Modification History
Not applicable.
Unit Descriptor
Unit descriptor |
This unit describes the performance outcomes, skills and knowledge required to implement, monitor and review strategies for the ongoing management of a small business's finances. It also includes day to day financial management of the small business. Specific legal requirements apply to the management of a small business. |
Application of the Unit
Application of the unit |
This work is undertaken by individuals who operate a small business. The unit is suitable for existing micro and small businesses or a department in a larger organisation. |
Licensing/Regulatory Information
Not applicable.
Pre-Requisites
Prerequisite units |
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Employability Skills Information
Employability skills |
This unit contains employability skills. |
Elements and Performance Criteria Pre-Content
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. |
Elements and Performance Criteria
ELEMENT |
PERFORMANCE CRITERIA |
1. Implement financial plan |
1.1. Identify financial information requirements and obtain specialist services , as required, to profitably operate and extend the business in accordance with the business plan 1.2. Produce financial budgets/projections, including cash flow estimates, as required for each forward period, and distribute to relevant people in accordance with legal requirements 1.3. Negotiate, secure and manage business capital to best enable implementation of the business plan and to meet the requirements of financial backers 1.4. Develop and maintain strategies to enable adequate financial provision for taxation in accordance with legal requirements 1.5. Develop, monitor and maintain client credit policies , including contingencies for debtors in default, to maximise cash flow 1.6. Select key performance indicators to enable ongoing monitoring of financial performance 1.7. Record and communicate financial procedures to relevant people to facilitate implementation of the business plan |
2. Monitor financial performance |
2.1. Regularly monitor and report on financial performance targets and analyse data to establish the extent to which the financial plan has been met 2.2. Monitor marketing and operational strategies for their effects on the financial plan 2.3. Calculate and evaluate financial ratios according to own/industry benchmarks 2.4. Assess financial plan to determine whether variations or alternative plans are needed, and change as required |
Required Skills and Knowledge
REQUIRED SKILLS AND KNOWLEDGE |
This section describes the skills and knowledge required for this unit. |
Required skills |
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Required knowledge |
The following knowledge must be assessed as part of this unit:
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Evidence Guide
EVIDENCE GUIDE |
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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. |
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Overview of assessment |
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Critical aspects for assessment and evidence required to demonstrate competency in this unit |
Evidence of the following is essential:
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Context of and specific resources for assessment |
Assessment must ensure:
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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:
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Guidance information for assessment |
Holistic assessment with other units relevant to the industry sector, workplace and job role is recommended, for example:
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Range Statement
RANGE STATEMENT |
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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. |
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Financial plan may include: |
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Financial information may include: |
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Specialist services may include: |
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Cash flow may include: |
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Relevant people may include: |
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Financial backers may include: |
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Credit policies may include: |
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Financial ratios may include: |
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Unit Sector(s)
Unit sector |
Competency field
Competency field |
Management and Leadership - Small and Micro Business |
Co-requisite units
Co-requisite units |
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