Bsbfim501A Manage Budgets and Financial Plans

2321 Words10 Pages
Why should organisations collect, file and maintain accurate financial records? To have a record of how the business is running. To determine how the business is sitting financially and to inspire different processes to assist in growing the business. It will also display what money is going where and whether there is any room for alterations in staffing, produce, and marketing. Basically, it is used to anaylse the business as a whole and per section and to determine performance. It is also a requirement of the ATO. What are the expectations of managers and supervisors in relation to budget or financial plans? To maintain the budget and implement the financial plans into the business. This also includes educating staff about the responsibilities of maintaining costs. What are the reports that can be used for financial planning in an organisation? Profit and Loss Balance sheet Revenue and Expenditure report Cash flow statement Debtors and Creditors reports What is the process for preparing budgets or other financial plans? 1. Identify data that needs to be collected. 2. Identify the appropriate sources of data. 3. Ensure currency, reliability and validity of data. 4. Classify and code the data according to accounting and organisational principles. 5. Calculate costs, profit and loss and/or breakeven analysis etc where necessary. 6. Access the results of data analysis and provide formal or informal reports on the outcomes. 7. Keep accurate and secure records of financial transactions. What two forms of budgeting might be used? Fixed and Flexible Which form of budget allows changes to be made? Flexible Explain how contingency plans work. Contingency plans are put in place to address any unexpected changes that may occur. They are developed using a 'What if' scenario and created ahead of time to avoid any
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