Assessment Task 2: Budgeting and cost analysis
Task description This task requires you to examine a selected budget process and to consider the effectiveness of the budget process as a mechanism for monitoring costs and performance within your organisation. Select a budget from your work unit, department or the whole organisation, and develop an understanding of the budget preparation and monitoring process for this budget. You may wish to meet with the individuals who are responsible for preparing, authorising, managing or implementing the budget. Prepare a report in which you describe, analyse and critique the budget preparation and monitoring process. In your discussion, identify any pitfalls associated with the budget and monitoring process, and actions which you recommend could be taken to improve the budget process. In the analysis of the budget process, ensure that you include a discussion of: • How the budget aligns to broader organisational planning, strategies and goals • The timing and timeframes associated with budget preparation • Key costs and revenues in the budget and key variables driving them • Whether the key costs and revenues are regarded as fixed or variable, and what factors ‘drive’ the costs • Where and how information is gathered for the budget • Any costing models or costing systems used to generate information for the budget • What signoff is required • How performance against the budget is measured and monitored • How the budget is communicated to others in the work unit, department or organisation • How other staff are encouraged to meet budget.
Evidence of Reading and Research You need to provide evidence of researching additional relevant peer reviewed academic articles. These articles are in addition to those provided in the Managing Finance readings.
Assessment Format: This assessment should be submitted in report format with an assessment cover sheet, title page, executive summary, table of contents, introduction, discussion, conclusions, recommendations, list of references and appendices (if required). Note that it is not essential to include the actual budget document within the assessment.