Reference no: EM131506193

Assessment layout

A spreadsheet template (in Excel format) has been provided and it will be required for completing tasks 2, 3, 4 and 5.

You should create your own WORD or similar document and use that document for the remaining tasks. A note is included at the end of each task advising you of which one to use.

For the tasks requiring a written response, ensure you present your work in a business style format clearly indicating the task number.
Please note that where a suggested length has been provided for a task, that this is a guideline only. You will be assessed on the quality of your answer in terms of whether it satisfactorily addresses the requirements of the assessment.

Tasks

Task 1 - Financial management

Reflect on the following statement:

Organisations are all different in terms of the products and/or services they provide, the competitive environment they operate within and the scale of operations. As a result their structure and resource requirements may also be different. A sound Financial Management and compliance process however is crucial in maintaining control and effectiveness of any organisation.

Required:
In the context of the above statement please answer the following questions.

Create your WORD document (or something similar) to answer this task. This document can be used for all required tasks in the assessment as indicated.

Part A
Outline the three (3) major commercial organisation types. Explain briefly the advantages and disadvantages associated with each one.

Part B
What are Key Performance Indicators (KPIs)? Why is it important to establish Objectives and KPIs at the start of the Financial Management Process? Provide three (3) examples of both Financial & Non-Financial KPIs. For each KPI what is being measured?

Part C
Assume you are managing a project involving the implementation of a new computer system. You have received a brief from Senior Management and created your project team and drafted a plan relating to the project. You will need to work closely with team members and stakeholders and you have had several meetings and attended presentations with the Finance Division to gain a full understanding of their policy and processes.

What do you consider to be the key attributes of a sound Financial Management Process to ensure the key objectives and KPIs of this project and the organisation are met (Refer to the Financial Management cycle) - Guide: 200 words in length.

Part D
An effective Financial Management Process is dependent on a number of factors. Crucial is the establishment of a sound system of Internal Control to minimise risk and maximise effectiveness.

Outline your understanding of Internal Control and why it is important to have a system in place as part of the Financial Management process. What are the key areas that need to be considered when implementing internal controls? Give an example of three (3) key controls that will assist in achieving these objectives - Guide: 200 words in length.

Task 2 - Basic spreadsheets for budgeting

You are required to use the template provided for this task.

Part A - Creation, formatting and formulas for the spreadsheet
Open the worksheet on the bottom tab in the Excel template titled "Task 2 - Part A".

You are required to:
Replicate the spreadsheet below by implementing the following:
1. Change the name of the worksheet to "Create Spreadsheets".
2. Centre the title across width of the table.
3. Fill the range of cells from Jul 14 to Dec 14 for units and revenue with a colour of your choice.
4. Ensure the width of each column is such that the text and figures are presentable.
5. Include the appropriate formats for numbers, dollars, dates and font size.
6. Use the SUM formula to arrive at 'Total' Quantity and 'Total' Revenue.
7. Calculate ‘Revenue' being the quantity multiplied by the Price Per Unit. Use Absolute Values in your calculation.

Part B - Linking spreadsheets
Task 2 - Part B requires you to create threespreadsheets on the template provided. The spreadsheets will be for Slater Stationery for Quarter 1, Quarter 2 and then the Total of the 2 Quarters.
Open the worksheet on the bottom tab in the Excel template titled "Task2 - Part B - 1st Qtr"

You are required to:
Replicate the spreadsheet below by implementing the following:
1. Centre the title of the spreadsheet across the width of the table.
2. Fill the range of cells relating to the column headings and total first quarter with a colour of your choice.
3. Ensure the width of each column is such that the text and figures are presentable. Where appropriate implement "Wrapping of text" for each heading.
4. Include the appropriate formats for numbers, dollars, dates and font size.
5. Calculate ‘Employee Total' using the SUM function for Jan, Feb and Mar.
6. Calculate the % of Total Sales column be that is the employee total as a % of the Total Sales. Use the Absolute Value function in your calculation.
7. Calculate the Commission Earned that is the Employee total multiplied by the ‘Current Commission Rate'. Use the Absolute Value function in your calculation.

Part B - 2nd Quarter
Open the worksheet on the bottom tab in the Excel template titled "Task 2 - Part B - 2nd Qtr"

You are required to:
Replicate the spreadsheet below by implementing the following -
1. Centre the title across the width of the table.
2. Fill the range of cells relating to the column headings and total second quarter with a colour of your choice.
3. Ensure the width of each column is such that the text and figures are presentable. Where appropriate implement "Wrapping of text" for each heading.
4. Include the appropriate formats for numbers, dollars, dates and font size.
5. Calculate ‘Employee Total' using the SUM function for Apr, May and Jun.
6. Calculate the % of Total Sales column that is the Employee total as a % of the Total Sales. Use the Absolute Value function in your calculation.
7. Calculate the Commission Earned that is the Employee total multiplied by the ‘Current Commission Rate'. Use the Absolute Value function in your calculation.

Part B - Summary
Open the worksheet on the bottom tab in the Excel templatetitled "Task 2 - Part B - Summary"

You are required to:
Replicate the spreadsheet below and incorporate the following:
1. Centre the title across the width of the table.
2. Fill the range of cells relating to the column headings and total second quarter with a colour of your choice.
3. Ensure the width of each column is such that the text and figures are presentable. Where appropriate implement "Wrapping of text" for each heading.
4. Include the appropriate formats for numbers, dollars, dates and font size.
5. Use the Linking function to arrive at the amount for "Employee Total Sales" and Commission Earned from the previous two worksheets created.

Task 3 - Accounting concepts

Part A - Terminology
From the following list of terms select the one that best answers the question below - Use Excel template titled ‘Task 3'.
1. Journal
2. Tax Invoice
3. Trial Balance
4. The Accounting Equation
5. Non-Current Assets
6. Shareholder's funds
7. Liability
8. Company
9. Chart of Accounts
10. Source Document
11. Petty Cash
12. Debit
13. Credit
14. Double Entry Bookkeeping
15. Accounts Receivable Ledger
16. Goods & Services Tax (GST)
17. General Ledger

Description of Term	Number
A document used to initiate and record a transaction in the  General Ledger	Ge
These books are often referred to as 'books of original entry'
A small amount of cash held for the payment of 'minor' day to day items
A listing of all the individual accounts referred to when allocating accounts to journals and source documents is a ......
A listing of customeraccounts showing all invoices with amounts owing
The balances in this report are used to prepare the Financial Reports
These entities have certain obligations controlled by Australian Securities & Investment Commission (ASICs)
Summary of transactions are grouped into journals and posted to the relevant ....................
The commitment to pay amounts owing in the future
An increase in Assets or expenses would give rise to a ? entry in the journal
Income accounts like Sales, Fees & Commissions have a  ?  balance
A Federal Government value added tax i.e. Levied on taxable supplies
A two sided accounting system is referred to as ...................
The Net value of the Shareholders of a 'company'is known as
These documents are required to record Accounts Receivable, Payable and required by law for GST and Income tax purposes
Assets, Liabilities & Owners Equity are part of this calculation.
Something of value that contributes towards Income and has a life greater than 12 months

Part B - Taxation and record keeping
1. The Goods & Services Tax (GST) is a tax levied and administered by the Australian Taxation Office (ATO). Explain this tax in terms of what it applies to and how it is imposed.

2. Briefly explain three (3) other forms of taxation imposed by the Australian Taxation Office (ATO).

3. Provide a broad overview of the record keeping requirements of a business from both an internal and external compliance perspective as imposed by the Australian Taxation Office (ATO).

Task 4 - Financial statements

The management of a client company would like to understand how they have performed for the month in terms of Net Profit, Gross Profit from trading and Revenue as Key Performance Indicators (KPIs). Of interest also is their Financial Position as at that date. You have produced and printed off a Trial Balance for the month ended 30 June 20x3.

Part A
In the capacity of a Finance Consultant for the Ajax Building Company you have been asked to prepare an Income Statement (Profit and Loss Statement) and Balance Sheet for the business for the month ended 30 June 20x3. Use the Excel worksheet titled ‘Task 4 Part A'.

Part B
Prepare a short report to Management outlining the results of the company in terms of Financial Key Performance indicators (KPIs) being reported i.e. Provide a brief summary of the Net Profit Performance and the company's financial position (from the Balance Sheet) as at 30 June 20x3. Is the company in a positive position and if so why?

Trial Balance as at 30 June 20x3

Account	Classification	Debit	Credit
Accounts Receivable	Current Asset	160,000
Cost of Sales	Cost of Sales	300,000
Freight outward	Expense	15,000
Dividend Income	Income		20,000
Inventory on Hand	Current Asset	100,000
Wages	Expense	120,000
Advertising	Expense	30,000
Motor Vehicle Expense	Expense	10,000
Sales	Income		600,000
Accounts Payable	Current Liability		75,000
Stationery	Expense	15,000
Depreciation - Plant	Expense	10,000
Income Tax	Expense	40,000
Motor Vehicle	Non-Current Asset	40,000
Bank Mortgage	Non-Current Liability		100,000
Plant & Equipment	Non-Current Asset	165,000
Bank Overdraft	Current Liability		50,000
Accumulated Depreciation	Non-Current Assets		10,000
Capital	Shareholder's Funds		200,000
Investments - Shares	Non-Current Asset	50,000
Dividends Paid	Shareholder's Funds	50,000
Retained Earnings	Shareholder's Funds		50,000
		$1,105,000	$1,105,000

Task 5 - Financial Statements - Cash Flow Statement

The Directors of Ajax Building Company Pty Ltd were satisfied with your report on their Profitability for the period ended 30 June 20x3. The Bank account however has gone from a positive balance of $40,000 at the start of the period to a negative position thereby requiring a bank overdraft of $50,000 * i.e. $90,000 turnaround in 12 months.

A follow up meeting has been organised where a more detailed explanation will be provided in relation to the business' cash flow position.

In preparation for the meeting you consulted with the accounting staff to ensure that all cash transactions for the period have been brought to account in the General Ledger. The following are two reports supplied to you:

a) An extract from the General Ledger Account showing all cash transactions being opening balance plus receipts less payments = Closing Balance.

b) An Ageing Summary showing the summary of Accounts Receivable as at 30 June 20x3 and the length of time outstanding. This Balance has been arrived at after starting with the opening balance at the start of the year plus sales invoices billed less cash received from customers.

Report A - Bank Account in the General Ledger

Cash at Bank Account
	Receipts (Debits)	$	Payments (Credits)	$
01/07/x2	Balance at start	40,000		400,000
			Accounts Payable
	Accounts Receivable	360,000	Wages Paid	120,000
	Cash Sales	150,000	Other Expenses	50,000
	Sale of Equipment	70,000	Bank Loan Repaid	20,000
	Dividends Received	20,000	Equipment Purchase	140,000
	Capital Injection	50,000	Dividends paid	10,000
30/06/x3	Balance at end *	50,000
		740,000		740,000

Required:

Part A
From the General ledger Account prepare a Statement of Cash Flow showing Cash flow from Operations, Investing and Financing for the 12 month period ended 30 June 20x3 Use the worksheet on the bottom tab in the Excel Template titled ‘Task 5'.

Part B
From the Statement of Cash Flow draft a brief report outlining the possible reasons why the company has generated a profit however the cash position has deteriorated by $90,000. As part of your answer refer to the Ageing summary and advise what possible action should be taken.

Use your WORD document and answer in a report format style.

Task 6 - Introduction to Budgets

Bill made the decision to open his own business five years ago. He had been working in the importation and wholesaling of furniture for some time and had developed skills in all facets of the business. He now has a company BJ Wholesale Company with many clients. His prime activities include the warehousing and wholesaling of three products being stools, coffee tables and buffets. He employs forty people including Managers in Sales and Marketing, Ordering, Warehousing, Distribution and Administration.

Whilst he has a good technical background and experience in the business there appears to be issues with planning and budgeting. The managers and the staff only have a broad understanding of the reporting structure and accountabilities. This is largely due to a lack of a documented organisation chart which clearly shows the lines of authority, responsibility and work groups. In addition the cost centres and sales groups for each product are not clearly identified.

Further analysis show that managers only have a broad understanding of the Key Performance indicators and the absence of a current year forecast and sales plan is making it difficult for other departments to plan their requirements and expenses. Bill being easy going in nature simply allows managers to spend on discretionary expenditure as they progress through the year.

He receives a report from his Accountant on the financial performance for the month and year to date and reports each quarter to the managers on Sales and Profit only.

Over the past two years profitability has fallen and he doesn't understand why. He is unable to establish what areas of the business are impacted and what managers are responsible. He has also noticed that there is a lack of coordination and cooperation between departments. Communication is poor and there is a high turnover of staff due to poor morale. In addition suppliers are not getting paid on time and customer satisfaction has fallen.

Bill understands his Operational and Master Reports being the Profit and Loss and Balance Sheet. The Cash Flow report is prepared by the Accountant. He does acknowledge however there is a problem with financial management throughout the business.

Required:
a) In the capacity of consultant you have been asked by Bill to provide advice on the deficiencies that exist with the Company's Financial Management Process. This includes the lack of a budgeting and reporting structure which would provide a greater level of control. Your report should include an explanation of budgeting and why it is an important planning tool. Guide: 150 words.

b) It is currently September 20x3 and Bill would like to understand the process to facilitate the creation of these budgets for the next calendar year being 20x4. This includes the creation of KPIs, current year forecast through to the final approval of the budget before the start of the forthcoming year. You may use bullet point format with a brief explanation.

c) Provide Bill with advice on the need for an effective structure, guidelines and management responsibility in setting the budget. How are the various parts of the budget such as sales and expenses justified, negotiated and then communicated through the relevant teams? Guide: 150 words.

d) From the structure of the company explain how the activities of one department may impact on another and the implications for budget setting. Guide: 150 words.

*complete assignment given in attachment

Attachment:- Assessment.rar