1. Review Half Yearly Performance and Revise Projections

Using the Appx1_Skyward_Budget_and Performance Report template review the data provided by Skyward for the first two quarters of the year.

Review the current assumptions and parameters of the budget for accuracy and relevance and conduct appropriate research into the relevant industry to identify the feasibility of forecasts.

Use your research and the additional information provided by Skyward to perform relevant analysis to determine an appropriate response to the previous 2 budgetary quarters.

To perform this analysis, complete the following schedules in the EXCEL Template:

• 3A Half Yearly Performance (by quarter first and second quarters)
• 3B Revised projections (for the third and fourth quarter)

Make sure that your Excel Spreadsheet includes all appropriate formulas and calculations including links across worksheets.

1. Prepare Cash Flow Forecast

Using the FNSACC523_AE_Sk3of3_Appx1_Skyward_Budget_and Performance Report template prepare a cash flow forecast for the third quarter and including calculations for cash Receipts and cash payments.

To prepare this budget complete the following in the EXCEL Template:

• 3C Cash Flow Forecast

Make sure that your Excel Spreadsheet includes all appropriate formulas and calculations including links across worksheets.

1. Prepare Half Yearly Financial Report

Using the Appx4_Skyward_Half Yearly Financial_Report_template prepare the half-yearly Financial Report for submission to Skywards Executive Team.

Make sure that the structure of your report follows the template headings and includes the following:

• First and second-quarter performance analysis and review
• Third and fourth quarter revised projections for 2023/2024 with detailed assumptions
• Detailed cash flow forecast for the third quarter
• Provide detailed analysis and discussion for delivering the outcomes outlined in the 2023/24 Annual budget including:
  • Recommendations to achieve a cash surplus
  • Review of budget processes.

With the third quarter about to start, forecasted sales are down 35% from budgeted numbers for the third and 4^th quarters.

Variable costs for the first and second quarters were accurately budgeted, however, variable costs are now forecasted to rise by 5% for the third and 4^th quarters. Fixed costs have remained the same for the duration of the budget.

Additional information relating to cash flow is also provided:

• Sales:
  • cash sales = 5% of total sales (EFTPOS, bank transfers and cash are reconciled daily)
  • of credit sales, 65% paid within the month of sale and a 2% on-time payment discount is applied. The remaining 35% paid within the month following the sale.
• Purchases:
  • All purchases are made on credit with 80% paid the month of purchase and the remaining 20% paid within the month following purchase.
• Cash balance as of 31 December 2023 was $883,253.

Skyward Travel/3.A
Half Yearly Performance Report
For the period ended 31 December 2023
	1st Quarter Budget $	1st Quarter Actual $	$ Variance	% Variance	F or U	2nd Quarter Budget $	2nd Quarter Actual $	$ Variance	% Variance	F or U
Sales	2,654,385	3,185,262	530,877	20%	F	1,516,791	1,895,989	379,198	25%	F
Less Cost of Sales	1,232,209	1,478,651	246,442	20%	U	704,120	880,150	176,030	25%	UF
Gross profit	1,422,175	1,706,611	284,435	20%	F	812,672	1,015,840	203,168	25%	F
Gross Profit %	54%	54%	N/A	0%		54%	54%	N/A	0%
Less operating expenses:
Employee Expenses	717,390	755,147	37,756	5%	F	513,859	540,904	27,045	5%	UF
Advertising	7,354	8,090	735	10%	UF	7,354	8,090	735	10%	UF
Rent	112,939	112,811	-128	0%	F	112,939	112,811	-128	0%	F
Other Operating Expenses	8,402	10,004	1,601	19%	UF	8,402	10,004	1,601	19%	UF
Utilities	10,354	10,354	0	0%		10,354	10,354	0	0%
Insurance	26,705	26,705	0	0%		26,705	26,705	0	0%
Depreciation of Office Equipment	6,450	6,450	0	0%		6,450	6,450	0	0%
Accounting Fees	5,000	5,000	0	0%		5,000	5,000	0	0%
Total operating expenses	894,595	934,560	39,966	4%	F	691,064	720,317	29,254	4%	UF
Net profit	527,581	772,050	244,469	46%	F	121,608	295,522	173,914	143%	F
Net Profit %	20%	24%	N/A	4%	F	8%	16%	N/A	8%	F

Skyward Travel/3.B
Quarterly Revised Projections
For the period ended 30 June 2024
	2023/24 Full Year Budget	3rd Quarter Budget $	3rd Quarter Projection $	4th Quarter Budget $	4th Quarter Projection $
Sales	7,583,957	1,137,593	739,436	2,275,187	1,478,872
Less Cost of Sales	3,520,598	528,090	554,494	1,056,179	1,108,988
Gross profit	4,063,358	609,504	184,942	1,219,008	369,883
Gross Profit %	54%	54%	25%	54%	25%
Less operating expenses:
Employee Expenses	2,326,811	446,015	446,015	649,547	649,547
Advertising	29,418	7,354	7,354	7,354	7,354
Rent	451,755	112,939	112,939	112,939	112,939
Other Operating Expenses	33,609	8,402	8,402	8,402	8,402
Utilities	41,417	10,354	10,354	10,354	10,354
Insurance	106,820	26,705	26,705	26,705	26,705
Depreciation of Office Equipment	25,800	6,450	6,450	6,450	6,450
Accounting Fees	20,000	5,000	5,000	5,000	5,000
Total operating expenses	3,035,629	623,220	623,220	826,751	826,751
Net profit	1,027,729	-13,716	-438,278	392,257	-456,868
Net Profit %	14%	-1%	-59%	17%	-31%

Skyward Travel/3.C
Half Yearly Performance Report
For the period ended 31 December 2023
	December	January	February	March
Total Sales	258,300	229,658	309,521	198,325
Cash Sales (5% of Total Sales)	12,915	11,483	15,476	9,916
Credit sales (95% of Total Sales)	245,385	218,175	294,045	188,409
CASH RECEIPTS BUDGET	January	February	March
Accounts Receivable Collections
December Collections	85,885
January Collections	138,978	76,361		64%
February Collections		187,307	102,916
March Collections			120,016
Total Collections from Accounts Receivable	224,862	263,668	222,932
Cash Sales	11,483	15,476	9,916
Total Cash Receipts	236,345	279,144	232,848
CASH PAYMENTS BUDGET	December	January	February	March
Credit Purchases	176,895	185,241	175,632	188,522
Payments:
December Payments	141,516	35,379
January Payments		148,193	37,048
February Payments			140,506	35,126
March Payments				150,818
Cash paid to suppliers	141,516	183,572	177,554	185,944
Wages	251,716	251,756	251,756	251,756
Accounting Fees	1,667	1,667	1,667	1,667
Other operating Expenses	3,335	3,335	3,335	3,335
Advertising	2,697	2,697	2,697	2,697
Rent	37,604	37,604	37,604	37,604
Insurance	8,902	8,902	8,902	8,902
Utilities	3,451	3,451	3,451	3,451
Total Cash Payments	450,888	492,984	486,966	495,356
CASH BUDGET	January	February	March
Opening Cash Balance	883,253	626,614	418,793
Cash Received from Cash Sales	11,483	15,476	9,916
Cash received from Credit Customers	224,862	263,668	222,932
Total Cash Receipts	236,345	279,144	232,848
Total Cash Available	1,119,598	905,758	651,641
Cash paid to Suppliers	183,572	177,554	185,944
Cash paid to Employees	251,756	251,756	251,756
Cash paid for other operating expenses	57,656	57,656	57,656
Total Cash payments	492,984	486,966	495,356
Closing Cash Balance	626,614	418,793	156,285

Appendix 4: Skyward Half Yearly Financial Report - GUIDELINES

Half Yearly Financial Report Skyward

Budget Overview/Summary

Summarise here what this report is going to be about

First and Second Quarter Performance

Copy the results from your 3A spreadsheet here. Dont just insert an image. Make it look pretty, this is a report to management remember

Third and Fourth Quarter Revised Projections

Copy the results from your 3B spreadsheet here. Dont just insert an image. Make it look pretty, this is a report to management remember

Third Quarter Cash Flow Forecast

Copy the results from your 3C spreadsheet here. Dont just insert an image. Make it look pretty, this is a report to management remember

Review of Assumptions and Feasibility of Forecasts

List the assumptions you used in the budget process here

Were they feasible? That is, were they a good projection or did you get it wrong

What changed that made your projections out?

What could change in the future that puts further projections out?

Recommendations to Achieve a Cash Surplus

Give some recommendations that improve cash

For example, think of the work we did in NPV in FNSACC521 Financial business information, where you analysed the collection pattern of Acc Rec and saw that if they collected debts faster they got a higher NPV.

For example, what costs can be reduced?

Review of Budgeting Process

What can be done better next time?