FNSORG506 - Prepare Financial Forecasts and Projections Assessment Answer

STUDENT ASSESSMENT

PREPARE FINANCIAL FORECASTS AND PROJECTIONS - FNSORG506

Instructions
You are advised to commence work on your assessment from week 1 and all tasks must be submitted by the due dates provided.
All assessments must be completed and delivered individually. Where an assessment involves group discussions, you should consider the input of your group but submit an individual assessment to your trainer.
Please read all instructions on completing each assessment. Instructions for completion are provided at the beginning of each assessment.
All written answers must be typed in a word document using Arial font, 12 size and single spacing if similar instructions are not provided in the assessment.
Your trainer will not be able to assist you in answering questions. However, your trainer will address any issues concerning questions requiring further explanation.
You may refer to your student learning resources or any other relevant resources when completing your assessment.
Assessments are due for submission as specified in the assessment schedule. Any variations to this arrangement must be approved by your trainer prior to the due date for submission.
You have access to computers which are equipped with Microsoft suite of products or any other relevant software and printing facility.
Use assessment templates if provided, to complete relevant sections of the assessment. You can also create your known templates for assessment evidence.
You must achieve a satisfactory result for all tasks to achieve competency in this unit.
All assessment answers should be submitted to the trainer in required format (soft or hard copy) as per trainer instructions with completed assessment cover sheet (if required).
Assessment Schedule
Task Due Date
Learning Activity Week 1
Task 1 Week 2
Learning Activity Week 3
Learning Activity Week 4
Task 2 Week 5
These materials were originally developed by Enhance Your Future Pty Ltd but may now be altered from the original form. Enhance Your Future Pty Ltd does not accept any liability for the Materials, the content and/or any reliance thereon.
Task 1 Theory Assessment
Student Instructions
Type all the answers in a word document if required.
You can conduct internet research to answer these questions.
Provide explanation of 2-3 lines when answering Describe questions.
Provide detailed workings for calculations questions.
Provide answers in table format wherever possible.
Question 1 Written Procedure and Checklist
Your task is to write a procedure or checklist of things that are required to prepare financial forecasts and projections of an organisation. Please ensure you include the following in your procedure/checklist
Timetable preparation
Identifying assumptions and parameters
Issuing instructions for preparation of forecasts and projections
Collecting and analysing data
Documentation of results
Approval protocols
You will be required to provide the procedure and checklist to the assessor.
Answer
Timetable preparation
S.NoDescription Pointer
1 Feasible timeline is given for the forecasting 2 All the elements have been determined for the preparation of timeline Identifying assumptions and parameters
S.NoDescription Pointer
1 Assumption taken for the financial forecasting is viable and applicable 2 Assumption and parameter are according to the company guidelines. Issuing instructions for preparation of forecasts and projections
S.NoDescription Pointer
1 The issuing instruction for preparation of the projections and forecast are viable 2 The issuance of instructions are according to the policy of the company.
Collecting and analysing data
S.NoDescription Pointer
1 The data which has been collected is accurate 2 The source of data collection is reliable and upto date Documentation of results
S.NoDescription Pointer
1 The document which is used to record the results covers the in-depth analysis. 2 The document is extensive enough to cover the policy of the company Approval protocols
S. No Description Pointer
1 The preparation of the financial projection and estimate is supported by the proper approval 2 Each phase of the projection is approved by the relevant person 3 The document is supervised and evaluated by the independent party Question 2 Written Answers
Provide answers to questions below in 1-2 paragraphs.
Discuss the difference between financial forecasts and projections.
Forecast is determined for the financial outcome projection or the primary metrics in the future which is near with the leading indicator viability. For booking forecast or revenue, there is a data backlog or pipeline to make an effective anticipation.
On the other hand, the terminology of projection is utilized with the domain of finance to mean the financial outcome which is predicting further into the future by utilizing the drivers which are high-level such as the rate of market growth, capacity of sales, conventional trends of growth to the outcome of future projection.
What method can you use to review your plans
1st Step in Planning of Finance Develop the Goals and Relationship
In this phase, the adviser who is preparing the financial planning introduce herself or himself and determines the process of financial planning to the prospective client or client
2nd Step in the Planning of Finance Relevant Data Gathering
In this phase, the data is gathered for the purpose of attaining the information to make the suggestion for the effective financial item or strategies to reach the goals which is on individual level that has to be gathered.
3rd Step in Planning of Finance Data Analysis
The person gathers the data which is relevant, now then he evaluates it.
4th Step in Planning of Finance Plan Development
In this phase, the revering plan steps involves in the plan development which can be analysed in order to assure the evaluation which is ongoing.
5th Step in Planning of Finance Plan Implementation
Now, the person transforms the plan into the work.
Assumptions in business plans and exception reports need to be reviewed to ensure what
Following are the assumption which are used in the planning of business and the exception in report that is required to assure the following elements
Services or Products Requirement
Client Base which is Sufficient
Analysis of financial performance reveals trends over time in what areas
Analysis of financial performance reveals trends over time in areas such as income statement, balance sheet, cash flow and ratio analysis. This analysis of the performance shows how the company is performing and how it is generating the revenue.
What 4 steps will assist you to write clear and unambiguous instructions
Utilization of short paragraphs and sentences.
Arrangement of points in order which is more logical.
Make specific statement.
Utilization of mood which is imperative.
What are the three main types of businesses
Sole proprietorship
Partnership
Private corporation
What are 6 types of financial models
Net Present Value (NPV)
Model of Discounted Cash Flow (DCF)
Model of Merger (MampA)
If there are many concepts and principles that apply to accounting that assist with ensuring data collected and processed is reliable, valid, complete and comprehensive. What are they
These are the principal which ensures that the data which has been gathered in order to derive the useful and important information are relevant and reliable on which the decision-making activities of the management as well as the investors can be carried out.
Define the following four terms
comprehensive,
the income which is comprehensive is determined by FASB as the equity change of the enterprise during the timeframe of other events or transaction and the factors from the sources of non-owner.
valid,
the control of account is determined as the procedures set that are executed by the company to assist assuring the accuracy and validity of its possessed records of finance.
completeness
the terminology of completeness deals with either the accounts and transaction that should be in the statement of finance are contained for illustration assertion of management that all procurement of the services and goods are contained in the financial statements of the company.
reliability.
Reliability in the accounting determines either the information which pertains to the financial statement can be utilized and verified consistently by the creditors and investors with the identical outcome.
What are the accounting cycle steps
Following are the steps of accounting cycle
Analysing and identifying the transactions of business
Recording in the companys journals
Recording in the companys ledger
Trial balance preparation which is unadjusted
Entries which are in the phase of adjustments
Trial balance which is adjusted
Financial statements
Entries which are closing
Trial balance post-closing
Entries which are reversing
Discuss the three main types of accounting.
Tax accounting
This type of accounting is utilized for the purpose of Tax Authorities which pertains to the Government.
Financial Accounting
This type of accounting is utilized for lenders, investors and agencies of government.
Management Accounting
This type of accounting is mainly utilized for management.
Failing to gain appropriate approval can result in what
It can lead in the business ability to conduct the effective business operations as failure in meeting the appropriate level of authority or approval can lead into the fraud or different activities which can results in the adverse impact on the business.

Task 2 Case Study and Practical Assessment
Student Instructions
Type all the answers in a word document if required.
You can conduct internet research to answer these questions.
Provide explanation of 2-3 lines when answering Describe questions.
Provide detailed workings for calculations questions.
Provide answers in table format wherever possible.
Question 1 Walls N Halls
Financial forecasts and projections
You are the project manager for Walls N Halls project. The management of the project has provided you required financial information in Appendix and asked you to prepare monthly financial forecast for the project and present that forecast to CEO of the project within two weeks.
For this task you will require the procedure/checklist that you created in Written Assessment Task 1.
Additional Information
Accounting Standards http//www.aasb.gov.au/Pronouncements/Current-standards.aspxOrganisational policies and procedures http//startupjunkies.com/extras/acct-policies.pdfPrepare the following for the Walls N Halls project (for three months), using the template provided in the Appendix.
Sales Budget
Items January February March Total

Sales 30,000 33,000 49,500 112,500
Operating Expenses Budget
Items January February March Quarter

Salaries for Partners 9,167 9,167 9,167 27,500
Salaries-Other Employees 6,667 6,667 6,667 20,000
Advertising 300 330 495 1,125
Stationery and photocopying 167 167 167 500
Electricity 100 100 100 300
Travel 600 660 990 2,250
Depreciation 167 167 167 500
Bank Charges 67 67 67 200
Phone/faxes 240 240 240 720
Rent 1,800 1,800 1,800 5,400
Total 19,273 19,363 19,858 58,495
Cash Flow Budget
Items January February March Quarter

Cash at Bank-1 Jan 12,000
Add Sales Revenue 30,000 33,000 49,500 112,500
Total 42,000 33,000 49,500 112,500
Less Cash Payments (19,273) (19,363) (19,858) (58,495)
Cash at Bank-31 March 22,727 13,637 29,642 54,005
Budgeted Income Statement
Items Amount

Sales Revenue 112,500
Less Operating Expenses (58,495)
Net Profit 54,005

While you prepare the financial forecasts and projections, you will need to ensure that you demonstrate the following
Analyse current and historical financial reports to establish trends, and examine external environment to gain objective overview
Review data to ensure consistency with model used and document analysis results clearly
Collect reliable, valid, complete and comprehensive data
Process and consolidate data in logical structured format that enables ready analysis according to established timetable
Document results clearly in suitable format that meets needs of target users
Apply standard accounting principles and techniques.
Presentation and role playing
You will meet the organisation CEO (your assessor) and undertake the following
Explain the project type
The type of project is construction of the building and conference hall
Reasons for selecting proposed financial model
This financial model has been selected as it covers the in-depth analysis of the investment appraisal.
Provide opportunity to ask questions
The opportunity which covers for providing the chance of asking the question involves stakeholders to inquire the management for their expected returns on investment.
Respond appropriately to all questions asked.
The strategy which would be based on the response to all question Is based on the strategy of active listening.
Seek and obtain all approvals for proposed financial projections in accordance with management objectives and financial and organizational policy.
For this purpose, the financial projections and estimate would require the hierarchy of management to provide approval for the preparation and completion of the statement.
Write an email to distribute results within required timeframe to relevant stakeholders.
Insert DD Month YYYY
Insert Client Name
Insert Client Position
Insert Company Name
Insert Company Address
Suburb State Post Code
Dear Insert Client Name
Re Dividends paid under Act of Corporations Franking and Accessibility
Following corrections to enable a profit to be paid on to a dissolvability as opposed to benefits reason for the motivations behind the Corporations Act 2001 (the Corporations Act), the Commissioner of Taxation issued Taxation Ruling TR 2012/5 to illuminate when a profit paid in consistence with the changed meaning of profit under the Corporations Act would be assessable for expenses purposes and the conditions in which any such profit would be unfrankable or frankable.
Executive Summary
We give a clarification of the accompanying
the alterations to area 254T of the Corporations Act, which changed the criteria regarding when to profit is paid for Corporations Act
Taxation Ruling TR 2012/5, which plots the Australian Taxation Office (ATO) see on what will establish a profit for duty purposes and if it tends to be franked.
Amendments to section 254T of the Corporations Act
Before the revisions, area 254T of the Corporations Act gave that a profit may just be paid out of benefits of an organization (the benefits test). It was commonly acknowledged that benefits in this setting implied held or discovered bookkeeping benefits of a perpetual character.
Nonetheless, from 28 June 2010, the test with respect to when a profit was paid turned into a three pronged asset report test expressing that an organization must not pay a profit except if
1) the organizations benefits surpass its liabilities previous the profit is proclaimed and the overabundance is adequate for the instalment of the profit
2) the profit is reasonable and sensitive to individuals in general
3) the instalment of the profit does not really mean the organizations capacity to pay its loan bosses.
For these reasons resources and liabilities are determined as per winning bookkeeping gauges.
In synopsis, it gives the idea that while the ATO acknowledges that an instalment to investors from a sum other than benefits is adequate under the Corporations Act and will regularly be a profit for expenses purposes, their elucidation and utilization of the franking arrangements make it especially ugly to do as such in certain conditions.
On the off chance that you have further questions on any subtleties contained inside this letter or on some other issue, kindly do not waver to reach me on XXX.
Yours faithfully
Insert Name and Title
Question 2 Written Report
Create a report which provides information regarding the following topics for an organisation in financial service industry in Australia. You may choose any organisation for this task.
Describe relevant financial industry codes of practice
Explain financial forecasting techniques, models and best practice
Identify key users or audience for financial forecasts and projections
Outline factors in the external environment that can impact on financial forecasts
Outline the relevance of historical financial reports to forecasting
Identify and interpret relevant organisational policy and procedures
Explain key requirements of relevant legislation and regulations that influence the financial services industry
The report should be a minimum of 1000 words and should be accurate and evidence provided through references. You may choose any relevant business report template for this task.
Introduction
The company which has been selected for the purpose of this study is Coca-Cola Amatil which is operating in Australia as beverages manufacturer.
Describe relevant financial industry codes of practice
The relevant financial industry practice code which is used by Coca-Cola Amatil is APES 110 Code for Professional Accountants (Annual-Reports, 2019).
Explain financial forecasting techniques, models and best practice
DERIVATIVES TECHNIQUES of VALUATION
Identify key users or audience for financial forecasts and projections
Government of Australia
Consumer of Beverages in Australia
Vendors (Campbell, 2019).
Outline factors in the external environment that can impact on financial forecasts
Competitive factors
Competition is no longer entirely a local matter, but a global issue, which directly affects the number of employees of Coca-Cola Amatil Corporation hires. The conditions that affect global competition include socio-political occasions, new product offers and competitors from emerging economies. The instruments that foresee the intention to help Coca-Cola Amatil in the management of global competition include consulting firms, information on university Operation departments, exchange affiliations and journalistic information reports. These assets can provide data that will help Coca-Cola Amatil choose precisely the way that Coca-Cola Amatil people should contract to balance specific powers.
Client Demand
Because the levels of production at that point drive the personnel requirement, and this is related to an external relationship of Coca-Cola Amatil. In general, Cola Amatil may not have adequate control to accurately estimate the personnel needs of Coca-Cola Amatil Corporation. The most ideal approach to build an accurate Client demand conjecture is to build successful methods to communicate with Coca-Cola Amatil Client base. Communication is achieved through Client surveys, makes follow-up calls and Client Feedback configurations. The changes of wind in the scene of soft drinks prepared to drink, which have affected the pool of drink benefits in Australia, Indonesia and New Zealand, are a danger to the profit of Coca-Cola Amatil These incorporate changes in buyer inclinations, a condition of divided and cost-cantered exchange, and expanded promulgation and guidelines. An essential factor is the concern for welfare and prosperity around sugar and counterfeiting, which is proceeding to move buyers inclinations towards low and not very attractive products, especially in the created nations. While this is happening, other non-dazzling drink classifications are finding solid development and Coca-Cola Amatil continues to develop its offer in these classes.
Government Regulations
All Operation es are impacted by a variety of governmental, state and nearby laws and guidelines. For example, government guidelines, for example, the lowest salary allowed by law, unemployment benefits, and worker protection costs are limiting factors when Coca-Cola Amatil is thinking about how many employees are expected to direct operations. of Coca-Cola Amatil. Large organizations have legal offices to monitor regulatory matters, however, smaller companies may need to use advance devices provided by the state unemployment office nearby or accessible data at the state offices that administer Coca-Cola Amatil Operation. The additional sources of data are the exchange of affiliations and associations. Coca-Cola Amatil has a 20 percent enthusiasm for EFC. EFC was designated as the organizer of the plan by virtue of the promulgation of the Container Deposit Plan of the New South Wales Government. EFC initiated the exchange during the period of 2017.
Environmental factors
Global environmental issues are essentially affecting the way Operation works. Given that the Coca-Cola Amatil Corporation must address all the natural effects identified with Coca-Cola Amatils Operation operations, it is essential that Coca-Cola Amatil works with ecological organizations identified with the Coca-Cola Amatil activities. This can incorporate water sheets, fun and fishing divisions and the Environmental Protection Agency. Compliance with the natural prerequisites may require additional workers assets that do not directly identify with the Operation operations of the Coca-Cola Amatil Corporation (management study, 2019)
Outline the relevance of historical financial reports to forecasting
The conventional financial documents to the forecasting can be stated as relevant by anticipating the concerns of the probable conditions of business that are possibility to impact the organization, enterprise, or nation. The relevant regulation and legislation which affects the financial industry of services are the NARTD which has impacted the greater market of final in New Zealand, Australia and it also affect the earning capability of Coca-Cola Amatil (Annual-Reports, 2019). The forecast of financial statements determines tends in the internal and external conventional project and data those patterns in order to give the interested parties with the more valuable information (sbnonline, 2019).
Identify and interpret relevant organisational policy and procedures
The board of the company is accountable for assuring that there is the relevant procedure and system in the company to assess, identify, manage and monitor risk. The committee of sustainability and risk reviews the management reports during the period, where it makes suggestion to the board in respect of the risk which is material that is faced by Coca-Cola Amatil in the segment in which it is operating its business function.
Another organizational policy which is made by the management of Coca-Cola Amatil is analysis of risk matter which is reviewed by the risk committee and he committee of finance and audit. The board that has been incorporated formed the policy of risk management that determines the approach of Coca-Cola Amatil to manage and oversight the risk of material business (Annual-Reports, 2019).
Explain key requirements of relevant legislation and regulations that influence the financial services industry
The relevant regulation and legislation which affects the financial industry of services are the NARTD which has impacted the greater market of finance in New Zealand, Australia and it also affect the earning capability of Coca-Cola Amatil (Annual-Reports, 2019).
Appendix
Case Study - Walls N Halls Budget Templates
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References / recommended resourcesPrepare financial forecasts and projections - FNSORG506, Enhance Your Future.
Annual-Reports (2019). online Ccamatil.com. Available at https//www.ccamatil.com/-/media/Cca/Corporate/Files/Annual-Reports/2018/Annual-Report-2017.ashx Accessed 12 Mar. 2019.
Campbell, P. (2019).How to put financial forecasting to work in your business this year. online Businessbankoftexas.com. Available at https//www.businessbankoftexas.com/business-resource-center/how-to-put-financial-forecasting-to-work-in-your-business-this-year.htm Accessed 12 Mar. 2019.
managementstudyhq (2019).External Factors Affecting Business Environment Management Study HQ. online Management Study HQ. Available at https//www.managementstudyhq.com/external-factors-affect-business-environment.html Accessed 12 Mar. 2019.
sbnonline (2019).Using historical data, benchmarking to develop a financial forecast - Smart Business Magazine. online Smart Business Magazine. Available at http//www.sbnonline.com/article/historical-data-benchmarking-develop-financial-forecast/ Accessed 12 Mar. 2019.

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