Project

This task is in continuation of part E of assessment task 3.

To complete this task, you will require the financial statements prepared as part of assessment task 2.

Considering those financial statements (cash flow forecast and forecasted income statement), you will be required to review and evaluate these financial management processes with the work team.

Your trainer, along with another student, will form a team with you. Your team will have 3 team members.

You will then be required to analyse the following:

• Cash flow statement:

• Identify how much cash flowed into the business in the fourth quarter.
• Deduce the source of finance most appropriate for this business, starting in quarter 3.
• Identify how much cash the business had in its account at the end of the cash flow statement period.
• Identify the quarter in which the business had the highest level of cash inflow.
• Identify the quarter in which the business had the highest level of cash outflow.

• Income statement

• Evaluate the legal structure of this business.
• Identify items that would be included under Financial Expenses.
• Calculate the tax liabilities for this business in 2019.

• Financial ratios

• Current ratio (working capital ratio)
• Debt to equity ratio
• Return on equity (ROE)

After analysing the financial management processes of the organisation, you will then be required to prepare a report for the board of directors (trainer/assessor) that must include the following:

• Outcomes of analysis of cash flow statement.
• Outcomes of analysis of income statement.
• Outcomes of financial rations.
• Your recommendations for improvement in the existing process.
• Implement the improvements in Contingency plan and attach to the report.
• Record-keeping requirements for the Australian Taxation Office (ATO) and for auditing purposes

Template for the report:

Evaluation report of the financial management processes

A cover sheet of the unit of competency

Version control information

Disclaimer and Acknowledgement

An introduction to the project

List of symbols and their explanations

Table of contents

The main body of the report covering the following topics:

• Outcomes of analysis of cash flow statement.
• Outcomes of analysis of income statement.
• Outcomes of financial rations.
• Your recommendations for improvement in the existing process.
• Implement the improvements in Contingency plan and attach to the report
• Record-keeping requirements for the Australian Taxation Office (ATO) and for auditing purposes

Summary and review

Glossary

References