InternationalInstitute of Business & Information Technology
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BSBFIM601 Student Assessment
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Instructions for Task 2
PLANNING PROJECT
Complete part A and then Part B of this assessment task.
PART A: ANALYSE FINANCES AND PREPARE BUDGETS
Grow Management Consultants is a consultancy business specialising in leadership consultancy and
has been operational for the last five years. The company offers a range of services to assist
companies to assess leadership behaviour of existing managers and performance metrics and to
design and implement customised leadership programs based on the assessment. Services are
offered Australia-wide.
The company employs a General Manager (you), 2 Principal Consultants (who are also Directors), 1
Senior Consultant, an Administration Officer and Receptionist.
Over the last two years, the company has diversified and offers regular professional development
workshops on all aspects of leading and managing staff. These workshops are conducted
approximately every 3 months in all major cities including Sydney, Brisbane and Melbourne. In 2014 –
2015, the company ran a total of 36 workshops. The company has also recently produced an E-book
about leadership techniques.
The intention is to replace the workshops with the annual conference in the next financial year as the
workshops were not well attended and client feedback indicates a personalised, company focused
approach in the form of consulting services is the service of choice.
The E-book has had reasonable sales but there needs to be a wider selection of books, as well as
more marketing. The plan is to generate $10,000 worth of sales for the e-books during the next
financial year and increasing over time.
As the General Manager for the company and with responsibility for finances, you are currently
completing the financial planning for the year ahead. This involves a review of the company’s
business plan, previous year’s profit and loss statement, the current business plan and strategic
directions and cash flow statements. Based on the review, you will be establishing budgets and
allocating funds. In developing the budget you are to assume a 5% increase in cost of sales, as well as
a 10% increase in sales for consulting services and executive search.
As per the business plan, the company plans to run an annual conference starting in end of 2015. The
costs for the conference have been estimated by the Principal Consultant as set out in the Estimated
Conference Costs document. Conference attendance is aimed at 100 people paying $750 each.
The Principal Consultant has also asked you to review the current accounting software used by the
business. The company is currently using MYOB but as it has grown, the Principal Consultant wishes
to review whether this is the best accounting software for the business. He has also requested that
the software have a cloud feature.
Complete the following activities:
1. Conduct research in preparation for your financial performance report.
▪ Review the scenario information above and the 2014-2015 Profit and Loss Statements and
the 2014-2015 Cash Flow Statements provided to you. Using this information, identify areas
of the business that have generated a profit and those that have generated a loss.
▪ Conduct research to establish why those areas have made a profit or loss. Your research
should include a review of the financial data provided to you, economic conditions and
business trends that may have resulted in the profit or loss. You will be required to report
on your findings in the financial performance report as outlined below.
▪ Conduct research on financial software systems as per the scenario information. Make notes
for use in your report.
2. Prepare a financial performance report for the Principal Consultants that includes an:
International Institute of Business & Information Technology
▪ Overview of the purpose of the report.
▪ Analysis of the previous year’s (2014 – 2015) profit and loss statement for Grow
Management Consultant, including revenue generated, cost of sales, gross profit/loss margin
and net profit/loss margin.
▪ Analysis of the current year’s (2015 – 2016) profit and loss statement for Grow Management
Consultant, including revenue generated, cost of sales, gross profit/loss margin and net
profit/loss margin.
▪ Analysis of overall business performance including the performance of each of the income
streams for both financial years.
▪ Outline of reasons for profit or loss based on your analysis of the data and research on
economic conditions and business trends.
▪ Analysis of the organisation’s goals and priorities for the upcoming financial year as
documented in the Strategic Business Plan and financial resources required to achieve these
goals, as well as key dates.
▪ An analysis of cash flow trends as per the cash flow statements.
▪ Review and analysis of at least three other financial software packages that the business
could use, including the advantages and disadvantages of each, as well as the advantages
and disadvantages of MYOB that is currently used.
3. Develop budget forecasts for the next financial year (2016-2017) as template provided by
assessor.
▪ Ensure that the analysis of the previous year’s data and future plans as indicated in the
business plan is taken into account in determining projected income and expenditure.
▪ As per the organisation’s financial management policy and procedure, the budget forecasts
are to be submitted in Excel. Develop a suitable format within Excel for your budget.
▪ Ensure that your budget includes the estimated income and costs for the conference and e-
book to be implemented in 2016. This is provided to you as a separate document.
▪ Assume a 5% increase in all general costs, as well as a 10% increase in income for consulting
and executive recruitment service. Input costs and income for the conference and e-book as
per the data indicated in the document.
4. Circulate report and budgets
▪ Ensure your documents are accurate and error free, and set out in a standard business
format.
▪ Submit the completed report and budgets to the Principal Consultants (your assessor) for
discussion at the meeting in Part B.
International Institute of Business & Information Technology
Profit & Loss
| |
Profit & Loss Statement for Grow Management Consulting FY
| 2014 – 2015 |
| PROFIT & LOSS |
2014 – 2015
| Income |
| Consulting fees |
$1,175,600 |
| Workshops |
$38,000 |
| Publications |
$2,000 |
| Executive Search Service |
$120,000 |
| Gross profit/net sales |
$1,335,600 |
| Expenses |
| Accounting fees |
$6,823 |
| Advertising & marketing |
$5,000 |
| Computer Software |
$4,600 |
| Insurance |
$7,500 |
| Lease/loan payments |
$1,500 |
| Motor vehicle expenses |
$2,500 |
| Office Cleaning |
$5,500 |
| Office supplies |
$2,100 |
| Rent & rates |
$43,000 |
| Repairs & maintenance |
$1,200 |
| Salaries/wages (including PAYG) |
$504,000 |
| Superannuation |
$60,000 |
| Telephone |
$3,400 |
| Utilities |
$2,400 |
| Travel and accommodation (for workshops) |
$24,000 |
| Contract writer e-book |
$10,000 |
| Total expenses |
$683,523 |
| NET PROFIT (Net Income) |
$652,077 |
| Assumptions: |
| All figures are GST inclusive. |
&C&”Verdana,Italic”&9This Profit and Loss Statement is intended as a GUIDE ONLY and DOES NOT constitute financial advice,
please verify and discuss your financial statements with a qualified accountant, solicitor or financial advisor.
Using this Profit & Loss
| Using this Profit & Loss Statement |
| This profit & loss statement contains a list of suggested profit items and expenses a typical business may have. You can edit these items by removing or adding rows and typing in your own items. Don’t forget to enter the financial year at the top of the statement. |
| Please note: This statement assumes all figures are GST inclusive. |
| Formulas |
| When you add your figures, the sheet will automatically calculate your totals and net profit at the bottom. If you are adding or removing rows please double-check your figures to ensure the calculations have been preserved. |
| Calculations |
| Gross profit/net sales equals |
Sales minus cost of goods sold minus any other expenses related to the production of a good or service. |
| Net profit equals |
Gross profit/net sales minus Total expenses. |
| This profit & loss statement is intended as a GUIDE ONLY and DOES NOT constitute financial advice, please verify and discuss your financial statements with a qualified accountant, solicitor or financial advisor. |
This profit & loss statement has been developed by business.gov.au, located within the Department of Industry.
Copies of the latest version of this spreadsheet can be downloaded from www.business.gov.au.
If you need further information, assistance or referral about a small business issue, please contact us on 13 28 46. |
