BSBFIM501 MANAGE BUDGETS AND FINANCIAL PLANS ASSESSMENT TASK 3 FEEDBACK COVER SHEETSTUDENT NAME STUDENT ID ASSESSOR NAME EVIDENCE COLLECTEDBENCHMARK REQUIREMENTS METYESNOTasks:☐☐☐☐☐☐OUTCOMESATISFACTORY ☐NOT SATISFACTORY ☐FEEDBACK TO STUDENT ASSESSOR’S SIGNATURE DATE Students please note: Your results will be made available in your Student Portal. Your Trainer will also email you with feedback on your performance, including where gaps are identified. Please ensure you regularly login to your student portal and Stanley College email to check this information. All decisions, including Assessments Outcomes can be appealed. For more information please refer to our Complaints and Appeals Policy (available from Student Services team or via our website) Monitor, control and review finances management process Submission details The assessment task 3 is due on the ‘Assessment Cover Sheet’ specified by your assessor. Any variations to this arrangement must be approved in writing by your assessor. Submit this document through firstname.lastname@example.org inbox or if your unit is on Moodle you will submit through your student log-in: https://sclms.moodle.school/login/index.php. All assessments to be submitted electronically with any required evidence attached. See specifications below for details. Performance objective You will demonstrate the ability to monitor and control finances. Assessment description In response to the scenario provided, you will create a simple spreadsheet budget to capture monitoring information. Using information provided to you, you will then use the budget spreadsheet to produce a report on expenditure in accordance with organisational policies and procedures. You will also modify a contingency plan and circulate an email includes a list of recommendations / improvements. Assessment introduction The assessment task includes two main sections: Procedure and Specifications. You are required to understand the difference between these sections: Procedure Review the scenario below: Read and analyse the Big Red Bicycle Pty Ltd Case Study information in Appendix 1 – 2.Design and develop a spreadsheet to capture budgeted and actual figures to produce a variance report. The actual budget figures spreadsheet is provided below: A budget spreadsheet Monitor and record actual figures. Ensure you follow Task A as per scenario above.Produce a variance report:Ensure the variance report follows Big Red Bicycle requirements (refer to Appendix 2).When analysing the variance report, consider the scenario information in Task B and the Contingency Plan provided in Appendix 1.Modify the contingency and implementation plans provided in Appendix 1 to improve effectiveness.Circulate an email (through your email inbox) to the relevant management including your recommendations (at least three) for improvements to existing processes in order to achieve the company aim. In your email include:At least three (3) recommendations / improvements in line with financial objectives of the work team and the organisation.The variance report, modified contingency and implementation plans.Ensure your email is professionally written.Take a screenshot of your email and paste it to a new MS Word document.Submit all documents required in the specifications below to your assessor. Ensure you keep a copy of all work submitted for your records. Specifications You must: Submit:Completed assessment evidence documents. Assessment evidenceInserted document• A budget variance report • A modified contingency plan and modified implementation plan • An email includes a list of recommendations / improvements Your assessor will be looking for: numeracy skills to read and understand a budget and to produce a variance reporttechnology skills to use software associated with financial recordkeepingknowledge of basic accounting principles to identify and use account balancesknowledge of organisational requirements related to financial managementknowledge of organisational requirements for records and reportsknowledge of principles and techniques involved in budgeting, profit and loss statements, electronic spreadsheets. Adjustment for distance-based learners No variation of the task is required.Documentation can be submitted electronically or posted in the mail. Appendix 1: Big Red Bicycle Pty Ltd Big Red Bicycle Pty Ltd is a bicycle manufacturer based in Bendigo, Victoria. The company produces bicycles which it sells to retailers in the domestic Australian market. The senior management structure of the company appears below. PersonPositionMichelle YeoChief Executive Officer (CEO)Tom CopelandManaging DirectorJohn BlackChief Financial Officer (CFO)Stuart LaRouxOperations General ManagerPat RobertsSenior AccountantSam GellarSales General ManagerCharles PierceProduction ManagerHolly BurkeHR Manager According to company strategic plans, the company aims to achieve a net profit before tax of $1,000,000. The chief risks to this goal are: poor sales due to economic downturnincreases in expenses such as wage expenses. In addition to Australian operations, the company is considering manufacturing overseas to take advantage of reduced costs. The company is also considering diversifying its product range to reduce exposure to poor sales of one product. Contingency plan for Task B Company name:Big Red Bicycle Pty LtdPerson developing the plan: Name:Tom CopelandPosition:Managing DirectorRisk identified: Profit for FY more than 10% less than budgetedStrategies/activities to minimise the riskBy whenBy whomProduce quarterly variance reports to identify income/ expenditure and profit shortfalls over 10%.Q2PRImplement sales training/coaching.Q2PRImplement incentives program.Q2PRReduce overtime.Q2PR Contingency implementation plan for Task B Risk identified:Profit for FY more than 10% less than budgetedActivityMonitoring activity and datePerson/sMonitor variance.Completion of variance report: Q2.PRAnalysis of report to identify issues.Management report: Q2.PREmail to warn employees of risk to jobs.Monitoring of variance report results: Q4.PREmail to announce rise of commission from 2% to 2.5%.Monitoring of variance report results: Q3.PREmail to inform employees that overtime will no longer be approved.Monitoring of variance report results: Q3.PREmail to inform employees of mandatory sales skills training: set program.Monitoring of variance report results: Q3.PRMandatory training conducted.Monitoring of variance report results: Q3.PR Appendix 2: Budgeting and finance policy Budget preparations The business plan will set the key parameters for all financial budgeting.Variations to the business plan must be approved by the CEO and senior management strategic committee.Prior period results are to be analysed to identify the profit level of cost centres, identify correlations between financial statistics and to set key performance indicators and benchmarks for future budgets.The budget planning committee will meet prior to budgets being developed and agree on budget parameters. The committee will consist of all department managers plus the CEO and Chief Financial Officer.A CAPEX budget will be developed from the approved business plan.A detailed sales budget must be completed before completing the profit budget for the year.A cash-flow budget covering the first three months will be prepared after the profit budget is completed.A master budget including profit projections will be completed from which cost centre allocations will be made.Budget notes that contain all the assumptions used in the budgets should accompany the master budget or be made available on a separate document. Where possible, the notes should justify the basis on which the estimates were made.Overheads (non-direct expenses) will be apportioned across the cost centres equally. Exceptions need to be negotiated with relevant authorities.All expenses and income will be spread equally throughout the year unless otherwise required by business needs or business environment.The financial cycle for budgeting purposes will be yearly ending 30 June. Reporting requirements Software applications to be used in reporting: Actual results will be produced monthly by the MYOB accounting system. Actual variances to budget will be produced using Excel with a report prepared for senior management for significant variances. Financial delegations Format for budgets and reports All budgets must include the: Name of the person who prepared it.Cost centre (if applicable).Name of the budget/report, i.e. sales, expenses, CAPEX, cash flow, budgetvariance report.Period of the budget.
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