SIT60316 Advanced Diploma of Hospitality Management
BSBFIM601 Manage finances
ASSESSMENT 1: Assignment
Part 1.
Task 1
The personnel I have to contact before commencing your reports:
Management requirements:
Ed’s Whitegoods Ltd Assumptions for 2015 financial year:
Jan-Sep |
Oct |
Now |
Dec |
Budget 2015 |
|
Sales |
$1,080,000 |
$111,837 |
$103,136 |
$133,860 |
$1,257,373.04 |
Purchase |
$477,000 |
$40,605 |
$26,910 |
$55,335 |
$629,842.50 |
Expenses |
$501,025 |
$41,752 |
$41,752.08 |
$41,752.08 |
$456,256 |
Profit |
$101,975 |
$29,480 |
$34,474 |
$36,773 |
$171,274 |
Monthly staff wages – 38750x12= 465000
Staff cut: 465000-47000=418,000
Asset Projections:
Asset |
Sep-14 |
Dec14 |
Projections 2015 |
Cash |
$245,000 |
$308,923 |
$400,000 |
Computer equipment |
$16,400 |
$16,400 |
$20,000 |
Van |
$26,000 |
$26,000 |
$24,000 |
Phones |
$2,300 |
$2,300 |
$2,300 |
Office Equipment |
$4,500 |
$4,000 |
$4,500 |
Debtors |
$13,580 |
$13,000 |
$10,000 |
Stock |
$117,303 |
$117,303 |
$117,303 |
Total |
$425,083 |
$487,926 |
$580,103 |
Assumptions:
Expenses projection:
Expenses |
Sep-14 |
Dec-14 |
Projections 2015 |
Phone Service / Calls |
$780 |
$975 |
$975 |
Electricity |
$1,590 |
$1,987.50 |
$2,200 |
Gas |
$600 |
$750.00 |
$820 |
Water |
$550 |
$687.49 |
$720 |
Insurance |
$1,300 |
$1,624.99 |
$1,500 |
Payroll |
$465,000 |
$581,250 |
$534,250 |
Cleaning |
$850 |
$1,062.49 |
$1,062 |
Finance Costs |
$1,650 |
$2,062.50 |
$2,200 |
Advertising |
$560 |
$700.01 |
$600 |
Rent |
$25,000 |
$31,249.99 |
$31,249.99 |
Petrol |
$560 |
$900.01 |
$1,000 |
Accountants Fees |
$370 |
$462.49 |
$462.49 |
Maintenance |
$1,405 |
$1,756.24 |
$1,800 |
Bank Fees |
$210 |
$262.50 |
$262.50 |
Office Supplies |
$600 |
$750.00 |
$700 |
Total |
$501,025 |
$626,481 |
$579,802 |
Assumptions:
Creditors:
Sep-14 |
Dec-14 |
Projections 2015 |
|
JRL Holdings |
$22,626 |
$30,126 |
$30,126 |
Innovating Technology Ltd |
$3,653 |
$16,003 |
$17,303 |
LMS Marketing |
$1,200 |
$0 |
$2,400 |
Rowlings& Sons |
$35,622 |
$20,322 |
$20,322 |
Total |
$63,101 |
$66,451 |
$70,151 |
Assumptions:
Debtors:
Sep-14 |
Dec-14 |
Projections 2015 |
|
P.L Farthings |
$1,323 |
$2,788 |
$3,200 |
J Smyth & Co |
$800 |
$1,300 |
$1,300 |
L.L Incorporated |
$356 |
$1,512 |
$1,812 |
National Appliances Direct |
$4,233 |
$6,018 |
$6,000 |
TNT |
$0 |
$336 |
$336 |
Total |
$6,712 |
$11,954 |
$9,436 |
Assumptions:
Task 2
Budget delegation and accountabilities
Specific Guidance on Budget Management Responsibilities in Ed’s Whitegoods
1. Budget Monitoring and Reporting Responsibilities
Role of the Ed’s Whitegoods CEO
Role of the Ed’s Whitegoods Management team
Role of Ed’s Whitegoods accountant
2. Principles of Budget Monitoring and Reporting
3. The responsibilities for financial delegates
Following is a list of financial delegation levels which are considered appropriate for various staff roles.
Level |
$ Limit |
Suggested Roles |
1 |
$500 |
Admin Officers, Admin Assistants, Retail officers |
2 |
$20,000 |
Shop managers |
3 |
$100,000 |
Manager of Financial Department |
4 |
$200,000 |
CEO of Ed’s Whitegoods |
Recording and documentation process
Records must be stored in an orderly manner, be easily identifiable to facilitate their efficient and effective retrieval/replacement by any authorised person for purposes such as:
The medium used for storing records needs to be useable, reliable and allow preservation for as long as required in accordance with legislative requirements and administrative efficiency. Some of these retention periods are lengthy or permanent. Archives are records relocated to long term storage for preservation beyond their immediate business function, including permanent records.
Risk Management and Contingency plan
Identified risks |
Likelihood |
Consequences |
Risk management |
Increase in cost price |
Medium |
Profit will reduce |
Price agreement with suppliers |
Injury caused by fork lift in loading area |
Medium |
Can Cause death |
Update WHS procedure |
Not meeting the need of staff with different levels of skill |
High |
Non-attendance |
Introduce flexibility, mentoring approach |
Operating program break down |
Low |
Shut down of operations |
IS availability 24/7 |
Risk Management policy and procedure
Purpose
To provide information and guidance on Risk Management
Scope
This Policy applies to all Ed’s Whitegoods employees and visitors and contractors to facilities controlled by the Ed’s Whitegoods. The policy extends to all current and future activities, and new opportunities.
Where necessary, more detailed risk management policies and procedures should be developed to cover specific areas of theEd’s Whitegoods operations, such as financial management and business management. Where this occurs, such policies and regulations should comply with the broad directions described in the Risk Management Policy.
3 Policy Statement
3.1 Recognition of the need for risk management:
Ed’s Whitegoods recognises the need for risk management to feature as a consideration in strategic and operational planning, day-to-day management and decision making at all levels in the organisation.
3.2 A commitment to implement risk management effectively:
Ed’s Whitegoods is committed to managing and minimising risk by identifying, analysing, evaluating and treating exposures that may impact on the company achieving its objectives and/or the continued efficiency and effectiveness of its operations. Ed’s Whitegoods will incorporate risk management into its institutional planning and decision-making processes. Risk management must also be included as a consideration in sectional and operational planning as a delegated line management responsibility. Ed’s Whitegoods staff must implement risk management according to relevant legislative requirements and appropriate risk management standards.
3.3 A commitment to training and knowledge development in the area of risk management:
Ed’s Whitegoods is committed to ensuring that all staff, particularly those with management, advisory and decision making responsibilities, obtain a sound understanding of the principles of risk management and the requisite skills to implement risk management effectively.
3.4 A commitment to monitor performance and review progress in risk management:
Ed’s Whitegoods will regularly monitor and review the progress being made in developing an appropriate culture of risk management and the effective implementation of risk management strategies throughout the organisation as a basis for continuous improvement.
4 Principles
4.1 Responsibility for Risk Management
Risk must first and foremost be managed at the corporate level as part of the company’s good governance and corporate management processes. Risk management is considered an integral part of all management and decision-making functions within Ed’s Whitegoods. The responsibility for the identification of risk and the implementation of control strategies and follow up remains a delegated line management responsibility. All stakeholders have a significant role in the management of risk. This role may range from initially identifying and reporting risks associated with their own jobs to participation in the risk management process.
5 Procedures
5.1 Whole of Ed’s Whitegoods Risk Management Process
Risk must first and foremost be managed at the corporate level as part of Ed’s Whitegoods good governance and corporate management processes. This process, coordinated and facilitated by the CEO of Ed’s Whitegoods, will involve the following key steps:
5.2 Review
On the advice of the Director (Internal Audit and Risk), the CEO of Ed’s Whitegoods will regularly monitor and review the progress being made in developing an appropriate culture of risk management and the effective implementation of risk management strategies throughout the organisation.
5.3 Guidance on Acceptable Risk
Through its monitoring, review and reporting functions, the CEO of Ed’s Whitegoods will ensure that the Company maintains a consistent approach to its assessment of acceptable risk.
5.4 Documentation
Each stage of the risk management process shall be appropriately documented. The extent of documentation required is dependent on the nature of the risk. Documentation will be controlled so as to inform part of an auditable quality management process.
5.5 Compliance
A representation and compliance statement should be provided by each head/manager as formal acknowledgement of their responsibility to comply with risk management policies and procedures. Each employee should have included in his/her Position Description a responsibility for risk management, and Annual Performance Appraisals should include an appropriate assessment thereof.
5.6 Staff Development
Management shall ensure that staff have available to them appropriate information and training opportunities in risk management as appropriate to their position and role within company.
6 References
Nil.
Record keeping Policy & Procedure
1. Policy Statement
Ed’s Whitegoods is committed to the principle of maintaining accurate, comprehensive, clear and complete records of services provided to all members. The records will be kept for the appropriate periods as laid down in legal and national requirements and safeguarded against damage, loss or improper usage.
To ensure transparency, member’s rights and confidentiality, there should be no alternative system of restricted files. Members should be made aware of all information kept about them and be able to endorse this by reading and signing any information received or kept about them. If there is any information from third parties, for which there is no permission to share, this should be kept in a restricted access section of the member’s records.
2. Staff Responsibilities
2.1 Manager
The Manager is responsible for ensuring that all members’ records are maintained and stored as per the policy and procedure in place and ensuring the destruction of records in accordance with policy and procedure.
2.2 Staff
All staff are responsible for compliance with the policy and procedure.
3. Staff Responsibilities
3.1 Manager
To ensure that all staff, volunteers and members have access to and are aware of this policy.
3.2 All staff
To be aware of, read and adhere to this policy and procedure.
4. Audit Plan
The Manager/ senior person will monitor adherence of the policy and report findings to the Trustees.
5. Scope
This policy applies to all staff, volunteers and Board of Directors.
The procedure aims to set out the steps by which records are created, the requirements of staff to complete the records appropriately and the requirements for the management, handling, storage and destruction of records.
6. Staff / volunteer training
All staff and volunteers are to be made aware of this policy.
All staff must have induction and training on member confidentiality and on the security of records, particularly electronic records.
All staff working with personal records need to be reminded that it is a disciplinary offence to disclose confidential information to unauthorised individuals.
7. Procedure
Care should be taken to ensure that information is recorded precisely for the purposes for which it serves and no others. The objectives include:
Computer held records
Storage of care records
Destruction of service user records
Where records are incinerated by an external contractor, the process is monitored and the company is required to give a written guarantee with regard to confidentiality.
Part 2
Task 1
1. Variance analysis
2015 Budgeted |
2015 Actual |
$ Variance |
% Variance |
Favourable/Unfavorable |
|
Sales |
$1,257,373 |
$1,623,000 |
$365,626.96 |
29.08 |
Favourable |
Purchase |
$629,843 |
$701,400 |
$71,557.50 |
11.36 |
Unfavourable |
Expenses |
$579,281 |
$402,000 |
-$177,281.24 |
-30.60 |
Favourable |
Profit |
$48,249 |
No Info |
N/A |
N/A |
N/A |
Discrepancy:
As per table above, we see discrepancy in the areas of:
Reasons for discrepancy:
Budgeting techniques used to prepare 2015 budget:
Recommendations for corrective measures:
Part 3
Task 1
Financial Management softwares
Name |
Price* |
Usability |
Features and functions |
Compatibility with other programs |
Compatibility with other specialists |
Affordable |
The solution offers construction accounting, customer management, and service management modules on a stand-alone basis. |
The integrated suite offers features such as estimating, bid management, project scheduling, and construction project management. |
The solution is capable of integrating with other applications like excel, office, and Lotus notes. The solution is Mac and iPad compatible. |
Reports are extremely detailed with the ability to drill down to many levels of each transaction |
|
ERPAG Software |
Expensive |
ERPAG allows users to manage business processes including selling, ordering, receiving and delivery. |
ERPAG allows users to manage business processes including selling, ordering, receiving and delivery. Other features include payroll, service management, shipping management, user-access management, point of sale and barcode scanning. |
ERPAG offers integration with Google Mail, Google Calendar, Google Drive, Microsoft, Magento, WooCommerce, Shopify, QuickBooks, Square, Stripe and more. It supports 40+ shippers globally including UPS, FedEx and USPS. |
It is suitable for small and midsize businesses in various industries, including automobile, retail, education, information technology and more. |
aACE Software |
Affordable |
Modules include accounting, customer relationship management (CRM), enterprise resource planning (ERP), inventory management, order management and production management |
The accounting module provides general ledger, lead tracking and balance sheet capabilities. The CRM module allows users to manage relationships with vendors and partners, as well as monitor sales, quotes and overall business performance. |
Can be used with android system |
Shipping and receiving management, calendar management and scheduling. |
*
Inexpensive - Price range $1000-10,000
Affordable – Price range $10,000-30,000
Expensive - Price range $30,000-100,000
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