Unit of competency details

Unit descriptor 

This unit describes the performance outcomes, skills and knowledge required to undertake financial management within a work team in an organisation. This includes planning and implementing financial management approaches, supporting team members whose role involves aspects of financial operations, monitoring and controlling finances, and reviewing and evaluating effectiveness of financial management processes in line with the financial objectives of the work team and the organisation.

No licensing, legislative, regulatory or certification requirements apply to this unit at the time of endorsement.

Application of the unit 

This unit addresses the requirement for managers to ensure that financial resources are used effectively. This is done by ensuring access to budget/s and ongoing monitoring expenditure against the budget/s.

The unit applies to managers working in small and large business environments and not for profit organisations.

Prerequisite units 

Employability skills 

This unit contains employability skills.

Elements describe the essential outcomes of a unit of competency.

Performance criteria describe the performance needed to demonstrate achievement of the element. Where bold italicised text is used, further information is detailed in the required skills and knowledge section and the range statement. Assessment of performance is to be consistent with the evidence guide.

ELEMENT 

PERFORMANCE CRITERIA 

1. Plan financial management approaches

1.1. Access budget /financial plans  for the work team

1.2. Clarify budget/financial plans with relevant personnel  within the organisation to ensure that documented outcomes are achievable, accurate and comprehensible

1.3. Negotiate any changes required to be made to budget/financial plans with relevant personnel within the organisation

1.4. Prepare contingency plans  in the event that initial plans need to be varied

2. Implement financial management approaches

2.1. Disseminate relevant details of the agreed budget/financial plans to team members

2.2. Provide support  to ensure that team members can competently perform required roles  associated with the management of finances

2.3. Determine and access resources and systems  to manage financial management processes within the work team

3. Monitor and control finances

3.1. Implement processes  to monitor actual expenditure and to control costs across the work team

3.2. Monitor expenditure and costs on an agreed cyclical basis to identify cost variations and expenditure overruns

3.3. Implement, monitor and modify contingency plans as required to maintain financial objectives

3.4. Report  on budget and expenditure in accordance with organisational protocols

4. Review and evaluate financial management processes

4.1. Collect and collate for analysis, data and information on the effectiveness of financial management processes  within the work team

4.2. Analyse data and information on the effectiveness of financial management processes within the work team and identify, document and recommend any improvements to existing processes

4.3. Implement and monitor agreed improvements in line with financial objectives of the work team and the organisation

REQUIRED SKILLS AND KNOWLEDGE 

This section describes the skills and knowledge required for this unit.

Required skills 

• numeracy skills to read and understand a budget and to update a budget
• technology skills to use software associated with financial record keeping.

Required knowledge 

• basic accounting principles
• organisational requirements related to financial management
• relevant legislation and current requirements of the Australian Taxation Office, including GST
• requirements for organisational record keeping and auditing
• principles and techniques involved in:

• budgeting
• cash flows
• electronic spreadsheets
• GST
• ledgers and financial statements
• profit and loss statements.

EVIDENCE GUIDE 

The Evidence Guide provides advice on assessment and must be read in conjunction with the performance criteria, required skills and knowledge, range statement and the Assessment Guidelines for the Training Package.

Overview of assessment 

Critical aspects for assessment and evidence required to demonstrate competency in this unit 

Evidence of the following is essential:

• financial skills required to work with and interpret budgets, ageing summaries, cash flow, petty cash, GST, and profit and loss statements
• knowledge of the record keeping requirements for the ATO and for auditing purposes.

Context of and specific resources for assessment 

Assessment must ensure:

• access to appropriate documentation and resources normally used in the workplace.

Method of assessment 

A range of assessment methods should be used to assess practical skills and knowledge. The following examples are appropriate for this unit:

• assessment of written reports indicating broad knowledge of managing budgets and managing financial resources in the organisation
• demonstration of techniques using financial record keeping software
• direct questioning combined with review of portfolios of evidence and third party workplace reports of on-the-job performance by the candidate
• oral or written questioning to assess knowledge of requirements for organisational record keeping and auditing
• review of contingency plans
• review of identification of cost variations and expenditure overruns
• evaluation of documentation reportingon budget and expenditure
• review of documentation identifying and recommending improvements to financial management processes.

Guidance information for assessment 

Holistic assessment with other units relevant to the industry sector, workplace and job role is recommended, for example:

• other units from the Diploma of Management.

RANGE STATEMENT 

The range statement relates to the unit of competency as a whole. It allows for different work environments and situations that may affect performance. Bold italicised wording, if used in the performance criteria, is detailed below. Essential operating conditions that may be present with training and assessment (depending on the work situation, needs of the candidate, accessibility of the item, and local industry and regional contexts) may also be included.

Budget /financial plans  may include:

• cash flow projections
• long-term budgets/plans
• operational plans
• short-term budgets/plans
• spreadsheet-based financial projections
• targets or key performance indicators for production, productivity, wastage, sales, income and expenditure

Relevant personnel  may include:

• financial managers, accountants or financial controllers
• supervisors, other frontline managers

Contingency plans  may include:

• contracting out or outsourcing human resources and other functions or tasks
• diversification of outcomes
• finding cheaper or lower quality raw materials and consumables
• increasing sales or production
• recycling and re-using
• rental, hire purchase or alternative means of procurement of required materials, equipment and stock
• restructuring of organisation to reduce labour costs
• risk identification, assessment and management processes
• seeking further funding
• strategies for reducing costs, wastage, stock or consumables
• succession planning

Support  may include:

• access to specialist advice
• documentation of procedures
• help desk or identified experts within the organisation
• information briefings or sessions
• intranet-based information
• training including mentoring, coaching and shadowing

Required roles  may include:

• arranging for use of corporate credit cards
• banking
• debt collection
• ensuring security, accuracy and currency of financial operations
• invoicing clients, customers and consumers
• maintaining journals, ledgers and other record keeping systems
• maintaining petty cash system
• purchasing and procurement
• wages and salaries payments and record keeping

Resources and systems  may include:

• hardware and software
• human, physical or financial resources
• record keeping systems (electronic and paper-based)
• specialist advice or support

Processes  to monitor actual expenditure and to control costs across the work team include:

• reporting of:

• assets
• consumables
• equipment
• expenditure
• income
• stock
• wastage

Reporting  may include data from:

• bank statements
• credit card statements
• financial reports
• invoices and receipts
• ledgers and journals
• logs
• petty cash records
• spreadsheet-based records

Data and information on the effectiveness of financial management processes  may include records (paper-based and electronic) related to:

• bank account records
• cash flow data
• contracts
• credit card receipts
• employee timesheets
• files of paid purchase and service invoices
• income and expenditure
• insurance reports
• invoices
• job costings
• petty cash receipts
• quotations
• taxation records
• wages/salaries books

Unit sector 

Competency field 

Management and Leadership - Management

Co-requisite units