required to seek inputs from at least two relevant stakeholders on the draft report.
This task is divided into two parts:
Use Table A in the following pages to complete Part A of this task. Use your workplace/organisation's template to complete Part B of this task.
Part A. Identify Organisational and Statutory Financial Reporting Requirements
To complete this task, you must:
• Access and review:
o Statutory financial reporting requirements.
These are the financial reporting requirements mandated by the Corporations Act 2001 (Corporations Act) and other relevant laws may apply to your organisation.
o Your organisation's financial reporting requirements.
These are the financial reporting requirements mandated by your organisation in their financial reporting policies & procedures, guidelines, and manuals. They are typically more detailed than statutory requirements and lay down internal policies and procedures that must be followed to comply with statutory requirements.
• Identify the documents/sources reviewed for statutory financial reporting requirements.
• Identify at least three statutory financial reporting requirements.
• Identify the documents/sources reviewed for organisational financial reporting requirements.
• Identify at least three organisational financial reporting requirements.
• Complete Table A in the following pages with the information identified. You will need this later to complete Part B of this task.

Part B. Prepare Draft Report on Financial Recommendations
To complete this task, you must:
• Access and review the Profit & Loss Statement and Cash Flow Statement of the workplace/organisation for the previous two financial years.
• Identify the name and year of the Profit & Loss Statements and Cash Flow Statements reviewed.
• Identify at least three significant issues in the reviewed financial statements.
These are issues that affect financial performance of the organisation, such as income and expenses, profitability, statutory obligations, product pricing, cost structures, internal controls.
• Prioritise the identified issues for review and decision-making.
Base your assigned priority on a logical order of importance, such as High, Medium, Low.
• Access and review the financial management processes of your organisation.
These are the processes followed by the organisation to manage their finances. They include methods by which budgets are created, financial transactions (for example, invoicing, providing credit, collecting outstanding debts) are recorded, budget, and financial reporting is conducted.
• Identify the documents/sources reviewed for financial management processes.
• Evaluate the effectiveness of at least three financial management processes.
o Identify at least two advantages of following each process.
o Identify at least two disadvantages of following each process.
o Compare the advantages and disadvantages of following each process and judge whether the process is effective or not.
• Prepare at least three financial recommendations that achieve either or both of the following objectives:
o Address the significant issues in financial statements that you identified for review and decision-making.
o Improve the effectiveness of the financial management processes you evaluated.
• Explain how each recommendation achieves the objective(s).
You must explain how your recommendations achieve the objectives. For example, by recommending an alternative financial management process you must explain how it will be more advantageous to the organisation.
• Prepare your draft report on financial recommendations, including the following:
o The name and year of the Profit & Loss Statements and Cash Flow Statements reviewed.
o At least three significant issues from the reviewed financial statements that you identified and prioritised for review and decision-making.
o Your evaluation of the effectiveness of at least three financial management processes.
o At least three financial recommendations that you prepared.
• Seek input from at least two relevant stakeholders in the organisation on the contents of your draft report on financial recommendations.
Relevant stakeholders can be individuals or groups directly impacted by the financial recommendations you are making.
Review Workplace Project Task 5 - Assessor's Checklist before starting this task. This form outlines the following:
• Resources you are required to access to complete the task.
• All criteria your submission must address to satisfactorily complete this task.
You assessor will discuss these resources with you, and the criteria outlined in this form prior to this assessment.
Review the template you will use to complete this task. If you are using a template from your workplace/organisation, discuss with your assessor to ensure that the template covers all requirements that apply to this task.

Submit your workbook responses and completed draft report on financial recommendations to your assessor. Include any supplementary documents/sources used to create the Draft report on financial recommendations, such as:
• Printed or online sources relevant tostatutory financial reporting requirements, including government websites
• Organisational financial reporting policies & procedures relevant to financial reporting requirements.
• Profit & Loss Statement and Cash Flow Statement of the workplace/organisation for the previous two financial years.
Organisational documents such as policies & procedures relevant to financial management processes.
You must also submit evidence of communication with at least two relevant stakeholders of the organisation seeking their input on the draft report on financial recommendations.
Evidence must be at least one of the following:
• Email correspondence
• Meeting minutes
• Video recording of the meeting conducted with the stakeholders
Important: Please block out any confidential organisational information in the submitted documents.

Attachment:- Manage organisational finances.rar