Submission details
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Student ID |
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Assessor’s Name |
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Assessment Date/s |
The Assessment Task is due on the date specified by your assessor. Any variations to this arrangement must be approved in writing by your assessor.
Submit this document with any required evidence attached. See specifications below for details.
Instructions
The purpose of this assessment task is to complete a set of activities to lead the development of financial strategy.
You will take on the role of the Operations Manager.
Your Assessor will take on the role of the General Manager.
Your Assessor will assign the role of the External financial advisers to your class mates.
You will have the responsibility to manage the team members.
For the meetings:
Your Assessor will supervise/observe the meeting.
You must complete the meeting agenda, meeting minutes and associated templates.
You must use the templates provided to document your responses.
You must follow the word limits specified in the templates.
Keep copies of all submitted materials for your records.
This assessment requires the student to complete a set of activities given in this assessment task based on the information given in the case study. These activities will provide an opportunity for the student to lead financial strategy development for the organisation given in the case study. This includes:
Using and analysing financial and economic information achieve enterprise objectives and maximise returns on financial resources.
Analysing and using budget systems and reporting processes.
Monitoring and managing financial resources over a full planning cycle, including setting targets, managing risks and improving compliance mechanisms.
Revising forecast according to changes in budget deviations.
Introduction
“Online Media Solutions” is a marketing and web development business based in Melbourne, Australia. The business started in operations in 2015 and has seen exponential growth since its establishment.
The business operates in the web service industry to offer superior and unique services to small businesses and institutions (B2B business model). Our experience and expertise in web sales and e-commerce give us the backing to provide solutions that are currently lacking in the market.
There is an all-time high demand for web development and marketing for small businesses with signs of rising further. Interestingly, few web developers have taken advantage of this opportunity, leaving the industry with no dominant participants.
The projects’ high costs and the focus on more prominent companies and institutions could contribute to why this market remains untapped. We will have a system that will reduce the project costs dramatically, allowing us to offer quality services at reduced costs.
Business plan
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Business plan excerpt Company details: Company name: Online Media Solutions, Pty. Ltd Company address: 2/10 Lawn court, Craigieburn, 3064, VIC Mission Provide best-in-class design services Make a positive impact on our customer businesses Be respected and admired by peers Our vision To provide best-in-class web design and development services in a simple, effective, and cost-effective manner to the target audience. Objectives The objectives of Online Media Solutions are as follow: To exceed customer expectations. To provide cost-effective and quality services to our clients. Build and maintain long-term relationships with the clients. To increase operational efficiency. To venture into new markets based on the opportunities identified. Keys to Success We will offer quality web services to small businesses and institutions at affordable prices. To build and tailor our services to small businesses. Positioning as a viable solution alternate to more established brands Services We currently offer the following services to our clients: Interface and Web Design Graphics design Website development Domain and web hosting Video editing Blog development Search engine optimisation E-commerce Values Quality service to our clients Integrity & Accountability Reliability Quality Innovation Respect Strategic directions The strategic direction of ONLINE MEDIA SOLUTIONS is to achieve its mission and vision is through: Increasing operational efficiency Engaging with customers through quality research and understanding supported by marketing techniques. Establishing a reputation for exceptional customer service and end to end solutions Supporting people to perform via training and performance management Controlling costs through operational efficiency Organisational structure and expertise The foundation team has 30 team members. The business has three (3) departments: IT department Marketing department Sales department The finance and human resource work are outsourced. All three (3) departments are managed by Managers who are experienced and experts in commercial web development and business-to-business sales. Further, the team members have years of experience working for MNCs. All the departmental managers’ report to the Operations.
Business model “Online Media Solutions” is a full-service web solutions provider for businesses. The company offers services through the mode of its B2B engagements. B2B services: “Online Media Solutions” service portfolio includes Web Design, Graphics design, Website development, Domain and web hosting, 2d & 3d animation, Blog development, Search engine optimisation and E-commerce. The project cost will be estimated by the appropriate number of hours needed to complete the project. The sales team will aggressively track prospective clients and sell the services provided for businesses. Operational model and strategies B2B engagements Lead generation – Lead generation refers to creating and generating prospective consumer interest or inquiry into a business’s products or services. This will be done by building a database of prospective customers using social networks, business listings, internet search etc. Sales pitch – A sales pitch is a line of talk that attempts to persuade someone or something with a planned sales presentation strategy of a product or service designed to initiate and close a product and service sale. Sales professionals prepare and give a sales pitch using the following methods: Face to face meetings E-mailing marketing contacts from the leads |
Financial statements for the last two years (Online Media Solutions)
Profit and Loss statement
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2019 |
2020 |
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Revenue |
$1,200,000 |
$1,500,000 |
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Direct Costs |
$132,000 |
$132,000 |
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Gross Margin |
$1,068,000 |
$1,368,000 |
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Gross Margin % |
89% |
91% |
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Operating Expenses |
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Salaries & Wages |
$395,520 |
$407,384 |
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Employee Related Expenses |
$79,104 |
$81,477 |
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Loan payments |
$24,000 |
$24,000 |
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Inventory purchases |
$48,000 |
$60,000 |
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Office supplies |
$36,000 |
$36,000 |
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Total Operating Expenses |
$582,624 |
$608,861 |
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Operating Income |
$485,376 |
$759,139 |
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Interest Incurred |
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Depreciation and Amortization |
$10,572 |
$17,428 |
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Gain or Loss from Sale of Assets |
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Income Taxes |
$94,961 |
$148,342 |
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Total Expenses |
$820,157 |
$906,631 |
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Net Profit |
$379,843 |
$593,369 |
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Net Profit / Sales |
32% |
40% |
Balance Sheet
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2019 |
2020 |
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Cash |
$536,930 |
$1,130,169 |
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Accounts Receivable |
$0 |
$0 |
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Other Current Assets |
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Total Current Assets |
$536,930 |
$1,130,169 |
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Long-Term Assets |
$76,800 |
$115,200 |
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Accumulated Depreciation |
($14,286) |
($31,714) |
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Total Long-Term Assets |
$62,514 |
$83,486 |
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Total Assets |
$599,444 |
$1,213,655 |
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Accounts Payable |
$0 |
$0 |
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Income Taxes Payable |
$23,612 |
$36,954 |
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Sales Taxes Payable |
$30,000 |
$37,500 |
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Total Current Liabilities |
$53,612 |
$74,454 |
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Long-Term Debt |
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Long-Term Liabilities |
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Total Liabilities |
$53,612 |
$74,454 |
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Paid-In Capital |
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Retained Earnings |
$165,989 |
$545,832 |
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Earnings |
$379,844 |
$593,369 |
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Total Owner’s Equity |
$545,832 |
$1,139,201 |
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Total Liabilities & Equity |
$599,444 |
$1,213,655 |
Cash flow statement
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Projected Cash Flow Statement |
2019 |
2020 |
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Net Cash Flow from Operations |
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Net Profit |
$379,843 |
$593,369 |
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Depreciation & Amortization |
$10,571 |
$17,429 |
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Change in Accounts Receivable |
$0 |
$0 |
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Change in Inventory |
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Change in Accounts Payable |
$0 |
$0 |
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Change in Income Tax Payable |
$22,198 |
$13,342 |
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Change in Sales Tax Payable |
$12,100 |
$7,500 |
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Change in Prepaid Revenue |
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Net Cash Flow from Operations |
$424,713 |
$631,639 |
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Investing & Financing |
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Assets Purchased or Sold |
($38,400) |
($38,400) |
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Net Cash from Investing |
($38,400) |
($38,400) |
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Net Cash from Financing |
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Cash at Beginning of Period |
$150,617 |
$536,930 |
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Net Change in Cash |
$386,313 |
$593,239 |
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Cash at End of Period |
$536,930 |
$1,130,169 |
Marketing plan
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Marketing plan excerpt The growth of the web and graphics design industry is huge. Over the last five years, it has grown almost by 30%. The web has become a tool for communicating, interaction and the growth of businesses. Existing situation ‘Online Media Solutions’ has successfully established itself in the web development and marketing industry with signs of rising further. ‘Online Media Solutions’ implemented a system for cost reduction that reduced the project costs dramatically and helped us offer quality services at reduced costs. We targeted the small businesses, assessed their needs and provided them with quality services at reduced costs. Existing customers The company focuses on small businesses and institutions that are looking to develop or upgrade their web presence. Our service brings onboard any small business that needs an internet presence, but we concentrate more on those that need more details about their operations online. Such companies most likely go for all or some of the following services: A shopping cart or e-commerce. Dynamic features and content. Aggressive marketing of products online. Market opportunity Opportunity ‘Online Media Solutions’ has successfully ventured into B2B engagements. Based on the analysis conducted, the organisation sees exponential growth in developing B2C products and selling them to customers. These products include: Web templates CMS templates Graphic templates Brochure Flyers Business cards Logo templates Solution Online Media Solutions will focus on developing the B2C products (specified in the opportunity section) and selling them to the end-users using its website. The organisation will focus on reducing operational costs and provide the products to the clients at prices cheaper than the market. SWOT analysis Strengths Experience team Market demand Known market Weaknesses Highly competitive market Low margin Opportunity B2C engagement to sell web-based products Threats Price wars Market share of existing players Competitor analysis ‘Online Media Solutions’ has an advantage over its competitors as there are not many competitors in the market that provide the products at such a reasonable cost. Further, the organisation has a very good reputation in the market and well-established links that will help them venture into the B2C segment and successfully conduct its operations. Target market segment strategy We will focus our marketing efforts on attracting end-users and small businesses. We reached this decision after careful market analysis and identifying the needs of this market segment. Marketing objectives To generate 60-70% revenue from small businesses and institutions To increase brand awareness in the market To generate 20-30% revenue from the new market segment (B2C engagements) Pricing Strategy Online Media Solutions will establish a pricing system to guide our clients on the nature of the services and the corresponding prices. Since we will be dealing with a market segment that tries to reduce costs, we will charge our services on an hourly basis. It will make the clients understand the services that will most likely cost them more. Expected costs, profits and sales from B2B engagements As the organisational pricing strategy, Online Media Solutions will charge for its products and services on an hourly basis. Following are the expected costs associated with the production and delivery of its products and services: Expected sales/revenue: $400,000 by the end of the first year. $600,000 million in next year. Expected expenses for its products and services: Labour cost: 20% of the revenue Indirect costs: 25% of the revenue |
Financial predictions for the next years:
Expected sales for the B2B engagements will increase by 20% in the next year, i.e., 2021 and 25% in the following year, i.e., 2022.
Expected expenses for the B2B engagements will increase by 20% in the next year, i.e., 2021 and 25% in the following year, i.e., 2022.
Expected sales and expenses from B2C engagements:
Sales: Year 2021
$400,000
Expenses: Year 2021
Labour cost: 20% of the revenue
Indirect costs: 25% of the revenue
Sales: Year 2022
$600,000
Expenses: Year 2022
Labour cost: 20% of the revenue
Indirect costs: 25% of the revenue
All the expenses for B2C engagements given in the start-up budget will be incurred in 2021.
Opportunity to venture into a new market.
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Opportunity to venture into a new market “Online Media Solutions” is a full-service web solutions provider for businesses. The company offers services through the mode of its B2B engagements. “Online Media Solutions” further want to venture into B2C engagement by selling its products. The products that the business will develop and sell to the end-users include: Web templates CMS templates Graphic templates Brochure Flyers Business cards Logo templates B2C Products “Online Media Solutions” product portfolio includes Web Templates, CMS Templates, Graphics Templates, Brochures, Flyers, Business cards and Animated logo templates. The prices are typically listed on the online shop where customers can either take monthly subscription or pay per download as per need. The business will have a database that will act as the repository for all the products. Start-up budget (B2B engagements)
Operational model and strategies The business will focus on B2C engagements along with the existing B2B engagements. B2C engagements The B2C engagement is primarily done through a dedicated online shop where customers can browse through the repository, select designs or templates or download. The steps in the process are as follow:
Key strategic metrics Price Quality Network Service Relationship Customer-centric goals Strategic initiatives Attractive portfolio Aggressive marketing Excellent service Service Relationship Customer-centric goals |
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Contractual and procurement policies excerpt
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Purpose of the policy This policy: establishes principles for the acquisition of all goods and services establishes the standards of behaviour for every person undertaking procurement activities; establishes procurement requirements to ensure activities adhere to probity, value for money and legislative requirements and supports the organisation’s values of respect, integrity, inclusion and diversity. Application of the policy This policy applies to all the staff members of the organisation. Procurement principles (1) The principles specified in this clause apply to all procurement activities. (2) Value for money. Purchasers must consider the total benefit derived from a good or a service against its total cost when assessed over the period the good or service is to be used. (3) Probity. Purchasers must deal fairly, impartially and consistently with all suppliers ensuring transactions are transparent, accountable and ethical. Purchasers must identify and appropriately manage any actual, apparent or perceived conflicts of interests. (4) Safety. Safety must be a consideration in all procurement decisions. Purchasers must ensure safety is a mandatory evaluation criterion for all procurement purchases. Purchasers must consider accessibility for people with disability when procuring goods and services Acquisitions must be consistent with the organisation’s safety management system. (5) Appropriate risk management. Purchasers must identify, consider and, if appropriate, take steps to mitigate the risks involved in any acquisition. Risk management considerations must be consistent with the organisation’s Risk management procedures. (6) Ethical behaviour, sustainability and social responsibility. Ethical behaviour, sustainability and social responsibility must be considerations in all procurement decisions. At least one mandatory evaluation criterion for all procurement activities must reflect ethics, sustainability and social responsibility. (7) Legality. Purchasers must ensure that acquisitions are made consistently with: all applicable laws and regulations; and all applicable organisation rules, policies and procedures. Standard for behaviour (1) Every person undertaking procurement activities must behave ethically and professionally and, in particular: comply with the procurement principles specified in this policy; observe all applicable probity requirements; deal fairly, impartially and consistently with all suppliers; monitor, report and manage any actual, apparent or perceived conflicts of interests; monitor and report any suspected fraud, corruption or other wrongdoing; and comply with the Code of Conduct – Staff and Affiliates. (2) Goods and services purchased or leased must be acquired for business use only. (3) Procurement activities must be conducted without internal conflicts of interests. A purchaser must not: approve their own request for goods and services; or both approve and certify receipt of goods and services. (4) Documents relating to acquisitions must be recorded and securely retained. These documents may include: (5) Tender responses or quotations must not be viewed until the specified close date. (6) Purchasers must not: split transactions or orders into components or parts to circumvent procedures or delegation approval levels. understate the value or risk attached to the procurement activity to circumvent procedures; collude with suppliers or prospective suppliers, or divulge the bid made by a supplier to other prospective suppliers before a contract is awarded the intent of securing a lower bid (“bid shopping”). Procurement approval (1) Before obtaining quotations or committing to procure any goods and services, the purchaser must satisfy themselves that: there is a demonstrated need for the goods or services; and there is, or will be, funding available for the proposed acquisition. (2) Acquisitions must be approved by the General Manager. (3) The purchaser must record goods and services assets valued at $10,000 or more in the organisation’s asset register. |
Your role and responsibilities
You are working as Operations Manager in ‘Online Media Solutions’. You report to the General Manager of the organisation.
The General Manager wants you to lead the development of a financial strategy for ‘Online Media Solutions’. This includes using and interpreting financial information to support business decision making, analysing and enterprise planning considering the opportunity identified to venture into a new market.
As part of your job role, you have the following responsibilities:
Analyse financial reports and establish the capacity of existing financial systems.
Forecast financial data and business requirements, including additional expenditure requirements.
Consult with relevant stakeholders, including financial advisers, regarding financial information to support decisions.
Prepare recommendations and assessment indicators for budget expenditure or for modification of existing projections according to organisational and legislative requirements and present recommendations to the stakeholders.
Identify resourcing requirements to implement financial recommendations and communicate recommendations to relevant stakeholders, including organisational staff.
Support staff in the implementation of recommendations and monitor actual income and expenditure against budgets.
Identify deviations from budgets that generate an adverse effect on budget objectives and promptly develop action plans to remedy significant deviations from budget objectives and projections.
Revise budget priorities to meet operational contingencies and risk management.
Skills Test:
This assessment requires the student to complete a set of activities given in this assessment task based on the information given in the case study. These activities will provide an opportunity for the student to lead financial strategy development for the organisation given in the case study. This includes:
Use and analyse financial and economic information to achieve enterprise objectives and maximise returns on financial resources.
Analyse and use budget systems and reporting processes.
Monitor and manage financial resources over a full planning cycle, including setting targets, managing risks and improving compliance mechanisms.
Revise forecast according to changes in budget deviations.
To do so, you must complete the following activities:
Activity 1: Prepare a financial strategy
Activity 2: Implement financial strategy
Activity 3: Monitor implementation of financial strategy
The roles and their responsibilities: Relationships with stakeholders such as External financial advisers and General manager
The assessment task requires you to communicate with a number of organisational stakeholders. The main roles applicable to the assessment task includes:
Role number 1: General Manager: The General Manager is the individual who supervises or is in charge of the organisation. They belong to a higher rank or status. Their job role and responsibilities are:
Assign a team to you to complete the project.
Assist you in understanding the task requirements.
Provide you with information about job roles and responsibilities.
Supervise you in completing the assessment task and requirements.
Participate in meetings based on the Script provided.
Provide feedback regarding the best sources to invest in the new business segment.
Role number 2: External financial advisers: The External financial advisers are the student’s co-worker or workfellow. They are associates that the candidate works with. Their job role and responsibilities are:
Assist you in completing the project on time.
Participate in a healthy and open discussion.
Participate in meetings based on the Script provided.
Provide feedback regarding the best sources to invest in the new business segment.
Note:
The trainer/assessor will take on the role of General Manager.
The trainer/assessor will assign the roles of stakeholders for each activity.
Each student will be assessed individually for all assessment activities.
Timeframe to complete the project:
To be advised by your Assessor.
Task requirements
You will be assessed on your technical knowledge and skills to complete this project
You will be assessed on working in a team environment and meeting your job role and responsibilities.
You must follow the instructions provided by the General Manager.
All individuals must complete their role and assigned responsibilities and meet the specified deadlines.
The task must be completed in the specified timeframe.
Activity 1: Prepare a financial strategy
This activity requires you to prepare a financial strategy for ‘Online Media Solution’. To do so, you are required to complete the following parts:
Part A: Analyse financial reports.
Part B: Forecast financial data and business system requirements.
Part C: Consult General Manager and External financial advisers.
Part D: Prepare recommendations and assessment indicators for budget expenditure
Part E: Present and communicate recommendations to relevant stakeholders, including organisational staff
Part A: Analyse financial reports.
This part of the activity requires you to analyse financial reports and establish the capacity of existing financial systems to invest in a new identified market, i.e. B2B engagements, based on the information given in the case study.
To do so, you are required to follow the steps given below:
Step 1: Analyse the following financial reports given in the case study.
Profit and loss statement
Balance sheet
Cash flow statement
Step 2: Calculate the following financial ratios and document the outcomes using Template 1.
Current ratio
Debt to equity ratio
Gross profit ratio
Inventory turnover
Net profit ratio
Return on assets
Step 3: Prepare a financial strategy using ‘Template 2’.
Assess the ratios prepared in Steps 2.
Analyse the start-up budget requirements for the new market, i.e., B2B engagements. (Given in the case study)
Analyse the expected costs, profits and sales for the new market, i.e., B2B engagements. (Given in the case study)
Assess the capacity of existing financial systems to invest in the new identified market.
Devise objectives and develop strategies (roadmap) to achieve the objectives.
Complete the financial strategy using ‘Template 2’. Include the following details:
Financial objectives
Budget priorities
The capacity of existing financial systems to invest in the new identified market based on financial ratios.
Strategies for achieving the objectives.
Word-limit to prepare the financial strategy is 400-500 words.
Template 1: Financial ratios
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Financial ratios |
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Financial ratios |
Calculations |
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Current ratio |
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Debt to equity ratio |
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Gross profit ratio |
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Inventory turnover |
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Net profit ratio |
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Return on assets |
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Template 2: Financial strategy
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Financial strategy (400-500 words) |
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Financial objectives |
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Budget priorities |
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The capacity of existing financial systems to invest in the new identified market based on financial ratios. |
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Strategies for achieving the objectives |
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Part B: Forecast financial data and business system requirements.
This part of the activity is a continuation of part A of this activity.
This part of the activity requires you to forecast financial data and business system requirements, including additional expenditure requirements.
To complete this activity, you must:
Analyse and use the following budget systems:
Activity-based budgeting.
Incremental budgeting
Follow the templates provided (Template 3 and Template 4) to complete the forecasts and report them to the General Manager.
To do so, you are required to follow the steps given below:
Step 1: Analyse the following financial reports given in the case study.
Profit and loss statement
Balance sheet
Step 2: Prepare the forecasted profit and loss statement and balance sheet using ‘Template 3’ and ‘Template 4’.
Analyse the expected sales and expenses for B2C engagements (given in the case study).
Analyse the financial predictions for the next years for both B2B and B2C engagements (given in the case study).
Document the forecasted profit and loss statement and balance sheet using ‘Template 3’ and ‘Template 4’.
Template 3: Forecasted profit and loss statement: Include and delete rows as required
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2021 |
2022 |
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Revenue |
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Direct Costs |
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Gross Margin |
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Gross Margin % |
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Operating Expenses |
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Salaries & Wages |
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Employee Related Expenses |
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Loan payments |
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Inventory purchases |
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Office supplies |
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Total Operating Expenses |
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Operating Income |
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Interest Incurred |
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Depreciation and Amortization |
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Gain or Loss from Sale of Assets |
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Income Taxes |
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Total Expenses |
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Net Profit |
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Net Profit / Sales |
Template 4: Forecasted balance sheet: Include and delete rows as required
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2021 |
2022 |
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Cash |
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Accounts Receivable |
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Other Current Assets |
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Total Current Assets |
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Long-Term Assets |
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Accumulated Depreciation |
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Total Long-Term Assets |
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Total Assets |
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Accounts Payable |
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Income Taxes Payable |
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Sales Taxes Payable |
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Total Current Liabilities |
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Long-Term Debt |
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Long-Term Liabilities |
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Total Liabilities |
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Paid-In Capital |
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Retained Earnings |
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Earnings |
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Total Owner’s Equity |
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Total Liabilities & Equity |
Part C: Consult General Manager and External financial advisers.
This part of the activity is a continuation of part A and part B of this activity.
This part of the activity requires you to consult the following stakeholders about financial information to support decisions.
General Manager
External financial advisers (Two).
The trainer/assessor will take on the role of the General Manager and assign the role of the External financial advisers to your class mates.
The trainer/assessor must further brief the student and the staff members of their roles and responsibilities and script to be followed before the meeting.
The roles and responsibilities are as below:
To conduct the meeting, you must follow the meeting process and the meeting script provided below.
Meeting process:
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Before the meeting |
1. Create a meeting agenda. Confirm the meeting time and place with the trainer/assessor. Use the meeting agenda template provided to prepare the meeting agenda. 2. E-mail the following documents developed in Activity 1 and Activity 2 along with the meeting agenda to the meeting participants and request confirmation for the meeting. Template 1: Financial ratios. Template 2: Financial strategy. Template 3: Projected profit and loss statement Template 4: Projected balance sheet |
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During the meeting |
1. Welcome the participants 2. Discuss the information about financial ratios and financial strategy (developed in part 1). 3. Clarify the understanding of the meeting participants. 4. Discuss the capacity of the existing financial systems to invest in the new identified market, i.e., B2C engagements. 5. Gather feedback from the General Manager and External financial advisers regarding the best sources to invest in the new business segment. 6. Conduct the meeting based on the ‘Meeting script’ provided. |
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After the meeting |
1. Summarise the agreed outcomes using the meeting minutes template provided. |
Meeting script: Meeting
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Script: Meeting 1 The Operations Manager will first discuss the outcomes of financial ratios and financial strategy (developed in part 1) After discussing key features of the outcomes of financial ratios and financial strategy, the Operations Manager will discuss the capacity of the existing financial systems to invest in the new identified market, i.e., B2C engagements. The Operations Manager will then answer the questions asked by the General Manager and Financial advisers. |
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Script for General Manager and External Financial advisers |
General Manager will ask the following questions: 1. What are the start-up requirements for venturing into the new market? 2. What do you think will be the best method to source funds to venture into the new market? External financial advisers will ask the following questions: 1. What is the capacity of existing financial systems to invest in the new market? 2. What are the outcomes of financial ratios calculated? 3. What are the expected profits from B2C engagements (new market) for the next year? 4. Why do you think that method chosen to source the funds is the most appropriate method? |
MEETING AGENDA TEMPLATE:
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Meeting/Project Name: |
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Date of Meeting: (MM/DD/YYYY) |
Time: |
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Meeting Facilitator: |
Location: |
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1. Meeting Objective |
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2. Attendees |
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Name |
Department/Division |
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Phone |
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3. Meeting Agenda |
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Topic |
Owner |
Time |
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4. Pre-work/Preparation (documents/handouts to bring, reading material, etc.) |
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Description |
Prepared by |
MEETING MINUTES:
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Meeting Minutes: |
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Date of Meeting: (MM/DD/YYYY) |
Time: |
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Minutes Prepared By: |
Location: |
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1. Meeting Objective |
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2. Attendance at Meeting |
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Department/Division |
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3. Agenda and Notes, Decisions, Issues |
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4. Action Items |
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Action |
Owner |
Due Date |
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5. Next Meeting (if applicable) |
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Date: (MM/DD/YYYY) |
Time: |
Location: |
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Objective: |
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Part D: Prepare recommendations and assessment indicators for budget expenditure
This part of the activity is a continuation of part A-C of this activity.
This part of the activity requires you to prepare recommendations and assessment indicators for budget expenditure according to organisational and legislative requirements.
To prepare recommendations and assessment indicators for budget expenditure, you must use Template 5 provided and include the following details:
Recommendations for sourcing funds to venture into the new market.
Assessment indicators for budget expenditure.
Organisational and legislative requirements for budget expenditure.
Template 5: Recommendations and assessment indicators for budget expenditure
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Recommendations and assessment indicators for budget expenditure |
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Recommendations for sourcing funds to venture into the new market (150-200 words) |
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Assessment indicators for budget expenditure (100-150 words) |
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Organisational and legislative requirements for budget expenditure (150-200 words) |
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Part E: Present and communicate recommendations to relevant stakeholders, including organisational staff
This part of the activity is a continuation of Part D of this activity.
This part of the activity requires you to present and communicate recommendations prepared in Part D of this Activity to the following stakeholders:
General Manager
External financial advisers (Two).
IT Manager
Marketing Manager
To present recommendations, you are required to:
Write an e-mail to the above stakeholders and present recommendations.
Follow the e-mail guidelines provided.
Ensure the text written in the e-mail is grammatically correct and free of errors.
Use business style writing.
Write an appropriate subject line.
The text must brief stakeholders on the recommendations and assessment indicators.
Attach recommendations and assessment indicators (Template 5) to the e-mail.
For Activity 1, your Assessor will look for evidence that you have:
Analysed financial reports and established the capacity of existing financial systems to invest in a new identified market.
Analysed the stated financial reports.
Calculated the stated ratios to assess the financial health of the organisation.
Used correct formulas to calculate financial ratios.
Prepared a financial strategy.
Analysed the start-up budget requirements for the new market, i.e., B2B engagements.
Assessed the capacity of existing financial systems to invest in the new identified market.
Devised objectives and developed strategies (roadmap) to achieve the objectives.
Included the budget priorities.
Forecasted financial data and business system requirements, including additional expenditure requirements.
Analysed and used budget systems and reporting procedures.
Prepared the forecasted profit and loss statement and balance sheet.
Consulted the General Manager and External financial advisers.
Conveyed information about financial ratios and financial strategy using language, format and style appropriate to the audience.
Used listening and questioning to confirm and clarify understanding.
Discussed the capacity of the existing financial systems to invest in the new identified market, i.e., B2C engagements.
Gathered feedback from the General Manager and External financial advisers regarding the best sources to invest in the new business segment.
Answered the questions asked by the General Manager and External financial advisers.
Prepared recommendations and assessment indicators for budget expenditure. Provided the following details:
Recommendations for sourcing funds to venture into the new market.
Assessment indicators for budget expenditure.
Organisational and legislative requirements for budget expenditure.
Presented and communicated recommendations to relevant stakeholders, including organisational staff:
Wrote an e-mail to the above stakeholders and presented recommendations.
Followed the e-mail guidelines.
Activity 2: Implement financial strategy
This activity is a continuation of Activity 1.
This activity requires you to implement the financial strategy prepared in Activity 1.
To do so, you are required to complete the following parts:
Part A: Identify resourcing requirements
Part B: Prepare an implementation and monitoring plan to support staff in the implementation of recommendations
Part A: Identify resourcing requirements
This part of the activity requires you to identify the resourcing requirements to implement the financial recommendations prepared in Part D of Activity 1 and implement forecasted financial statements prepared in part B of Activity 1.
You must document resourcing requirements using Template 6.
To identify the resourcing requirements, you are required to follow the steps given below:
Step 1: Analyse the following forecasted budgets/statements prepared in Part B of Activity 2:
Forecasted profit and loss statement
Forecasted balance sheet
Step 2: Analyse the financial recommendations prepared in part D of Activity 3.
Step 3: Identify and document resourcing requirements to implement the financial recommendations prepared in Part D of Activity 1 and implement forecasted financial statements prepared in part B of Activity 1. Document the outcomes using Template 6.
Template 6: Resourcing requirements
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Resourcing requirements (200-250 words) |
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Part B: Prepare an implementation and monitoring plan to support staff in implementing recommendations
This part of the activity requires you to prepare an implementation and monitoring plan to support staff in implementing recommendations prepared in part D of Activity 1 and implementing forecasted financial statements prepared in part B of Activity 1.
To do so, you must analyse the following documents prepared in Activity 1:
Forecasted financial statements prepared in part B of Activity 1. (Template 3 and Template 4)
Forecasted profit and loss statement
Forecasted balance sheet
Recommendations prepared in part D of Activity 1. (Template 5)
To prepare an implementation and monitoring plan, you are required to follow the steps given below:
Step 1: Prepare an implementation plan using Template 7 to support staff in implementing recommendations prepared in part D of Activity 1 and implementing forecasted financial statements prepared in part B of Activity 1. Include the following details in the Implementation Plan (Template 7).
Four (4) financial targets to be achieved by the end of the next financial year.
Two (2) risks associated with the achievement of each financial targets.
Strategies to minimise risks.
Resources required.
Step 2: Prepare a monitoring plan using Template 8 to support staff in implementing recommendations prepared in part D of Activity 1 and implementing forecasted financial statements prepared in part B of Activity 1. Include the following details in the Monitoring Plan (Template 7).
Four (4) financial indicators to be monitored during the implementation of forecasted financial statements.
Steps to be implemented to monitor financial indicators over a full planning cycle.
Timeframes to monitor the financial indicators over a full planning cycle.
Resources required to monitor financial indicators.
Compliance mechanism to be followed to procure resources. Include details regarding financial legislations and policies and procedures to be followed.
Template 7: Implementation plan
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Implementation plan |
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Four (4) financial targets to be achieved |
Two (2) risks associated with the achievement of each financial targets |
Strategies to minimise risks |
Resources required. |
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Template 8: Monitoring plan
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Monitoring plan |
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Four (4) financial indicators to be monitored. |
Steps to be implemented to monitor financial indicators. |
Timeframes to monitor the financial indicators over a full planning cycle. |
Resources required. |
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Compliance mechanism to be followed to procure resources (150-200 words) |
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For Activity 2, your Assessor will look for evidence that you have:
Identified resourcing requirements based on the following.
Forecasted budgets/statements.
Financial recommendations.
Prepared an implementation plan to support staff in implementing recommendations and included the following details:
Four (4) financial targets to be achieved by the end of the next financial year.
Two (2) risks associated with the achievement of each financial targets.
Strategies to minimise risks.
Resources required.
Prepared a monitoring plan and included the following details:
Four (4) financial indicators to be monitored during the implementation of forecasted financial statements.
Steps to be implemented to monitor financial indicators over a full planning cycle.
Timeframes to monitor the financial indicators over a full planning cycle.
Resources required to monitor financial indicators.
Compliance mechanism to be followed to procure resources. Include details regarding financial legislations and policies and procedures to be followed.
Activity 3: Monitor implementation of financial strategy
Activity context:
During the implementation of the forecasted budgets or financial statements for the initial year, i.e., 2021, the following were actual income and expenditure:
Actual sales from B2B engagements increased by 20%, as expected in the forecasts.
Expected sales for the expenses for the B2B engagements increased by 20%, as expected in the forecasts.
Sales and expenditure from B2C engagements:
Sales:
$360,000 (10% less than forecast)
Expenses:
Labour cost: 20% of the sales/revenue
Indirect costs: 30% of the sales/revenue
Revisions to be made to the budget priorities in the budget for the year 2022 to meet operational contingencies and risk management:
Expected sales and expenses for the B2B engagements will be same as forecasted.
Expected sales and expenses from B2C engagements:
Sales: Year 2022
$540,000
Expenses: Year 2022
Labour cost: 20% of the revenue
Indirect costs: 35% of the revenue
Description of the activity:
This activity is a continuation of Activity 1 and Activity 2.
This activity requires you to monitor the implementation of the financial strategy. To do so, you are required to complete the following parts:
Part A: Monitor actual income and expenditure against budgets and identify deviations from budgets that generate an adverse effect on budget objectives
Part B: Develop action plans to remedy significant deviations from budget objectives and projections
Part C: Revise budget forecast according to changes in budget deviations.
Part A: Monitor actual income and expenditure against budgets and identify deviations from budgets that generate an adverse effect on budget objectives
This part of the activity requires you to monitor actual income and expenditure against forecasted budgets and identify deviations from budgets that generate an adverse effect on budget objectives.
To do so, you are required to follow the steps given below:
Step 1: Monitor actual income and expenditure against forecasted budgets.
Assess the actual income and expenditure information given in the Activity context.
Compare the actual income and expenditure against the forecasted profit and loss statement and balance sheet and document the outcomes using Template 9 and Template 10.
In column 2 of Template 9 and Template 10, include the forecasted figures for profit and loss statement and balance sheet.
In column 3 of Template 9 and Template 10, calculate the actual figures based on the actual income and expenditure information given in the Activity context.
In column 4 of Template 9 and Template 10, calculate deviations based on forecasted and actual income and expenditure and mark them as favourable or unfavourable.
Step 2: Based on the calculations performed in Step 1, identify the unfavourable deviations from the budget that generate an adverse effect on budget objectives and document using Template 11.
Template 9: Forecasted versus actual profit and loss statement: Include and delete rows as required
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Forecasted figures |
Actual figures |
Deviations (Favourable or unfavourable) |
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Revenue |
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Direct Costs |
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Gross Margin |
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Gross Margin % |
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Operating Expenses |
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Salaries & Wages |
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Employee Related Expenses |
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Loan payments |
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Inventory purchases |
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Office supplies |
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Total Operating Expenses |
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Operating Income |
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Interest Incurred |
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Depreciation and Amortization |
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Gain or Loss from Sale of Assets |
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Income Taxes |
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Total Expenses |
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Net Profit |
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Net Profit / Sales |
Template 10: Forecasted versus actual balance sheet: Include and delete rows as required
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Forecasted figures |
Actual figures |
Deviations (Favourable or unfavourable) |
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Cash |
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Accounts Receivable |
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Other Current Assets |
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Total Current Assets |
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Long-Term Assets |
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Accumulated Depreciation |
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Total Long-Term Assets |
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Total Assets |
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Accounts Payable |
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Income Taxes Payable |
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Sales Taxes Payable |
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Total Current Liabilities |
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Long-Term Debt |
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Long-Term Liabilities |
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Total Liabilities |
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Paid-In Capital |
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Retained Earnings |
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Earnings |
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Total Owner’s Equity |
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Total Liabilities & Equity |
Part B: Develop action plans to remedy significant deviations from budget objectives and projections
This part of the activity is a continuation of part A of this activity.
This part of the activity requires you to develop action plans to remedy significant deviations from budget objectives and projections identified in part A of this activity.
You must use Template 11 to develop action plans. You must develop an action plan for each negative deviation identified.
To develop the action plans, you must follow the steps given below:
Step 1: Identify three (3) negative deviations based on the outcomes of part A of this activity.
Step 2: Develop an action plan for each identified negative deviation. Include the following information in each action plan:
Three (3) risks based on the negative deviation.
Remedial action
Key performance indicators
Person responsible
Template 11: Action plans
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Action plans |
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Negative deviation 1:
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Three (3) risks based on the negative deviation. |
Remedial action |
Key performance indicators |
Person responsible. |
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Negative deviation 2:
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Three (3) risks based on the negative deviation. |
Remedial action |
Key performance indicators |
Person responsible. |
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Negative deviation 3:
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Three (3) risks based on the negative deviation. |
Remedial action |
Key performance indicators |
Person responsible. |
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Part C: Revise budget forecast according to changes in budget deviations.
This part of the activity is a continuation of part B of this activity.
This part of the activity requires you to revise budget forecasts based on budget deviation identified in part B of this activity and to meet the operational contingencies and risk management given in the activity context.
You must revise budget forecasts using Template 12 and Template 13.
To revise budget forecasts, you must follow the steps given below.
Step 1: Analyse the forecasted financial statements prepared in Activity 1 (Part B).
Step 2: Analyse the deviations identified in part B of this activity.
Step 3: Assess the revisions to be made to the budget priorities in the budget for the year 2022 to meet operational contingencies and risk management (given in the Activity context.
Step 4: Revise the budget forecasts based on the analysis conducted in Step 1 to Step 3 and document the revised budget forecasts using Template 12 and Template 13.
Template 12: Revised profit and loss statement: Include and delete rows as required
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2021 |
2022 |
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Revenue |
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Direct Costs |
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Gross Margin |
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Gross Margin % |
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Operating Expenses |
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Salaries & Wages |
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Employee Related Expenses |
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Loan payments |
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Inventory purchases |
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Office supplies |
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Total Operating Expenses |
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Operating Income |
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Interest Incurred |
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Depreciation and Amortization |
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Gain or Loss from Sale of Assets |
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Income Taxes |
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Total Expenses |
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Net Profit |
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Net Profit / Sales |
Template 13: Revised balance sheet: Include and delete rows as required
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2021 |
2022 |
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Cash |
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Accounts Receivable |
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Other Current Assets |
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Total Current Assets |
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Long-Term Assets |
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Accumulated Depreciation |
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Total Long-Term Assets |
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Total Assets |
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Accounts Payable |
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Income Taxes Payable |
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Sales Taxes Payable |
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Total Current Liabilities |
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Long-Term Debt |
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Long-Term Liabilities |
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Total Liabilities |
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Paid-In Capital |
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Retained Earnings |
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Earnings |
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Total Owner’s Equity |
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Total Liabilities & Equity |
For Activity 3, your Assessor will look for evidence that you have:
Monitored actual income and expenditure against budgets and identified deviations from budgets that generate an adverse effect on budget objectives.
Assessed the actual income and expenditure information given in the Activity context.
Compared the actual income and expenditure against the forecasted profit and loss statement and balance sheet.
Identified the unfavourable deviations from the budget that generated an adverse effect on budget objectives.
Developed action plans to remedy significant deviations from budget objectives and projections and included the following details:
Three (3) risks based on the negative deviation.
Remedial action
Key performance indicators
Person responsible.
Revised budget forecast according to changes in budget deviations.
Analysed the forecasted financial statements prepared.
Analysed the deviations identified.
Assessed the revisions to be made to the budget priorities in the budget for the year 2022 to meet operational contingencies and risk management.
Revised the budget forecasts based on the analysis conducted.
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Candidate: I declare that this work has been completed by me honestly and with integrity and that I have been assessed in a fair and flexible manner. I understand that the Institute’s Student Assessment, Reassessment and Repeating Units of Competency Guidelines apply to these assessment tasks. |
Signature: ___________________
Date: ____/_____/_____ |