Working effectively in finance - osbornebooks.co.uk

1 Osborne Books Tutor Zone Working effectively in finance answers to chapter activities Osborne Books Limited, 2016. 2 Working effectively in finance tutor zone The finance function roles and 1 responsibilities External Internal The Sales Department of the organisation 4. The Sales Department of a customer 4. The finance company who lends money to the organisation 4. The finance Department of a supplier 4. The HR Department of the organisation 4. Management Financial accounting accounting Drawing up budgets 4. Producing the trial balance 4. Calculating the costs of producing a product 4. Financial planning for the future 4. Managing the accounts of trade receivables 4. chapter activities answers 3. Department needing information Accounting information provided Sales Department The insurance costs of running the business Administration Department Customers who are exceeding their credit limit Production Department The cost of material (b) An independent accountant appointed by a business who checks the accounts of that business Fiona Robin ( finance Director) Managing Director Don Everdene (Payroll Line Manager) Accounts Manager David Barry (Sales Ledger Assistant) Accounts Line Manager (c) Limits on hours spent driving maintenance vehicles (b) Cash forecast figures (a) Sales & Marketing (a) Signing arrangements for issuing of cheques (c)

2 Retaining written records for a specific period of time finance function finance activity Purchases ledger Topping up an imprest system Payroll Checking supplier invoices Petty cash Maintaining a cash book Issuing invoices Preparing budget reports Deducting tax (a) Direct costs of manufacturing an item (b) Indirect costs of manufacturing an item 4 Working effectively in finance tutor zone Managing Director finance Director Marketing Director Human Resources Director finance Manager Sales Manager Administration Manager Accounts Line Managers Sales Representatives Sales Administration Accounts Assistants Administration Assistants Assistants The amount of money Statement of profit or loss flowing into and out of a business Statement of financial The income less expenses position for a financial period The net worth of the Statement of cash flows business, how it is financed and how much it owes chapter activities answers 5.

3 effectively Working in the finance 2 function (b) The organisation being able to pay debts when they are due (a) Chasing up late payments due from customers (b) Completing the VAT Return on time to avoid a fine (e) Paying money received from customers into the bank promptly (g) Negotiating long credit terms with suppliers (b) Employee code of conduct (c) Energy saving instructions and guidance Employers are bound by the Health & Safety at Work Act which ensures that the workplace is a safe place in which to work. The Working Time Regulations also affect employers and set down restrictions on the hours that employees will be expected to work. The Living wage regulations protects employees by setting out the lowest amounts employers are allowed to pay their employees. Confidentiality is important in the workplace and this principle is supported in law by the Data Protection Act.

4 (b) The ability to repay its debts when they are due (b) True; (a), (c) and (d) False (b) The money a business has in the bank, plus the amounts owed by its customers, plus inventories, less the amounts that must be paid to suppliers (d) 6 years 6 Working effectively in finance tutor zone Financial information, documentation 3 and data security (a), (b), (d), (e) and (g). (a), (b), (c) and (i). (f), (h) and (j). A bank statement is an external document received from the bank. It shows the customer's balance at both the start and end of the period. A debit balance will mean that the account is overdrawn and it will have interest deducted. (a) and (d) True; (b) and (c) False Budget Actual Variance Adverse Favourable . Direct Material 12,000 10,000 2,000 4. Direct Labour 11,000 15,000 4,000 4. (b) and (c) True; (a) and (d) False The total receipts for May are 12,700 and the total payments for May are 6,500.

5 The net cash flow for the month of May is 6,200. The balance carried forward at the end of May and brought forward at the beginning of June is 13,200. The balance carried forward at the end of June is 6,900. (a) True; (b), (c) and (d) False (b) Ensuring all personal data is kept confidential and only used for its intended purpose. chapter activities answers 7. 4 Effective business communications (b) It's time to do some revision (d) I love coffee; its aroma makes me think of dark rich chocolate (a) To study accounting is too difficult and learning to drive is too (c) To lose one set of keys is bad luck but to lose two sets of keys is a disaster (b) There is no point worrying about their chances of winning their game (c) There seems to be some misunderstanding whether they're eligible or not From To 1. Subject Staff meeting For the attention of finance Department staff 2.

6 Please attend a meeting to be held in the Conference Hall 3. at on 3 December . This meeting is 4. compulsory and will lead the way to significant changes in the way the Department is operated in the future. 5. Regards Imogen Strega Senior finance Manager 8 Working effectively in finance tutor zone incorrect word correction Cumberbatch Clutterback month's months gratefull grateful recieving receiving faithfully sincerely (b) Regards Section title Section contents A short explanation (often for managers and executives) summarising the areas the report examines. Summary (Executive). This sets out and analyses the results of the investigations of the report. Recommendations A single page stating what the report is about, who wrote it, and the date it was written. Appendices This sets out the information gathered by the report and is the basis for the conclusions.

7 Conclusions The suggested course(s) of action which are based on the report. Title page Additional information which supports the report but is not contained in the findings. This section tells the reader how the report came about and explains the nature of the tasks and the people involved. chapter activities answers 9. (a) Your Line Manager has requested a meeting to discuss next month's Email budget forecasts. He is currently out of the office and would like to know your availability tomorrow. (b) A supplier has left a message to say that an invoice has been paid but Telephone they don't know which invoice it relates to. (c) The sales manager would like to know how much is outstanding on ten Report customer accounts. (d) You need to remind yourself to process the petty cash payments on Note Friday as the cashier will be on holiday.

8 10 Working effectively in finance tutor zone 5 Calculations and spreadhseets (a) 176. (b) 175. (c) 176. (d) 176. (e) 176. (f) 175. (a) (b) (c) (d) (e) (f) (a) 1/2. (b) 50%. (c) 1:1. (d) 2/3. (e) 67%. Total amount VAT amount Net amount . (a) (b) (c) (d) (e) (f) chapter activities answers 11. Workings: (a) 36 6 = 6 (VAT), Net = 36 6. (b) 17 x 5 = 85 (Net), Total = 17 + 85. (c) x 20% = (VAT), Total = + (d) x 20% = (VAT), Total = + (e) x 5 = (Net), Total = + (f) 378 6 = 63 (VAT), Net = 378 63. Price Trade Trade VAT Total (before discount) discount discount % . Alexandra Ltd 5% Maddie and Co 4% Vapo Tool Ltd 10% Digital Settings Ltd 20% Monthly sales Monthly sales %. March 14,600 April 15,800 May 13,500 June 18,100 July 17,300 August 14,300 Total 93,600 12 Working effectively in finance tutor zone Target sales Actual sales Actual sales in Employee entitled excess of the to a bonus?

9 Target Yes/No %. Alan Bench 10,000 10,900 9% No David Wear 12,000 11,100 ( ) or 0% No Danielle Barker 5,000 6,500 30% Yes Alisha Singh 14,000 17,220 23% Yes / 250 = per unit Year 1 11%. Year 2 8%. Year 3 7%. chapter activities answers 13. 6 Planning and managing your work Priority Task number (1 to 4). Priority 1 4. Priority 2 3. Priority 3 2. Priority 4 1. (b) The finance Director asks for some costing figures to be sent to him for a meeting which is taking place in two hours time Recording future activities for future reference diary Activities planned for a one day sales conference action plan A list of activities that have to be done by you to do' list A list of activities to be done by different people schedule (c) A task that is urgent and important Effectiveness is getting the result that you want, which in the case of a workplace means targets are met and the workforce well motivated.

10 Efficiency means getting a job done with the minimum waste of effort and resources. 14 Working effectively in finance tutor zone A client has dropped off a pile of invoices and you have been asked to put them in 3. date order so they can be processed next week The Payroll Manager has asked you to check the overtime rates for the employees 2. of a client who need to be paid this week There are three VAT returns that need to be submitted by the end of next month. The 4. three clients need telephoning to remind them to bring in the relevant paperwork The receptionist is off sick and you have been asked to answer the telephone and 1. distribute the mail (a). WEDNESDAY AFTERNOON AND THURSDAY TO DO' LIST (in order of completion). Task 1 Preparing the figures for the Line Manager Task 2 Posting to the ledgers using a computer accounting program Task 3 Dealing with emails and the post and processing purchase orders Task 4 Checking documents received Task 5 Preparing bank payments to suppliers Task 6 Getting quotes from suppliers (b) (c) You would not be providing the necessary support to your work team (a) (d) Speak to the Line Manager, explaining the situation and suggesting that she allocates some of the work to a colleague who has time available to help out (b) (c) Invoices sent out late could mean that payments received from credit customers may be delayed chapter activities answers 15.