Unit number and title
Level 5 Diploma Business
Unit 2 Managing Financial Resources
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Finance as a resources , Making financial decisions & Analysing financial performance
The purpose of this assignment is to give the learners a broad understanding of the sources and availability of managing financial for a business organisation. Learners will learn how to evaluate these different sources and compare how they are used. They will learn how financial information is recorded and how to use this information to make decisions for example in planning and budgeting.Decisions relating to pricing and investment appraisal are also considered within the unit. Finally, learners will learn and apply techniques used to evaluate financial performance
Since embarking upon your Business you have been looking for a new job in finance or accountancy. You have had a number of years of experience working in industry and you would be particularly interested in a role which involved working with and advising local businesses. Eventually you secure a post with a large firm of accountants as a Finance and Business Advisor. This is a new departure for the company who have, traditionally, concentrated upon accountancy and auditing services.
As a starting point, the senior partner in the company suggests that you put together:
You are given the following information from the company’s financial statement.
From the balance sheet as at
31 March 2003
31 March 2002
Total Asset less current liabilities
Creditors Due after more than one year
Share Capital ( 25p share)
From the profit and loss account for the year ended
Cost f goods sold
Calculate the following ratios and comment on the performance of the business over the two years;
Cash Flow Forecast for a new business - Northfield Components Ltd: Jan 2008 - Dec 2008
Rent & Rates
Light & Heat
Gross profit marginStock TurnoverDebtors Collection period ( Debtors Days)Creditors payment period ( creditors days(This provides evidence for outcome 2 – assessment criteria 2.1, 2.2 , 2.3 and 2.4 for outcome 4 – assessment criteria 4.1,4.2 and 4.3)
The Financial Accountant of Northfield Components has recently resigned and left his post with immediate effect. The Directors decide to advertise for a replacement but realize that the recruitment process may take up to three months. In the short term they decide to bring in a financial consultant to tide them over until a permanent appointment is made. You are asked by your line manager to take on this role – initially for three months
On your first morning in early January 2008 the Directors present you with the cash budgets prepared by the departed financial accountant. You are given the budgetfor the twelve months from January 2008. The directors are concerned about the likely cash deficits shown in the cash budget.