Assignment on finance, Their is no word limit and here is attached assignment
Assessment Information: To be deemed competent for this unit of competency, you are required to satisfactorily complete two (2) assessment tasks: 1. Assessment Task 1: Prepare budgets 1. Assessment Task 2: Monitor and review budget Assessment Instructions Your assessment will be required to be typed in Arial font size 12 only. You will provide your completed assessment for all of questions in one document and MUST be uploaded into MOODLE (No other method of submission will be accepted). You are required to professionally format your document including spell-check and indicating each Task answer [e.g. Task 1 (a.) then the answer, Task 1 (b.) then the answer etc.] according to this Assignment requirement. You may lose marks if you have not spell-checked your document (as this is a professional formatting requirement, a business skill). This assessment can be completed in one of several ways. Assessment candidates may identify unit requirement within their own work environment or organisation, or with reference to a scenario provided by the trainer/assessor. Be sure to properly reference your sources of information using the Harvard referencing system. For more information go to:- 1. Student Handbook - latest version 1. Ask your Trainer/Assessor to provide you with this information In order to determine if you are addressing this assignment adequately in terms of competency/comprehension (prior to due date) a draft copy of your assessment should be discussed during class time in consultation with your Trainer/Assessor. For this feedback/ support from your Trainer/Assessor, you will need to bring to class your “draft copy” with any evidence of the research you have conducted to produce the assessment. If, as a student you feel you have special needs that require your Trainer/Assessor to apply a reasonable adjustment – please discuss this with your Trainer/Assessor at the beginning of the subject studies. Your Assignment must: 1. Be of a professional standard (spelling, grammar, punctuation) 1. Size 12, Arial Font 1. 1.5 Spacing 1. All pages must have a Header/Footer with the following details: 3. Name 3. Student ID 3. The course & unit of competency 3. Date 3. Page numbering 1. Title page 1. Index page 1. Body of work 1. Referencing Assessment task 1: Prepare budgets Performance objective For this task, you are required to respond to a range of questions that examine your understanding of key legislative and financial management requirements for a case study organisation. This assessment also requires you to review available financial information and establish a budget for the organisation. Assessment description This assessment requires you to determine the requirements to undertake budgeting, financial forecasting and reporting requirements for an organisation. You will also need to review the case study provided and prepare a budget (in electronic spreadsheet format) and budget notes for distribution and implementation in the organisation. Procedure Part A 1. Read and analyse the case study information (including business plan summary and previous financial data) in Appendices 1–3, and complete the following tasks. a. Develop a sales budget, profit budget, cash flow budget and debtor ageing summary using electronic spreadsheets (as separate worksheets) making sure each budget is divided into quarterly periods and that you use previous financial data to determine allocations for resources. i. Ensure each budget you prepare complies with the organisational policies and procedures as provided. b. Develop budget notes that include: i. identification of reasons for previous profits and losses ii. your comment on the effectiveness of existing financial management approaches iii. all assumptions and bases that have been made or used to form budgets iv. any relevant notes regarding implementation and monitoring of budget expenditure v. an explanation of the required legislative requirements of financial management (and outline statutory requirements of ATO, GST, company tax, PAYG) vi. review of two types of digital technology that can be used for financial management. Make a recommendation in the budget notes as to which you would suggest using for the case study. Part B 1. Communicate information regarding the budget and answer a series of eight questions (see Appendix 4) in written or oral form as agreed with your assessor. Specifications You must submit: · a completed annual budget in a single spread sheet with a separate sheet for each budget component · budget notes and question answers in a written format · all documentation in timeframe and format agreed with your assessor. Your assessor will be looking for evidence that you: · have reviewed the case study information provided by submitting an appropriate budget with budget notes · understand, and can explain, the required legislative requirements of financial management (and outline statutory requirements of ATO, GST, company tax, PAYG) · can outline compliance requirements for the Corporations Act 2001 · can identify and recommend use of suitable software for financial management · have clearly communicated information regarding the budget and correctly responded to a series of questions (e.g. describe the principles of accounting and financial systems) · can describe implications of financial probity · can outline the critical dates/initiatives that will require or generate resources · have provided for additional items (as necessary and appropriate) in the budget · have recommended new or modified internal controls that could improve risk management and maintenance of audit trails · have developed an annual budget, as appropriate · have developed appropriate budget notes · have responded appropriately to the questions presented by ‘Jim Schneider’, the CEO in the case study in this assessment task. Appendix 1: Case study – Houzit Pty Ltd You have recently been appointed as the business manager of Houzit Pty Ltd having been a store manager for the past three years. Houzit Pty Ltd is a 15-store retail chain located in Brisbane. Houzit is the leading homewares retailer, catering to the growing need for furnishing new and renovated dwellings in the greater Brisbane area. The assortment on offer of bathroom fittings, bedroom fittings, mirrors and decorative items together with the recently added lighting fixtures has positioned Houzit as a leader in homewares retailing in Australia. Houzit has grown over the past five years from a single store to the current chain. Houzit prides itself on superior after sales service which has been a key reason for the continued growth in sales and corresponding profit increases. Today Houzit employs over 150 staff. Houzit Pty Ltd is a proprietary limited company (ACN 34 765 234 02) registered with the Australian Securities and Investment Commission. The registered address is with Houzit’s solicitors (Langs Lawyers, 535 Queen Street, Brisbane, QLD 4000) and the principle place of business is 505 Boundary Street Spring Hill Brisbane QLD 4000. Computer software requirement The current accounting information system has not adequately provided sufficient analysis of revenue and expenditure and has made it difficult to make informed estimates of future profits. Estimates have relied on the ‘gut feel’ of the experienced traders on the board and of the senior managers. The board sees the need to apply more analysis to past results that they believe could be done with the introduction of state-of-the-art computer software. Houzit Pty Ltd wants to upgrade their existing accounting system which will manage the company accounts more efficiently in the long run. They request that the new system you recommend to them to be compliant with all legislative and statutory requirements for small to medium businesses. None of Houzit’s products are GST free however the accounting information system records the GST collected as well as the input tax credits earned on the purchases of stock and assets. These amounts are reported and paid in accordance with the business activity statement (BAS) schedule determined by the Australian Tax Office. They have 100 fulltime and 50 part-time staff, but only 10 of the staff will have or need access to the financial system. Some staff are paid on a salary sacrifice arrangement that attracts fringe benefits tax. The staff with access to the financial system want software that is a single purchase with no ongoing license fees, and a plan to keep using if for the next 3–5 years, while the organisation continues to grow. They are anticipating that within five years they will have over 250 full-time staff, and at least 20 staff will require access to the financial system by then. The payroll system deducts withholding tax from the employees and remits this along with the firm’s pay as you go (PAYG) instalment each quarter as reported on the firm’s business activity statement. Income tax return for the company and its annual statement is completed by the firm’s accountant. Taxes and fees due are paid by the due dates. Financial records are kept at Houzit’s principle place of business. Houzit have just upgraded their computers and have five new desktop PCs which will be used by the finance staff. They are current (for 2011) specification machines with i5 CPUs and 4Gb RAM each, and all have Windows 7 Professional and Norton’s 360 installed with the professional version of Microsoft Office Small Business as well. Other staff will use their machines at various times, so it is important that the software requires a login to access data and that data stored by the software cannot be accessed in any other way. Corporate details Jim Schneider, the CEO, has asked you to prepare some financial budgets for the 2011/12 financial year as a preliminary overview of the financial year ahead. He asked you to first prepare a 12 months budget and then break it up over the four quarters. The areas he is particularly interested in seeing is: 1. Sales budget for 2011/12 by department by quarter. 2. Profit budget (including detailed expenses) for 2011/12 by quarter. 3. The cash flow result per quarter of the GST after adjusting the GST collected by the allowable GST tax credits. 4. The anticipated aged debtors summary at the end of each quarter. The CEO wants to be given all the budgets except for the aged debtors budget which the accountant and accounts receivable clerk can monitor. The CEO produced a summary of the current business plan that covered the budget year to highlight some of the key goals, objectives and strategies he would like incorporated into the budget. Business plan summary 1. The anticipation that the coming financial year would maintain the same sales growth as the growth that took place between 2007/08 to 2010/11. 2. To budget for an increase in inflation to 4% per annum and that all costs subject to inflation should incorporate this particular increase. 3. A new car costing $97,466 including GST has been planned for in the coming period to replace the five year old vehicle currently used by the chairman. This fuel inefficient car will attract a luxury car tax. 4. Sales breakup over the departments is anticipated to be bathroom fittings 30%, bedroom fittings 25%, mirrors 15% and decorative items 10% together with the recently added lighting fixtures 20%. 5. Profits are to be built on securing a growing customer base which will generate loyalty sales and become the refer other customers to the organisation. The superior after-sales service is the key