Modification History
Not applicable.
Unit Descriptor
This unit deals with the skills and knowledge required to interpret the types of financial information used by operational supervisors and managers in their day-to-day work activities. It focuses on understanding of key financial terminology, different types of financial reports and on how financial information is used in the management of a business. This unit does not include the skills required to produce financial reports that would generally be created by more senior managers, financial specialists or accountants. This unit underpins other financial units such as THHGLE13B Manage finances within a budget, THHGLE14B Prepare and monitor budgets and THHGLE15B Manage financial operations.
This unit deals with the skills and knowledge required to interpret the types of financial information used by operational supervisors and managers in their day-to-day work activities. It focuses on understanding of key financial terminology, different types of financial reports and on how financial information is used in the management of a business. This unit does not include the skills required to produce financial reports that would generally be created by more senior managers, financial specialists or accountants. This unit underpins other financial units such as THHGLE13B Manage finances within a budget, THHGLE14B Prepare and monitor budgets and THHGLE15B Manage financial operations
Application of the Unit
Not applicable.
Licensing/Regulatory Information
Not applicable.
Pre-Requisites
Not applicable.
Employability Skills Information
Not applicable.
Elements and Performance Criteria Pre-Content
Not applicable.
Elements and Performance Criteria
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Elements and Performance Criteria |
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Element |
Performance Criteria |
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1 |
Access and interpret financial information |
1.1 |
Identify and use relevant business performance indicators and benchmarks for decision-making purposes. |
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1.2 |
Identify the range of financial information and reports required to effectively monitor business performance at a day-to-day operational management level. |
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1.3 |
Access and review relevant financial information at appropriate times in accordance with enterprise policy and financial reporting periods. |
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1.4 |
Interpret financial information correctly. |
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2 |
Apply financial information to management activities |
2.1 |
Identify the financial information that applies to particular areas of work operation. |
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2.2 |
Review financial information in terms of its impacts on day-to-day work operations and take action accordingly. |
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2.3 |
Share appropriate financial information with colleagues in a timely manner. |
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Required Skills and Knowledge
Not applicable.
Evidence Guide
Essential Knowledge and Skills to be Assessed
The following knowledge and skills must be assessed as part of this unit:
understanding of the basic features of accounting and its purpose including:
chart of accounts and account categories (e.g. assets, liabilities, equity, income, cost of sales, and expenses)
the basic rules underpinning double-entry accounting and the concept of debits and credits
accrual versus cash accounting
the profit and loss statement and the balance sheet as the key financial statements used to measure business performance (including role, how these reports are generated, format, features and key information an operational manager should look for)
reporting periods (including variations such as different financial years)
the concept of balancing entries and reconciliations
concepts of costing including fixed and variable costs
general features of computerised accounting packages including the types of packages available for different industry sectors
overview of the financial record-keeping process and key terminology including:
ledgers, subsidiary ledgers and journals
transactions, receipts, disbursements
invoices, accounts payable, debtors, creditors
reconciliations, including purpose, different types of reconciliation and the impact of unpresented cheques, bank charges, direct debits and credits
cashflow
financial terminology used specific to different industry sectors (e.g. average spend, cover, ullage, Travel Compensation Fund requirements)
overview of the GST accounting and reporting processes for business and the impact of this on day-to-day operations.
Linkages to Other Units
This unit underpins effective performance in a range of other financial and business units. Combined training and assessment is strongly recommended. Examples of related units are:
THHGLE13B Manage finances within a budget
THHGLE14B Prepare and monitor budgets
THHGLE15B Manage financial operations
Critical Aspects of Assessment
Evidence of the following is critical:
understanding of the accounting process and of key accounting terminology
ability to interpret financial information and determine the relationship between the information and the performance of a business.
Context of Assessment and Resource Implications
Assessment must ensure:
project or work activities that allow the candidate to interpret financial information relating to the performance of a tourism or hospitality business
use of commercially-realistic financial data and reports.
Assessment Methods
Assessment methods must be chosen to ensure that skills in interpreting financial information can be practically demonstrated. Methods must include assessment of knowledge as well as assessment of practical skills.
The following examples are appropriate for this unit:
case studies which allow the candidate to report on business performance through analysis of financial reports
oral or written questions to assess knowledge and understanding of accounting concepts and terminology
review of portfolios of evidence and third party workplace reports of on-the-job performance by the candidate.
Key Competencies in this Unit
Key Competencies are an integral part of all workplace competencies. The table below describes those applicable to this unit. Trainers and assessors should ensure that they are addressed in training and assessment.
Level 1 = Perform Level 2 = Administer and Manage Level 3 = Design and Evaluate
Key Competencies
Collecting , Organising and Analysing Information
For example:
Interpreting monthly income and expenditure statements (2)
Communicating Ideas and Information
For example:
Explaining financial performance issues to staff members (2)
Planning and Organising Activities
For example:
Accessing and analysing information at the appropriate time and applying this to workplace operations (1)
Working with Others and in Teams
For example:
Discussing ways in which business performance could be improved with colleagues (2)
Using Mathematical Ideas and Techniques
For example:
Calculating percentage increases or decreases in expenditure or income (2)
Solving Problems
For example:
Investigating an apparent discrepancy in financial information (2)
Using Technology
For example:
Using a computerised accounting system to generate financial information (1)
Essential Knowledge and Skills to be Assessed
The following knowledge and skills must be assessed as part of this unit:
understanding of the basic features of accounting and its purpose including:
chart of accounts and account categories (e.g. assets, liabilities, equity, income, cost of sales, and expenses)
the basic rules underpinning double-entry accounting and the concept of debits and credits
accrual versus cash accounting
the profit and loss statement and the balance sheet as the key financial statements used to measure business performance (including role, how these reports are generated, format, features and key information an operational manager should look for)
reporting periods (including variations such as different financial years)
the concept of balancing entries and reconciliations
concepts of costing including fixed and variable costs
general features of computerised accounting packages including the types of packages available for different industry sectors
overview of the financial record-keeping process and key terminology including:
ledgers, subsidiary ledgers and journals
transactions, receipts, disbursements
invoices, accounts payable, debtors, creditors
reconciliations, including purpose, different types of reconciliation and the impact of unpresented cheques, bank charges, direct debits and credits
cashflow
financial terminology used specific to different industry sectors (e.g. average spend, cover, ullage, Travel Compensation Fund requirements)
overview of the GST accounting and reporting processes for business and the impact of this on day-to-day operations.
Linkages to Other Units
This unit underpins effective performance in a range of other financial and business units. Combined training and assessment is strongly recommended. Examples of related units are:
THHGLE13B Manage finances within a budget
THHGLE14B Prepare and monitor budgets
THHGLE15B Manage financial operations
Critical Aspects of Assessment
Evidence of the following is critical:
understanding of the accounting process and of key accounting terminology
ability to interpret financial information and determine the relationship between the information and the performance of a business.
Context of Assessment and Resource Implications
Assessment must ensure:
project or work activities that allow the candidate to interpret financial information relating to the performance of a tourism or hospitality business
use of commercially-realistic financial data and reports.
Assessment Methods
Assessment methods must be chosen to ensure that skills in interpreting financial information can be practically demonstrated. Methods must include assessment of knowledge as well as assessment of practical skills.
The following examples are appropriate for this unit:
case studies which allow the candidate to report on business performance through analysis of financial reports
oral or written questions to assess knowledge and understanding of accounting concepts and terminology
review of portfolios of evidence and third party workplace reports of on-the-job performance by the candidate.
Key Competencies in this Unit
Key Competencies are an integral part of all workplace competencies. The table below describes those applicable to this unit. Trainers and assessors should ensure that they are addressed in training and assessment.
Level 1 = Perform Level 2 = Administer and Manage Level 3 = Design and Evaluate
Key Competencies
Collecting , Organising and Analysing Information
For example:
Interpreting monthly income and expenditure statements (2)
Communicating Ideas and Information
For example:
Explaining financial performance issues to staff members (2)
Planning and Organising Activities
For example:
Accessing and analysing information at the appropriate time and applying this to workplace operations (1)
Working with Others and in Teams
For example:
Discussing ways in which business performance could be improved with colleagues (2)
Using Mathematical Ideas and Techniques
For example:
Calculating percentage increases or decreases in expenditure or income (2)
Solving Problems
For example:
Investigating an apparent discrepancy in financial information (2)
Using Technology
For example:
Using a computerised accounting system to generate financial information (1)
Range Statement
This unit applies to all tourism and hospitality sectors. The following explanations identify how this unit may be applied in different workplaces, sectors and circumstances.
For generic pre-employment training and assessment, a range of industry contexts must be addressed. Where the focus is sector or workplace specific, training and assessment must be tailored to meet particular needs.
Financial information must include :
source documents
journals
transaction reports
account summaries/balances
profit and loss statements
invoices
budget reports
expenditure reports (labour/non-labour).
Financial information may include :
balance sheets
trial balance
receivables reports
stocktaking sheets
purchase summary reports
stock reports
variance reports
wastage reports
sales reports
supporting reports (e.g. covers, occupancy rates, staff costs, units sold)
business activity statements
labour/wages reports
cashflow reports
bank statements
bank deposit documentation
merchant statements
transaction exemption reports
cheque books
credit card transaction statements
banking summaries
merchant summaries.
This unit applies to all tourism and hospitality sectors. The following explanations identify how this unit may be applied in different workplaces, sectors and circumstances.
For generic pre-employment training and assessment, a range of industry contexts must be addressed. Where the focus is sector or workplace specific, training and assessment must be tailored to meet particular needs.
Financial information must include :
source documents
journals
transaction reports
account summaries/balances
profit and loss statements
invoices
budget reports
expenditure reports (labour/non-labour).
Financial information may include :
balance sheets
trial balance
receivables reports
stocktaking sheets
purchase summary reports
stock reports
variance reports
wastage reports
sales reports
supporting reports (e.g. covers, occupancy rates, staff costs, units sold)
business activity statements
labour/wages reports
cashflow reports
bank statements
bank deposit documentation
merchant statements
transaction exemption reports
cheque books
credit card transaction statements
banking summaries
merchant summaries.
Unit Sector(s)
Not applicable.
