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Unit of competency details

BSBESB403 - Plan finances for new business ventures (Release 1)

Summary

Usage recommendation:
Current
Mapping:
MappingNotesDate
Supersedes and is equivalent to BSBSMB402 - Plan small business finances 18/Oct/2020

Release Status:
Current
Releases:
ReleaseRelease date
1 1 (this release) 19/Oct/2020


Training packages that include this unit

Classifications

SchemeCodeClassification value
ASCED Module/Unit of Competency Field of Education Identifier 080301 Business Management  

Classification history

SchemeCodeClassification valueStart dateEnd date
ASCED Module/Unit of Competency Field of Education Identifier 080301 Business Management  19/Oct/2020 
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Unit Of competency

Modification History

Release  

Comments  

Release 1

This version first released with BSB Business Services Training Package Version 7.0.

Application

This unit describes the skills and knowledge required to identify financial requirements of a business, including profit targets, cash flow projections and strategies to garner financial support.

The unit applies to those establishing a business providing self-employment, as well as those establishing a new venture as part of a larger organisation.

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

Unit Sector

Business Competence – Entrepreneurship and Small Business

Elements and Performance Criteria

ELEMENT 

PERFORMANCE CRITERIA 

Elements describe the essential outcomes.

Performance criteria describe the performance needed to demonstrate achievement of the element.

1. Prepare to plan finances

1.1 Identify costs associated with production and delivery of business products and/or services

1.2 Set profit targets according to business venture requirements and workplace procedures

1.3 Calculate prices based on costs and profit targets, as a charge-out rate for labour or unit price for products and/or services

1.4 Calculate break-even sales point to assess viability of business venture

1.5 Evaluate and select pricing strategies in relation to market conditions to meet profit targets and according to workplace procedures

1.6 Prepare projected profit statement to supplement business plan

2. Develop a financial plan

2.1 Identify working capital requirements necessary to attain profit projections

2.2 Identify non-current asset requirements and consider alternative asset management strategies

2.3 Prepare cash flow projections to enable business operation according to business plan and legal requirements

2.4 Identify capital investment requirements accurately for each operational period

2.5 Select budget targets to enable ongoing monitoring of financial performance

3. Plan to acquire finance

3.1 Identify start-up and ongoing financial requirements according to financial plan and budget

3.2 Identify sources of finance for required liquidity according to business goals and objectives and workplace procedures

3.3 Research and assess cost of securing finance on optimal terms

3.4 Develop strategies to obtain finance as required to ensure financial viability of business venture

Foundation Skills

This section describes those language, literacy, numeracy and employment skills that are essential to performance but not explicit in the performance criteria.

Skill 

Description 

Reading

  • Identifies, analyses and evaluates complex information from a range of sources

Writing

  • Prepares written plans and workplace documentation that communicate information clearly and effectively

Numeracy

  • Analyses numerical information to determine costs, prices, profit and losses, and other financial data

Self-management

  • Identifies implications of legal and regulatory responsibilities for own work
  • Takes a range of constraints into account and adjusts, if necessary

Unit Mapping Information

Supersedes and is equivalent to BSBSMB402 Plan small business finances.

Links

Companion Volume Implementation Guide is found on VETNet - https://vetnet.gov.au/Pages/TrainingDocs.aspx?q=11ef6853-ceed-4ba7-9d87-4da407e23c10

 

Assessment requirements

Modification History

Release  

Comments  

Release 1

This version first released with BSB Business Services Training Package Version 7.0.

Performance Evidence

The candidate must demonstrate the ability to complete the tasks outlined in the elements, performance criteria and foundation skills of this unit, including evidence of the ability to:

  • develop at least one financial plan that addresses financial requirements of a business or new business venture, including cash flow projections and a projected profit statement.

In the course of the above, the candidate must demonstrate that the plan:

  • reflects legal requirements applicable to business
  • includes strategies to monitor financial performance of business.

Knowledge Evidence

The candidate must be able to demonstrate knowledge to complete the tasks outlined in the elements, performance criteria and foundation skills of this unit, including knowledge of:

  • legislative and regulatory requirements relating to business described in performance evidence
  • process for conducting break-even analyses
  • workplace procedures for:
  • costing for the business, including margin or mark-up, charge-out rates and unit costs
  • setting profit targets
  • identifying sources and investigating costs of securing appropriate financial assistance
  • methods and relative costs of obtaining finance
  • principles and procedures for preparing:
  • balance sheets
  • cash flow forecasts
  • profit and loss statements
  • financial plans
  • purpose of financial reports
  • accounting terminology required when planning finances for new business ventures
  • methods for analysing working capital cycles.

Assessment Conditions

Skills in this unit must be demonstrated in a workplace or simulated environment where the conditions are typical of those in a working environment in this industry.

This includes access to:

  • software for financial calculations
  • legislation and regulations relating to business described in performance evidence
  • workplace documentation and resources relevant to performance evidence.

Assessors of this unit must satisfy the requirements for assessors in applicable vocational education and training legislation, frameworks and/or standards.

Links

Companion Volume Implementation Guide is found on VETNet - https://vetnet.gov.au/Pages/TrainingDocs.aspx?q=11ef6853-ceed-4ba7-9d87-4da407e23c10