Review and update the Financial Policy and Procedure as per your suggested recommended improvements to the financial management process according to the variance report and role play.In addition, we dont need to list specific budgets such as marketing etc in this policy and procedure.

• Please consider adding some additional points regarding the % of budget that can be used per quarter e.g. a maximum of 40% of the budget can be used in a single quarter. This will help reduce the likelihood that managers will allocate majority of the budget in a single quarter and not have anything left for other quarters. Also consider adding a clause that states they must keep a certain% of the budget aside for unexpected expenses e.g. 10%.

Financial Policy and Procedure

Introduction

Management need to ensure efficient administration of Bounce Fitness and accurate financial accountability to ensure that the funding received is used toward achieving the goals of the missing and to ensure that all legal requirements are met.

Objectives

• To develop agreed procedures that will ensure records of all financial transactions are accurate and up to date
• To ensure that a budget guides spending so that objectives in the Bounce Fitness Mission, Vision and Objectives are met
• To develop agreed procedures that will ensure all incomes and expenditure is audited annually, and these accounts are available to the Board and Stakeholders
• To develop agreed processes for spending so that it is clear who needs to authorise various levels of spending

Procedure

• The annual budget is drafted by the General Manager Finance and is overseen by the Chief Executive Officer from budget actuals, bank statements and records maintained by the Bookkeeper and approved by the General Manager Finance. The Chief Executive Officer approves the final budget and presents it to the Board of Directors
• An independent audit of the financials is conducted annually by the Accounting Firm representing Bounce Fitness.
• The Accounting Firm will audit accounts annually and present a Statement of Financial Performance on each occasion to the Chief Executive Officer who will in turn present it to the Board
• Financial records may be accessed by the Board Members, Chief Executive Officer and the General Manager Finance. Other information may be accessed as needed by the Bookkeeper or Administrative Assistants with the approval of the General Manager Finance
• Centre Managers are responsible for planning, approving and keeping to their budgets and if an overrun is foreseen or occasioned, the General Manager Finance is informed at the earliest possible time
• Six Monthly reports are produced for the Centre Managers and they convey information related to targets such as budgeted expense vs actual expense, projected sales vs actual sales. Variations must be reported to General Manager of Finance at the earliest possible time.
• Centre Managers manage Petty Cash to the value of $100 per item and may spend up to $500 of budgeted funds on agreed and budgeted area. Any other expenses must be approved in advance by the General Manager Finance.
• General Manager Finance may authorise expenditure up to $5,000 without consultation. Any unbudgeted expenditure or amounts above that must be approved by the Chief Executive Officer
• Chief Executive Officer may authorise expenditure up to $10,000 without consultation. Any unbudgeted expenditure or amounts above that must be approved by the board.

Role Play

Chairperson: According to the Variance Report for 1st and 2nd Quarter we can clearly see that the overall costs are higher than the budget. Can you guys explain to me what happened ? Marketing Manager: The budgeted expenses for 2nd quarter exceeded $10,000. This was due to additional website maintenance requirements caused by the website upgrade in Quarter 1. But our actual and planned expenses are still within the $100,000 budget. Fitness Manager: The Equipment budget was exceeded because there were a number of unexpected equipment breakdowns that then lead to replacement of equipment. Within the 1st Quarter, the following equipment had to be replaced: Spin Bike maintenance tried to fix it but it had to be replaced. The replacement spin bike cost $1,200 Elliptical Machine maintenance tried to fix it but it had to be replaced. The replacement machine cost $2,000 Within the 2nd Quarter, the following equipment had to be replaced: Five x boxing gloves at a cost of $60 each. Stationary bike maintenance tried to fix it but it had to be replaced. The replacement bike cost $1,500 Also the repairs and maintenance and wages also increased in the 1st Quarter due to the equipment breakdowns.

Variance Report
Student Name	Nguyen Anh Duy
Organisation Name	Bounce Fitness
Date Range for Report	July - September
	Projected	Actual	% Variance	$ Variance	Interpretation
Total Revenue	$215.000	$215.000	%0	$0	No variance
Expense	Budgeted	Actual	% Variance	$ Variance	Interpretation
Purchases ( Stock etc)	$20.000	$19.000	-5%	-$1.000	Expenses lower than budgeted
Accountant fees	$1.200	$1.200	0%	$0	No variance
Equipment	$20.000	$20.467	0.5%	$467	Expenses higher than budgeted
Advertising & marketing	$30.000	$30.000	0%	$0	No variance
Bank fees & charges	$200	$200	0%	$0	No variance
Utilities	$1.000	$1.000	0%	$0	No variance
Telephone	$1.000	$1.000	0%	$0	No variance
Rent & rates	$12.000	$12.000	0%	$0	No variance
Repairs & maintenance	$2.000	$4.000	100%	$2000	Expenses higher than budgeted
Stationery & printing	$300	$300	0%	$0	No variance
Membership & affiliation fees	$300	$500	66.7%	$200	Expenses higher than budgeted
Licensing	$	$	%	$	No variance
Insurance	$2.000	$2.000	0%	$	No variance
Superannuation	$8.850	$8.850	0%	$	No variance
Income tax	$20.000	$20.000	0%	$	No variance
Wages ( including PAYG)	$90.000	$93.000	3.33%	$3.000	Expenses higher than budgeted
Staff Training	$	$	%	$	No variance
	$	$	%	$	Choose an item.
	$	$	%	$	Choose an item.
	$	$	%	$	Choose an item.
Total Cost	$209.050	$213.517	2%	$4467	Overall expenses are nearly the same at budgeted
Variances Identified
Overall Cost against the Budget	Overall cost are higher than the Budget by $4467
Overall Revenue against Budget	No variance in the revenue; it met the budget

Variance Report
Student Name	Nguyen Anh Duy
Organisation Name	Bounce Fitness
Date Range for Report	October - December
	Projected	Actual	% Variance	$ Variance	Interpretation
Total Revenue	$230.000	$230.000	%0	$0	No variance
Expense	Budgeted	Actual	% Variance	$ Variance	Interpretation
Purchases ( Stock etc)	$25.000	$25.000	0%	$0	No variance
Accountant fees	$1.200	$1.200	0%	$0	No variance
Equipment	$0	$1.800	%	$1800	Expenses higher than budgeted
Advertising & marketing	$18.000	$28.000	64%	$10.000	Expenses higher than budgeted
Bank fees & charges	$200	$200	0%	$0	No variance
Utilities	$950	$950	0%	$0	No variance
Telephone	$1.000	$1.000	0%	$0	No variance
Rent & rates	$12.000	$12.000	0%	$0	No variance
Repairs & maintenance	$3.000	$3.000	0%	$0	No variance
Stationery & printing	$400	$400	0%	$0	No variance
Membership & affiliation fees	$500	$500	0%	$0	No variance
Licensing	$5000	$5000	0%	$0	No variance
Insurance	$2.000	$2.000	0%	$0	No variance
Superannuation	$8.740	$8.740	0%	$0	No variance
Income tax	$21.000	$21.000	0%	$0	No variance
Wages ( including PAYG)	$92.000	$92.000	0%	$0	No variance
Staff Training	$5.000	$5.000	0%	$0	No variance
	$	$	%	$	Choose an item.
	$	$	%	$	Choose an item.
	$	$	%	$	Choose an item.
Total Cost	$195.990	$207.790	5%	$11.800	Overall expenses higher than budgeted
Variances Identified
Overall Cost against the Budget	Overall cost are higher than the Budget by $11.800 ( 5%)
Overall Revenue against Budget	No variance in the revenue; it met the budget