Learner Instructions 2
(Implement financial management approaches)
The candidate will demonstrate the ability to implement financial management approaches.
In response to the scenario provided, you will access and communicate details of budget to a team member (assessor). You will then support the team member to perform their required role with respect to software resources and systems.
- Read the scenario provided in Appendix 1 to this assessment task and tasks A and B.
- Prepare to meet with your team member (assessor) to communicate budget and then coach and train them in new role:
- access required budget information from assessor
- determine organisational needs
- identify coaching/training needs of team member.
- plan coaching/training session:
- outcome: team member produces spreadsheet to meet management requirements
- include activities/elements to instruct, practice, test, motivate
- Set up a time with your team member to have a coaching/training session.
- Meet with your team member (assessor) to coach them in role:
- Explain budget and relevance to team member’s accountabilities
- Use appropriate coaching techniques or models such as GROW
- Use appropriate motivational theory
- Train learner in required spreadsheet techniques, include elements of instruction, practice and testing/feedback
- Include recordkeeping requirements for Australian Taxation Office (ATO) and auditing purposes, for items such as petty cash, and GST.
- Submit all documents required in the specifications below to your assessor. Ensure you keep a copy of all work submitted for your records. Specifications
- meet with your assessor to role-play support of team member submit coaching/training plan.
Your assessor will be looking for:
- numeracy skills to read and understand a budget and to communicate a budget
- technology skills to use software associated with financial recordkeeping
- knowledge of basic accounting principles to identify and use account balances in communication and training
- knowledge of organisational requirements related to financial management, such as those contained in organisational policies and procedures
- requirements for organisational recordkeeping and auditing with respect to petty cash
- knowledge of principles and techniques involved in budgeting and electronic spreadsheets.
Appendix 1 – Scenario
Big Red Bicycle Pty Ltd is a bicycle manufacturer based in Bendigo, Victoria. The company produces bicycles which it sells to retailers for on-sale in the domestic Australian market.
The senior management structure of the company appears below:
Chief Executive Officer (CEO)
Chief Financial Officer (CFO)
Operations General Manager
Sales General Manager
According to company strategic plans, the company aims to achieve a net profit before tax of $1,000,000. The chief risks to this goal are:
- poor sales due to economic downturn
- increases in expenses such as wage expenses.
In addition to Australian operations, the company is considering manufacturing overseas to take advantage of reduced costs. The company is also considering diversifying its product range to reduce exposure to poor sales of one product.
You are the manager of Sales Team A. You manage a small team of sales team members. Your duties include accessing budget information for your team, explaining relevant aspects of budgets and features of budget documents to your team, and supporting team members to achieve performance goals.
You have determined that you will need to access budget information from the Senior
Accountant to explain to your team. You will explain the overall financial objective of the business, provide an overview of the budget and explain how the budget translates to expense allocations for the team.
You have determined that one team member, Bill Goodale, will be responsible for tracking expenses and petty cash throughout the financial year. To meet organisational needs, this duty will need to be performed in accordance with policies and procedures.
You have determined that expenses will need to be divided equally and tracked by quarter. Bill will need to develop a spreadsheet to keep track of actual expenditure by account. To help control expenses, the spreadsheet will need to provide an ongoing tally of expense by account.
Bill’s skills include basic accounting. Bill needs to be informed of Big Red Bicycle policies and procedures for petty cash. Bill is familiar with Microsoft Excel but does not know how to use formula and functions to sum columns or rows of figures.
Appendix 2 – Financial policies and procedures
Expense reimbursement Purpose of the policy
To detail procedures to be followed in relation to expense reimbursement of expenses that have been incurred on behalf of the organisation.
Big Red Bicycle will reimburse staff for reasonable and authorised expenses that have been incurred by them on behalf of the organisation or in the course of conducting Big Red Bicycle business.
- Staff will not be reimbursed in the following circumstances:
- any late payment penalties, e.g. overdue interest on credit cards
- expenses that are usually recovered from a third party
- penalties and fines, e.g. parking, traffic
- those claims that should have been made using the purchase order system
- those expense claims made by staff as a tax deduction
- those expenses that were not made for business purposes.
- Travel expenses claims:
- insurance for trip cancellation will be reimbursed
- mileage allowance will be given for the use of a staff member’s vehicle when used for work-related travel
- personal stopovers or indirect routes will not be reimbursed
- travel reimbursement is provided for the most direct and economical mode of travel available; circumstances will be considered on a ‘case-bycase’ basis.
- Accommodation expenses:
- reimbursement will cover moderate accommodation expenses; circumstances will be considered on a ‘case-by-case’ basis
- items of a personal nature that are charged to a hotel account will not be reimbursed.
- Employee’s own meals:
- employees on Big Red Bicycle business will be reimbursed for any reasonable and appropriate meal expenses.
- All relevant and original source documents must be attached to the Expense Reimbursement Form. A statutory declaration may be required where these original documents are not provided.
- Appropriate advance payments may be authorised.
- Employees have authority to approve expenses up to the amount detailed in their individual job description. Any expenditure claims above the level prescribed must be forwarded to supervisors for approval.
- Employees incurring authorised expenditure must submit their reimbursement requests on a signed Expense Reimbursement Form.
- Source documents (including tickets, receipts, vouchers, invoices) must be kept for all purchases and expenses claims.
- The CFO will use discretion to reimburse reasonable but unauthorised expenses.
- Those claims that have not been adequately prepared, have not been duly authorised, or are lacking in original documentation, will be returned to the employee with reasons that outline why the claim has not been processed.
Purpose of the policy
To detail procedures to be followed in relation to tracking petty cash expenditure.
Big Red Bicycle maintains a petty cash system to allow authorised personnel to pay for small expenditures in connection with business activity.
- One team member is authorised to disburse petty cash with one alternate in case of sickness or emergency.
- Petty cash is to be kept secure, locked in safe.
- Receipts for cash must be issued.
- Receipts must be reconciled at the close of each business day.
- Amounts over $800 must be banked.
- Petty cash expense will be recorded as miscellaneous expense.