Managing Financial Resources and Decisions

Learning outcome

Evidence

(Page no)

Understand the sources of finance available to a business

Understand the implications of finance as a resource within a business

Be able to make financial decisions based on financial information

and comparisons, both internal and external.

Student signature:                                                                 Date:

In addition to the above PASS criteria, this assignment gives you the opportunity to submit evidence in order to achieve the following MERIT and DISTINCTION grades

Grade Descriptor

Indicative characteristic/s

Contextualisation

Identify and apply strategies to find appropriate solutions

M1.2 – Complex problems with more than one variable have been explored

To achieve M1 you will show that complex problems with more than one variable have been explored

(Tasks 1 and 2)

Select / design and apply appropriate methods / techniques

(Task 2)

Present and communicate appropriate findings

(Task 1–4)

Use critical reflection to evaluate own work and justify valid conclusions

(Task 1–4)

Take responsibility for managing and organising activities

(Task 1-5)

Demonstrate convergent/lateral/creative thinking

D3.5 – Innovation and creative thought have been applied

(Task 1-5)

This assignment is designed to give learners a broad understanding of the sources and availability of finance for a business organisation. In this assignment learners will evaluate these different sources and compare how they are used. Learners will understand and indicate how financial information is recorded and how to use this information to make decisions for example in planning and budgeting.  Decisions relating to pricing and investment appraisal are also considered in the assignment. Additionally, learners will apply techniques used to evaluate financial performance.

You wish to start a new business but lack sufficient funds to do so. You have been encouraged by your friends to go find external funding for your business idea, and this may include potential investors, so that you may get it started as they believe it is a really good business idea.

You must write an Investor Proposal Report to secure funding for a new business venture that you would like to start.

Potential entrepreneurs create an investor proposal to elicit investments, usually monetary, from one or more future stakeholders/funders. Writing a successful investor proposal is largely a matter of understanding your potential investors/stakeholders and addressing the concerns and questions they are most likely to have.

The proposal is generally written in sections, beginning with high-level summary information and progressing to detailed plan sections. The overall intent is to secure investor confidence and, thereby, investor money. For the purposes of this module the Investment Proposal Report must highlight the learner’s ability to understand and manage financial resources and support financial decisions being made.

(should also talk about ratio analysis, just show your results not the calculation)

Executive summary – Give an outline of your business idea, what the funding will be used for and what it hopes to accomplish. Indicate why you are approaching a particular stakeholder for funding. Indicate why you think financial planning is important in such a context i.e. applying for funding from an investor.

To achieve M1, you will make effective judgements about the sources of funding available and which to select for your business venture.

To achieve M1 you will show that complex problems with more than one variable have been explored

To achieve D3 you will have generated creative and innovative ideas to use in this assignment and have taken appropriate decisions based on these ideas

Source of finance – The amount of funding required must be indicated and justified. Indicate which is your preferred source of funding and why. Indicate and explain the the costs associated with this choice and justify why these are acceptable and the most advantageous for your plan. Also, what the alternative sources of funding were and why they were not selected specifically to this proposal (This should be linked to the choice of investor)

To achieve M1, you will make effective judgements about the sources of funding available and which to select for your business venture.

To achieve M1 you will show that complex problems with more than one variable have been explored

To achieve M2 you will have used and applied relevant theories/techniques to explore the different sources of funding and present your findings

To achieve D1 you will have made decisions and choices that were based on conclusions which evaluated the differences between the various sources of financing, assessed which source was most appropriate and justified the choices made

To achieve D3 you will have generated creative and innovative ideas to use in this assignment and have taken appropriate decisions based on these ideas

Return on Investment – You must use at least two Investment Appraisal techniques for this section to indicate what the Return On Investment (ROI) is for potential funders. You must also explain why the ROI is positive, identify which stakeholders would be interested in this information and why they would want this information. (can use ratio analysis  to show why your investment should invest in your business)

To achieve M1 you will show that complex problems with more than one variable have been explored

To achieve M2 you will have used and applied relevant theories/techniques to explore the different sources of funding and present your findings

Explain and justify the venture’s potential  success – You must mention issues such as the importance and impact of financial planning on the success of their venture, a brief outline of your pricing strategy and why you have selected this approach and finally the importance and benefit of budgeting for your venture’s success and in securing funding.

To achieve M1 you will show that complex problems with more than one variable have been explored

To achieve M2 you will have used and applied relevant theories/techniques to explore the different sources of funding and present your findings

To achieve D2 you will have demonstrated an effective approach to independent research and study and will have met the deadline to submit the tasks and achieve the unit assessment criteria

Financial documentation – A very simple Profit & Loss Statement, Balance Sheet and a Cash budget appropriate for your form of business can be created. It will use projected amounts based on your research and judgement regarding your chosen business venture.

Note: The LO’s state students do not have to prepare these but I think that in order for students to fully understand the management of financial resources it is necessary that they are able to compile simple versions of such documents.

To achieve M2 you will have used and applied relevant theories/techniques to explore the different sources of funding and present your findings

To achieve M3 the work you present must be presented in a suitable format, that being the Report and the appropriate financial statements.

To achieve D2 you will have demonstrated an effective approach to independent research and study and will have met the deadline to submit the tasks and achieve the unit assessment criteria

Sources of information:

Business Studies. 4^th ed. By Dave Hall, Rob Jones, Carlo Raffo and Alain Anderton; Causeway Press; ISBN-13: 978-1405892315

Times 100 Business case studies website: www.businesscasestudies.co.uk

Qualification

Assessor name

Unit Number and title

Student name

(tick)

1.1

1.2

1.3

4.1

4.2

4.3

OVERALL GRADE: PASS/MERIT/DISTINCTION

Higher Grade achievements (where applicable)

Grade descriptor

Achieved ?

(tick)

Grade descriptor

Achieved ?

(tick)

M1: Identify and apply strategies to find appropriate solutions

D1: Use critical reflection to evaluate own work and justify valid conclusions

M2: Select / design and apply appropriate methods / techniques

M3: Present and communicate appropriate findings

Formative feedback 1

 Formative feedback 2

Assessor Signature

Date

Student  Signature

Date