PART A - Performance objective
Report and monitor expenditure and compare with financial plans so that recommendations are developed for key stakeholders.
Assessment description
Complete the financial reporting for each period and develop recommendations using the templates provided.
Procedure
1. Read the case study.
2. Complete the financial reports for each period as requested.
3. Analyse the data and complete your recommendations in the space provided.
4. Complete a new budget based on your recommendations.
Proactive Management Consultants Pty Ltd (PMC) is a small service organisation that provides consultative services to a wide variety of clients and has been in existence for just over five years. Typically they advise their clients on professional development opportunities, organisational structure and simple training initiatives.
Although the past 12 months have been profitable for PMC, they face a very uncertain future. Reducing government support, the global financial crisis, an increasingly competitive market and a client base that believe they are already paying too much.
PMC prides itself on the advice they give their clients, however, finance has never been their strength. The PMC board has approached your company to provide monthly financial reports and recommendations on how they should proceed with their financial plans.
PMC has provided each month's sales and expenditure data from which they require your company to complete the reporting in the provided templates, interpret the data and provide recommendations.
Accounts payable are entirely paid month-to-month whereas accounts receivable is calculated 60% current month, 30% last month, 10% second to last month: actual May sales = $42,100, actual June sales = $47,300. These figures will be required to determine actual sales receipts for July and August.
PMC has also provided you with a list of initiatives they had planned to undertake over the next six months that have been budgeted for in their financial planning which they need you to consider in your recommendations. They are:
- anticipate large invoicing month in July due to number of leads
- all company motor vehicle registrations and insurance are due in July $18,000
- 15th of August moving to new premises whereby rent increases to $3,500 per month
- To increase productivity PMC will upgrade all computers under expensed equipment in September at $12,000.
- have sought an aggressive advertising campaign in October to invigorate lost clientele, $16,000
- Due to advertising campaign, PMC are recruiting two new consultants in October. This will add 30% to November's and December's payroll and $10,000 in recruitment and training during October and result in increased business (40% November and December).
- purchasing a licence to deliver an innovative training program in November for $20,000
- have contractual agreements in January and February that will generate $32,000 in sales
- three employees on annual leave will have 50% impact on sales in November
- conducting a professional development week for all staff in December $18,000
- employee bonuses due in December, anticipate $16,000.
Part 2: Plan analysis
Read the following Contingency plan developed by Eden Black for Proactive Management Consultants Pty Ltd. Your task is to analyse the strategies that have been developed to mitigate the risk and answer the questions below.
1. Has Eden identified all strategies to mitigate the identified risk? Justify your response.
2. Has Eden correctly identified the correct people to consult in the development of the strategies? Justify your response.
3. If you believe Eden has not identified all the strategies or people to be consulted, what would your recommendations be?
4. Are the timelines that Eden has created achievable? Justify your response.
PART C- Support and resource
Performance objective
Create a development plan for a new employee that ensures they have the support and resources they need to complete the tasks associated with budgets and financial plans.
Assessment description
Analyse the case study and make recommendations using the templates provided.
Procedure
1. Read the case study.
2. Complete parts 1 and 2.
3. Make recommendations that ensure the employee is provided with appropriate resources and support.
Case study
Jack Curran is the sales manager for a small forklift dealership called Uplifter Pty Ltd. Recently, Jack's sales coordinator, Bev Jones. retired after 10 years. Bev is certainly going to be missed as was able to do so much that it allowed Jack to concentrate solely on selling forklifts rather than the day-to-day financial management and planning. Jack realises he is
certainly going to miss the all the work Bev did for him.
A couple of weeks pass and Jack begins to realise the depth of the sales coordinator position and how the right person, trained properly, will certainly be an enormous asset. Jack begins to write a person specification that outlines the requirements of the role.
Sales coordinator - Job specification
Duties will include:
- process all invoicing and purchase orders
- process all banking, cheque, credit card and cash receipts
- enter accounts receivable and payable
- enter journal entries and maintain general ledger
- administer petty cash
- develop monthly sales reports
- develop monthly profit and loss reports
- administer payroll for 15 employees.
This role will require a working knowledge of:
- MYOB and Excel computer applications
- general accounting practices
- general payroll practices.
Jack advertises the position and receives a resume from Emily Grime. The resume indicates that Emily is qualified for the role. Emily's previous two positions have been slightly more junior, however very similar to the sales coordinator position. Emily describes her Excel and MYOB skill level as intermediate and also states that she has attained a Certificate IV in Business administration. After two interviews Jack is convinced that Emily is the best person for the job and hires her.
Emily commences in seven days and Jack is determined to make this work. Jack is seeking your help to write a list of information and procedures that he will need to provide Emily so that she has all the knowledge, support and available resources and systems to do her job well.