Assesment 2 – BSBFIM501A Nestle

BSBFIM501 Assessment 2 Manage Budgets and Financial Plans

Nestlé S.A. is a Swiss transnational food and beverage company headquartered in Vevey, Vaud, Switzerland. It is the largest food company in the world measured by revenues, and ranked #72 on the Fortune Global 500 in 2014.

Nestlé’s products include baby food, bottled water, breakfast cereals, coffee and tea, confectionery, dairy products, ice cream, frozen food, pet foods, and snacks. Twenty-nine of Nestlé’s brands have annual sales of over CHF1 billion (about US$1.1 billion), including Nespresso, Nescafé, Kit Kat, Smarties, Nesquik, Stouffer’s, Vittel, and Maggi. Nestlé has 447 factories, operates in 194 countries, and employs around 339,000 people. It is one of the main shareholders of L’Oreal, the world’s largest cosmetics company.

Nestlé was formed in 1905 by the merger of the Anglo-Swiss Milk Company, established in 1866 by brothers George Page and Charles Page, and Farine Lactée Henri Nestlé, founded in 1866 by Henri Nestlé (born Heinrich Nestle). The company grew significantly during the First World War and again following the Second World War, expanding its offerings beyond its early condensed milk and infant formula products. The company has made a number of corporate acquisitions, including Crosse & Blackwell in 1950, Findus in 1963, Libby’s in 1971, Rowntree Mackintosh in 1988, and Gerber in 2007.

BUDGETS

Budget for Income

Budget for Expenses

Factors Influence Budget

changes in economic and other parameters, particularly global economic developments;

matters not included in the fiscal forecasts because of uncertainty about their timing, magnitude or likelihood; and

the realisation of contingent liabilities or assets.

How this information can be used to distributed properly in the organization

There are four types of communication:

1. Visual Communication

Examples of this type of communication include specially designed signs, electronic communication, documents, and even presentations. It is essential that each individual has the capability of both implementing and comprehending visual communication processes in the workplace.

2. Written Communication

Examples of this type of communication include reports, evaluations, emails, instant messages, physical and electronic memos, training materials, and other types of documents that are similar in nature.

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n nature.

3. Verbal Communication

Verbal communication is a core component when it comes to the overall success of a business. Verbal means that certain sounds, specific languages, and the spoken word may be used. 

4. Non-Verbal Communication

The physical activities may include the way that you move your body, the tone that is displayed when it comes to the tone of an individual’s voice, and touching.

Monitoring the Budget

I include a rough estimate of the item’s cost in my project’s budget.

I can develop this rough estimate by using my prior experience, by checking with others who have purchased similar items in the past, or by checking with my procurement department. Usually, I don’t check with specific vendors or supplies when developing this rough estimate.

I submit a written, approved request for the item to my procurement department.

This request specifies the rough estimate of the cost included in my project budget and any upper limit that the actual cost can’t exceed. The project manager or his designee approves it, and anyone else who controls the expenditure of project funds (such as the finance department) approves it.

My procurement department selects a vendor and submits a purchase order.

The purchase order formally requests the vendor to furnish I the item and specifies the procurement department’s estimate of the price.

The vendor agrees to provide the item I requested.

The vendor provides I written confirmation that he will sell I the item, together with the item’s price (including applicable taxes and shipping and handling charges) and the projected delivery date.

I receive and accept the item but aren’t yet billed for it.

I receive the item and verify that it meets the agreed specifications. If I don’t accept the item after the vendor makes repeated attempts to fix any problems I have with it, my procurement department cancels the purchase order and I begin looking for a different vendor or a different item that will meet my needs.

I or my finance department receives a bill for the item.

This bill details the item’s final cost, together with associated discounts, taxes, and shipping and handling charges.

My finance department disburses funds to pay for the item.

The bill for my item is paid with money from my project’s funds.

Contingency Plan

A budget variance is the difference between the budgeted or baseline amount of expense or revenue, and the actual amount. The budget variance is favorable when the actual revenue is higher than the budget or when the actual expense is less than the budget.

Those budget variances that are uncontrollable usually originate in the marketplace, when customers do not buy the company’s products in the quantities or at the price points anticipated in the budget. The result is actual revenues that may vary substantially from expectations.

Some budget variances can be eliminated through the simple aggregation of line items in the budget. For example, if there is a negative electricity budget variance of $2,000 and a positive telephone expense budget variance of $3,000, the two line items could be combined for reporting purposes into a utilities line item that has a net…

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