ASSESSMENT COVER SHEET

This form is to be completed by the assessor and used as a final record of student competency. All student submissions including any associated checklists are to be attached to this cover sheet before placing on the students file. Student results are not to be entered onto the Student Database unless all relevant paperwork is completed and attached to this form.

Student Name	Saikumar Somavarapu	Student ID	13122138
Assessor Name	Saurav chattoraj	Completion Date	9/03/2023
Course Name	CERT IV in Commercial Cookery	Course Code
Unit Name	manage finances within a budget	Unit Code	SITXFIN003

FIRST ATTEMPT: q SECOND ATTEMPT: q

Please attach the following student evidence to this form			Result S = Satisfactory NS = Not Yet Satisfactory DNS = Did Not Submit
Assessment 1	q		S \| NYS \| DNS
Assessment 2	q		S \| NYS \| DNS
		Final Assessment Result for this unit C = Competent / NYC = Not Yet Competent	C / NYC

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I give permission for a copy of my marked work to be retained and reproduced for the purpose of review and validation.

Student Signature: Saikumar

Date: 09/03/2023

Assessor Feedback:

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Assessor Signature: ____________________________

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ASSESSMENT COVER SHEET

BSBTWK501 Manage diversity in the workplace

Assessment Task 1

SITXFIN003Managefinances within a budget

Written Test

Assessment Submission details:

Please include following details on the top of your assessment:
- Your Name SAIKUMAR SOMAVARAPU
- Your Student Id 13122138
- Your Trainer’s name SAURAV CHATTORAJ
- Title of your Assessment SITXFIN003
- Assessment Due Date
- Actual Submission Date 9/03/2023

Please Note: Any changes in the assessment due date must be approved by your trainer.

This assessment must be in Microsoft word format. Following settings should be made for this assignment to keep consistency among all the assessments:

	Body text		Page setup
• • • •	Font: Times New Roman Font size: 12 point Line spacing: Double Text style: Normal	• • • •	Top: 2.54 cm Bottom: 2.54 cm Left: 3.17 cm Right: 3.17 cm
		•	Header: 1.25 cm
		•	Footer: 1.25 cm

Do not forget to attach the Cover Sheet at the front of the assessment.
Make sure you have signed the Cover sheet to declare this is your own work.
You can e-mail this assessment to your trainer’s e-mail address with following details: In ‘subject’ mention your ‘student Id – Your name’.

Achieving Competence:

To be deemed competent in this assessment you must:

Correctly address all of the assessment requirements as described in this task
Correctly address all of the submission instructions
Successfully complete the Assessment Questions
Submit assessment on or before the due date with an assessment cover sheet

Performance objective:

You need to answer the entire questions using information given to you from class and from your course material.

Assessment description:

You must provide a response to all questions in assessment Questions section.

Assessment Questions:

Checkpoint 1
Question 1: Indicate whether the following statements in regards to budgets are true or false?
1. A budget is a financial document which anticipates the future earnings and expenditure of a business	 Trnue  False
2. Budget targets are set and these are analysed against actual results during a given period	 True  False
3. Budgets must be compiled by a chartered accountant	 True  False
4. Budgets are nominated for a financial year and then broken into quarters and monthly figures	 True  False
5. To make the budget relevant, budgets are broken down further into revenue and expense categories	 True  False
Question 2: List 4 common benefits of budgeting?
1. Budget provide direction. 2. budgets motivate staff 3. Budgets coordinated business activities 4. budget help evaluate business performance
Question 3: Indicate whether the following statements in regards to business budgets are true or false?
1. Budgets may contain Sales Revenue, Cost of Goods Sold (COGS), Wages, Rent, Electricity, and other components	 True  False
2. Capital expenditure budgets must include superannuation, payroll tax, etc.	 True

			 False
3. Budgets can be managed through accountancy software programs such as Xero, MYOB and Cash whiz			 True  False
4. Large businesses may have a budget committee or external advisers to assist in compiling the total budget			 True  False
5. Master budget incorporates only the revenue generating departments of a business			 True  False
6. Upcoming projects must be budgeted for to ensure the project is viable			 True  False
Question 4: Connect the correct definitions with the following types of budgets?
1	Wage Budget	– also known as expense budgets, they show the projected expenditure of the business
2	Purchasing budgets	– these budgets are used for planning the costs of things like conferences
3	Sales budgets	– anticipates the movement of money flowing into, through and out of the business
4	Cash flow budget	– is prepared prior to a new project commencing
5	Events budgets	– covers employment costs, including superannuation, payroll tax (if applicable), recruitment costs and training
6	Project budgets	– Also known as a revenue budget, it shows the projected income either in units sold or revenue amount.
Question 5: What is the purpose of a Capital Expenditure Budget? How does a Capital Expenditure Budget impact on the overall business?
This is a special type of budget used to purchase assets. Some examples of when a capital expenditure budget would be prepared include a refurbishment and purchases of equipment such as commercial ovens and dishwashers. The items included in this budget are not expenses of the business; they are assets which will have a lifespan of several years. They will not appear on the Profit and Loss Statement but will affect the Balance Sheet and Cashflow Statement. The capital expenditure budget must be developed in conjunction with the Master Budget, as the impact of large amounts of capital expenditure has a significant effect on the Profit and Loss Budget and Cashflow Budget. This is because there will be less cash which can be put towards the operating expenses of the business.
Checkpoint 2
Question 6: Indicate whether the following statements in regard to factors impacting on budget are true or false?
1. Management restructures are internal factors that do not impact on budget			 True  False

2. Human resource requirements will impact on budgets as each new staff member required will add additional expenditure to the budget	 True  False
3. Projects will impact on budget and depending on size may best be assessed in a separate budget	 True  False
4. External factors are outside the control of the business. Typical examples are legislation and regulation	 True  False
5. Variances to budget must be checked regularly so that corrective measures can be put in place	 True  False
Question 7: List 3 examples of external factors that may impact on budgets?
1. legislation and regulation changes 2. Marketing trends 3. Changes in global economy
Question 8: Indicate whether the following statements in regard to factors impacting on budget are true or false?
1. New projects and other business objectives will impact on budgets as funds will need to be allocated	 True  False
2. Changes in legislation can affect the business both operationally and financially.	 True  False
3. External factors are outside the control of the business. Typical examples are legislation and regulation	 True  False
4. Changes in the global economy cannot have a huge impact on turnover for TH&E businesses.	 True  False
5. Market trends will affect the number of customers visiting your establishment	 True  False
Question 9: List 5 components of an Operating Budget?
1. sales and revenue budget 2. purchases and cost of goods sold budgets 3. wages budget 4. operating expense budget 5. Budgeted profit and loss statement

Question 10: What is the purpose of a Cash Budget (Cashflow Statement)?
Cashflow statement – this budget is prepared in order to determine whether the business has the cash available to cover the expenditure – both capital and non-capital. It is a prediction of the bank account movements and shows all of the cash flowing into the bank account as well as the cash flowing out of the bank account. To create the cash budget, you must anticipate when customers are likely to pay their bills as well as when you will be required to pay the business’s bills. You must ensure that you take every purchase into account, including direct debits and direct deposits which may enter or leave you account without notification. The cash budget will show you the closing balance of the bank account at the end of each month and whether you are likely to be short of cash. It is important to ensure that a master budget produces not only a profit, but a positive cashflow.
Checkpoint 3
Question 11: Indicate whether the following statements in regard to budgets are true or false?
1. Draft budgets must be reviewed and analysed only by the Accounts Payable clerk before they become the final budget		 True  False
2. Feedback on the draft budget should be obtained from all cost centres to avoid any oversights		 True  False
3. Prioritising the budget can be difficult as there are often conflicting demands		 True  False
4. Budgets are like pies and must be shared between departments		 True  False
5. Prioritising the budget can be difficult as there are often conflicting demands		 True  False
Question 12: Indicate whether the following statements in regard to budgets are true or false?
1. Firm timelines for submissions by all participants to the draft budget are an essential management tool to complete budgets in time		 True  False
2. Communicating final budget to cost centre managers and operational staff ensures that budget targets are clear		 True  False
3. Additional categories are often added to the final budget after it has been communicated to operational staff		 True  False
4. Soft and hard copy of the final budget must be distributed by the Financial Controller to all staff		 True  False
5. Each Department Head should understand their part of the budget and how it contributes to the overall business.		 True

	 False
Question 13: Why is it important that staff understand a budget and associated targets?
Once the management team has received and understand the budget, it is their responsibility to filter this information down to their staff. All staff within a business should have some knowledge of the budget for their area, from managers through to operational staff, administration to financial staff. While they may not know or understand the whole picture, it can be motivating for them to understand what their sales targets or expenditure limits are and why they have been set. It will show them that up-selling and on-selling are important and encourage them to make a positive contribution to the department’s outcome. If staff have some knowledge of the expectations, they are more likely to actually meet them.
Question 14: Indicate whether the following statements in regard to communicating budgets are true or false?
1. Impacts of budget outcomes and the reasoning behind it must be explained to relevant staff	 True  False
2. Staff must be encouraged to self-manage their section to achieve budget targets	 True  False
3. Communicating final budget to cost centre managers and operational staff ensures that budget targets are clear	 True  False
4. Staff should also be advised of the importance of budgetary control and meeting the budget each month.	 True  False
5. Communicating budget impacts to operational staff is always undertaken by the Finance team	 True  False
6. The manager of each department will ultimately be responsible for their department	 True  False
Checkpoint 4
Question 15: Indicate whether the following statements in regard to monitoring budget are true or false?
1. Monthly reviews of the budget against actuals is an important tool of budget management	 True  False
2. Budget overs and unders should be investigated on an annual basis	 True  False

3. Financial reports outlining statistical information must be drawn from the budget as they are subject to tax laws	 True  False
4. Finance should prepare reports such as the Profit and Loss, Balance Sheet and Cashflow Statement.	 True  False
5. Budget variances and impacts should be reviewed on a continual basis	 True  False
Question 16: Briefly explain the following types of reports?
Cashflow Reports – Cashflow Reports show movement of the bank accounts of a business. They show the current cash on hand, forecast when money is likely to come into the businesses, and when disbursements (money going out) are due Occupancy reports – Occupancy reports are used to analyse the occupancy level of the establishment. Hotel Reservations/Front Office Management construct these reports based on the number of rooms booked each night, as well as the number of guests. These reports are very important to the running of a hotel as empty rooms impact on all other areas of the establishment. Low numbers will mean fewer guests to attend the restaurant and bar, fewer sales in mini bar and so on. The minimum occupancy rates required to cover wages and other fixed costs are known to the establishment so it is essential for the viability of the business that occupancy rates stay significantly above this figure. Sales reports – Sales reports are produced by each revenue-producing department within a business. The different revenue categories, including food, beverage, rooms, gaming, conferencing, tour bookings, massage and golf will be listed, showing the actual revenue for the period as well as the budget and the variance between the two. Sales reports are used for managers to analyse the performance of each department compared to budget and to find any weak spots. This way, any underperforming areas can be corrected before the situation becomes too negative. Variance reports – Variance reports highlight deviations from budget. Budgets are set at the start of the year, based on expected revenue and expenses. Each month the financial statements will be analysed to show where any variances are occurring so that the issue can be rectified, or at least explained to the senior management team. For example, if the number of guests at the resort in October was 100 but the budget was 200, the Front Office Manager would analyse why the variance has occurred. Is it just a downturn in this resort’s customers, or is it affecting the whole area? Was the latest marketing initiative a failure? Each scenario will require a different approach for the business to rectify it. Expenditure reports – Expenditure reports can be in two formats – labour and non-labour. Labour expenditure reports show the expenditure related to labour for a specific period. They will include all factors relating to employment such as superannuation and Workers Compensation Insurance as well as the actual wages. Non-labour expenditure reports show all other expenditure of the business compared to budget for the period. This will include selling expenses (advertising, etc.), administrative expenses (stationery, etc.) and finance expenses (interest, etc.)
Question 17: Briefly explain the following types of reports?
Covers reports – Covers reports are completed by restaurants and bars to record and allow analysis of the number of guests served in a service period, such as dinner. This information is used to determine the average spend per customer for food and beverage. Food may be further broken down into entrée, main and dessert and beverage may be broken down further as well. Management can then identify areas which are not meeting budget and determine the reasons for this. For example, you may be charging too much for your entrées, so customers are less likely to purchase a 3-course meal, or your waiters may not be up-selling enough wine and Stock reports – Stock reports show the closing stock level at the end of the period. Each department will have its own stock report, whether they are kitchen, cellar, or housekeeping. Analyses can be done on which items are popular, with a high turnover, and which are less popular and slower moving. Stock on hand can be a significant drain on cashflow as it must be paid for upfront, sometimes a long time before any income is produced from it. Wastage reports – Wastage reports show how much stock is wasted each period. Each time an incorrect beverage is made or a stock item goes off, it must be recorded in the wastage report. This report allows management to determine the reason for variances between income produced and stock used up. If more stock is used up than could be accounted for by the recorded sales, the wastage reports should be checked to discover the reason. Purchase summary report – A purchase summary report is a summary of all purchases within the period. This provides useful information for management as it is a quick reference point as to the suppliers used and the amount spent with each. It is a useful tool for bargaining with suppliers for cheaper prices or higher quality products.

Question 18: Which types of business must file a Business Activity Statement? What are the components of a Business Activity Statement?

Businesses that are registered for GST are required to lodge regular Business Activity Statements (BAS). The frequency of lodgement depends on the amount of GST collected by the business – monthly or quarterly. The BAS is a double-sided, one page document. The first side reports on the business’ total sales, export sales, GST-free sales, capital purchases and non-capital purchases. On the back of the BAS, you will report on wages paid, tax withheld from wages (PAYGW), other withholdings (such as ABN withholding), as well as PAYG instalment (PAYGI) income. On the bottom of this side, a summary of the GST collected, PAYGI and PAYGW owing and GST Paid is reported to work out the net amount owing to the ATO, or that the ATO owes the business. Your business software should provide a GST report which can be used to fill in the BAS. You will need to collate other reports such as a wages report to be able to fill in all of the details.

Checkpoint 5

Question 19: Explain the following budgeting terms?

Variance – Variance refers to the difference between the actual figure and figure that was projected.

Projected/Forecasted Figure – a prediction of the future figures may be, based on previous earnings, known as cost and expenses.

Actual Figure – a known amount which have been achieved or is constant.

Budgeted Figure – the amount of money allocated.

Question 20: Explain the terms “favourable Variance and “unfavourable Variance”?
The variance can be in either direction – either above or below the budgeted amount. This is known as either favourable variance or unfavourable variance. This will depend on whether the budget is for revenue or expenditure. For a revenue budget, being over budget is considered favourable variance as you have made more revenue than expected. For an expenditure budget going over budget is considered unfavourable as you have spent more than was expected.
Question 21: Indicate whether the following statements in regard to variances are true or false?
1. Variances to budgets may be expressed as ratios and businesses may have set limits for acceptable variances	 True  False
2. Unfavourable revenue variances will create an increase in net profit	 True  False
3. Variances can be due to data entry error	 True  False
4. Variances must be analysed thoroughly as they could be indicative of serious misconduct or theft	 True  False
5. Revenue variances can be more devastating to a business than expenditure variances	 True  False
Question 22: Indicate whether the following statements in regard to analysing budgets are true or false?
1. Wages can often vary from budget.	 True  False
2. The only way to meet budget targets and savings is to cut expenditure	 True  False
3. Raising revenue will affect budget in a negative sense as expenses will increase more than the amount of revenue	 True  False
4. Net profit is impacted by an increase in revenue	 True  False
5. Raising average spend by up-selling is an effective way to increase profitability	 True  False
6. If the projected sales figures are $200,000 and the actual sales figure is $240,000 – this represents a favourable variance of 20%	 True  False
7. If the projected sales figures are $150,000 and there is a favourable variance of 10%, the actual sales figures are $165,000	 True  False
Question 23: Which of the following occurrences would result in achieving a favourable variance in profit?
1. Increased revenue with costs remaining constant	
2. Increased revenue with costs decreasing	
3. Decreased revenue with costs increasing	
4. Decreased revenue with costs remaining constant	
5. Revenue remaining constant with costs decreasing	
6. Revenue remaining constant with costs increasing	
Checkpoint 6
Question 24: Indicate whether the following statements in regard to reviewing budgets are true or false?
1. All variances throughout the year must be collated to update the budget on an ongoing basis	 True  False
2. The budget target cannot be amended and must be met regardless of changes in circumstances	 True  False
3. Internal and external analysis is a must for assessing budget impacts	 True  False
4. Management must assess factors such as price increases by suppliers to manage the budget	 True  False
5. Future budgets are often based on last year’s budget	 True  False
6. The department managers do not have to use numeracy and literary skills to interpret financial data as it is done by the Finance department	 True  False
Question 25: Which key processes need to be followed and analysed when reviewing and updating a budget?
You should collate all variances that are discovered throughout the year, as well as the required changes, to enable the budget to be updated. The budget must be reviewed on a regular basis to ensure that it is still relevant. Factors such as price increases, significant downturns in customers and changes in operations can mean the budget should be updated throughout the year. If a significant event occurs, there is no point in keeping the old budget and trying, unrealistically, to meet it. You are better off amending the budget to reflect both internal and external changes on a regular basis. This will ensure that the budget remains up-to-date and relevant throughout the year.

Question 26: In order to have a budget change approved, you must prepare a report. List 5 essential details which must be included in a budget report for presentation to the budget committee?

In order to have a budget change approved (especially an increase) you must prepare a report which clearly explains the idea, costs, reasons for the change, benefits to the department and overall benefit to the business. If the long term benefit of the change is going to save the company money, it is important to explain how much money it will save and over what time period. You may need to include a range of financial reports, or statistical data to help demonstrate your reasoning. This lets the decision maker to a clear cost versus benefit analysis of the budget request.

Assessment Task 2

SITXFIN003 Manage finances within a budget

Assessment Submission details:

Please include following details on the top of your assessment:
- Your Name SAIKUMAR SOMAVARAPU
- Your Student Id 13122138
- Your Trainer’s name SAURAV CHATTORAJ
- Title of your Assessment SITXFIN003
- Assessment Due Date
- Actual Submission Date 9/03/2023

Please Note: Any changes in the assessment due date must be approved by your trainer.

This assessment must be in Microsoft word format. Following settings should be made for this assignment to keep consistency among all the assessments:

	Body text		Page setup
• • • •	Font: Times New Roman Font size: 12 point Line spacing: Double Text style: Normal	• • • •	Top: 2.54 cm Bottom: 2.54 cm Left: 3.17 cm Right: 3.17 cm
		•	Header: 1.25 cm
		•	Footer: 1.25 cm

Do not forget to attach the Cover Sheet at the front of the assessment.
Make sure you have signed the Cover sheet to declare this is your own work.
You can e-mail this assessment to your trainer’s e-mail address with following details: In ‘subject’ mention your ‘student Id – Your name’.

Achieving Competence:

To be deemed competent in this assessment you must:

Correctly address all of the assessment requirements as described in this task
Correctly address all of the submission instructions
Successfully complete the Assessment Questions
Submit assessment on or before the due date with an assessment cover sheet

Performance objective:

The purpose of this assessment is to assess your ability to complete tasks outlined in elements and performance criteria of this unit in the context of the job role, and:

manage a budget for a business over a three-month period that meets the specific business’ needs
undertake at least two of the following to inform management of the above budget:

o discussions with existing suppliers o evaluation of staffing and rostering requirements o evaluation of impact of potential roster changes o review of operating procedures o sourcing new suppliers

c) monitor income and expenditure and evaluate budgetary performance over the above budgetary life cycle d) complete financial reports related to the above budget within designated timelines and using correct budget terminology

Assessment description:

This task consists of 3 parts, Part A, Part B & Part C.

For Part A you are required to complete a budget analysis.

For Part B you are required to answer questions relating to the importance of monitoring and analysing budgets and identifying methods to rectify shortfalls.

For Part C you have been provided with the projected data sheet for reference in the spread sheet. Please use the spread sheet file to complete the calculations.

PART A

Case Study Analysis on Budget Variance

Top of the Town Hotel has asked you to calculate the variance for the following figures for the month of July and August. Also calculate the total profit that was budgeted and actual. Analyse the findings and inform them about the variance as they are concerned and would like to monitor the income, expenditure, profit levels, budgetary performance of their Food and Beverage Department.

Item		July			August
	Budget	Actual	Variance	Budget	Actual	Variance
Sales Revenue	230,000	225,000	5,000	230,000	228,000
Food Costs	85,000	87,000	2,000	85,000	86,000
Beverage Costs	14,000	15,000	1,000	15,000	15,000
Labour Costs	77,000	82,000	5,000	78,000	82,000
Fixed Costs	35,000	35,000	0	35,000	35,000
Total Costs	441,000	446,000	5,000	443,000	448,000
Profit

The Hotel owners and managers would like to know from you the major areas of concern where there is a deviation that needs further monitoring and improvement.

PART B

Answer the following questions.

Questions:

Explain the importance to the owners of monitoring budgets and why do you think it will help them to manage their finances better for the business.

A-Monitoring budgets is important that help business to catch any variations in time to, reduce cost and meet the target. business can realise that there is an issue and will be able to adjust the issue and arrange any other strategies to compensate. That’s why budget should be monitored regularly throughout the year.

Explain to them the use of analyzing the monthly budget and comparing the forecasted budget against the actual budgets.

A- The budget must be reviewed on a regular basis to ensure that it is still relevant. Factors such as price increases, significant downturns in customers and changes in operations can mean the budget should be updated throughout the year. If a significant event occurs, there is no point in keeping the old budget and trying, unrealistically, to meet it. You are better off amending the budget to reflect both internal and external changes on a regular basis. This will ensure that the budget remains up-to-date and relevant throughout the year.

Explain your findings and possible reasons for these variances.

A-all the variance are unfavorable as they are above the actual budget.

What improvements can be done to overcome the variance between forecasted and actual budget?

one can try to figure out the problem early on and find a solution that could be preventing misconduct, handling data entry properly or updating budget to meet reasonable cost increase from expenditure.

Part C

Variance Analysis Note

You have been provided with the projected data sheet for reference in the Spread sheet.

Please use the spread sheet file to complete the calculations.

In this part you are provided with an excel file with 2 spread sheets (Budgeted Rooms Revenue Sheet, Actual Rooms Revenue sheet)with the actual figures on the rooms for a given quarter. You are required to calculate the actual revenue that has been generated for each month in the given quarter based on the actual occupancy rate.

Calculate the following details using the appropriate sheet as per the given instructions

Budgeted Rooms Revenue Sheet

Refer to the projected data sheet.

In this sheet first calculate the total projected/forecasted revenue per room type for all 365 days.
You are also required to calculate total projected/forecasted revenue per room type for each month for Jan, Feb and Mar.
Calculate the total rooms for each month
Calculate the Total Revenue for all room types for each month
Calculate the total projected revenue for 3 months (Jan, Feb and Mar)

Actual Rooms Revenue Sheet

In this sheet you are provided with the Actual occupancy for each month.
Calculate the Revenue per room type for each month (Jan, Feb and Mar)
Calculate the total rooms for each month
Calculate the Total Revenue for all room types for each month
Calculate the Variance for each room type for each month (Note before you can do this calculation you have first calculated the budgeted rooms revenue for each month as instructed above using the Budgeted Room Revenue sheet)
Calculate the variance %