Fitness Essential is a local sports business that provides personal training services, general exercise and fitness classes, and indoor pool facilities for swimming training. It also sells fitness attire at competitive prices. Staff are employed full and part time, and it contracts some personal trainers. 

The business is to undergo its annual internal finance audit. Finance manager Phoebe needs to explain the financial management processes she uses to her newly appointed financial assistant. The information provided by Phoebe will be also used to train new staff in financial management procedures.

Task

In a Word document, list and discuss Phoebe's key points for planning financial management, establishing and implementing a budget (and allocating funds), and reporting processes.

Include the following in your discussion:

1. Requirements for financial probity and principles of accounting systems; how a review and analysis of previous financial data is undertaken; the business plan for initiatives that will impact on next financial cycle, and the suitability of existing software for financial management.

2. Processes used when reviewing financial data (profit and loss statements, cash flows) in determining resource allocations; preparing estimates for budget inclusions to meet organisational and statutory requirements, including legislation and conventions relevant to the business (ATO requirements including GST, Company Tax, and PAYG.) Also, process of tracking audit trails.

3. Methods used in reporting significant issues in financial performances, circulating reporting requirements to managers and supervisors ensuring clarity and conformity, and how the financial management process is evaluated for effectiveness.

Answer rating: 100% (QA)

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