Uuriintuya Otgonbaatar SMC20200228

ABN: 57 169 281 501 E:

[email protected] W:
www.sydneymetrocollege.edu.au Sydney (Head Office):
Level 2, 16-22 Wentworth Avenue Surry Hills NSW 2010
T: 02 8937 0991 Melbourne: Level 1 &2, 213-215 Lonsdale
Street, Melbourne VIC 3000

Task 1: Prepare budgets

Part 1 a (refer to Spreadsheet)

Profit budget
Profit Budget
Particlulars 2011/12 Qtr 1 Qtr 2 Qtr 3 Qtr 4
Revenue (%) 8% 20% 24% 26% 30%
$16,971,236.6 $4,073,096.9 $4,412,521.5 $5,091,370.6
Sales $3,394,247.83
4 7 3 7
Less: Cost of $2,321,665.2 $2,515,137.2 $2,902,081.2
$9,673,605.09 $1,934,721.26
Goods Sold 7 7 8
$1,751,431.7 $1,897,384.2 $2,189,289.3
Gross Profit $7,297,631.91 $1,459,526.57
0 6 9
Gross Profit (%) 43% 43% 43% 43% 43%
Expenses
Accounting Fees $10,000.00 $2,500.00 $2,500.00 $2,500.00 $2,500.00
Interest Expense $84,508.00 $21,127.00 $21,127.00 $21,127.00 $21,127.00
Bank Charges $1,600.00 $400.00 $400.00 $400.00 $400.00
Depreciation $170,000.00 $42,500.00 $42,500.00 $42,500.00 $42,500.00
Insurance $13,390.00 $3,347.50 $3,347.50 $3,347.50 $3,347.50
Store Supplies $3,749.20 $749.84 $899.80 $974.79 $1,124.76
Advertising $350,000.00 $200,000.00 $50,000.00 $50,000.00 $50,000.00
Cleaning $16,281.80 $3,256.45 $3,907.74 $4,233.38 $4,884.67
Repairs &
$64,272.00 $16,068.00 $16,068.00 $16,068.00 $16,068.00
Maintenance
Rent $2,640,508.00 $660,127.00 $660,127.00 $660,127.00 $660,127.00
Telephone $14,996.80 $2,999.36 $3,599.23 $3,899.17 $4,499.04
Electricity
$26,780.00 $5,356.00 $6,427.20 $6,962.80 $8,034.00
Expense
Luxury Car Tax $13,200.00 $13,200.00 - - -
Fringe Benefits
$28,000.00 $7,000.00 $7,000.00 $7,000.00 $7,000.00
Tax
Superannuation $187,020.00 $37,404.00 $44,884.80 $48,625.20 $56,106.00
Wages & Salaries $2,078,000.00 $415,600.05 $498,720.01 $540,279.99 $623,399.95
Payroll Tax $98,705.00 $19,741.00 $23,689.20 $25,663.30 $29,611.50
Workers’
$41,560.00 $8,312.00 $9,974.40 $10,805.60 $12,468.00
Compensation
$1,395,171.8 $1,444,513.7 $1,543,197.4
Total Expenses $5,842,570.80 $1,459,688.20
8 3 2
Net Profit (Before $1,455,061.11 -$161.63 $356,259.82 $452,870.53 $646,091.97

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Tax)
Income Tax $436,566.70 $0.00 $106,877.95 $135,861.16 $193,827.59
Net Profit $1,018,494.41 $0.00 $249,381.87 $317,009.37 $452,264.38

Sales budget

Sales Budget
Particulars % 2011/12 Qtr 1 Qtr 2 Qtr 3 Qtr 4
BUDGET (%) $8.00 20% 24% 26% 30%
  $16,971,236.6 $4,073,096.9 $4,412,521.5 $5,091,370.6
Total Sales $3,394,247.83
4 7 3 7
Details
Bathroom 30 $1,221,929.0 $1,323,756.4 $1,527,411.2
$5,091,370.99 $1,018,274.35
fittings % 9 6 0
Bedroom 25 $1,018,274.2 $1,103,130.3 $1,272,842.6
$4,242,809.16 $848,561.96
fittings % 4 8 7
15
Mirrors $2,545,685.50 $509,137.17 $610,964.54 $661,878.23 $763,705.60
%
Decorative 10
$1,697,123.66 $339,424.78 $407,309.70 $441,252.15 $509,137.07
items %
Lighting 20 $1,018,274.1
$3,394,247.33 $678,619.39 $814,619.39 $882,619.39
fixtures % 3

GST Cash Flow Budget

Particulars 2011/12 Qtr 1 Qtr 2 Qtr 3 Qtr 4
GST Collected $1,697,123.66 $339,424.78 $407,309.70 $441,252.15 $509,137.07
Less: GST
$1,287,104.93 $288,659.14 $306,854.17 $326,324.99 $365,266.63
Paid
GST Payable $410,018.77 $50,765.64 $100,455.52 $1,114,927.16 $143,870.44

Aged Debtors Budget

Particulars TOTAL Qtr 1 Qtr 2 Qtr 3 Qtr 4
$16,971,236.6 $3,394,247.8 $4,073,096.9 $4,412,521.5 $5,091,370.6
Sales
4 3 7 3 7
% Debtors
20% 20% 20% 20% 20%
Sales
$1,018,274.1
Total Debtors $3,394,247.33 $687,849.57 $814,619.31 $882,504.31
3
Aged Analysis
Current 84% $577,793.64 $684,280.22 $741,303.62 $85,350.27
30 Days 10% $68,785.00 $81,461.93 $88,250.43 $101,827.41
60 Days 5% $34,392.48 $40,730.96 $44,115.18 $50,913.70
90 Days 1% $6,878.49 $8,146.19 $8,825.04 $10,182.74

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Budget Notes (Part 1 (b))

Some of the reasons for previous year profits for Houzit Pty Ltd are the following:

1. Strict control for indirect expenses such as rent, telephone, and interest etc.
2. Making essential gross profit margin in the production and purchase process.
3. Keeping a lower price on products.
4. To grow the marketing process by increasing advertisement cost.
5. Using essential human resource policy by tightly controlling wages and
salaries and other related costs.

Existing financial management approaches are not effective due to the following
reasons:

1. A not clear way that new customers are secured.

2. Overtime timesheet is not fully authorized.
3. Customer discount indications are not recorded.
4. Uncontrolled service invoices.
5. Assets are not registered properly and some of them do not have unique
code.
6. Lack of feedback and communication between lines (shop floor to head
office).
7. Insufficient cash and debtors` reconciliation procedures are implemented.

Assumptions used to create the above-mentioned budgets are following:

1. Keeping company policy related to sales results is that 8% growth each year.
2. Not more than 4% of inflation in expenses.
3. Financial results are not significantly affected by financial management
inefficient.
4. Australian legislative environment related to company activity is not changed
much.

Following are the keys points that must be followed during the implementation and
monitoring of budget expenditure:

 The budget implementation structure. It can be according to structure for

example financial decision flow can be made by company hierarchy.
 The budget includes all expenditure of the company areas for the full year.
 Registering actual expenditure dates
 Continually making budget review
 Future expenditure commitments
 Making the budget review each month's time.
 Regular variance analysis continually. It is significant to identify variances
between planned and actual budget when it happens.
 Giving explanations and making recommendations based on variance
analysis. The reasons should be clear to prevent a failure in the future budget.

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 Incorporating significant variances in future budget planning.

Part 2: Questions and Answers

1. Current compliance requirements and liabilities for this organization under the
Corporations Act 2001 are following:
Shareholders
Shareholders with at least 5% of the votes in a small proprietary company may give
the company a direction that must be signed by shareholders and it is made no later
than 12 months after the end of the financial year following 2 ways:
1. prepare a financial report and directors’ report for a financial year;
2. send them to all shareholders.
Therefore, the financial report does not have to comply with some or all of the
accounting standards and it is to be audited.
Registered office
The registered office must be in Australia and cannot be in Post Office address.
Directors
A proprietary company must have at least 1 director. That director must ordinarily
reside in Australia. However, a proprietary company must have at least
2 directors while the company has one or more CSF shareholders. Of
those directors: if there are only 2 of them--at least one of them must ordinarily
reside in Australia; otherwise--a majority of them must ordinarily reside in Australia.
Secretaries
A proprietary company is not required to have a secretary but, if it does have 1 or
more secretaries, at least 1 of them must ordinarily reside in Australia.
Financial Reporting
A small proprietary company has to prepare the financial report and director`s report
only. The financial report that is for shareholders does not have to comply with all
financial standards. It can be a directors' report or a part of that report need not be
prepared and is to be audited. A Larger proprietary company has to prepare an
audited financial report and lodge it with The Australian Securities and Investments
Commission (ASIC) within 4 months of the end of each financial year instead of in
certain circumstances where relief from this requirement is granted under certain
ASIC Class Order.
Constitution
A standard constitution for a proprietary company limited by shares registered under
the Corporations Act 2001 (Cth) contains provisions dealing with the powers of the
company, the issue of shares, calls on partly-paid shares, transfer of shares, general
meetings of the members, the appointment and removal of directors, meetings of the
directors, procedures for dividends and other procedural matters and requirements.
And  It doesn't need to be lodged with ASIC, but a copy must be kept with
the company's records. A company must provide a current copy of the constitution to
any member who requests it within seven days.

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2. Following are the two (2) commercially available accounting software

recommended for this organisation:

Xero is an online accounting software solution for sole traders and small businesses.
It allows users to take care of basic accounting needs such as automating some
ordering and stock processes, creating purchase orders, and managing expenses.
Therefore, there is no need to install the software on a computer and devices but
software payment is requested each month.
Xero also accepts online payments such as debit and credit cards, and payment
gateways such as PayPal from invoices. Like MYOB Advanced, Xero is also cloud-
based and can be accessed from any internet-enabled device.
Small businesses can view their cash flows, transactions, and account details,
personal expenses can also be managed with mobile review and approval of each
receipt. Xero offers unlimited email support and integration with a variety of systems.
MYOB is a cloud business management software tailored to mid-sized
organizations. A single unified platform, MYOB delivers finance, inventory
management, manufacturing and payroll functionality. It includes the MYOB
Advanced Business (cloud ERP suite) and the MYOB Advanced People payroll and
HR suite.
The MYOB Business and People suites deliver an end-to-end business management
system on a single platform. The benefits of this unified system are realized when
information flows between functions, reducing duplication of effort, manual data entry
and real-time business insights.

Requirements MYOB XERO

Provide an analysis of revenue and expenditure Yes Yes
Manage the company accounts more efficiently No Yes
Compliant with all legislative and statutory requirements
Yes Yes
for small to medium businesses.
Recording GST and completing BAS Yes Yes
Single purchase with no ongoing license fees No No
Multiuser capability Yes Yes
Complete payroll system Yes Yes
Compatible to current computer systems Yes Yes

Based on the above comparition, XERO accounting software is recommended for

this company`s financial process.

3. Accounting principles used in developing budgets.

Matched principle
It directs a company to report an expense on its income statement in the period in
which the related revenues are earned. Further, it results in liability to appear on
the balance sheet for the end of the accounting period and it is associated with
the accrual basis of accounting and adjusting entries.
If an expense is not directly tied to revenues, the expense should be reported on

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the income statement in the accounting period in which it expires or is used up. If
the future benefit of a cost cannot be determined, it should be charged to
expense immediately.

Time period principles

It applies to both cash accounting and accrual accounting. In financial terms, it is

often offered to as the accounting year, or accounting and reporting time periods
that can be monthly, quarterly, annually.

Account groups

An account group is a named CSA (the Creative Solutions Accounting) that is

used in financial statements to increase their flexibility and to enable you to use a
financial statement for multiple clients. In CSA, Account groups enable you to
easily collect information for reporting purposes. It allows the company to set up
financial statements that can be used with every client even though each client
may have a different chart of accounts and a single account, one or more ranges
of accounts, and/or one or more existing account groups are can be defined.

4. Following are the implications of probity when preparing and revising budgets:

Responsibility
Responsibility is concerned with innovation and participants responsible for the
budgeting process. For example, the company managers and employees have to
ensure all information related to the financial situation is defined, estimated, and
included in the budgeting process.
Honesty
It is important to collect real information that includes all costs, profits, its dates, and
estimation failures in the budgeting process to identify the real financial situation and
predict the future financial situation. Then the budget plan can be made correctly and
organized effectively.
Decency
The company is one of the social groups of human society. Then, everyone who all
stakeholders of the company have to be respected. The budgeting should not be
harmful and it is made based on reasonable discussion to treat people well and it
ultimately pays for itself by earning the loyalty of employees and customers.
Conflict of interest
To keep company stability and its good environment, conflict of interest should be
avoided officials must not use their position and their potential for any decision of the
company. The conflicts of interest must be managed appropriately by the
management system and officials must not accept any personal benefits.

5. Critical dates and initiatives that will require or generate resources for Houzit
Pty Ltd in the next financial cycle are following:

1. Reduction on the principle of the loan by a payment of $100,000 on the 31

December 2011.

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2. To reduce the expected gross profit rate by 1% on the 2010/11 result in the
hope that lower prices on the products.
3. To increase the advertising budget by $70,000 over the 2010/11.
4. To increase wages and salaries by $172,500 over the 2010/11.
5. A new car costing $97,466 including GST has been planned for in the coming
period to replace the five-year-old vehicle.

6. Items recommended for inclusion in the budgets for Houzit Pty Ltd are the
following:

Travel: costs of business travel by car, airplane, and train, etc. Also, travel money is
estimated by public transport prices for the employees.
Company environment benefits: health care, social security, and comfort costs
should be estimated and included in the budget.
Training fees: It is beneficial for human capital development and preventing any
failure of employees. There can be several categories of training such as new
employees and other special programs or technology courses etc.
Consultants or specialist: Special and extra help needs during busy times,
company innovation, and development. For example, new program entry and
development of products.
Office supplies: It is an effective cost for the company and employees' comfort in
the workplace. If it is estimated more, the company unprofitable expenses are grown,
on the contrary, if it is estimated less than its needs, employees' sacrifice can be lost.
It can be estimated an amount per person or department per year.

7. Following are the modified internal control rules for the organisation to
improve risk management:
 Authority process: One person making all transaction decisions adversely
affects company activity. Then it should be delegated to other members of the
management team to create quick and effective daily activity and
management system. Also, all stakeholders have a clear understanding of
who reports to whom within an organization and who responsible for what will
limit the chance for internal control issues.
 Job description: all job description defined, clearly explaned for all
employees. It is important everyone knows what they have to do or not.
 Customer service: Using the official program to register information related
to customers. The information must collect daily and direct managers
responsible for controlling this process. It will allow avoiding customer service
failure and helps customers are sacrificed.
 Debtors and cash flow: All debtor and cash flow reconciliations have to be
checked 7 days before the due date by line managers. Cash transactions are
calculated daily and the cashier has to deliver it to the line manager on time.
 Monitoring activity: Several controlling processes needs to be added to
complete processes by employees. Such as registering assets, counting
cash, and preventing unnecessary invoices. These activities must be
controlled daily.

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8. Recommended internal controls for audit trail are following:

Input Controls – Houzit Pty Ltd is mostly failed for the data entry process especially
for the manual process. Collecting data is root integration and evaluating a financial
situation at that time. Daily input controls have to be added line managers`
responsibility. One of the ways of preventing this kind of issue is cross-training. It is
effective employees are cross-trained on accounting tasks and it has several
advantages.
 Employees can execute each others` accounting work when someone is not
on job.
 Employees also can explain and report auditors.
 If at least 2 employees can perform accounting tasks, auditors can get easier
help with any accounting issue.
Corrective internal controls – it is typically those controls put in place after the
detective internal controls discover a problem. These controls could include
disciplinary action, reports filed, software patches or modifications, and new policies
prohibiting practices such as employee tailgating. They are usually put into place
after discovering the reasons why they occurred in the first place. Then it is required
in Houzit Pty Ltd to prevent issues occur again.

References:
https://asic.gov.au/for-business/registering-a-company/steps-to-register-a-
company/constitution-and-replaceable-rules/
http://www5.austlii.edu.au/au/legis/cth/consol_act/ca2001172/
https://www.xero.com/
https://www.myob.com/au
https://www.youtube.com/watch?v=a38oYlrREYI
https://cs.thomsonreuters.com/ua/acct_pr/csa/cs_us_en/fr/popup_shg_accountgroup
s.htm#:~:text=An%20account%20group%20is%20a,group%20definitions%20are
%20client%20specific.
https://cs.thomsonreuters.com/ua/acct_pr/csa/cs_us_en/topics/hidd_account_groups
.htm
https://smallbusiness.chron.com/seven-internal-control-procedures-accounting-
76070.html
https://www.edgepointlearning.com/blog/cross-training-employees/
https://chapters.theiia.org/montreal/ChapterDocuments/GTAG%208%20-
%20Auditing%20application%20controls.pdf
https://reciprocitylabs.com/resources/what-are-the-3-types-of-internal-controls/

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Task 2: Monitor and review budget

Variance Report

Houzit Pty Ltd

Variance Report – 1st Quarter ended 31.03.2011
Variance Varianc
Particulars Budget Actual F or U
($) e (%)
Sales $3,394,247.83 $3,371,200.00 $23,047.00 1% U
Less: Cost Of
$1,943,721.26 $1,955,296.00 -$11,574.74 -1% U
Goods Sold
Gross Profit $1,459,526.57 $1,415,904.00 $43,622.57 3% U
Gross Profit % 43% 42% 1% 2% U
Expenses
Accounting Fees $2,500.00 $2,500.00 $0.00 0% F
Interest Expense $21,127.00 $28,150.00 -$7,023.00 -33% U
Bank Charges $400.00 $380.00 $20.00 5% U
Depreciation $42,500.00 $42,500.00 $0.00 0% F
Insurance $3,347.50 $3,348.00 -$0.50 0% F
Store Supplies $749.84 $790.00 -$40.16 -5% U
Advertising $200,000.00 $150,000.00 $50,000.00 25% F
Cleaning $3,256.45 $3,325.00 -$68.55 -2% U
Repairs &
$16,068.00 $16,150.00 -$82.00 0% F
Maintenance
Rent $660,127.00 $660,127.00 $0.00 0% F
Telephone $2,999.36 $3,100.00 -$100.64 -3% U
Electricity Expense $5,356.00 $5,245.00 $111.00 2% F
Luxury Car Tax $13,200.00 $12,000.00 $1,200.00 9% F
Fringe Benefits Tax $7,000.00 $7,000.00 $0.00 0% F
Superannuation $37,404.00 $37,404.00 $0.00 0% F
Wages & Salaries $415,600.05 $410,500.00 $5,100.05 1% F
Payroll Tax $19,741.00 $19,741.00 $0.00 0% F
Workers’
$8,312.00 $8,312.00 $0.00 0% F
Compensation
Total Expenses $1,459,688.20 $1,410,572.00 $49,116.20 11% F
Net Profit (Before
-$161.63 $5,333.00 -$5,494.63 3400% F
Tax)
Income Tax $0.00 $1,600.00 -$1,600.00 1600% F
Net Profit $0.00 $3,733.00 -$3,733.00 3733% F

According to Australian tax law, we had to pay $13200 for luxury car tax, but $12000
was paid actually. Advertising cost was less than $50000. Also we saved several
little amounts of money from wages, electricitybank charges. Then net profit is

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become possible. However there are some variances related to profits and tax, these
variances are identified as good results.

Debtor Analysis
Particulars 2009/10 2010/11 2011/12
Trade Debtors $873,006.00 $942,846.48 $1,018,274.13
Sales $14,550,100.00 $15,714,108.00 $16,971,237.00
Debtor Days 21 23 24

Trade debtors are calculated following way:

1. Each debtor calculated 20% of last quarter`s debtor

2. Last quarters debtors estimated 30% of each year sales

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Report – Financial Evaluation Report

Student Name Uuriintuya Otgonbaatar SMC202002228

Unit Name BSBFIM601 Manage finances

Term Term 4
Date 06 November 2020

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Executive Summary

This report analysis of various budgets previously created within Houzit Pty Ltd. It
clearly shows list of significant issues, variances from budget, comparative
performances, recommendations for ongoing financial viability and evaluation of
financial management processes.

Introduction

In the case of study, it was found to be a difficult quarter because the economy
continues to the recession and the impact of retail trade, affecting sales and revenue
directly. The bank has adjusted the interest rate in accordance with the increased
international pressures and Houzit an important part in lending interest rate changes
that meet market conditions. As we see that the cost of interest is higher than that of
a budget.

Main Contents

Issues Analysis

Issues Details Reason Priority

Gross profit Gross profit has been One of the most common
fluctuation fluctuating over the years with experience of gross profit
1
a slight increase in the recent fluctuation is decline in
budget. sales.
High overall The overall expenses of the There is no specific
company company is high which can department dedicated for
2
expense be reduced significantly with innovative budgeting.
innovative budgeting.
High rental Rent expense is the highest Not doing research in the
expense rental market and look for
percent shared expense. A better option.
slight negative change in this
3
can make a big difference as
a whole.

Raise of An increase in interest rate Mortgage interest rate

interest rate increase of banks.
with have an adverse impact
on the organisation due to
4
bank loan on their balance
sheet.

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Variances
Houzit Pty Ltd
Variance Report – 1st Quarter ended 31.03.2011
Variance Varianc
Particulars Budget Actual F or U
($) e (%)
Sales $3,394,247.83 $3,371,200.00 $23,047.00 1% U
Less: Cost Of
$1,943,721.26 $1,955,296.00 -$11,574.74 -1% U
Goods Sold
Gross Profit $1,459,526.57 $1,415,904.00 $43,622.57 3% U
Gross Profit % 43% 42% 1% 2% U
Expenses
Accounting Fees $2,500.00 $2,500.00 $0.00 0% F
Interest Expense $21,127.00 $28,150.00 -$7,023.00 -33% U
Bank Charges $400.00 $380.00 $20.00 5% U
Depreciation $42,500.00 $42,500.00 $0.00 0% F
Insurance $3,347.50 $3,348.00 -$0.50 0% F
Store Supplies $749.84 $790.00 -$40.16 -5% U
Advertising $200,000.00 $150,000.00 $50,000.00 25% F
Cleaning $3,256.45 $3,325.00 -$68.55 -2% U
Repairs &
$16,068.00 $16,150.00 -$82.00 0% F
Maintenance
Rent $660,127.00 $660,127.00 $0.00 0% F
Telephone $2,999.36 $3,100.00 -$100.64 -3% U
Electricity Expense $5,356.00 $5,245.00 $111.00 2% F
Luxury Car Tax $13,200.00 $12,000.00 $1,200.00 9% F
Fringe Benefits Tax $7,000.00 $7,000.00 $0.00 0% F
Superannuation $37,404.00 $37,404.00 $0.00 0% F
Wages & Salaries $415,600.05 $410,500.00 $5,100.05 1% F
Payroll Tax $19,741.00 $19,741.00 $0.00 0% F
Workers’
$8,312.00 $8,312.00 $0.00 0% F
Compensation
Total Expenses $1,459,688.20 $1,410,572.00 $49,116.20 11% F
Net Profit (Before
-$161.63 $5,333.00 -$5,494.63 3400% F
Tax)
Income Tax $0.00 $1,600.00 -$1,600.00 1600% F
Net Profit $0.00 $3,733.00 -$3,733.00 3733% F

References :
https://www.ato.gov.au/business/luxury-car-tax/
https://www.ato.gov.au/rates/luxury-car-tax-rate-and-thresholds/

Reasons for variances:

In accordance with the variance report, the number of different figures is the
expense, interest income, sales of goods, advertising costs and accounting fees.
The cause of variability is an integral part of the economy that remains in recession,
and the bank has adjusted the interest rate in accordance with the increased

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international pressures. Additionally, the organization cannot publish some

magazines in this quarter to promote the store proposals.

Performance

Debtor Analysis
Particulars 2009/10 2010/11 2011/12
Trade Debtors $873,006.00 $942,846.48 $1,018,274.13
Sales $14,550,100.00 $15,714,108.00 $16,971,237.00
Debtor Days 21 23 24

Recommendations

i. Outline your recommendations for ongoing financial viability for the

organisation, based on your assessment of the issues, reasons for variances and
organisational performance you have identified (Steps 1–3).

 Increase the budget along with organizational needs

 Building new communication system such as chat with managers to do
reporting
 Carefully identify any deviation
 Try not to create matching loss
 Developing ongoing process

I recommend that organizations improve their budget in accordance with the

Organization's needs and maintain financial capabilities. The data is collected to
validate the budget, as well as analysis of the reporting analysis spreadsheets. Built
up a chat system with monthly reporting officers to executives, if the budget deviation
is specified significantly, the primary cause of the deviation must be carefully
identified. Make sure not to create a matching loss in other areas in the business is
to develop, adjust, or correct the solution. They should be advertised to promote
corporate products and services for profit and sales. Wages and salaries should be
adjusted to the standard.

i. Include in this section your plans for a revised budget, effectively managing
contingencies and issues that have been identified in feedback and monitoring
of the budgets.

This is to improve the cost management due to existing expense estimates and the
identification of an area that is critical for improvement within the next budget.
Business must see how current, expense, revenue, and resources are implemented.
Costs, including wages, supplies, shares, repayment of loan, plant and training
equipment, employees and raw products. For budget review, review the budget and
actual costs according to financial objectives and discuss changes and have been
approved by the board. For encumbrances is a role-setting and responsibility for
emergency operations and schedule the plan.

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Evaluation

i. Provide a summary review of the financial management processes in place for the
organisation, in light of your assessment of the issues, reasons for variances and
organisational performance you have identified. Include in this section any
recommendations you have for modifying management processes.

Financial management involves deciding on the size and composition of the assets
and levels, and the structure of the company's funds, according to corporate financial
management, is required to use regular audit budgets and provide employees with
financial management. The budgeting period for different organization requirements
depends on the organization and system selected. It can be used for a 5-year annual
budget of 6 monthly. Different durations and budgets are used for different purposes,
as well as cost estimation and existing resources, and specifying areas for an in-
place improvement. It is a continuous use, which is a proactive approach to
identifying a rapid improvement area, it relates to a PDCA cycle, which is a plan to
monitor action.

Conclusion

To conclude, organizations are performing slightly higher wages and salaries

compared to industry benchmark for wages and salaries that are similar to 11% of
the sales is to use emergency plans in the slowing economy to reduce the risk of
liability through short-term repayment of debts. The report displays the actual budget
and result, which helps to plan and forecast sales and budget for future budgets. The
report also provides the main variance that is the key to participating in sales and
profitability for organizations that support financial structure and ensure the
confidence of living. We can do this by reducing payroll and salary costs to maintain
gross margin rates and adjust other forms to meet the needs of the organization. In
addition, it is used emergency plan for the economic slowdown to reduce the risk of
liability by using our profit on long-term debts, which will reduce the interest burden
in the business and reduce the pressure from decreasing gains.

References

● Wilson C., 2009, Financial management: principles and applications, 5th edn,
Pearson Education, NSW.
● Dean, P., Shepherd, J., 1999, Managing finance: accounting for non-accountants,
3rd edn, National Core Accounting Publications, Australia.

Role play
Link: https://youtu.be/-elZZVe38eM

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