Course Title: Evaluate organisation's financial performance

Part B: Course Detail

Teaching Period: Term2 2009

Course Code: ACCT5264C

Course Title: Evaluate organisation's financial performance

School: 650T TAFE Business

Campus: City Campus

Program: C6072 - Advanced Diploma of Accounting

Course Contact : Angelo Sellan

Course Contact Phone: +61 3 9925 5460

Course Contact Email:angelo.sellan@rmit.edu.au


Name and Contact Details of All Other Relevant Staff

Susan Naser
susan.naser@rmit.edu.au

Nominal Hours: 60

Regardless of the mode of delivery, represent a guide to the relative teaching time and student effort required to successfully achieve a particular competency/module. This may include not only scheduled classes or workplace visits but also the amount of effort required to undertake, evaluate and complete all assessment requirements, including any non-classroom activities.

Pre-requisites and Co-requisites

Nil.

This course is co-delivered and co-assessed holistically along with  BSBITU402A (COSC-5946C)Develop and use Complex Spreadsheets and FNSACCT501B (ACCT5240C) Provide Business and Financial Performance Information.

Course Description

This unit covers the analysis and estimation process required to determine an organisation’s financial position and performance.  The course seeks to develop and employ skills related to financial analysis, estimation, and performance review of both the short and long term activities of a firm.

If you are undertaking this course in Melbourne from semester 2, 2012 onwards your teacher will advise you if you require access to a computer for the course. It is recommended that you have access to a mobile computing device to allow greater flexibility in terms of where you can work on campus outside class times.


National Codes, Titles, Elements and Performance Criteria

National Element Code & Title:

FNSACCT608B Evaluate organisation's financial performance

Element:

Determine long and short term needs

Performance Criteria:

2.1.Resources required by organisation to meet short and long term obligations are identified and costed using standard financial analysis techniques
2.2.Financial priorities are established and reviewed based on reported performance and identified trends, organisational objectives and expected returns to operations and investments
2.3.Financial options review and analyse a range of possible assets and liabilities to optimise the capital mix required to support operations and trading needs
2.4.Organisational policies and procedures for expenditures and investments are evaluated to ensure relevance to changing personnel profiles
2.5.Debt to equity targets are analysed in terms of organisations expected performance and established in line with organisational objectives using standard accounting techniques

Element:

Evaluate returns to operations

Performance Criteria:

1.1.Cash flow and profitability patterns are trended to identify current position and expected returns from investments and projected operations
1.2.Averaged returns are disaggregated to assess strengths and weaknesses in organisational performance
1.3.Investment returns are evaluated against risk, profit and capital budget requirements

Element:

Review performance

Performance Criteria:

3.1.Forecasts are justifiable given observed trends, information, events and assumptions
3.2.Standard errors are calculated to produce levels of accuracy suitable for planning purposes
3.3.Forecasts are reviewed regularly in line with actual performance and alternative sources of information
3.4.Risk strategies are assessed for long term viability and harmonised with short term goals and obligations

Learning Outcomes



Details of Learning Activities

Students will study financial evaluation and monitoring; skills and theory in laboratory sessions, tutorials, and practical sessions through prescribed exercises and assessment work. These concepts will also be explored through the investigation of appropriate real world simulated environments.


Teaching Schedule

Week Week Commencing Topic Performance Criteria Assessment
1 July 6th  Introduction –Financial management functions / Goal: Profit maximization v Maximise share holders wealth.
Leverage effects on profits, Operating v Financial leverage, capital structure and earnings per share. 		 1.1, 2.1, 2.2, 2.3, 2.4, 2.5  
2  13th  Long term planning. Pro forma statements
Financial analysis: Introduction to ratios, areas of performance, Trend analysis and benchmarks, Liquidity ratios.
Spread sheet revision 		 2.2, 2.4, 3.1,3.3  
3  20th  Long term planning. Pro forma statements use with Internal growth rate, Sustainable growth rate.
Financial analysis; Profitability, Gearing and Valuation ratios
Spread Sheet charts 		 2.2, 2.4, 3.1, 3.3  
4  27th  Short term planning - working capital requirements / management
Efficiency / utelisation ratios, operating and cash cycles.
Business Plan: Choosing a business idea / setting key business objectives.
Spread Sheet logical functions 		 2.1, 2.2, 2.3, 2.5  
5  Aug 3rd  Short term planning – Accounts receivable management.
In class consultation for assignment one.
Business Plan: Evaluating the business idea 		 2.1, 2.2, 2.3, 2.5  1st meeting with clients (assignment two)
6  10th  Short term planning – Inventory management EOQ, reorder points.
In class consultation for assignment one.
Business Plan: Assessing Business Opportunities 		 2.1, 2.2, 2.3, 2.5  Assignment One
7  17th  All of the above further exercises to consolidate and integrate topics.
Business Plan: Marketing 		   
8  24th  ASSESSMENT WEEK    TEST 1
   31st  Mid Semester Break    
9  Sept 7th

 Weighted average cost of capital
Business Plan: Financial Plan

 2.1  
10  14th  Weighted average cost of capital (WACC); components of WACC, calculation and application of WACC.
Business Plan: Balanced score card. 		 2.1  2nd meeting with clients (assignment two)
11  21st  Long term planning. Financial math and net present value revisited. Cash flow construction for capital budgeting net present value applications  1.1, 1.2, 2.1, 3.1  
12  28th  Long term planning. Financial math and net present value revisited. Cash flow construction for capital budgeting net present value applications  1.1, 1.2, 2.1  
13  Oct 5th  Risk in capital budgeting
Risk adjusted discount rate, Systematic risk, Various approaches to evaluating risk. 		 3.1, 3.2, 3.3, 3.4  Presentations to clients (assignment two)
14  12th  Accounting for leases. Operating Vs Financial Leases and differences in accounting treatment.
In class consultation assignment three 		 2.2  
15  19th  Evaluation of leases, Borrow and buy Vs Lease.
In class consultation assignment three 		   
16  26th  ASSESSMENT WEEK    TEST TWO
17  Nov 2nd  Deferred assessments. In class consultation / completion assignment three    Assignment Three
18  9th  Feedback    


Learning Resources

Prescribed Texts

Clive Wilson, Bruce Keers, Andrew Medlen, Brain Walters.
Financial Management Principles and Applications, 5th Edition.
Pearson / Prentice Hall.

9780733978708

References


Other Resources

Lecture materials, Class exercises notes on DLS


Overview of Assessment

Assessment may incorporate a variety of methods including technical requirements documentation, homework, assignments, group and/or individual projects, in class exercises, written and practical tests, problem solving exercises, presentations, direct observation of actual and simulated work practice, presentation of a portfolio of evidence which may comprise documents, and/or photographs and/or video and audio files, review of products produced through work-based or course activities.

Students are advised that they are likely to be asked to personally demonstrate their assessment work to their teacher to ensure that the relevant competency standards are being met. Students will be provided with feedback throughout the course to check their progress.

 


Assessment Tasks

2 tests at 15% each = 30%
Assignment 1, 25%. Assignment 2, 25%. Assignment 3, 20%.
An assessments cumulative score of 50% or above must be achieved, and each assignment must achieve 50% or above of its allotted weighting in order to pass the course.
Demonstration of competency in selected employability skills is also mandatory.
Embedded within the unit of competency is the following skills:
Communication, teamwork, problem-solving, initiative/enterprise, planning/organising, self-management, learning, and technology


Assessment Matrix

Course Overview: Access Course Overview