projected financial statement

Submission details The assessment task is due on the date specified by your assessor. Any variations to this arrangement must be approved in writing by…

Submission details

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.

Performance
objective

The
candidate will demonstrate the ability to undertake budgeting,
financial forecasting and reporting and to allocate and manage
resources to achieve the required outputs for the business unit.

Assessment
description

This
assessment consists of preparing a one-year budget and projected
financial statement including income & expenses and liabilities &
assets using the given data. You may consult with your
trainer/assessor if any additional support and guidance is required.

Procedure

This
Assessment Task has two (2) parts – Part A and Part B.

PART
A:

For this
assessment, students are to utilise the data in the Appendices
regarding Ed’s Whitegoods. The instructor can role-play the part
of Edward Tan, the proprietor and will give any additional
information required, including company policies and procedures,
milestones etc.

Students
are to undertake the following:

List all
personnel you would consult with in order to gain adequate advice
prior to commencing your reports.

Consult
with your instructor to determine management requirements

Prepare
a 1-year budget & projected financial statement including:

Sales
forecast, taking into account additional information in Appendix 5

Estimated
expenses / inventory costs

Estimated
profits

Ensure
report layout and format comply with management information
requirements, are clear and error-free

Note:
Students must use appropriate spreadsheet or accounting software to
undertake this task.

Students
must ensure that estimates of future cash flow, costs and revenues
are realistic in context of the available information at the time of
creating the budget. Changes in circumstances should be anticipated
as best as possible with emphasis on financial risks and creating
protection strategies in accordance with organisational procedures.
Any liaison with the proprietor of the business to determine
milestones, policies, goals etc. should be carried out with your
instructor, who will role play the relevant parts.

PART
B:

Now you
are to take your completed budget and arrange an appointment with
your assessor, who will role-play a finance specialist. In this
meeting, you are to

Manage
the meeting direction and progress

Discuss
with the finance specialist the aspects of your budgets / financial
plans (the package)

Have
your package reviewed, ensuring you validate your reasons and
proposals

Amend /
revise your package as appropriate

Specifications

You must
now:

Detail
in writing all delegations and budget accountabilities for
implementation and management of your package

Develop
a written procedure that details the recording systems and
documentation process you will follow for monitoring and controlling
all activities against your plans.

Develop
a risk management and contingency plan for all your proposed
financial plans; along with a policy and procedure to be followed
when implementing these plans

Develop
a policy and procedure that outlines proper maintenance of records
of financial performance and provides for evaluation of the
effectiveness of your financial management process

You are
to submit the following evidence / perform the following tasks:

Develop
and submit your annual budget as outlined above

Your
assessor will be looking for your ability to:

plan for financial
management

read and review profit and
loss statements, cash flows and aging summaries

prepare, implement and
revise a budget which aligns with the business plan, is based on
research and analysis of previous financial data and cash flow
trends, and meets all compliance requirements

contribute to financial
bids and estimates

establish a budget and
allocate funds in accordance with statutory and organisational
requirements

communicate with other
people including:

reporting on financial
activity and making recommendations

identifying and
prioritising significant issues

ensuring managers and
supervisors are clear about budgets.

analyse the effectiveness
of existing financial management approaches including reviewing
financial management software, managing risks of misappropriation of
funds, ensuring systems are in place to record all transactions,
maintaining an audit trail and complying with due diligence.

Appendix
1 – Big Ed’s Whitegoods Ltd

Edward Tan owns a medium
sized whitegoods retail store. He provides you with the following
information which is current as of 1 October 2014. All sales and
purchasing figures are inclusive of GST.

Assets:

Cash (Bank) $245,000

Computer
equipment $16,400

Delivery Van $26,000

Phones $2,300

Office Equipment $4,500

Debtors $13,580

Stock $117,303

Expenses

Phone Service /
Calls $780

Electricity $1590

Gas $600

Water $550

Insurance $1300

Payroll $465,000

Cleaning $850

Finance Costs $1650

Advertising $560

Rent $25,000

Petrol $560

Accountants Fees $370

Maintenance $1405

Bank Fees $210

Office Supplies $600

Creditors:

JRL Holdings $22,626

Innovating Technology
Ltd $3,653

LMS Marketing $1,200

Rowlings &
Sons $35,622

Ed has 3 customers that
purchase a large quantity of stock through him which he delivers to
their premises. To keep these customers happy, Ed is providing this
service on credit to the customers listed below. The listed
customers have a debt owing to Ed as listed:

Debtors:

P.L Farthings $1,323

J Smyth & Co $800

L.L Incorporated $356

National Appliances
Direct $4,233

Appendix
2 – Big Ed’s Whitegoods Ltd Transactions October 2014

Ed
sold the following items:

Each sold at:

12 fridges $1600

15 freezers $800

13 microwaves $470

11 Range hoods $190

6 ovens $2100

16 cook tops $560

18 dishwashers $990

22 Vacuums $390

14 Coffee makers $600

25 Toasters $99

5 Irons $156

16 Mixers $89

13 Deep fryers $99

4 Portable A/Cs $350

0 Hairdryers $35

14 Irons $45

14 Scale Sets $24

13 Kettles $78

15 Small Bins $40

7 Large Bins $60

9 Wine coolers $299

5 Washing Machines $340

4 Dryers $330

TOTAL $111837

All Sales for cash

Ed
purchased the following items:

Each purchased for:

10 fridges $800 Purchased on
credit from JRL

15 freezers $250 Purchased
on Credit from JRL

10 microwaves $150

10 Range hoods $80

5 ovens $900

15 cook tops $200

15 dishwashers $450

20 Vacuums $130 Purchased on
credit from Innovative Tech

10 Coffee
makers $250 Purchased on credit from Innovative Tech

20 Toasters $35

5 Irons $78

15 Mixers $45

10 Deep fryers $45

0 Portable A/Cs $180

0 Hairdryers $9

10 Irons $19

10 Scale Sets $12

10 Kettles $34

10 Small Bins $13

5 Large Bins $22

15 Wine coolers $130

5 Washing
Machines $220 Purchased on credit from Rowlings

5 Dryers $210

TOTAL $40605

All Invoices paid at time
of purchase unless otherwise stated

The
following amounts were paid to creditors:

JRL Holdings $5,000

Innovating Technology
Ltd $2,000

Rowlings & Sons $5,000

Deliver
services were provided on credit to the following:

P.L Farthings $300

J Smyth & Co $150

L.L Incorporated $362

National Appliances
Direct $600

The
following was paid in expenses

Phone Service /
Calls $65

Electricity $132.50

Gas $50

Water $45.83

Insurance $108.33

Payroll $38750

Cleaning $70.83

Finance Costs $137.50

Advertising $46.67

Rent $2083.33

Petrol $46.67

Accountants
Fees $30.83

Maintenance $117.08

Bank Fees $17.50

Office Supplies $ 50

TOTAL
EXPENSES $41,752.08

Bank
Statement October 2014

1-Oct

BALANCE FORWARD

 

 

$245,000.00

CR

3-Oct

Loan Costs (National)

$137.50

$244,862.50

CR

4-Oct

Telstra Invoice 3365432

$65.00

$244,797.50

CR

5-Oct

HLH Electricity

$132.50

$244,665.00

CR

6-Oct

Ultimate Gas

$50.00

$244,615.00

CR

8-Oct

Wages

$19,375.00

$225,240.00

 

8-Oct

Rent

$2,083.33

$223,156.67

CR

9-Oct

Cash Deposit

$6,000.00

$229,156.67

CR

13-Oct

JRL Holdings

$5,000.00

$224,156.67

CR

15-Oct

Innovative Technology

$2,000.00

$222,156.67

CR

17-Oct

Cash Deposit

$25,837.00

$247,993.67

CR

22-Oct

Cash Withdraw

$500.00

$247,493.67

CR

22-Oct

Wages

$19,375.00

$228,118.67

CR

22-Oct

Purchase 11451

$12,620.00

$215,498.67

CR

23-Oct

Shell

$46.67

$215,452.00

CR

23-Oct

Purchase 11452

$8,630.00

$206,822.00

CR

25-Oct

Cash Withdraw

$500.00

$206,322.00

CR

25-Oct

Purchase 11453

$1,405.00

$204,917.00

CR

25-Oct

LMS Marketing

$46.67

$204,870.33

CR

25-Oct

Cash Withdraw

$50.00

$204,820.33

CR

26-Oct

Water

$45.83

$204,774.50

CR

26-Oct

Insurance Direct Debit

$108.33

$204,666.17

CR

27-Oct

Corporate Cleaning Ltd

$70.83

$204,595.34

CR

27-Oct

Rowlings & Sons

$5,000.00

$199,595.34

CR

27-Oct

Cash
Deposit

$35,000.00

$234,595.34

CR

28-Oct

Fees

$17.50

$234,577.84

CR

28-Oct

P.L.Harris
Repairs

$117.08

$234,460.76

CR

29-Oct

Yarra
Valley

$45.83

$234,414.93

CR

30-Oct

Cash
Deposit

$45,000.00

$279,414.93

CR

30-Oct

Cash
Withdraw

$500.00

$278,914.93

CR

30-Oct

Office
Supplies

$50.00

 

$278,864.93

CR

Appendix
3 – Ed’s Whitegoods Ltd Transactions November 2014

Ed
sold the following items:

Each
sold at:

8
fridges $1600

10
freezers $800

6
microwaves $470

15
Range hoods $190

5
ovens $2100

18
cook tops $560

18
dishwashers $990

26
Vacuums $390

18
Coffee makers $600

13
Toasters $99

7
Irons $156

11
Mixers $89

9
Deep fryers $99

6
Portable A/Cs $350

2
Hairdryers $35

16
Irons $45

18
Scale Sets $24

14
Kettles $78

14
Small Bins $40

17
Large Bins $60

10
Wine coolers $299

10
Washing Machines $340

4
Dryers $330

TOTAL $103136

All
Sales for cash

Ed
purchased the following items:

Each
purchased for:

5
fridges $800 Purchased on credit from JRL

5
freezers $250 Purchased on Credit from JRL

5
microwaves $150

10
Range hoods $80

5
ovens $900

10
cook tops $200

10
dishwashers $450

20
Vacuums $130 Purchased on credit from Innovative Tech

10
Coffee makers $250 Purchased on credit from Innovative Tech

10
Toasters $35

5
Irons $78

10
Mixers $45

5
Deep fryers $45

5
Portable A/Cs $180

0
Hairdryers $9

15
Irons $19

15
Scale Sets $12

10
Kettles $34

10
Small Bins $13

5
Large Bins $22

5
Wine coolers $130

0
Washing Machines $220 Purchased on credit from Rowlings

0
Dryers $210

TOTAL $26910

All
Invoices paid at time of purchase unless otherwise stated

The
following amounts were paid to creditors:

JRL
Holdings $5,000

Innovating
Technology Ltd $2,000

LMS
Marketing $1,200

Rowlings
& Sons $5,000

Deliver
services were provided on credit to the following:

P.L
Farthings $200

J
Smyth & Co $350

L.L
Incorporated $462

National
Appliances Direct $490

TTNT $336

As
of December 2014, Ed gains another valuable customer, TTNT, who he
sets up on the same credit delivery scheme as his other regular
customers.

The
following was paid in expenses

Phone
Service / Calls $65

Electricity $132.50

Gas $50

Water $45.83

Insurance $108.33

Payroll $38750

Cleaning $70.83

Finance
Costs $137.50

Advertising $46.67

Rent $2083.33

Petrol $46.67

Accountants
Fees $30.83

Maintenance $117.08

Bank
Fees $17.50

Office
Supplies $ 50

TOTAL
EXPENSES $41,752.08

Bank
Statement November 2014

1-Nov

BALANCE
FORWARD

 

 

$278,864.93

CR

3-Nov

Loan
Costs (National)

$137.50

$278,727.43

CR

4-Nov

Telsta
Invoice 3365433

$65.00

$278,662.43

CR

5-Nov

HLH
Electricity

$132.50

$278,529.93

CR

6-Nov

Ultimate
Gas

$50.00

$278,479.93

CR

8-Nov

Wages

$19,375.00

$259,104.93

 

8-Nov

Rent

$2,083.33

$257,021.60

CR

9-Nov

Cash
Deposit

$3,606.00

$260,627.60

CR

13-Nov

JRL
Holdings

$5,000.00

$255,627.60

CR

15-Nov

Innovative
Technology

$2,000.00

$253,627.60

CR

17-Nov

Cash
Deposit

$9,000.00

$262,627.60

CR

22-Nov

Cash
Withdraw

$500.00

$262,127.60

CR

22-Nov

Wages

$19,375.00

$242,752.60

CR

22-Nov

Purchase
11454

$7,209.00

$235,543.60

CR

23-Nov

Shell

$46.67

$235,496.93

CR

23-Nov

Purchase
11455

$5,695.00

$229,801.93

CR

25-Nov

Cash
Withdraw

$500.00

$229,301.93

CR

25-Nov

Purchase
11456

$3,656.00

$225,645.93

CR

25-Nov

LMS
Marketing

$1,200.00

$224,445.93

CR

25-Nov

LMS
Marketing

$46.67

$224,399.26

CR

25-Nov

Cash
Withdraw

$50.00

$224,349.26

CR

26-Nov

Water

$45.83

$224,303.43

CR

26-Nov

Insurance
Direct Debit

$108.33

$224,195.10

CR

27-Nov

Corporate
Cleaning Ltd

$70.83

$224,124.27

CR

27-Nov

Rowlings
& Sons

$5,000.00

$219,124.27

CR

27-Nov

Cash
Deposit

$46,530.00

$265,654.27

CR

28-Nov

Fees

$17.50

$265,636.77

CR

28-Nov

P.L.Harris
Repairs

$117.08

$265,519.69

CR

29-Nov

Yarra
Valley

$45.83

$265,473.86

CR

30-Nov

Cash
Deposit

$44,000.00

$309,473.86

CR

30-Nov

Cash
Withdraw

$500.00

$308,973.86

CR

30-Nov

Office
Supplies

$50.00

 

$308,923.86

CR

Appendix
4 – Ed’s Whitegoods Ltd Transactions December 2014

Ed
sold the following items:

Each
sold at:

16
fridges $1600

15
freezers $800

6
microwaves $470

8
Range hoods $190

8
ovens $2100

14
cook tops $560

14
dishwashers $990

29
Vacuums $390

26
Coffee makers $600

19
Toasters $99

9
Irons $156

16
Mixers $89

13
Deep fryers $99

8
Portable A/Cs $350

1
Hairdryers $35

21
Irons $45

22
Scale Sets $24

19
Kettles $78

31
Small Bins $40

16
Large Bins $60

16
Wine coolers $299

15
Washing Machines $340

8
Dryers $330

TOTAL $133860

All
Sales for cash

Ed
purchased the following items:

Each
purchased for:

10
fridges $800 Purchased on credit from JRL

10
freezers $250 Purchased on Credit from JRL

10
microwaves $150

15
Range hoods $80

10
ovens $900

15
cook tops $200

15
dishwashers $450

30
Vacuums $130 Purchased on credit from Innovative Tech

25
Coffee makers $250 Purchased on credit from Innovative Tech

20
Toasters $35

10
Irons $78

18
Mixers $45

15
Deep fryers $45

10
Portable A/Cs $180

5
Hairdryers $9

25
Irons $19

25
Scale Sets $12

20
Kettles $34

30
Small Bins $13

15
Large Bins $22

15
Wine coolers $130

10
Washing Machines $220 Purchased on credit from Rowlings

10
Dryers $210

TOTAL $55335

All
Invoices paid at time of purchase unless otherwise stated

The
following amounts were paid to creditors:

JRL
Holdings $10,000

Innovating
Technology Ltd $4,000

Rowlings
& Sons $8,600

Deliver
services were provided on credit to the following:

P.L
Farthings $965

L.L
Incorporated $332

National
Appliances Direct $695

The
following was paid in expenses

Phone
Service / Calls $65

Electricity $132.50

Gas $50

Water $45.83

Insurance $108.33

Payroll $38750

Cleaning $70.83

Finance
Costs $137.50

Advertising $46.67

Rent $2083.33

Petrol $46.67

Accountants
Fees $30.83

Maintenance $117.08

Bank
Fees $17.50

Office
Supplies $ 50

TOTAL
EXPENSES $41,752.08

Bank
Statement December 2014

1-Dec

BALANCE
FORWARD

 

 

$308,923.86

CR

3-Dec

Loan
Costs (National)

$137.50

$308,786.36

CR

4-Dec

Telsta
Invoice 3365434

$65.00

$308,721.36

CR

5-Dec

HLH
Electricity

$132.50

$308,588.86

CR

6-Dec

Ultimate
Gas

$50.00

$308,538.86

CR

8-Dec

Wages

$19,375.00

$289,163.86

 

8-Dec

Rent

$2,083.33

$287,080.53

CR

9-Dec

Cash
Deposit

$32,615.00

$319,695.53

CR

13-Dec

JRL
Holdings

$10,000.00

$309,695.53

CR

15-Dec

Innovative
Technology

$4,000.00

$305,695.53

CR

17-Dec

Cash
Deposit

$58,565.00

$364,260.53

CR

22-Dec

Cash
Withdraw

$500.00

$363,760.53

CR

22-Dec

Wages

$19,375.00

$344,385.53

CR

22-Dec

Purchase
11457

$9,643.00

$334,742.53

CR

23-Dec

Shell

$46.67

$334,695.86

CR

23-Dec

Purchase
11458

$11,555.00

$323,140.86

CR

25-Dec

Cash
Withdraw

$500.00

$322,640.86

CR

25-Dec

Purchase
11459

$11,287.00

$311,353.86

CR

25-Dec

Cash
Withdraw

$600.00

$310,753.86

CR

25-Dec

LMS
Marketing

$46.67

$310,707.19

CR

25-Dec

Cash
Withdraw

$50.00

$310,657.19

CR

26-Dec

Water

$45.83

$310,611.36

CR

26-Dec

Insurance
Direct Debit

$108.33

$310,503.03

CR

27-Dec

Corporate
Cleaning Ltd

$70.83

$310,432.20

CR

27-Dec

Rowlings
& Sons

$8,600.00

$301,832.20

CR

27-Dec

Cash
Deposit

$20,652.00

$322,484.20

CR

28-Dec

Fees

$17.50

$322,466.70

CR

28-Dec

P.L.Harris
Repairs

$117.08

$322,349.62

CR

29-Dec

Yarra
Valley

$45.83

$322,303.79

CR

30-Dec

Cash
Deposit

$22,028.00

$344,331.79

CR

30-Dec

Cash
Withdraw

$500.00

$343,831.79

CR

30-Dec

Office
Supplies

$50.00

 

$343,781.79

CR

Appendix
5 – Ed’s Whitegoods Ltd Assumptions for 2015 financial year

Following
research on market trends and consumer confidence, as well as
inflation and other factors, Ed has provided you with the following
set of assumptions for the 2015 business year.

Purchase
cost of goods is set to rise by 5%

Decreased
consumer confidence means that sales are expected to decrease by
12%

Ed
believes he can increase his sale prices by 8% which should have
minimal impact on overall sales, perhaps reducing total sales by a
further 3%

Ed
plans on reducing his expenses by laying off one of his part time
staff members who has a yearly salary of $47,000. This is hoped
to have only minimal impact on productivity, however a decrease

Appendix
6 – Ed’s Whitegoods Ltd Historic Data

2015
Business Year

Total
Sales: 1366000

Total
Purchases: 643000

Total
Expenses: 186000

Jan
– September 2014

Total
Sales: 1080000

Total
Purchases: 477000

Total
Expenses: 378000
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