SITXFIN003 Assessment Task 2 of 2 (Project)

Overview

Introduction

Welcome to the Student Assessment Tasks 2 of 2 (Project) for SITXFIN003 Manage finances
within a budget. These tasks have been designed to help you demonstrate the skills and
knowledge that you have learnt during your course.

Please ensure that you read the instructions provided with these tasks carefully. You should also
follow the advice provided in the Hospitality Works Student User Guide. The Student User
Guide provides important information for you relating to completing assessment successfully.

Assessment for this unit

SITXFIN003 Manage finances within a budget describes the performance outcomes, skills and
knowledge required to take responsibility for budget management where others may have
developed the budget. It requires the ability to interpret budgetary requirements, allocate
resources, monitor actual income and expenditure, and report on budgetary deviations.

For you to be assessed as competent, you must successfully complete two assessment tasks:

Assessment Task Overview

Assessment Task 1 of 2 (Knowledge questions)
Assessment Task 2 of 2 (Project)
Preparing for assessment
You must answer all questions correctly.
You are required to manage finances within a
budget for a case study organisation and then report
on your findings.

Please read through all of the assessment tasks and related documents carefully before you get
started. Ensure that you have everything that you need and seek clarification from your
trainer, assessor or workplace supervisor if you have any questions.

Supporting resources: Supporting resources include templates, journals, workbooks

and portfolios which can be used to support you in providing evidence of your
competence. Your assessor will provide you with these documents before you begin
your assessment tasks. For this unit, the supporting resources comprise:
· Café Quarterly Budget (Assessment Task 2)
· Budget Report Template (Assessment Task 2)
Once you have read through the assessment tasks and are satisfied that you are clear on the
requirements and submission dates, complete and sign a Student Assessment Agreement. Your
assessor will countersign the agreement and keep it on file. You will find a Student Assessment
Agreement in Appendix B of your Hospitality Works Student User Guide or your RTO will
provide you with one.

Remember to check your Hospitality Works Student User Guide for information about:

• submitting assessments
• assessment appeals
• re-assessment guidelines
• responding to written questions.

Assessment Task 2 of 2
(Project) Information for
students
You are required to manage finances within a budget for a case study organization and then
report on your findings.
You will need access to:

• your learning resources and other information for reference

• accounting software (Wave free online software)
• your Café Quarterly Budget
• your Budget Report Template.

Ensure that you:

• review the advice to students regarding responding to written tasks in the Hospitality
Works Student User Guide
• comply with the due date for assessment which your assessor will provide
• adhere with your RTO’s submission guidelines
• answer all questions completely and correctly
• submit work which is original and, where necessary, properly referenced
• submit a completed cover sheet with your work
• avoid sharing your answers with other students.

Assessment information
 Information about how you should complete this assessment can be found in Appendix A of the Hospitality Wo
where this task should be completed
how your assessment should be submitted.
Note: You must complete and submit an assessment cover sheet with your work. A template is provided in App

QUESTION 1
Item 1 of 10
Complete the following activities.
Carefully read the following scenario.
You are the café manager of a popular café within the Blue Healer Hotel and Spa. The owner has
provided you with the budget for the next quarter and it is part of your responsibility to allocate
resources and manage the finances within the budget.
The budget has been increased in month three as this is a popular month where lots of visitors
stay at the Blue Healer and neighbouring guest houses as there is a music festival on. As such,
additional wait staff will be hired on a casual basis and less private catering jobs will be booked
in as the café will be at its peak.
Additional information:

• The business uses local suppliers but due to a recent drought the cost of meat with the
usual supplier, Fresh Farms, went up by 7% last month.
• The café serves breakfast, light meals, light dinners and sharing plates, smoothies,
coffee, pastries and is a local favourite for its homemade iced tea.
• Due to the clientele of the hotel and health spa, and the area within which the Blue Healer
is located, there have been a number of requests for more vegetarian and vegan options.
• Apart from you and the owner (you also cook and prepare food) there is full-time chef
named Navneet, two part-time kitchen porters and casual wait staff employed.
• There has been a pattern of food wastage in the past two months with too much fruit
purchased that spoiled before it could be used as the iced tea became so popular that not
as many smoothies were made and sold.
• The food budget has blown out over the past three months but the owner can’t increase it
as the profit from the café is being invested into building and landscaping works to create
an outside undercover area that will double the capacity of the café.

The business uses Wave Accounting free online software for recording income and expenditure
but makes use of Excel spreadsheets for budgeting and planning purposes.
Answer
QUESTION 2
Item 2 of 10
Review past information and future budget and plan fund allocation.
Review the following:

• Case study and additional information above

• Café Quarterly Budget – budget page
• Café Quarterly Budget – past information page

Look at the cost of sales figures related to food and beverage purchases which is the food and
beverage budget that is allocated to you.
Do some research and source some local meat suppliers in your area and check out the costs of
menu items you have planned for previously in the past, or meals you are familiar with and see
what that 7% could look like and the impact over a three-month period. Bring this information
with you to the meeting in the next activity step to provide recommendations to the owner.
Think about how you can work effectively with the budget allocated to you and the changes you
could make to manage the finances more effectively.
Make notes on your research and findings for use in the following activity.

Answer
In terms of a review and analysis of all previous knowledge, the only thing that has increased is
in the section of food and sales, which has increased from $70000 to $97000 in three months.
However, due to sales on the ration, which are generally between $36000 and $20000, there has
been an increase in the purchasing of casual dining. Due to ration sales typically ranging between
$36000 and $20000, casual dining is the norm. As a result, the general conclusion of this study is
that we have been experiencing profit benefits as well as an increase in buy rate with a similar
ratio for the last three months.

However, if we look at some of the causes for the lack of profitability, one of them could be the
loss of food. Many seeds have been purchased in the last two months. As a result, there are
several options that can be pursued in order to improve profit margins. The first alternative is to
refrain from purchasing food that isn't being used or sold in the economy. For example, if the
whole budget is $7000, we can eliminate the fruits that are no longer useful, reducing the budget
to fewer dollars. That is, $4000.

As previously said, the price of cheese is increasing by 7%. As a result, I've been researching
local butchers and meat suppliers, which is one of the key options for profit margins not
increasing and decreasing.

According to someone’s research, the actual price of cheese and its supplies is increasing by 7%,
and I also discovered some possible facts concerning pure cheese and its suppliers.

They sell the variety of items related with meat and many more with reasonable prices. Hence
their prices are up to 7% low than the present vendors. They sell a wide range of meat-related
things as well as a variety of other items at cheap costs. As a result, their prices are up to 7%
lower than those of current providers.
QUESTION 3
Item 3 of 10 4
Have a meeting with the owner to discuss the budget and fund allocation
Now that you have reviewed all the information, have a meeting with the manager (your
assessor) at the date and time advised to discuss any concerns, priorities and changes you would
like to make before you allocate the funds. Review the new suppliers you have sourced with your
assessor.
During the meeting, you will need to demonstrate effective communication skills including:

• Speaking clearly and concisely

• Using non-verbal communication to assist with understanding
• Asking questions to identify required information

Responding to questions as required.

Answer
Date: 07/18/2021
Time: 10:30 am
Blue Healer Café Premises is the location for this event.

Subject: - Group discussion with the assessor; improvement analysis and grant allocation.

Me: Sir, good morning (Assessor). My name is Philip Bailey, and I'm the proprietor of the Blue
Healer Café.
Assessor: Good morning Philip
Me: I'd like to express my gratitude for presenting me with such a significant chance. So I'm sure
you're much more aware with today's talk regarding advances in a few categories in terms of
fund distribution. After going over all of the crucial data and day-to-day records for the café, I
discovered that we are losing money and that we aren't doing enough to increase the profits.
Assessor: Is it Philip, It may irritate you, yet it is accurate in certain ways.
Me: So, in order to come up with a solution, I've been going over all of the budgets, both
previous and present, as well as all of the employees' past and present results. It's very
disappointing; I've pointed out that the waste of all the food has been going on for the past three
months, and as a result, there's less of a chance of a big profit margin. As a result, the appropriate
rationale could be a 7% increase in the price of beef supplies.
Assessor: Did you look for any new suppliers of meat at a fair price,Philip?
Me: Yes, one of them caught my eye. But, when it comes to better meet supply to the clients, I
can't entirely rely on that one particular source. Because this is a long-term business, I just want
to make sure that the customers are satisfied with the food they are receiving. The only thing that
kept me thinking was whether I should change the meat supplier or not, because we've been
dealing with him for a long time and he knows when and where things should go. So I'd really
like to hear your thoughts on whether I should change suppliers or not.
Assessor: So, if you don't change the supplier, what will you do?
Me: As I mentioned before in the discussion, I've been without meals for the previous two
months. We are becoming more reckless by purchasing a greater number of foods, resulting in
food waste and a reduction in profit margin.
Assessor: So, have you got anything ready to help you increase your profit margin?
Me: Yes, Sir, I was successful in finding the greatest meat provider here near where I reside,
which is only a 10-minute walk away. So, if we chose these suppliers for our meat needs, there is
a good probability that our profit margin will increase?
Assessor: All right, Philip I'll evaluate all you've said and think about it.
Me: I'd really appreciate it if you could say something and provide your opinion.
Assessor: All right, Philip. Give me some time to research this thoroughly, and I'll return with
more options. Sir, thank you very much. I'll be looking forward to hearing from you. Sir, Have
good day.
Assessor: Philip, how are you today?

QUESTION 4
Item 4 of 10
Allocate funds
Using the Café Quarterly Budget template – Fund allocation page, allocate the funds for the
quarter to the relevant areas and what you will purchase from existing or new suppliers. Make
notes in the relevant column to support your choice and rationale. Add or delete rows as
necessary and apply cell formatting and the use of formula functions as necessary.
Submit to your assessor.

Answer
Allocations of Funds
Account First month Second Months Third months
Fruits $1500 $1500 $1000
Vegetables $2500 $2500 $3000
Breads $250 $250 $1500
Meats $4000 $4000 $7000
Flours $300 $300 $500
Coffee $500 $500 $2000
Sauce and spices $50 $50 $500
Dry goods $2000 $2000 $3000
Total $ 15,000 $ 15,000 $20,500

With the most recent budget allocation, we have been able to lower the cost of packaged meals.
In the third cycle, the last food procurement expense was $24000, with fresh food purchasing
funds of $20500. Because the amount and quality of food remain consistent over time, it could
aim to increase profitability.

QUESTION 5
Item 5 of 10
Meet with your team
Briefly meet with Navneet (your assessor) to discuss the resource allocations and the planning
for the next quarter in relation to fresh produce, reduction of wastage and recipe variation.
Make sure that you discuss the importance of sticking to the budgeted allocations and discuss
ways that food wastage can be avoided to ensure the budget is met.
During the meeting, you will need to demonstrate effective communication skills including:

• Speaking clearly and concisely

• Using non-verbal communication to assist with understanding
• Asking questions to identify required information

Responding to questions as required.

Answer
Date: 07/18/2021

Time: 10:00 am
Blue Healer CAFÉ is the location for this event.
Subject: A discussion with the assessor about the production of fresh foods, as well as waste
reduction and a range of recipes.
Everyone involved in the meeting is welcome to come in:
Philip (me): Good day, and welcome to this modest gathering of talk. Assessor \s(Mr. Allen
Burnett)
Assessor: Good morning,. Thank you very much.
Me: So, as we all know, the major reason for convening this tiny meeting is to discuss the main
reason for convening it. Today's major theme will be about serving nutritious and fresh foods in
our coffee shop, as well as reducing food waste and providing a diversity of recipes. I'll be
delivering a quick summary of all of the above-mentioned topics. Despite the fact that we will be
discussing a variety of recipes and fresh foods, we will have a greater emphasis on the topic of
food waste minimization. This is because I believe one of the main reasons why the budget is
failing to reach its goals and objectives is because of this.
Assessor: It sounds appealing. Let's get this dialogue started.
Me: As we all know, we work in the hospitality industry, where customer happiness and
satisfaction from cuisine are of paramount significance. As a result, it is our primary
responsibility to ensure that food safety is at the top of our priority list. To ensure that food is
prepared in a clean and safe environment, the area in which it is prepared must be clean and tidy.
When it comes to cleaning, I'm referring to the kitchen and the gas area, both of which must be
clean and set up in such a way that they can fulfill all of the good food hygiene and health and
safety criteria.

While working in the kitchen, managers must ensure that all kitchen employees are adequately
trained and equipped in all elements of food storage, including where to store various types of
food such as meat and vegetables, dairy products, and so on. As we are all aware, foods that last
a long time in the kitchen, such as fruits and vegetables, require special attention and storage in
order to be used when needed.
I'm providing all of the tiny details since I've noticed a lot of food waste in the kitchen over the
last three weeks. I discovered that there was a lot of vegetable waste.
Either there was a lack of proper and adequate training, or the employees lacked knowledge of
how to properly store fresh dairy goods, and so on.
Assessor: That's right. So, Philip, do you have any suggestions about how to solve these issues?
Me: Yes, I agree. The most important thing we can do is raise knowledge about the problems
that may occur in the future as a result of food waste, as well as how to maintain and reduce food
waste through various trainings on appropriate food storage and other topics.

Stock turnover ratio: In order to ensure that our food is of the highest quality on the market, we
must follow stock inventory ratios such as LIFO and FIFO.

Hold food in sealed containers: After finishing the work, we need to make sure that any
remaining food that can be used the next day is securely packed in containers so that it is safe
and does not come into touch with insects or other things.

Before storing food, each item should be labeled with the use-by date.
Meats must be preserved and maintained at a very low temperature: we must ensure that meat is
kept at the bottom of the refrigerator to avoid contamination from meat juices leaking into other
prepared dishes.
Cleanliness in all areas: to guard against pollutants and bacterial accumulation). After performing
all of the tasks, make sure to clean thoroughly to avoid contamination and bacterial growth.

Temperature Control: Workers must be informed about the legal requirements for storing food at
the proper temperature, such as keeping the fridge temperature below 4 degrees Celsius and the
freezer temperature below 18 degrees Celsius.

Me: Sir, thank you very much. I will make certain that it will be quite beneficial in the future.
Moving on to a different issue, we have methods for reducing food waste, which are as follows:

Prevent over-purchasing of stock: It is critical to ensure that we only buy things that we know
we will use, as there has been a tendency in food loss and waste in the last three months, with
food being purchased, utilized, and then thrown away. As a result, we must be careful not to
overspend on food that will not be consumed.

Food should be stored in the proper manner and in the proper location: As previously stated, all
foods, including meat, should be kept at the proper temperature. As a result, we must ensure
that
our refrigerators and freezers are set at the proper temperature.

Check all shipments against the local department's store: When placing orders or ordering food
from another location or from another country, we must ensure that the food we order is only
delivered or shipped once so that no food is wasted.

Donating leftover foods to a homeless hospice: When we waste food, we never consider that
there are some individuals and places in the world that cannot even drink water, making food
tough. As a result, we should establish solid relationships with organizations such as charity
houses, homeless hospices, and so on, and contribute all of the ingredients and leftover meals.

Keep a close eye on portion sizes: we need to be wary of large meal portions and super-sized
main courses, as we know that the quality of the food is more essential than the quantity.

Keeping inventory: In order to reduce food waste, we must always know what goods we have in
stock.

Providing numerous trainings to employees on how to reduce food waste: All employees should
have a basic understanding of food safety; this can only be used to teach them how to reduce
food waste.
As a result, these are some of the methods that can be used to reduce food waste.
Assessor: Excellent! Philip, it's fantastic. All of the topics covered in discussions today will be
implied.
Me: Thank you very much, Sir. Now we'll talk about the last topic, which is the variety of
recipes. Despite the fact that I am not a skilled cook, I would be interested in seeing any
improvements made to the new recipe.

Assessor: Fantastic! It's fantastic, Philip. All of the topics covered today in meetings will be
implied.

Me: Sir, thank you very much. The last subject to be considered is the variety of recipes. Despite
the fact that I am not a skilled cook, I would be very interested in seeing any improvements made
to the new recipe.

Assessor: Philip, I'm overjoyed. You've done an excellent job of researching everything, and it
will really assist the café's growth.

Me: Thank you very much, sir; I'll be doing more research in this area in the future.

(This is where the gathering comes to an end)

Assessor: Philip, that's excellent. Okay, I'm going to leave now. Have a wonderful day.
Sir, have a pleasant day.
QUESTION 6
Item 6 of 10
Monitor activities – month 1
It is the end of month 1. You have kept to the budget and the funds have been allocated as you
planned for.
Using the relevant accounting software and the exact figures from your fund allocation
document, enter the expenses you have incurred over the first month exactly as they are
represented in your fund allocation page of your spreadsheet.
Print a report of the entries or take a screenshot and submit to your assessor.
Answer

I have provided the full sum of $2,075 for commodities, such as the fresh meat distributor VIC,
for the first day of the month of November. We've also created a small budget for the first cycle
to evaluate if it'll be useful in the months ahead. As a result, I'm utilizing the accounting software
Wave to distribute monies and create a chart.

We've already announced that the wave accounting tools will be used for budgeting, allocating,
and distributing monies for the blue healer café.

QUESTION 7
Item 7 of 10
Monitor activities – month 2
It is the end of month 2. You have kept to the overall budget but funds have had to be rearranged
in the following ways:

• There was an accident when unloading the vegetable crate one week and all the produce
was spoiled. You had to purchase a second crate which pushed your amount spent with
the vegetable supplier up by 10%.
• To accommodate for the overspend, you reduced the amount spent on cakes and
pastries by that same amount and baked inhouse.

Enter the expenditure figures into the accounting software as outlined in your fund allocation
document but consider the information above and work out the variances.
Print a report of the entries or take a screenshot and submit to your assessor.
Answer
We had such a minor collision in the second cycle that we had to buy an extra box of veggies,
but we elected to spend less on bakery things. For example, instead of fifteen kilograms, ten
kilograms would cost $100. This choice was made in order to spend 10% of the additional funds
on vegetables.

We used wave managerial accounting to re-distribute funds shortly after the event.
According to the report, the expected budget was $2,075; however the actual budget spent was
$2225, resulting in a $150 disparity.
QUESTION 8
Item 8 of 10
Monitor activities – month 3
It is the end of month 3. The following has happened:
Due to recent environmental conditions, less people came to the local area than planned for and
many people cancelled their accommodation at Blue Healer. Some of the food for the first week
had already been ordered and as such – there was a lot that went to waste. The figures have been
calculated for the month based on 4 weeks. $6000 was spent on food in preparation for the
increased numbers but during the first week there was a total waste of 35%. Many items were
able to be frozen, and as such the budget can be amended for the next quarter to try and recoup
some of the losses. The following three weeks the same amount was spent as budgeted for the
two prior months, being $3,750 per week and a total of $6000 for the month was spent on
beverages.
Enter the expenditure figures into the accounting software as outlined in your fund allocation
document but consider the information above and work out the variances.
Print a report of the entries or take a screenshot and submit to your assessor.
Answer

QUESTION 9
Item 9 of 10
Develop an actual budget from the past three months
Develop an actual budget using the past information and your financial records you complied
and submitted in the previous activity steps. Make a new page in the Café Quarterly Budget
spreadsheet and name it ‘Actual Budget’.
Assume the following information:
 • Variances of 10% are not considered unusual.
• The actual income is as follows:
• The operating expenses are all correct.

Submit to your assessor.

Answer
When we see the results of our spending, we'll be able to see where the problems are. These
could be some of the few options for the next quarter's budget control, with operational costs
projected to be approximately $40000.

QUESTION 10
Item 10 of 10
Conduct research and write a budget report
Compile a report to the owner about what has occurred over the past three months. You will also
need to conduct some research when writing this report as outlined below. Submit in the
timeframe as provided to you by your assessor.
Include the following in your report:
 • The status of the budget and the variations in relation to what was projected – use
percentages and figures to discuss a detailed account of what has occurred in the overall
actual budget in relation to projections.
• Lessons learned from what has occurred in the past quarter and ideas for how you can
prevent similar situations in the future by improvements that can be made.
• Undertake research to investigate new or different approaches to budget management
and then outline the benefits and advantages of different approaches you could take and
how these approaches may impact on customer service levels or staff.
• Provide recommendations for budget management for the next quarter and provide
estimates for this period.

Make sure you use correct budget terminology and your report is neatly presented, clear and
concise with the use of statistical representations.
Use the Budget report template to guide your work.
Submit to your assessor.

Answer
Budgeting Report Template

Introduction
The budget report is an internal report used by management to compare the budgeted amount of
the results obtained for a certain period of time with the actual amount of the outcomes obtained.
Budget reports must be prepared and tailored to the needs of the commission company. The
primary goal of preparing a budget report is to examine how this budget is met by comparing the
budgeted result to the actual performance over the year for the accounting period Blue Healer
Café's expenditure budgeted output from January to December.
Body
There was a lot in the first month, and we started with a limited budget. We only had a net
income of $37000 in the first month, which includes all of us. Food revenue and expenditures, as
well as capital expenditures, are examples. Similarly, on the second cycle, we had an occasion
where we had to buy back the fruits and vegetables. We had to purchase a second container,
resulting in a 10% increase in the amount you invested with the vegetable supplier. We have
reduced in order to meet any excess. The funds were spent on the same quantity of bakery
products cooked in-house.
We had a net profit of at least $40000 at the conclusion of the day. We made at least $40000 in
net profit. Because of the weather, we experienced a lot of ups and downs in the third month;
less people came to the local community than expected, and many individuals left. The blue
healer, on the other hand, postponed their lodging. For the first week, you can eat whatever you
want. It had already been ordered, so there was a lot of it. It had already been ordered, so there
was a tonne on its way.

The results for the month were determined based on a four-week investment of $6000 in food
supplied to the needy in preparation for increased amounts, yet 35 percent of total waste was
generated in the first week. Many items have been postponed; therefore the budget for the next
quarter can be changed to try to return some of the expenses. For the next three weeks, the same
amount was spent on drinks as had been budgeted for the previous two months, $3750 per week,
for a total of $6000 per month. However, by the end of the month, we are willing to make a
profit of $43800 from prior practice, we have learnt a lot about how to avoid food waste, and we
have also proposed ways to ignore food transactions that have resulted in a beneficial result of
increased profits. Setting up a budget can be difficult, therefore figuring out the appropriate
budgeting strategy for our needs can be challenging. I also looked into five standard budgeting
methods, as well as their benefits and drawbacks.

1. Incremental budgeting
By introducing enhancements to financial procedures, you can get them on the spending plan.
The timeframes that are currently in use the change is usually expressed in percentages and
might be significant. Depending on a variety of conditions, either an extension or a decline or a
decrease may be made, in general, the associations' needs and circumstances. It aids in
portraying market evolution and advances in the lookout in some ways.

Advantages
• Straightforwardly simple
• Simple to keep up with and easy to optimize
• Disadvantages
• External capital distribution Gradual existence Vulnerable to the excess Fiscal slackness
• Negatively creative.

2. Budgeting on a zero-based basis (ZBB)

The ZBB requires justification for all sorts of expenditure consumption as well as
information on equalization articulation in order to develop a new budget. On this record,
rather than being referred to as the normal way for alerting prior data, this methodology is
used independently of the preceding period's expense. It also necessitates that businesses
establish new budgeting from the ground up, starting with a "zero" baseline, as the name
implies.
Advantages
• Increased precision
• Productivity enhancements
• Capital distribution that is optimized and in line with the company's objectives
• Disadvantages
• Capital is restricted.
• Incapable of calculating the unquantifiable
• Coaching or instruction that is comprehensive.

3. Adaptive budgeting in response to events (ABB)

Activity-based budgeting (ABB) calculates the total cost of achieving a goal as a
specified level of intensity. First and foremost, this highest level approach
necessitates the characterization and extensive study of all cost-generating
elements. This research would then serve as a foundation for utilizing the money
in order to achieve the projected level of operation.
Advantages
• Increased Efficiency
• Cost control was removed, and redemption was no longer possible.
 • Lack of funds and resources is a disadvantage.
• Promote a specific concept.
4. Budgeting based on the outcomes
Another extreme variation is quality budgeting, in which spending are tied to specific goals. The
first collection with PBB is an objective collection. These objectives will then serve as the
foundation for the tasks that the organization intends to carry out, as well as the costs associated
with them.
Advantages
• Choosing a specific owner
• Primary actions that should be prioritized
• Disadvantages
• Dedications are required.
• Recommendations to promote rationality

Recommendations
As with the previous three-month history, I recommend not overloading the budget, but only
other portions, though a few can be beneficial. When it comes to building a decent budgeting
system, we must exercise extreme caution.We'd have to organize regular meetings to cover all of
the shareholders' financial decisions. Finally, at the end, I would also suggest that the budget be
re-evaluated on a regular basis, as this helps us to see how reality differs from our best
intentions. When we see the results of our spending, we'll be able to see where the problems are.
These could be some of the few options for the next quarter's budget control, with operational
costs projected to be approximately $40000.