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SITXFIN004 Prepare and Monitor Budgets Assignment - Canterbury Business College, Australia

Assessment Part A -

Your task: Answer each question below.

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

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

Competitor research -

Customer or supplier research -

Declared commitments in areas of operation -

Financial information from suppliers -

Financial proposals from key stakeholders -

Performance data/information from previous time periods -

Departmental, event or project budgets -

Grant funding guidelines or limitations -

Management policies and procedures -

Organisational budget preparation guidelines -

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

Management restructure -

Human resources requirements -

New projects and business objectives -

Changes in commodity or service prices -

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

Legislation and regulations -

Changes in the global economy -

Market trends -

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

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

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

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

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

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.

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

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

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

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

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

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

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

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

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

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

21. Explain each of the following types of budgets:

Cash budget/Cashflow budget -

Departmental budget -

Event budget -

Project budget -

Purchasing budget -

Sales budget -

Wage budget -

Master budget -

Part B -

Instruction for the learners:

Task 1 - Requires you to prepare a draft budget following a meeting with all heads of department where you have finalised the details and requirements to be included for next year's budget.

Task 2 - Requires you to prepare a final budget, based on the changes made to your draft budget following a management meeting.

Task 3 - Requires you to respond to 3 financial scenarios.

All responses must be typed and clearly referenced to each task. Your trainer will provide you with feedback for each task. You will be provided with the opportunity to rectify any shortfalls based on the feedback from submitted work for this assessment.

Each completed spreadsheet must be attached to the relevant task and clearly referenced.

Task 1 - Your Tasks:

You are required to complete a draft budget based on information and factors that were determined during an executive meeting at Hotel Futura.

A. Access the excel spreadsheet named "Task 1-Hotel Futura Budget Forecast". The first tab on this spreadsheet is labelled "Departments Small" and shows the existing budget figures for the 2016 financial year.

B. Use the template "Draft Budget" on the second tab of the spreadsheet and perform the calculations below using basic formulas.

Task 2 - Your Tasks:

You have provided the chief financial controller with the draft budget for 2017. Following the recent executive meeting where the draft budget was discussed, you are now required to establish the final budget reflecting the changes based on the latest actuals and variances as well as major road works which will affect Futura Restaurant and Bar during 2017.

A. Access the excel spread sheet named "Task 2-Budget Futura_Rest.&Bar". The first tab on this spreadsheet is labelled "Futura Restaurant and Bar" and shows the Draft budget figures for the 2017 financial year.

B. Use the template "Revised Budget" on the second tab of the spreadsheet and perform the calculations below using basic formulas based on the following changes:

1. Calculate the anticipated Food revenue for each month and the yearly total.

2. Calculate the anticipated Beverage revenue per month and the yearly total.

3. Calculate the Total Revenue for each month and the yearly total.

4. Calculate the overheads total for each month (at 90% of turnover for each for each month with 1000 or more customers and at 96% for each month with less than 1000 customers) and the yearly total.

5. Calculate the profit for each month and the yearly total.

6. Calculate the Cost of Goods Sold for food and beverages, given a combined percentage of 32%.

7. Calculate the staff costs for each month at 31% for each month with 1000 or more customers and at 35% for each month with less than 1000 customers.

8. Calculate the 'Other overheads" for the operation.

9. Print a copy of the revised budget.

10. Print the revised budget showing all formulae used.

Task 3 - Your Tasks:

Read the following 3 scenarios and answer the questions attached for each scenario.

Scenario 1: The finance team has created budget forecasts for Hotel Futura based on carefully researched factors for the last 3 years and these were always very accurate. The recent budget which included all departments of the hotel was implemented 3 months ago and the forecasted figures for Food Cost and COGS/Beverages in both the Restaurant and the Bar Operations have blown out by nearly 4.5 percent.

What could be the reasons for this? List 5 examples of areas you would investigate and explain why.

Scenario 2: Hotel Futura has successfully operated for 7 years. During this period, overall turnover has doubled, and during the past 3 budget periods annual budgets have been increased by 15% each year which was exceeded each time. During the last 6 months however, management has noticed that the opposite trend seems to be occurring now.

List 5 external factors which could contribute to this and explain which methods you would use to determine this.

Scenario 3: You have successfully negotiated the draft budget with each department head of the Hotel which has now been approved by the director and implemented 6 weeks ago.

You have finalised the financial data of the Hotel for the next management meeting and noticed the following:

1. Which reports would you need to prepare for these issues?

2. Who is it essential to involve when these matters need to be discussed?

3. Suggest options to address and rectify these issues.

4. How could the cashflow issue be addressed?

Part C - Budget Project

Instructions - Based on the type of budget and data chosen by you, you are required to:

1. Consult with the relevant staff directly affected by the budget (Department heads, e.g. head- chef, events manager etc.) on the components to be included in the budget. This requires a written report of the details that were discussed including a detailed analysis of the factors that impact on the particular budget.

2. Following your consultation, you are required to complete a draft budget which reflects the details you have provided in your report.

3. Present the draft budget to the staff you consulted on the budget components. Provide details of feedback and changes that were requested. This needs to include the why's and how's.

4. Based on the feedback received, complete the final budget. Obtain approval of the relevant department head(s), financial officer or person in charge of the organisation. Attach a copy and the signed, approved budget.

5. Monitor the budget against performance at intervals as instructed, this may be e.g. weekly or monthly and include the relevant reports and actions taken for each review during the budget cycle.

6. Each change actioned taken as a result of underperformance must be documented and signed by the authorised person in the workplace or where the budget is monitored in a simulated environment, by your trainer.

7. On completion of the budget cycle, provide a summary report for the budget performance. What are your recommendations for the next cycle based on your monitoring and reviews? Why?

Task - Prepare a budget for a business that meets the specific business' needs.

JUST NEED HELP WITH THE PART B THANKS.

Attachment:- Prepare and Monitor Budgets Assignment Files.rar