Task 3: Establish and Implement Budgets Assessment Description This assessment comprises of a mix of tasks to demonstrate ability to: 1. Use previous financial data to determine allocations for resources. 2. Make informed estimates of new items for inclusions in the budget. 3. Prepare budgets in accordance with organisational requirements and statutory requirements. 4. Circulate budgets 5. Manage risks and maintain audit trial Performance objective You are required to address the following: Section 1: Budget Develop a profit and sales budget Organisational and statutory requirements Circulate budgets Assess risks Specifications You are required to: Submit the completed assessment tasks Complete the tasks with sufficient detail and present them in a professional manner Use your own words and reference sources appropriately Meet the word count where required Apply critical thinking Assessment Evidence Requirements Checklist Assessment Task 3 Profit and sales budget Outline of compliance considered for budgeting Outline of plan to circulate the budget Observation checklist from trainer Report to CEO on risks It is advisable to: Review each section carefully Further research the topics addressed in each assessment task Your assessor will be looking for demonstrated evidence of your ability to address specific tasks related to key topics covered in this unit. Section 1: Develop Budgets PART 1: Annual budget – profit budget Develop a budget in quarterly period. To do so: o use previous financial data to better determine allocation of resources o consider assumptions based on your analysis of the Case Study o undertake appropriate research to make informed estimate of new item for inclusions in budget (if relevant) o use the template provided o consider organisational and statutory requirements PART 2: Sales Budget ABC is increasing its advertising budget by 12 % in the next financial year. Part of their marketing strategy is to increase sales of the outbound service by 10% each quarter for the next financial year. Prepare a simple sales budget for the outbound service. o Include the amount of sales and the average gross profit margin. o Consider that ABC plans to run a cost-cutting project to bring the gross profit margin for the service to 42% from the third quarter of the financial year Additionally: o consider information about historical sales data o forecast the amount of sales based on historical data and the scenario provided o consider organisational and statutory requirements o use the template provided in the excel spreadsheet PART 3: Organisational and statutory requirements The budget must comply with organisational and statutory requirements. Briefly outline what you considered when developing the budget. (Min. 50 words). PART 4: Circulate the budget Outline how the budgets will be circulated to ensure relevant managers are clear about content, reporting requirements, and financial delegations. Role play communicate budget Schedule a time with the trainer and assessor in week 5 of delivery. This is a role-play where the trainer and assessor, will play the role of the CEO in the organisation. You are required to present present the profit budget and clarify each element of the budget, reporting requirements and financial delegation (15 minutes meeting) as required by the CEO. This is an assessable task and the trainer and assessor will evaluate your performance during the role-play. PART 5: Assess risks. Prepare a report directed to the CEO, that addresses the following: What has been done or will be done to ensure that there are not opportunities for misappropriation of funds? What other financial risks have been considered in financial planning and measures that have been or will be put in place to avoid them or mitigate their effect? What has been planned and/or implemented to maintain an audit trail and ensure correct financial transactions? What is the best suggested approach to comply with due diligence? Note: To simplify the report, consider that you are writing an email to the CEO (in a professional manner) that addresses the points above. Consider the financial policy provided, the Case Study and what you would additionally do (proposed improvements) to assess and manage risks. Min. 150 words *Overall Result Task 3: S NYS *Optional additional comments from trainer and assessor
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