Assessment Tasks and Instructions

Student Name Sujata Sen Thakuri

Student Number RC00002288
Course and Code
Unit(s) of Competency and Code(s) SITXFIN005 Manage physical assets
Stream/Cluster
Trainer/Assessor

Assessment for this Unit of Competency/Cluster Details

Assessment 1 Short Answers
Assessment 2 Project

Assessment conducted in this instance: Assessment 1 2 3

Reasonable Adjustment
1. Has reasonable adjustment been applied to this assessment?
No No further information required

Yes Complete 2.
2. Provide details for the requirements and provisions for adjustment of assessment:

Student to complete
My assessor has discussed the adjustments with me
I agree to the adjustments applied to this assessment
Signature Sujata Date 10/09/2023

2nd Assessor to complete

I agree the adjustments applied to this assessment are reasonable
Name

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 Signature Date
Assessment Guidelines
What will be assessed
The purpose of this assessment is to assess your underpinning knowledge to complete the tasks outlined in the
elements and performance criteria for this unit of competency and relating to the following aspects:

 business objectives relevant to the management of physical assets:

o profitability
o growth
o providing quality products and services to customers
o adhering to:
 codes of conduct
 environmental sustainability philosophies and practices
o industry accreditation schemes
 types of physical assets required by tourism, hospitality and event organisations and the organisation in
particular:
o buildings
o computer systems
o equipment fixtures, fittings and furniture in one of the following:
 accommodation establishments
 commercial kitchens
 restaurants and bars
 storage areas
 tourism, hospitality and event offices
 transportation depots
o gardens
o pools
o rides and games
o vehicles
o vessels
 maintenance requirements for different types of physical assets
 considerations for long-term assessment of physical assets:
o ability to meet business objectives
o cost of maintenance over a period of time
o customer and staff feedback
o input from specialists where required
o operational efficiency
o safety
 equipment specifications to guide acquisition process:
o budget parameters
o environmental sustainability policies for the business
o floor plans

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 o numbers and types of required equipment fixtures, fittings and furniture
o operational performance requirements:
 efficiency
 customer traffic
 staff usage
o types of products and services offered by the business
 formats for and inclusions of asset registers specified in performance evidence
 features and benefits of different financing options for asset acquisition:
o hire purchase
o lease
o purchase
o rent
 depreciation that can be applied to different types of physical assets
 data used in the estimation of asset acquisition:
o current maintenance contracts
o estimates and quotations from suppliers
o previous contracts and costs
o published or advertised prices
 practices to support environmental sustainability using different types of physical assets.
Place/Location where assessment will be conducted including timeframes

Resource Requirements
Pen, Paper or computer, internet access
Calculator

Instructions for assessment including WHS requirements

You are required to address all questions to achieve competence. Your trainer will provide you with instructions
for time frames and dates to complete this assessment.
Once completed, carefully read the responses you have provided and check for completeness. Your trainer will
provide you with feedback and the result you have achieved.

Statement of Authenticity
I acknowledge that I understand the requirements to complete the assessment tasks
The assessment process including the provisions for re-submitting and academic appeals were explained
to me and I understand these processes
I understand the consequences of plagiarism and confirm that this is my own work and I have
acknowledged or referenced all sources of information I have used for the purpose of this assessment
Student Signature: Sujata Date: 10/09/2023

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This assessment: First Attempt 2nd Attempt Extension – Date: / /

RESULT OF ASSESSMENT Satisfactory Not Yet Satisfactory

Feedback to Student:

Assessor(s) Signature(s): Date: / /

Student Signature Sujata Date: 10/09/2023

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Assessment 1

Your Task:

Answer the following questions below. All questions must be answered.

1. How can the following business objectives influence the methods used for managing physical assets in an
organisation? Provide 1 example for each:

 Profitability

Example: The organization may prioritize maximizing asset use and reducing maintenance expenses if the
major business goal is to maximize profitability. Implementing technologies for predictive maintenance
may be necessary to detect probable equipment breakdowns early on and prevent downtime and repair
costs. They might also put money into assets that produce a higher return on investment (ROI) and more
money.

 Growth

Example: To fulfill rising demand, a company looking for expansion could need to increase the number of
its physical assets. This can entail investing in new equipment, buildings, or transportation. To ensure
effective tracking and exploitation of these recently purchased assets, they may also invest in scalable
asset management systems and technology.

 Providing quality products and services to customers

Example: An organization may invest in asset management strategies that give regular maintenance and
calibration of important equipment top priority in order to preserve and enhance the quality of its goods
and services. To ensure accurate and trustworthy test findings, a pharmaceutical company can, for
instance, create a strict asset maintenance program for lab equipment.

 Adhering to:
o codes of conduct
o environmental sustainability philosophies and practices

Codes of Conduct:

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Example: Asset monitoring and documentation techniques can help organizations that have strict ethical
standards and codes of conduct ensure compliance. In the food industry, for instance, businesses may
develop stringent asset management protocols to track the origin and handling of materials and ensure
adherence to food safety requirements.

Environmental Sustainability Philosophies and Practices:

Example: An organization may invest in energy-efficient equipment and adopt asset management
procedures that monitor and control energy use if it is devoted to environmental sustainability. For
instance, a manufacturing organization might replace older, energy-guzzling equipment with more energy-
efficient models and continuously track energy consumption to see opportunities for improvement.

 Industry accreditation schemes

Example: Specific asset management standards and procedures may need to be followed by organizations
applying for industry accreditation. For instance, in order to comply with accreditation criteria, facilities in
the healthcare industry may need to keep meticulous records and schedules for the calibration and
maintenance of medical equipment.

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2. Provide 8 examples for different types of physical assets required by tourism, hospitality and event
organisations:

Responses
1. Hotel Buildings: Hospitality organizations, such as hotels, require physical assets like buildings and
accommodations to house guests.
2. Furniture and Fixtures: Hotels, restaurants, and event venues need furniture and fixtures to create
comfortable and aesthetically pleasing spaces for guests.
3. Fleet of Vehicles: In order to carry passengers to different locations or tour sites, tour companies
frequently require a fleet of vehicles, such as buses, vans, or boats.
4. Kitchen Equipment: Restaurants and catering services rely on kitchen equipment like stoves, ovens,
refrigerators, and dishwashers to prepare and serve food.
5. Audiovisual Equipment: Event organizations need audiovisual equipment, including sound systems,
projectors, screens, and lighting, to facilitate presentations, conferences, and entertainment.
6. Recreational Facilities: Resorts and recreational tourism providers require assets like swimming
pools, golf courses, or sports equipment to offer leisure and entertainment options to guests.
7. Conference and Meeting Spaces: Conference centers and hotels require meeting rooms and
conference facilities equipped with tables, chairs, and presentation tools.
8. Tourist Attractions: Tourism groups may own or manage real estate that houses popular tourist
attractions like museums, landmarks, or theme parks.

3. List 5 physical assets relevant to your workplace or training and provide the maintenance details typically
required for each:

Physical Asset Maintenance Requirements

Computer Systems Regular software updates, hardware cleaning, and backup

Office Furniture Periodic cleaning, inspection for damage, and repairs

Networking Devices Firmware updates, cable management, and dust removal

HVAC System Regular filter replacement, system inspection, and repair

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Lighting Fixtures Bulb replacement, cleaning, and periodic electrical checks

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4. List 6 key aspects which must be considered for the long-term assessment of physical assets in terms of
nature of requirements and necessity of acquisition. Who could be typically involved in this in terms of
feedback and specialist advice?

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Responses
1. Strategic Alignment: Determine how the physical asset aligns with the organization's
long-term strategic goals and objectives. Consider whether it supports the core mission and
whether it will contribute to future growth.
2. Lifecycle Analysis: Assess the entire lifecycle of the asset, including acquisition,
operation, maintenance, and disposal costs. This analysis should account for potential
future upgrades or replacements.
3. Economic Viability: Evaluate the economic feasibility of acquiring and maintaining the
asset over the long term. Consider factors like the asset's ROI, depreciation, and cost-
benefit analysis.
4. Technological Relevance: Determine if the asset's technology or design is likely to
become obsolete in the future. Consider how advancements in technology may impact the
asset's effectiveness.
5. Regulatory Compliance: Make sure that all applicable laws, rules, and industry standards
are followed in the asset's acquisition and operation. Analyze how the utilization of the
asset might be impacted by changing regulations.
6. Environmental Impact: Assess the asset's environmental sustainability, taking into
account its resource use and carbon footprint. Take into account the company's dedication
to sustainability and any potential upcoming environmental requirements.

Involvement

1. Senior Management: Discussions and decisions on the acquisition of important assets

should involve senior executives and leadership.
2. Financial Analysts: Financial experts can perform economic viability assessments and
provide insights into the asset's financial implications.
3. Technical Experts: Engineers, technicians, and subject matter experts can assess the
technological relevance and maintenance requirements of the asset.
4. Legal and Compliance Teams: Legal experts ensure that the asset acquisition and
operation comply with relevant regulations and standards.
5. Environmental Specialists: Environmental experts assess the asset's impact on
sustainability and help the organization make eco-conscious decisions.
6. Procurement and Supply Chain Teams: These teams manage the acquisition process,
including vendor selection, negotiations, and contract management.
7. Facilities Management: Facilities management teams are crucial for maintenance and
operational considerations for enduring assets like buildings or equipment.
8. Stakeholders and Users: Internal stakeholders' and end-users' feedback might offer
perceptions on the usefulness and functionality of the asset.

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5. The following are parameters which are used to guide the acquisition of physical assets. Provide examples
and details for what should be considered, for each aspect.

Budget parameters

 Example: If a company's budget stipulates that it can only spend up to $500,000 on assets, it must
make sure that the asset it chooses is within this limit.

 Details: Consider not only the upfront purchase cost but also ongoing operational and
maintenance costs to stay within budget constraints.

Environmental sustainability policies for the business

 Example: A business committed to environmental sustainability may prioritize the acquisition of

energy-efficient assets.

 Details: To ensure that the asset is in line with the company's sustainability objectives, evaluate its
energy usage, emissions, and environmental effect.

Site plans

 Example: When planning to acquire a new building, refer to site plans to ensure that the asset's

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 size, shape, and location fit within the existing property layout.

 Details: Examine site surveys, zoning regulations, and utility connections to determine the
feasibility of installing and maintaining the asset.

Auxiliary items

 Example: If acquiring a manufacturing machine, consider the need for auxiliary items like spare
parts, tooling, or safety equipment.

 Details: Evaluate the availability and cost of necessary supporting items to ensure the asset can be
effectively utilized.

Performance requirements

 Example: For a delivery vehicle, define performance requirements such as load capacity, fuel
efficiency, and speed.

 Details: Specify the asset's operational and functional criteria to meet the business's needs and
standards.

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 Suitability to products and services offered

 Example: When purchasing kitchen equipment, a high-end restaurant should make sure it can
manage the unique menu items and food preparation methods offered.

 Details: Examine the asset's capability, features, and quality in relation to the goods or services
the company offers.

6. Which details need to be recorded in an asset register for each physical asset?

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Responses
1. Asset Identification:
 Asset name or description.
 Unique asset identification number or code.
2. Asset Location:
 Physical location of the asset, including building, room, or site details.
3. Acquisition Information:
 Date of acquisition.
 Purchase cost or acquisition value.
 Vendor or supplier information.
4. Asset Specifications:
 Detailed specifications or technical information about the asset.
 Serial number or model number.
5. Ownership Details:
 Information about the asset's owner or department responsible.
 Contact information for the asset's custodian or manager.
6. Maintenance History:
• A log of maintenance and repair work.
• Dates for servicing, maintenance, and repairs.
• Maintenance-related costs.
7. Depreciation Information:
 Depreciation method used (e.g., straight-line, reducing balance).
 Current and accumulated depreciation values.
 Estimated remaining useful life.
8. Warranty Information:
 Warranty start and end dates.
 Warranty coverage details and terms.
9. Insurance Details:
 Insurance policy information, including policy number and coverage.
 Insurance provider contact information.
10. Asset Status:
 Current operational status (e.g., in use, out of service, in storage).
 Condition assessment (e.g., good, fair, poor).
11. Resale or Disposal Information:
 Expected end-of-life date or disposal date.
 Method of disposal (e.g., sale, donation, recycling).
12. Usage History:
 Records of asset usage, including hours of operation or mileage.
 Any specific utilization patterns or trends.
13. User Information:
 Information about the primary users or custodians of the asset.
 User contact details.
14. Compliance and Regulatory Information:
 Documentation of compliance with industry standards or regulations.
 Certification or inspection records, if applicable.

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 15. Documentation and Attachments:
 Attach digital or physical copies of asset-related documents, such as manuals,
warranties, and maintenance reports.
16. Photographs:
• Visual record of the asset, including images showing its present state and any
distinguishing characteristics.
17. Emergency and Safety Information:
 Any emergency procedures or safety considerations related to the asset's use or
maintenance.

7. Provide an overview of the features, advantages and disadvantages of each of the following financing
options when acquiring assets:

1. Hire Purchase:
 Features:
 Under hire purchase, the asset is purchased through an installment plan.
 Ownership of the asset is transferred to the buyer after the final installment.
 Typically involves a down payment followed by fixed monthly payments.
 Advantages:
 Immediate use of the asset without paying the full purchase price upfront.
 Ownership is eventually transferred to the buyer.
 Depreciation and interest expenses may have tax benefits.
 Disadvantages:
 Total cost may be higher due to interest payments.
 Ownership transfer occurs only after the final payment.
 Defaulting on payments may result in asset repossession.
2. Lease:
 Features:
 Lease agreements allow the lessee to use the asset for a specified period.
 Ownership generally remains with the lessor.
 Lease terms can be fixed or flexible.
 Advantages:

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  Lower initial costs compared to outright purchase.
 Flexibility to upgrade to newer assets.
 Potential tax benefits, such as deducting lease payments.
 Disadvantages:
 No ownership at the end of the lease term (unless a buyout option is chosen).
 Long-term leasing can be more expensive than buying.
 Limited control over the asset's use and modifications.
3. Purchase:
 Features:
 Outright purchase involves buying the asset with cash or financing it through a loan.
 Immediate ownership and control of the asset.
 Advantages:
 Full ownership and control from the outset.
 Potential for long-term cost savings compared to leasing.
 No ongoing lease payments or interest costs.
 Disadvantages:
 High initial capital expenditure.
 The asset's value may depreciate over time.
 The organization bears the risk of obsolescence.
4. Rent:
 Features:
 Renting assets involves paying periodic fees to use them, but ownership remains with the lessor.
 Common for short-term or temporary asset needs.
 Advantages:
 No need for a significant upfront investment.
 Flexibility to switch to different assets or adjust usage as needed.
 Maintenance and repairs are often the lessor's responsibility.
 Disadvantages:
• Usually more costly over time when compared to ownership.
• No equity is created, and there is no asset ownership.
• Limited control over the customization or alteration of the asset.

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8. Explain the methods for calculating the depreciation of assets using each of the following methods:

Prime cost method

A straightforward and popular method for computing depreciation is the Prime Cost Method, sometimes
referred to as the Straight-Line Depreciation Method. It evenly distributes an asset's cost throughout the
course of its useful life. The formula for depreciation using this approach is as follows:

Formula: Depreciation Expense = (Cost of Asset - Residual Value) / Useful Life

 Cost of Asset: This is the original purchase or acquisition cost of the asset.
 Residual Value: Also known as salvage value, it represents the estimated value of the asset at the
end of its useful life.
 Useful Life: This is the expected number of years or units of production over which the asset will be
used before it is considered fully depreciated.
Example: Let's say a company purchases a computer for $1,000, and it has an estimated residual value of
$200 after 5 years. Using the Prime Cost Method:
Depreciation Expense = ($1,000 - $200) / 5 years = $800 / 5 years = $160 per year
So, the annual depreciation expense for the computer is $160.

Diminishing Value Method

The Declining Balance Method, often referred to as the Diminishing worth Method, takes into account
the notion that an asset's worth declines more quickly in its early years of use. With this strategy, the
depreciation expense can be higher in the early years and lower in the latter years. The formula for
depreciation using this approach is as follows:

Formula:
Depreciation Expense = (Book Value at the Beginning of the Year * Depreciation Rate)

Book Value at the Beginning of the Year: This is the asset's value at the start of the fiscal year.
Depreciation Rate: Typically expressed as a percentage, it is determined by dividing 100% by the asset's
estimated useful life.
Example:
Suppose a company purchases machinery for $10,000 with a useful life of 5 years. Using a 20%
depreciation rate (100% / 5 years), the calculation would be as follows:

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 Year 1:
Depreciation Expense = ($10,000 * 20%) = $2,000
Book Value at the End of Year 1 = $10,000 - $2,000 = $8,000

Year 2:
Depreciation Expense = ($8,000 * 20%) = $1,600
Book Value at the End of Year 2 = $8,000 - $1,600 = $6,400

9. Go to the ATO website link provided below and source the information for the current simplified
depreciation rules which apply:

https://www.ato.gov.au/Business/Income-and-deductions-for-business/Depreciating-assets/Simpler-
depreciation-for-small-business/

Responses

Eligible Assets:
These regulations apply to eligible assets purchased and first used (or installed ready for use) for a taxable
purpose between 7.30 pm (AEDT) on October 6, 2020 and June 30, 2023.
• For these assets, there is no cost cap.
• General temporary full expensing regulations may apply to assets that are not subject to the simplified
depreciation rules.
Working out Your Deduction:
 Assets covered by the simplified depreciation rules are not eligible to reject the temporary full
expensing option.
For assets purchased and first used (or installed ready for use) for a taxable purpose within the
specified period, you must immediately deduct the business portion of the asset's cost; these assets
are not added to your small business pool; you also deduct the balance of the small business pool at
the end of an income year ending between 6 October 2020 and 30 June 2023.
Following complete expense, the pool's closing balance for the revenue year is zero.
 Examples:
 There are examples provided to illustrate how temporary full expensing works for small business
entities using simplified depreciation rules, including scenarios where entities cease to use
simplified depreciation rules.
Improvements:
 The costs of improvements made to an asset are deductible for the business portion from 7.30 pm
(AEDT) on 6 October 2020 to 30 June 2023.
Lock Out Rules Suspended:

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• Until June 30, 2023, the "lock out" regulations, which banned small business organizations from using the
simplified depreciation regime for five years if they opted out of it, will not be in effect. This makes
temporary full expensing available to small business enterprises.

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10. Provide 4 examples of sources for data to enable you to estimate reliable acquisition costs. What does this
need to consider in terms of contractual obligations and ongoing maintenance?

Responses
1. Vendor Quotations and Proposals:
 Source: Obtain detailed quotations and proposals from potential vendors or suppliers. This
can include quotes for equipment, software, services, or any other items you plan to
acquire.
 Contractual Obligations: Review the terms and conditions in vendor proposals carefully.
Ensure they specify pricing, delivery timelines, warranties, and any service-level agreements
(SLAs) that might apply.
 Ongoing Maintenance: Determine if the vendor offers ongoing maintenance or support
packages. If so, understand the costs and terms associated with them.
2. Historical Data:
 Source: Analyze historical data from previous acquisitions or similar projects within your
organization. This data can provide insights into past acquisition costs.
 Contractual Obligations: Check if there are any lessons learned or insights from past
contracts that could impact the current acquisition. Consider if there are any long-term
commitments or maintenance contracts from previous acquisitions that need to be factored
in.
 Ongoing Maintenance: Assess whether any ongoing maintenance or support contracts from
previous acquisitions are still in effect and their associated costs.
3. Market Research and Benchmarking:
 Source: Conduct market research to understand industry benchmarks and average
acquisition costs for similar products or services.
 Contractual Obligations: While market research won't provide specific contractual details, it
can help you negotiate better terms by knowing the industry standards. Ensure that
contracts for the current acquisition align with or improve upon these benchmarks.
 Ongoing Maintenance: Market research can also provide insights into typical ongoing
maintenance costs for similar acquisitions.
4. Internal Cost Analysis:
 Source: Analyze internal cost structures, including labor, infrastructure, and other internal
resources required for the acquisition.
 Contractual Obligations: Internal cost analysis can help identify any contractual obligations
related to internal resources. Ensure that these obligations are accounted for in the
acquisition plan.
 Ongoing Maintenance: Consider ongoing internal resource requirements for maintenance
and support, as these can impact long-term costs.

Aspects to consider

 Contractual Terms: Make sure that the purchase contracts expressly outline the costs, conditions of
payment, delivery timelines, warranties, and any fines or rewards for achieving specific milestones.
 Service Level Agreements (SLAs): If the acquisition involves services or ongoing support, negotiate
and establish SLAs that specify performance standards and consequences for non-compliance.

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  Warranties and Guarantees: Understand the warranties provided by vendors and any associated
costs or conditions for warranty claims.
 Renewal and Termination Clauses: Review renewal and termination clauses in contracts to
understand the flexibility and costs associated with discontinuing or extending services.
 Scalability and Flexibility: Consider whether the acquisition can scale or adapt to changing needs,
and whether this flexibility is addressed in the contracts.
 Total Cost of Ownership (TCO): Evaluate the TCO, which includes not only acquisition costs but also
ongoing maintenance, support, and operational expenses over the product or service's expected
lifespan.

11. List 3 examples for environmental sustainability that applies to physical assets and outline the
environmental and financial benefits as applicable:

Example Environmental and Financial Benefits

- Lower greenhouse gas emissions due to less energy use. - Lower utility costs as a
result of less energy use. - Reliance on non-renewable energy sources is lessened. -
Increased longevity of lighting fixtures, which cuts down on waste. - Potential tax
Energy-Efficient breaks or credits for improvements.
Lighting Retrofit

Solar panel
installation - The production of renewable, clean energy from sunshine. - Reduced reliance on
fossil fuels and greenhouse gas emissions. - Lower electricity costs or possibly
income from the generation of surplus energy (net metering). - Enhanced market
appeal and property value. - Potential tax breaks, subsidies, or incentives from the
government for installation.

Water - Reduced water use, protecting a valuable resource. - Lower costs for wastewater
Conservation treatment and water bills. - Lessening of the demand on local ecosystems and
Measures water supplies. - Potential discounts or rewards for water-saving improvements. -
Protection of aquatic habitats and water quality. - Lower maintenance and repair

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expenses as a result of water usage efficiency.

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