As the financial manager, who has conducted an audit on the Nara Groups budgets, you must now prepare a report highlighting your findings. Using the information you have collected in previous tasks, prepare a variation report, of approximately 300 words in length, reviewing the budgeted period. Your report must meet the following format as required by the organisation:

1. Name of Reviewer

2. Date of Review

3. Budget Period in Review

4. Address the following points:

   1. List the top 3 areas of greatest concern, with discrepancies between the forecasted budget and actual performance.

Provide a brief explanation of each discrepancy, stating why it may have occurred and why it is of concern.

2. What was the organisations tax liability for the period? What is the difference between the actual tax liability and the budgeted tax liability? (Note: use the total profit in Part 2 Task 1

(d) not Part 2 Task 1 (c).

3. Evaluate the effectiveness of the financial management process, by considering its ability to ensure that the forecasts of the budget are achieved.

4. Recommendations for next budget period to ensure financial viability of the organisation and prevent the discrepancies from reoccurring.

18:07 & 36 4 APEX APPENDIX: 01 THE NARA GROUP BANK STATEMENTS OCT NOV DEC 2018 Note: brackets imply a negative figure Debited Credited $ 730.000 $ $ s $ $ 32,200 15,416 125.000 5,000 4,583 $ 243,845 $ $ $ $ $ $ $ 41 250 165,000 36,766 27,766 24.066 104,166 557,083 Bank Statement October 2018 Transactions 1-Oct Balance Forward 2-Oct Sponsorship Cost 3-Oct Management Software Payment Building RNR 5-Oct Promotional Material Cost 5-Oct Community Contributions 7-Oct Operating Revenue Cash B-Oct Marketing Contracts 9-Oct Room Furnishing 10-0 Room Cleaning Cost 11-Oct Room Maintenance Cost 12-Oct AHMG Operating Fee 13-Oct Building Her NBH 14-Oct Staff Salaries Payment NG 15-O 16-O Operating Revenue Cash 17-Oct Utilities Cost 18-Oct 19-Oct Building Rent NCC 20-Oct Room Cleaning Cost 21-Oct 22-Oct Building AM CON 23-Oct Operating Revenue Cash 24-Oct 25-Oct Accounting and Reporting Costs 26-Oct 27-Oct 28-Oct Stall Salaries Payment NG 29-Oct Operating Revenue Cash 30-Oct Booking.com Cash Receipt 30-Oct Trhago Cash Recept 30 Oct Expedia Cash Receipt 31-Oct P.L Farthing Cash Receipt $ 212.700 Balance $ 730 000 $ 697.800 $ $82,384 $ 557,384 $ 552 384 s 547,801 $ 791 646 $ 750 395 $ 585,395 $ 548 630 s 520.864 $ 496,798 $ 392,632 $ (164,451) $ (164,451) $ 49,249 $ 36,683 $ 36,683 $ 142,4831 $ 79,2491 $ 79,2491 $ (120,915) $ 110,085 $ 110,085 $ 106,822 $ 106,822 $ 106,822 $ (450,261) $ (194911) S RS, 089 S 505 089 $ 255.0 $ 891089 $ 11.566 $ $ 79,166 36.766 $ 41 666 $ 231,000 $ $ 557,083 $ 255,350 $ 200.000 $ 420.000 $ 250.000 $ 136.000 APEX 31-OctSmyth Co Cash Receipt 31-0 LL Advisory Cash Receipt $ 100,000 $ 425,000 $ 991,089 $ 1.416,089 Debited Credited $1,416,089 Bank Statement November 2018 Transactions 1- Nov Balance Forward 2-Now Sponsorship Cost 3. Nov Management Software Payment 4-Now Building Rent NR 5-Nov Room Cleaning Cost 6-Novl Community Contributions 7- Nov Operating Revenue Cash B-Nov Marketing Contracts 9-Nov Room Furnishing 10 Nov $ 32,300 $ 15,417 $ 125,000 $ 36,766 $ 4583 Balance $ 1,436,089 $ 1,383,789 $ 1,358,372 $ 1,243,372 $ 1,206,606 $ 1,202,023 $ 1,316,523 $ 1,355.273 $ 1.190.273 $ 1.190.273 $ 194,500 $ 41,250 $ 165,000 18:07 & 36 4 PES 31-Oct 31-Oct Smyth & Co Cash Receipt LL Advisory Cash Recelot $ 100,000 $425.000 s 9910 $ 1,416,00 Debited Credited $1.416,089 $ $ $ $ $ 32,300 15,417 125,000 36,766 4SR3 $ 194,500 $ 41.250 $ 165,000 11. NON $ 24,067 $ 261,425 $ 104, 167 $ 557,053 $ 27,767 Bank Statement November 2018 Transactions 1-Now Balance Forward 2-Now Sponsorship Cost 3-Now Management Software Payment 4-Nov Building Rent NR 5-Nov Room Cleaning Cost 6-Nov Community Contributions 3. Now Operating over Cash 3-Nov Marketing Contracts 9-Nov Room Furnishing 10-Now AHMG Operating For 12-Noy Operating Revenue Cash 13-Now Building Rent NEM 14 Nov Staff Salaries Payment NG 15-Nov Room Maintenance Cost 16-Nov 17. Nov Utilities Cost 18 Nov Operating Revenue Cash 19-Nov Building Rent NCC 20-Now Room Cleaning Cost 21-Nov 22-Nov Building AM Cost 23-Now 24-Nov Accounting and Reporting Costs 26-Nov 27-Nov Operating Revenue Cash 28-Nov Staff Salaries Payment NG 29-Nov 29 Nov Booking.com Cash Receipt 29-Nov Trivage Cash Receipt 30-Now Expedia Cash Receipt 30-Now PL Farthings Cash Recept 30-Nov Smyth & Co Cash Recept 30-Nov Ll Advisory Cash Receipt $ 11,567 $ 211,500 Balance $ 1,416,019 $ 1,383,789 $ 1,368,372 $ 1,243,372 $ 1,206.606 $ 1,202,023 $ 1,396.523 $ 1,355,273 $ 1,190,223 $ 1,190,273 $ 1.166.206 $ 1,427,631 $ 1,323,464 $ 766,381 $ 238,614 $ 738,614 $ 727,047 $938.547 $ 859,380 $ 822,610 $ 822.610 $ 780,44 $ 780,944 $ 780.944 $ 777,681 $ 777,681 $ 96,081 $ 438,997 $ 438,97 $ 838.997 $ 1.165.997 $ 1,395.997 $ 1,545,997 $ 1,626,497 $ 3,986 497 $ $ 79,16 36,770 $ 41.666 25 New s 3.263 $ 218,000 $ 557,054 $ 400,000 $ 327,000 $ 230,000 $ 150,000 $ 30.500 $ 370,000 APEN Bank Statement December 2018 Transactions 1-Dec Balance Forward Debited Credited $ 1.996,497 3-D $ 15,417 Management Software Payment Building Rent NR Operating Revenue Cash Community Contributions $ 125,000 S-Dec $ 243450 Balance $ 1,96 497 $ 1,996 497 $ 1,981.00 $ 1,856,080 $ 2,039,530 $ 2,094,946 $ 2,094.946 $ 2,053,696 $ 1.698.696 $ 4.584 6-Dec 7-Dec B-Dec Marketing Contracts Room Furnishing $ $ 41,250 165,000 18:07 & 36 4 Debited Credited $ 1,996,497 $ 15,412 $ 125.000 $ 243,450 $ 4584 $ $ 165,000 $ 36,766 27,767 $ 24,067 $ 104 167 $ 557054 $ $ 220.500 Bank Statement December 2015 Transactions Balance Forward 2-Dec 3-Dec Management Software Payment 4-Dec Building Rent NR 5-Dec Operating Revenue Cash Community Contribution 7-Dec 8-Dec Marketing Contracts 9-Dec Room Furnishing 10-Dec Room Cleaning Cost 11-Dec Room Maintenance Cost 12-Dec AHMG Operating Fee 13-Dec Building Rent NBH 14-Dec Staff Salaries Payment NG 15-Dec Operating Revenue Cash 16-Dec 17-Dec Utilities Cost 18-Dec Building Rent NCC 20-Dec Room Cleaning Cost Operating Revenue Cash 22-Dec Building AM Cost 23-Dec 24-Dec 25-Dec Accounting and Reporting Costs 26-Dec 27-Dec Operating Revenue Cash 28-Dec Start Salaries Payment NG 29-Dec Contingency Account Transfer 30-Dec Booking.com Cash Receipt 30-Dec The Cash Recept 30-Dec Expedia Cash Receipt 31-Dec P.L Farthing Cash Receipt 31-0 Smyth & Co Cash Receipt 31-0 LL Advisory Cash Recent $ 11.567 Balance $ 1,996 497 $ 1,996 497 $ 1,50100 $ 1,856,080 $ 2,099.530 $ 2,094.946 $ 2,094.246 $ 2,053,696 $ 1,698,696 $ 1,851.930 $ 1.624.163 $ 1.500,096 $ 1,695.929 $ 1,138845 $ 1,359,345 $ 1,359,145 $ 1,347,778 $ 1.347.778 $ 1.268611 $ 1,231.845 $ 1,496,845 $ 1,455,178 $ 1,455,178 $ 1,455.178 $ 1,451.914 $ 1,451.914 $ 1,690,064 $ 1,141,981 $ 997,619 $ 1,2574619 $ 1,542,619 $ 1.782.619 $ 1,932619 $ 2,012,619 $ 2.437,519 $ $ 79,167 36,766 21-0 $ 265.000 $ $ 3,264 $ 247.150 $ 557,00 $ 144,362 $ 270,000 $ 275.000 $ 240,000 $ 150.000 $ 80.000 $425.000 APEX APPENDIX: 02 AUDIT TRAIL TEMPLATE AUDIT TRAIL FORM Auditor Name Audit Period Date of Audit: Audit Item 01/02/03/04 Audit Notes Yes/No? of prowide further detail. What was the amount received/paid? How much was the discrepancy? 18:07 & S 552 03 $ 144,362 US 28-0 29-0 30-Dec 30-Dec 30-Dec 31-Dec 31-Dec 31-0 Operating USA Stall Salaries Payment NG Contingency Account Transfer Booking.com Cash Receipt Tohago Cash Recept Expedia Cash Receipt PL Farthings Cash Receipt Smyth & Co Cash Receipt LL Advisory Cash Recais 36 + ATAISO 31,6900 $ 1.141.981 $ 997419 $ 270.000 $ 1,267,619 $ 275.000 $ 1,542,619 $ 240.000 $ 1,782,619 $ 150.000 $ 1,992,619 $ 80,000 $ 2.012,519 $425,000 $267519 APEX APPENDIX: 02 AUDIT TRAIL TEMPLATE AUDIT TRAIL FORM 01/02/03/04 Auditor Name: Audit Period: Date of Audit Audit Item Audit Notes Yes/No? no, prowide further details. What was the amount received/paid? How much was the discrepancy? Does the operating cash revenue received match the cash flow statement? Do the debtors cash receipts match the accounts receivable for October 2018? Do the debtors cash recelts match the accounts receivable for November 2018? Do the debtors cash receipts match the accounts receivable for December 2018? Do the variable expenses paid match the operating budget? Do the fed expenses paid match the operating budget? Auditor Snature: II 18:07 & 36 4 APEX APPENDIX: 01 THE NARA GROUP BANK STATEMENTS OCT NOV DEC 2018 Note: brackets imply a negative figure Debited Credited $ 730.000 $ $ s $ $ 32,200 15,416 125.000 5,000 4,583 $ 243,845 $ $ $ $ $ $ $ 41 250 165,000 36,766 27,766 24.066 104,166 557,083 Bank Statement October 2018 Transactions 1-Oct Balance Forward 2-Oct Sponsorship Cost 3-Oct Management Software Payment Building RNR 5-Oct Promotional Material Cost 5-Oct Community Contributions 7-Oct Operating Revenue Cash B-Oct Marketing Contracts 9-Oct Room Furnishing 10-0 Room Cleaning Cost 11-Oct Room Maintenance Cost 12-Oct AHMG Operating Fee 13-Oct Building Her NBH 14-Oct Staff Salaries Payment NG 15-O 16-O Operating Revenue Cash 17-Oct Utilities Cost 18-Oct 19-Oct Building Rent NCC 20-Oct Room Cleaning Cost 21-Oct 22-Oct Building AM CON 23-Oct Operating Revenue Cash 24-Oct 25-Oct Accounting and Reporting Costs 26-Oct 27-Oct 28-Oct Stall Salaries Payment NG 29-Oct Operating Revenue Cash 30-Oct Booking.com Cash Receipt 30-Oct Trhago Cash Recept 30 Oct Expedia Cash Receipt 31-Oct P.L Farthing Cash Receipt $ 212.700 Balance $ 730 000 $ 697.800 $ $82,384 $ 557,384 $ 552 384 s 547,801 $ 791 646 $ 750 395 $ 585,395 $ 548 630 s 520.864 $ 496,798 $ 392,632 $ (164,451) $ (164,451) $ 49,249 $ 36,683 $ 36,683 $ 142,4831 $ 79,2491 $ 79,2491 $ (120,915) $ 110,085 $ 110,085 $ 106,822 $ 106,822 $ 106,822 $ (450,261) $ (194911) S RS, 089 S 505 089 $ 255.0 $ 891089 $ 11.566 $ $ 79,166 36.766 $ 41 666 $ 231,000 $ $ 557,083 $ 255,350 $ 200.000 $ 420.000 $ 250.000 $ 136.000 APEX 31-OctSmyth Co Cash Receipt 31-0 LL Advisory Cash Receipt $ 100,000 $ 425,000 $ 991,089 $ 1.416,089 Debited Credited $1,416,089 Bank Statement November 2018 Transactions 1- Nov Balance Forward 2-Now Sponsorship Cost 3. Nov Management Software Payment 4-Now Building Rent NR 5-Nov Room Cleaning Cost 6-Novl Community Contributions 7- Nov Operating Revenue Cash B-Nov Marketing Contracts 9-Nov Room Furnishing 10 Nov $ 32,300 $ 15,417 $ 125,000 $ 36,766 $ 4583 Balance $ 1,436,089 $ 1,383,789 $ 1,358,372 $ 1,243,372 $ 1,206,606 $ 1,202,023 $ 1,316,523 $ 1,355.273 $ 1.190.273 $ 1.190.273 $ 194,500 $ 41,250 $ 165,000 18:07 & 36 4 PES 31-Oct 31-Oct Smyth & Co Cash Receipt LL Advisory Cash Recelot $ 100,000 $425.000 s 9910 $ 1,416,00 Debited Credited $1.416,089 $ $ $ $ $ 32,300 15,417 125,000 36,766 4SR3 $ 194,500 $ 41.250 $ 165,000 11. NON $ 24,067 $ 261,425 $ 104, 167 $ 557,053 $ 27,767 Bank Statement November 2018 Transactions 1-Now Balance Forward 2-Now Sponsorship Cost 3-Now Management Software Payment 4-Nov Building Rent NR 5-Nov Room Cleaning Cost 6-Nov Community Contributions 3. Now Operating over Cash 3-Nov Marketing Contracts 9-Nov Room Furnishing 10-Now AHMG Operating For 12-Noy Operating Revenue Cash 13-Now Building Rent NEM 14 Nov Staff Salaries Payment NG 15-Nov Room Maintenance Cost 16-Nov 17. Nov Utilities Cost 18 Nov Operating Revenue Cash 19-Nov Building Rent NCC 20-Now Room Cleaning Cost 21-Nov 22-Nov Building AM Cost 23-Now 24-Nov Accounting and Reporting Costs 26-Nov 27-Nov Operating Revenue Cash 28-Nov Staff Salaries Payment NG 29-Nov 29 Nov Booking.com Cash Receipt 29-Nov Trivage Cash Receipt 30-Now Expedia Cash Receipt 30-Now PL Farthings Cash Recept 30-Nov Smyth & Co Cash Recept 30-Nov Ll Advisory Cash Receipt $ 11,567 $ 211,500 Balance $ 1,416,019 $ 1,383,789 $ 1,368,372 $ 1,243,372 $ 1,206.606 $ 1,202,023 $ 1,396.523 $ 1,355,273 $ 1,190,223 $ 1,190,273 $ 1.166.206 $ 1,427,631 $ 1,323,464 $ 766,381 $ 238,614 $ 738,614 $ 727,047 $938.547 $ 859,380 $ 822,610 $ 822.610 $ 780,44 $ 780,944 $ 780.944 $ 777,681 $ 777,681 $ 96,081 $ 438,997 $ 438,97 $ 838.997 $ 1.165.997 $ 1,395.997 $ 1,545,997 $ 1,626,497 $ 3,986 497 $ $ 79,16 36,770 $ 41.666 25 New s 3.263 $ 218,000 $ 557,054 $ 400,000 $ 327,000 $ 230,000 $ 150,000 $ 30.500 $ 370,000 APEN Bank Statement December 2018 Transactions 1-Dec Balance Forward Debited Credited $ 1.996,497 3-D $ 15,417 Management Software Payment Building Rent NR Operating Revenue Cash Community Contributions $ 125,000 S-Dec $ 243450 Balance $ 1,96 497 $ 1,996 497 $ 1,981.00 $ 1,856,080 $ 2,039,530 $ 2,094,946 $ 2,094.946 $ 2,053,696 $ 1.698.696 $ 4.584 6-Dec 7-Dec B-Dec Marketing Contracts Room Furnishing $ $ 41,250 165,000 18:07 & 36 4 Debited Credited $ 1,996,497 $ 15,412 $ 125.000 $ 243,450 $ 4584 $ $ 165,000 $ 36,766 27,767 $ 24,067 $ 104 167 $ 557054 $ $ 220.500 Bank Statement December 2015 Transactions Balance Forward 2-Dec 3-Dec Management Software Payment 4-Dec Building Rent NR 5-Dec Operating Revenue Cash Community Contribution 7-Dec 8-Dec Marketing Contracts 9-Dec Room Furnishing 10-Dec Room Cleaning Cost 11-Dec Room Maintenance Cost 12-Dec AHMG Operating Fee 13-Dec Building Rent NBH 14-Dec Staff Salaries Payment NG 15-Dec Operating Revenue Cash 16-Dec 17-Dec Utilities Cost 18-Dec Building Rent NCC 20-Dec Room Cleaning Cost Operating Revenue Cash 22-Dec Building AM Cost 23-Dec 24-Dec 25-Dec Accounting and Reporting Costs 26-Dec 27-Dec Operating Revenue Cash 28-Dec Start Salaries Payment NG 29-Dec Contingency Account Transfer 30-Dec Booking.com Cash Receipt 30-Dec The Cash Recept 30-Dec Expedia Cash Receipt 31-Dec P.L Farthing Cash Receipt 31-0 Smyth & Co Cash Receipt 31-0 LL Advisory Cash Recent $ 11.567 Balance $ 1,996 497 $ 1,996 497 $ 1,50100 $ 1,856,080 $ 2,099.530 $ 2,094.946 $ 2,094.246 $ 2,053,696 $ 1,698,696 $ 1,851.930 $ 1.624.163 $ 1.500,096 $ 1,695.929 $ 1,138845 $ 1,359,345 $ 1,359,145 $ 1,347,778 $ 1.347.778 $ 1.268611 $ 1,231.845 $ 1,496,845 $ 1,455,178 $ 1,455,178 $ 1,455.178 $ 1,451.914 $ 1,451.914 $ 1,690,064 $ 1,141,981 $ 997,619 $ 1,2574619 $ 1,542,619 $ 1.782.619 $ 1,932619 $ 2,012,619 $ 2.437,519 $ $ 79,167 36,766 21-0 $ 265.000 $ $ 3,264 $ 247.150 $ 557,00 $ 144,362 $ 270,000 $ 275.000 $ 240,000 $ 150.000 $ 80.000 $425.000 APEX APPENDIX: 02 AUDIT TRAIL TEMPLATE AUDIT TRAIL FORM Auditor Name Audit Period Date of Audit: Audit Item 01/02/03/04 Audit Notes Yes/No? of prowide further detail. What was the amount received/paid? How much was the discrepancy? 18:07 & S 552 03 $ 144,362 US 28-0 29-0 30-Dec 30-Dec 30-Dec 31-Dec 31-Dec 31-0 Operating USA Stall Salaries Payment NG Contingency Account Transfer Booking.com Cash Receipt Tohago Cash Recept Expedia Cash Receipt PL Farthings Cash Receipt Smyth & Co Cash Receipt LL Advisory Cash Recais 36 + ATAISO 31,6900 $ 1.141.981 $ 997419 $ 270.000 $ 1,267,619 $ 275.000 $ 1,542,619 $ 240.000 $ 1,782,619 $ 150.000 $ 1,992,619 $ 80,000 $ 2.012,519 $425,000 $267519 APEX APPENDIX: 02 AUDIT TRAIL TEMPLATE AUDIT TRAIL FORM 01/02/03/04 Auditor Name: Audit Period: Date of Audit Audit Item Audit Notes Yes/No? no, prowide further details. What was the amount received/paid? How much was the discrepancy? Does the operating cash revenue received match the cash flow statement? Do the debtors cash receipts match the accounts receivable for October 2018? Do the debtors cash recelts match the accounts receivable for November 2018? Do the debtors cash receipts match the accounts receivable for December 2018? Do the variable expenses paid match the operating budget? Do the fed expenses paid match the operating budget? Auditor Snature