Subheading

Elements and Performance Criteria

ELEMENT	PERFORMANCE CRITERIA
Elements describe the essential outcomes.	Performance criteria describe the performance needed to demonstrate achievement of the element.
1. Review accounts receivable requirements	1.1 Check receipts entered into manual accounts receivable system for accuracy, consistency and completeness 1.2 Identify and make record of incorrect entries according to type and source of receipt 1.3 Identify and investigate discrepancies between monies owed and monies paid according to organisational policies, procedures and guidelines 1.4 Amend receipts entered into manual accounts receivable system according to established procedures
2. Identify bad and doubtful debts	2.1 Review debtor ledger according to organisational policies and guidelines to identify outstanding monies and seek further information where required 2.2 Verify bad and doubtful debt status through liaison with debtors 2.3 Complete reporting procedures and required documentation for bad and doubtful debts according to organisational policies and guidelines
3. Review client compliance with terms and conditions and plan recovery action	3.1 Identify clients in default of trading terms according to organisational credit policies and operating procedures 3.2 Contact identified clients and promptly and courteously make satisfactory arrangements for payment of outstanding monies 3.3 Action organisational policy and procedures for monies owing that constitute breach of organisational credit policy 3.4 Review previous activities and communication with clients to establish adequacy of follow-up procedures, and determine whether usual organisational recovery avenues have been exhausted 3.5 Develop plans to pursue debt recovery or to initiate legal action, with measures completed in line with organisational policies, guidelines and timeframes
4. Prepare reports and file documentation	4.1 Prepare reports that document accounts receivable, debt recovery type and cause, and debt recovery plan 4.2 Distribute reports to supervisors, managers, and other designated parties 4.3 File documentation according to organisational policy and procedures
5. Distribute creditor invoices for authorisation	5.1 Identify, investigate and rectify invoice discrepancies and encode and record invoices correctly 5.2 Request authorisation for payment from designated personnel
6. Remit payments to creditors	6.1 Draw up and ensure authorisation of cheque requisition 6.2 Collect and record data relating to creditor details and amounts paid according to organisational guidelines, and prepare report for ratification by management 6.3 Prepare creditor payment in line with organisational requirements 6.4 Prepare journal to record payment
7. Reconcile outstanding balances	7.1 Obtain statements of outstanding balances from suppliers where required 7.2 Reconcile balances outstanding to invoices received

Assessment Evaluation Description

By completing this assessment the learner will gather evidence of their ability, knowledge and skills to prepare non-complex income tax returns for individuals in accordance with statutory requirements, and encompasses gathering and verifying data, calculating taxable income and reviewing compliance requirements.

Performance measurement:

Your result for this assessment will be deemed satisfactory or not-yet-satisfactory in line with specified educational standards under the Australian Qualifications Framework.

What does satisfactory mean?

These answers contain relevant and accurate information in response to the question/s with limited serious errors in fact or application. If incorrect information is contained in an answer, it must be fundamentally outweighed by the accurate information provided. This will be assessed against a marking guide provided to assessors for their determination.

What does not-yet-satisfactory mean?

This occurs when an assessment does not meet the marking guide standards provided to assessors. These answers either do not address the question specifically, or are wrong from a legislative perspective, or are incorrectly applied. Answers that omit to provide a response to any significant issue (where multiple issues must be addressed in a question) may also be deemed not-yet-satisfactory. Answers that have faulty reasoning, a poor standard of expression or include plagiarism may also be deemed not-yet-satisfactory.

What happens if you are deemed not-yet-satisfactory?

In the event you do not achieve a satisfactory outcome in this assessment, you will be given more opportunities to re-do the assessment after consultation with your Assessor.

Important: It is your responsibility to ensure your assessment resubmission addresses all areas deemed unsatisfactory by your assessor. Please note, if you are still unsuccessful in meeting a satisfactory outcome after resubmitting your assessment, you will be required to repeat the unit.

Use the prescribed textbook for this unit, the Internet and other sources to help you complete this assessment task.

Assessment Tasks

1. Case Study: 3 Cases

2. Business Presentation in the Case Study 3

You MUST attempt to answer all questions in this assessment.

Assessment Task A

Scenario 1

You are a junior accountant at NIET and are responsible for general bookkeeping works and posting transactions to special journals, ledgers and financial statements.

Q1. You have been received the following receipts from the marketing staff to claim reimbursement. You are required to check the receipts and post transactions to the ledger. (PC 1.1)

Explain what you must check and where to post the above transactions.

Q2) From Q1, your colleague entered the above transactions to the companys vehicle expense account and the inventory account. You have been now told by the marketing staff that the cups and the plates were used for marketing activities. (PC 1.2)

Q3) You have received a payment request letter from one of your suppliers, LY office supplies and lodged a complaint in regard to late payment for Invoice 242.

You have checked the payment detail and the previous accountant made a payment of $11,550. The office manager has informed you that two of the supplied computers will be returned as the products have some technical issues. You need to consider the following policies.

- Your Company does not issue credit note.

- Your company requires new invoice if sale returns occur.

You are required to resolve a conflict in payment procedure for your suppliers.

Explain steps you must undertake to resolve the above issue. (PC 1.3)

Q4. You are required to receive new receipt (Tax Invoice) from the supplier in Q3, explain how to amend general journal entries. (PC 1.4)

Q5. You have found the debtors schedule and are required to review the schedule. According to the organizational policies, more than 90 days uncollected funds must be recognized as bad debts. The company has the following policies;

- 5% discount on an invoice is allowed on the payment from debtors within 3 days

- 2% discount on an invoice is allowed on the payment from debtors within 7 days

- 3% interest imposed on an invoice to the debtors within 30day account

- 5% interest imposed on an invoice to the debtors within 60day account

- 10% interest imposed on an invoice to the debtors within 90day account

- Any debts are not collected more than 90 days from the issuance date of an invoice must be recognized as bad debts and send a request to a debt collection agency.

Identify outstanding monies that NIET must collect from their debtors and explain how NIET can accelerate their collections. (PC 2.1)

Q6. From Q5, you are also required to identify bad debts. Once you identify the bad debts, you are required to communicate with accounts manager to minimize doubtful debts from the debtors. Explain how NIET can minimize doubtful debts. (PC 2.2)

Q7. From Q5 and Q6, you are required to report in regard to bad and doubtful debts in accordance with the organizational policies and guidelines. You must use the below heading to report and provide your professional advice for NIET.

Date:

From:

To:

Topic: Current Bad Debts and Doubtful debts and its collection procedures.

Case Study 2 Role Play and questions

One of your debtors, Jason Johnsons has been trading with your business more than 10 years and you have known his business for ages. He was one of your trustable clients but is currently experiencing financial difficulties. Jason needs educational services from your business however, he was not able to settle his account for the last 6 months.

From Case Study 1 Q5, his debts were placed in more than 90 days account and still owes $1730.00 from the last year. Recently, you have been asked by Jason whether you can provide another educational service for his business WHS management plan.

Claire Suzanne has also requested another WHS education but you are concerned with her account as she does not pay promptly.

Q1. You are required to identify debtors in default of trading terms. The company has the following policies for debtors.

- All debtors must be contacted when the debt is placed in 90 days account

- All debtors must be treated equally unless they become insolvent

- All debtors must be contacted when their accounts are placed in more than 90 days account.

- All debtors must provide their payment plans before they become insolvent

Role Play (PC 4.1, 4.3)

Once you have successfully identified the debtors in default of trading terms from Q1 in accordance with the companys policies, then you must conduct a role play with your trainer.

Your trainer: Debtor

Your role: the companys account manager

As you have identified the debtor in default of trading terms according to organisational credit policies, you need to contact the client and have to arrange payment plan for outstanding monies. During your role play, you need to explain why the meeting must be organized and need to discuss with the debtor in order to establish payment plan with the debtor.

During the role play, the following points must be addressed and

- Must be able to address the current issues

- Must be able to convince the debtor to agree the payment plan

- The payment plan must be completed within 2 years

- Must explain legal action against the debtor and debt recovery procedure

Once you have completed the role play, you are required to complete the following form to record for documentation.

Document No	Deb-INS-0003
Date
Debtor Name
Debtor Address
Account Balance
Outcome
Payment Plan
Approval required	Finance Manager must approve this form before taking the action

Business Report (PC 4.2)

Once you have successfully completed the role play, you need to report to your trainer with your business report. Your report must be completed with the following headings.

- Documentation No:

- Date

- From: (your name)

- To: Accounting Manager (your trainer), Customer Service & Sales Manager

Topic: Debtors payment schedule and payment arrangement

Decision:

Actions required:

You have received an invoice from General Manager as follow.

Q2. You are required to make a payment in accordance with the invoice. You need to check the invoice whether any errors made by the supplier and need to report to the account manager if there are differences to the supplies. (PC 5.1)

Q3. Once you have received the amended invoice from the supplier, and are about to proceed the payment for the invoice. Write an email to the finance manager for the payment approval. (PC 5.2)

Q4. As the supplier is very new to the company, you are required to establish the suppliers account. Explain what information you need to acquire. (PC 6.2)

Q5. You are going to issue a company cheque for the invoice, in order to issue the cheque, what do you have to record and collect? (PC 6.1)

Q6. According to the companys policy, the payment must be made before its due date. When is the last day that the cheque must be dispatched? (PC 6.3)

Q7. You have received the following information and required to post the transactions to the general journal. (PC 6.4)

Q8. You have received the following transactions from the procurement manager as follows;

14^th Jun 2018: Office Supplies from Officeworks for $682.00 (GST inclusive), Invoice No: 0614-3147, ABN 1567894302

16^th Jun 2018: Labour Hire from EPS Total Labour Solution for $1320 (GST inclusive), Invoice No: NIET06-13, ABN: 3789573145

18^th Jun 2018: An electricity bill from AGL for $2750 (GST inclusive), Invoice No: 15171819, ABN: 2894301275

20^th Jun 2018: School supplies from IKEA for $12100 (GST inclusive), Invoice No: 1318921765, ABN: 3467829024

NIET has the following policies for creditors.

- All discounts options must be accepted.

- All payments must be made upon approval from finance manager within a 2 week period

Currently IKEA offers 2% discounts on a payment within 5 days from invoice issuance day.

You are required to complete the following table. (PC 7.1)

Invoice Date	Creditor	ABN	Invoice No	Amount	GST	Total Amount	Scheduled Payment

Trade Creditors schedule
Opening Balance
Closing Balance

Q9. An examination of the accounting records and the bank statement of the business at 31 May provides the following information:

1. The Cash account has a balance of $ 7575.50

2. The bank statement show a balance of $4138.75

3. On 31 May, the receipts of $3613.65 were deposited in the bank at the end of that day but were not recorded by the bank until 1 Jun.

4. Cheques issued and mailed in May but not limited among the cheques listed as paid on the bank statement were:

Cheque No. 206: $890.40

Cheque No. 222: $313.60

5. A bank service charge of $155.50 for May was deducted on the bank statement.

6. A Cheque received from a customer for $220 in payment of his account and deposited by the Sallys Pizza was returned marked NSF with the bank statement.

7. Interest of $48.40 earned on the business cheque account was added on the bank statement.

The company discovered that cheque no.201, which was correctly written as $1880 for the May rent was recorded as $1180 in the business accounts.

You are required to complete the following table. (PC 7.2)

Bank Reconciliation at (Date)
Cash balance from bank statement 31 May			$4,138.75
Add:
Deposit in transit		$3,613.65	$7,752.40
Deduct:
Outstanding Cheques
No. 206	*******
No. 222	*******
Reconciled cash balance 31 May			$6,548.40
Cash balance from business' records 31 May			$7,575.50
Add:
Interest earned on cheque account		$48.40	$7,623.90
Deduct
Bank service charge	*******
NSF Cheque	$220.00
Error: Cheque No.201 written for $1880 recorded as $1180	$700.00	$1,075.50
Reconciled cash balance 31 May			$6,548.40