Assessment Task 1
Part A: Prepare a Cost of Goods Sold Budget
Part B: Prepare a Sales Budget
Assessment Task 2
Part A: Prepare and Report a Master Operating Budget
Part B: Prepare Financial Forecasts
Description:
A financial forecast is a financial plan or budget for a business. It is an estimate of two essential future financial
outcomes for a business – their projected income and expenses. A financial forecast is an essential part of a
business plan.
For this task, you will be provided with a set of sample data (financial reports) drawn from an actual annual
report. Using the financial reports, you will be required to prepare financial forecasts for the next financial
year. You may use the same Excel worksheet template provided for the budgets. Prepare financial forecasts for
the next financial year;
FNS40615 Certificate IV in Accounting FNSACC402 Prepare Operational Budgets & FNSORG506 Prepare Financial Forecasts and Projections (CLUSTERED) ASSESSMENT TASKS Mode | Classroom Delivery FNS40615| FNSACC402 Prepare Operational Budgets - FNSORG506 Prepare Financial Forecasts and Projections Learner’s Guide | V 3.0 | Jan 2017 Macquarie Education Group Australia Pty Ltd t/a Macquarie Institute | RTO Code 91305 | CRICOS Code 02657J Approved by: QAC | Next Review: Dec 2017 Page 2 of 16 FNSACC402 Prepare Operational Budgets - FNSORG506 Prepare Financial Forecasts and Projections Supporting: FNS40615 Certificate IV in Accounting; May also support other qualifications based on respective packaging rules © Le-Sharma Pty Ltd, 2016 Copyright: Provided under license from Le-Sharma Pty Ltd. All rights reserved. This document and its contents are protected by Australian and International copyright laws. No part of this document may be reproduced or transmitted in any form or by any means, electronically or mechanically, including photography, scanning, recording or any information storage or retrieval system, without permission in writing from the copyright owner or from Le-Sharma Pty Ltd. Information and/or resources used from the Commonwealth, government agencies, training.gov.au, public domain information, or any other external sources do not constitute copyright and remain the property of the original authors/agencies. All the websites and external resources mentioned in this publication, including any information linked to or referred to public domain information, are copyrighted to their respective owners. Web links are used as examples for reference purpose only and may have changed since publication of this resource. Le-Sharma Pty Ltd or author does not claim endorse the views expressed by them. Le-Sharma Pty Ltd ACN: 613 011 475 FNS40615| FNSACC402 Prepare Operational Budgets - FNSORG506 Prepare Financial Forecasts and Projections Learner’s Guide | V 3.0 | Jan 2017 Macquarie Education Group Australia Pty Ltd t/a Macquarie Institute | RTO Code 91305 | CRICOS Code 02657J Approved by: QAC | Next Review: Dec 2017 Page 3 of 16 Unit of Competency : FNSACC402 Prepare Operational Budgets - FNSORG506 Prepare Financial Forecasts and Projections Total Delivery Hours : TBA Schedule : TBA Cluster/Term : TBA 1. Introduction This assessment pack contains all the assessment tasks that need to be completed for this unit of competency. ALL the given tasks must be completed and submitted as per the instructions provided. Supporting information and guidelines are provided separately in the “Assessment Guide”, available from your trainer/assessor and online portal. 2. Unit Overview This resource is developed for a clustered delivery and assessment of; ▪ FNSACC402 Prepare Operational Budgets ▪ FNSORG506 Prepare Financial Forecasts and Projections The assessments are designed such that they satisfy the competency requirements of both the units. The lesson plan combines the topics related to both the units. FNSACC402 Prepare Operational Budgets FNSORG506 Prepare Financial Forecasts and Projections This unit describes the skills and knowledge required to prepare and document operational budgets for a variety of organisations. It applies to individuals who use specialised knowledge and systematic approaches to undertake strategic financial activity for an organisation. No licensing, legislative or certification requirements apply to this unit at the time of publication. This unit describes the skills and knowledge required to plan a financial forecast or projection, identify assumptions and parameters, collect, consolidate and analyse data, make forecasts or projections, document results and obtain approval. It applies to experienced individuals who use a range of specialist and managerial techniques to plan and carry out their work, and provide direction to others. No licensing, legislative or certification requirements apply to this unit at the time of publication. Detailed unit description, including performance criteria and competency evidence can be accessed online at; http://training.gov.au/Training/Details/FNSACC402 http://training.gov.au/Training/Details/FNSORG506 View Unit View Unit http://training.gov.au/Training/Details/FNSACC402 http://training.gov.au/Training/Details/FNSORG506 http://training.gov.au/Training/Details/FNSORG506 http://training.gov.au/Training/Details/FNSORG506 http://training.gov.au/Training/Details/FNSORG506 FNS40615| FNSACC402 Prepare Operational Budgets - FNSORG506 Prepare Financial Forecasts and Projections Learner’s Guide | V 3.0 | Jan 2017 Macquarie Education Group Australia Pty Ltd t/a Macquarie Institute | RTO Code 91305 | CRICOS Code 02657J Approved by: QAC | Next Review: Dec 2017 Page 4 of 16 Learning Outcomes FNSACC402 Prepare Operational Budgets FNSORG506 Prepare Financial Forecasts and Projections Learning Outcomes On successful completion of this unit, the student/trainee will be able to; ▪ Prepare budget ▪ Set budget timeframe ▪ Document budget Learning Outcomes On successful completion of this unit, the student/trainee will be able to; ▪ Plan preparation timetable ▪ Identify assumptions and parameters ▪ Issue instructions and relevant aids for preparation of forecasts and projections ▪ Collect, consolidate, model and analyse data ▪ Document results and obtain approval As well as demonstrating the performance criteria, to be assessed as competent, the student must demonstrate their ability to apply the required knowledge and skills in a range of situations. These are summarised in the unit description as provided in the link above. The students must familiarise themselves with all the competency requirements for this unit of competency and ensure that they have received all the relevant information and support, including assessment task and submission schedules, and any specific assessment requirements and conditions, from the trainer/assessor prior to undertaking these assessments. Unit Prerequisites There are no prerequisites for undertaking this unit of competency. 3. Prescribed Text and Resources Pearson Scope, Prepare operational budgets Learner Guide, Pearson http://www.pearson.com.au/9781741039023 Hanke J.E., Wichern D., 2013, Business Forecasting: Pearson New International Edition, Pearso Suggested Learner Resources & Readings NIA, 2010, Budgeting: A Practical Approach, Pearson http://www.pearson.com.au/9781442538429 Lalli W. R., 2012, Handbook of Budgeting (6th Ed.), Wiley Corporate F&A, Wiley Banks A., Giliberti J., 2008, Budgeting, McGrew Hill Bragg S. M., 2011, Budgeting: A Comprehensive Guide, AccountingTools FNS40615| FNSACC402 Prepare Operational Budgets - FNSORG506 Prepare Financial Forecasts and Projections Learner’s Guide | V 3.0 | Jan 2017 Macquarie Education Group Australia Pty Ltd t/a Macquarie Institute | RTO Code 91305 | CRICOS Code 02657J Approved by: QAC | Next Review: Dec 2017 Page 5 of 16 4. Assessment Tasks The following summative assessments are planned for this unit; # Assessment Task/Activity Type Assessment Method 1 Part A: Prepare a Cost of Goods Sold Budget Individual Practical/Analytical Part B: Prepare a Sales Budget Individual Practical/Analytical 2 Part A: Prepare and Report a Master Operating Budget Individual Written Part B: Prepare Financial Forecasts Individual Practical/Analytical These assessment tasks/activities have been described in detail in the following section. Task schedule to be advised by trainer/assessor based on the lesson and session plans. FNS40615| FNSACC402 Prepare Operational Budgets - FNSORG506 Prepare Financial Forecasts and Projections Learner’s Guide | V 3.0 | Jan 2017 Macquarie Education Group Australia Pty Ltd t/a Macquarie Institute | RTO Code 91305 | CRICOS Code 02657J Approved by: QAC | Next Review: Dec 2017 Page 6 of 16 Assessment Task 1 Part A: Prepare a Cost of Goods Sold Budget Description: For a company selling a physical product, the cost of goods sold (also called COGS, Cost of finished products or cost of sales) forecast answers the question of how much it will cost to produce or stock the product(s). The COGS forecast relate to the sales forecast as more stock or components are needed to be purchased if more items are expected to be sold. A Cost of Goods Sold forecast also contributes towards preparing an operational budget. It is essential that you familiarise yourself with key budgeting and accounting principles prior to undertaking this task. This task should be completed in conjunctions with learning sessions and students must ensure that they attend all the sessions to develop the basic understanding of key concepts and theories. For this task, your trainer/assessor will play the role of Company’s Finance and Accounting Manager for consultation and necessary inputs. Your responsibility will be to maintain a positive and proactive communication with your manager. Background: Hardwood Products is a producer of quality hard wood furniture and manufactures two different types of timber product, Dining Tables and Buffets and uses three raw materials, Ash, Redwood, and pine 2-packs. The company has a strong finance and accounting focus and prepares various budgets before the start of each financial year. Budgets are monitored against actual data during the operating periods and the company produces the required stocks based on sales forecasts for each period. The following actual and forecast sales have been provided by the company’s marketing manager; Sales Forecast: Hardwood Products Period Dining Tables Buffets Actual April 20 100 May 20 100 June 20 100 Forecast July 20 100 August 30 150 September 25 120 October 40 160 The following budget information is provided by the company; ▪ Dining Tables sell for $9,000 each and the Buffets sell for $4,250