FIN600 Financial Management (Scenario Analysis Report) Assignment Help
Assessment Task
Drawing on your understanding of the fundamentals of financial management, as well as costs, budgets and management control, write a 1,000-word scenario analysis report identifying, measuring and analysing the budget variances of a fictitious company. More detailed information about this fictitious company can be found in the Assessments area of the subject site. This assessment is a practical task involving the application of budgeting skills, comparison of actual performance with the budget and analysis of the observed variances. The aim of this assessment task is to consolidate your knowledge and skills relating to the financial management of business operations.
Context
Budget variances refer to the differences between the actual financial results of a company and the budgeted or planned financial results for a specific period. These variances can be either favourable or unfavourable, depending on whether the actual results are better or worse than what was planned. Understanding and analysing budget variances is important for companies because it allows them to identify areas of their business that may be underperforming or overperforming. By comparing actual results to planned results, businesses can identify where they need to make changes in order to improve profitability, reduce costs or increase revenue. Performing variance analysis is one of the many activities that a management accountant performs when providing financial and non-financial information to aid effective decision-making in an organisation.
This assessment task will focus on three types of variances: direct materials, direct labour and overhead variances. Interpreting these variances successfully requires you to both analyse and evaluate. This includes breaking down each variance into its components as follows.
The formulas for the variances above are found in the Costs, Budgets and Management Control module, under the Variance Analysis topic.
Instructions
In this assessment task, you will take the role of the management accountant of the company and analyse variances based on a comparison of the actual performance of the business operations relative to its budgeted performance. To be successful in this assessment task, you are required to follow the steps below.
1) Read and understand the topics covered in the modules:
• Introduction to Financial Management
• Costs, Budgets and Management Control
2) Analyse the additional information in the Assessment 1 Variance Analysis Template (MS Excel file), which is provided in the Assessments area of the subject site. The template contains the following sheets:
• Background Information – includes details about the fictitious company and further instructions about how to use the sheets in the template.
• Data – includes information on standard budget and actual performance.
• Template – contains empty cells in which you are to insert the correct formula and calculate the required item.
• Variance Report Format – outlines the information required in the variance report that you are required to submit to support your scenario analysis report.
3) Write a scenario analysis report supported by a variance report, based on the data and operational details of a fictitious company provided in Step 2. Your variance report should follow the format provided in the Assessment 1 Variance Analysis Template (MS Excel file).
4) Using the information from the business operations, budget and the actual production and costs data, you are required to identify, measure and analyse the following variances and investigate their sources:
• Direct material variances
• Direct labour variances
• Overhead variances
5) In your scenario analysis report, you are required to:
• summarise and present your variance analyses
• evaluate your variance calculations in Steps 2–4, discuss the potential causes for the variances and provide any remedial measures that can be taken to minimise the variances
• recommend to the client what position to take in relation to each of the three (3) variances determined, based on your evaluation of the variance calculations.
Scenario Analysis Report Structure and Format
Your 1,000-word scenario analysis report should follow industry standards and be structured as shown in detail below:
Executive Summary – In this section (100–150 words), you are required to summarise your entire report. As a minimum, you will need to discuss the purpose of your report, the methodology you have used, the key findings and your recommendations. The executive summary is not included in the word count.
Table of Contents – This section is not included in the word count.
1. Background (around 150 words) – Provide a description of the task, the tools and methods that will be applied, and how the report is organised.
2. Standard budget (around 50 words, in addition to the tabulation) – Using information on the production design and process, as provided within the Assessments area of the subject site, tabulate a standard budget for the specified production volumes.
3. Comparison of the actuals with the budget (around 50 words, in addition to the tabulation) – Calculate and tabulate the variances, while distinguishing the variances into material, labour and overhead variances, and their sources.
4. Analysis of Variances (around 400 words) – Discuss the potential reasons for the variances, their significance and possible ways to resolve the more critical variances.
5. Recommendations and Overall Assessment (around 350 words) – Use the variances of the company, as revealed by the analysis you have undertaken, to recommend what position the
client should take in relation to each of the three (3) variances listed in Step 4 in the Instructions section.
6. References – A minimum of six (6) academic and related references (e.g. journal articles, book chapters, conference papers) and at least two (2) non-academic and related references (e.g. company websites and annual reports, newspaper articles, government websites, consultant reports, etc.) are required to support the discussions in your scenario analysis report. Please make sure your references are current. All references should be in the current APA style. Using Wikipedia, Investopedia and similar sources should be avoided. This section is not included in the word count.
Read the assessment rubric, which is an evaluation guide with the criteria for grading your assessment. This explains what features a successful scenario analysis report should exhibit.
Referencing
It is essential that you use current APA style for citing and referencing the sources that you use. Please see more information on citing and referencing guidelines on the Academic Success webpage.
Assessment Support
For a range of additional resources and support to help you complete your assessment, please consult the Study Support page on the Student Hub.
Academic Integrity
All students are responsible for ensuring that their submitted work is original, adheres to academic writing standards outlined in the Torrens University Academic Writing Guide, and is appropriately referenced according to the guidelines provided in the Torrens University APA Referencing Guide.
Students need to have read and be aware of the Torrens University Australia Academic Integrity Policy, Academic Integrity Procedure and subsequent penalties for academic misconduct. For more information, please refer to the Academic Integrity guidelines and the Torrens University Library.
Students must also keep all required evidence in making an assessment; a copy of all submitted material and any assessment drafts.
Generative AI
Please refer to the Torrens University Library for guidance on the use of Generative AI. Please speak to your learning facilitator regarding the use of GenAI tools in your assessments.
Submission Instructions
Submit all components of Assessment 1 via Assessments > Briefs & Submissionsin the main navigation menu in FIN600 Financial Management:
• Scenario analysis report (MS Word file)
• Variance report (MS Excel file)
Important Note:
Please ensure that you have attached all components of Assessment 1 (both the ‘Scenario analysis report’ and the ‘Variance report’) to the Assessment 1 submission point before clicking the ‘Submit’ button.
Please name your file using the following format:
o SubjectCode_Surname_FirstNameInitial_AssessmentNumber
e.g. FIN600_Jones_S_Assessment 1.docx
Your marked assessment can be viewed in MyLearn.
Assessment Due Dates and Late Penalties
Assessments may be submitted on or before the due date. Late penalties apply for assessments that are submitted after the due date.
Refer to:
• Assessment Policy for Higher Education Coursework (HE) and ELICOS
Torrens University | Think Education
• Assessment Special Consideration Guidelines for Students (HE Coursework)
Torrens University | Think Education
• Student Hub for Assessment Extension Information.
Special Consideration
To apply for special consideration for a modification to an assessment task or exam due to unexpected or extenuating circumstances, please consult the Assessment Policy for Higher Education Coursework and ELICOS and, if applicable to your circumstance, submit a completed Application for Assessment Special Consideration Form to your learning facilitator.
Assessment Rubric