Assessment 1 APC finance

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Assessment 1 APC finance

Assessment 1 Part A

  • Making sure that all major decisions have detail minutes to identify the reasons for the decisions. This would include why the decision was made and the strategies to implement the decision.
  • Another requirement for record keeping is to ensure that all records are kept for at least 5 years. There are records such as financial reports, operating statements, and other important business reports.

    Some records are even required to be kept for at least 10 years.

  • Auditors are responsible to conduct audit in accordance with Australian Auditing Standards. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report.
  • There is no stipulated frequency as to how often the ATO can audit the business, however the more frequent the audit, the safer the company can be from Financial discrepancies.

  • All financial Reports: Balance Sheets, Income Statement, Cash Flow. Etc.
  • The General ledger

    Journals

    Asset register

    Cash records such as receipts, deposits and cheque butts.

    All these records must be kept for the auditing process to be most successful.

  • Most companies will be warned about poor performance in providing proper financial reports. If there are no improvements in the provided reports, a fine of $2,200 may be given to the company. The mistakes will also be reviewed and any honest mistakes will be taken into consideration when deciding the penalty.
  • The ATO also offers expert advice for business which need help providing proper documents.

    Assessment 1 Part B

    Simpson PTY Ltd

    Food

    Total sales = 573,300

    COGS = 251160

    Profits = 321140

    Drinks

    Total sales = $50,000

    COGS = $16,000

    Profits = $34,000

    ......

    Assessment 1 APC finance
    Last updated: Sep 2023

    Page 1

    Profits = $34,000

    Sales 60060

    Food

    Total sales = 780,780

    COGS = 251160

    Profits = 529620

    Drinks

    Total sales = $45,000

    COGS = $15,000

    Profits = $30,000

    PART b Task 2

  • The revenue has increased significantly and the profits have become higher than the expected results. This means that the strategies have been effective and the prices are also very effective. Being able to increase the price as well as the number of sales is very lucky and the profits will increase a lot.

    Having performances that are better than the budgeted or expected result means that the company has grown much faster than planned. This means that the company has more profits to spend and a greater amount of customers to serve. More customers means better business and bigger profits.

    The overall performance of the Simpsons company is good. Their profits are very high and the COGS are very low. They could get a lot more money from drinks as they have increased the number of sales dramatically however the price is too low. Increasing the price slightly will increase the income dramatically and the number of sales will still be higher than the required selling demand. Therefore the only recommendation would be to increase the price of drinks slightly, this will improve the profits without affecting the sales significantly.

    B)

    The contract for purchasing the drinks is very effective. With cheaper COGS the profits will increase. Reaching the required sale demand is the only barrier, however Simpsons has passed the required sale demand extremely easily. This means that the price is increase and the sale demand will drop slightly however profits will be increased.

    C)

    With the performance in term 1 of the next year, it is obvious that the budget must be adjusted to maximise the profitability and performance of the company. If adjustments are not made, the prices and profits will remain unchanged meaning that an opportunity to increase profits was missed. The company can grow much faster if the budgets are adapted to the market changes of the customers.

    ...

    Assessment 1 APC finance
    Last updated: Sep 2023

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