This unit applies in any industry context and to a wide range of individuals who need to interpret financial data to inform their work practice, including senior operational staff, supervisors and managers.

This unit does not include the skills required to produce financial reports that would generally be created by senior managers, financial specialists or accountants.

Nil

ELEMENT

PERFORMANCE CRITERIA

1

Access and interpret financial information.

1.1

Identify and use relevant business performance indicators and benchmarks for decision-making purposes.

1.2

Identify the range of financial information and reports required to monitor business performance effectively on a day-to-day operational management level.

1.3

Access and review relevant financial information at appropriate times according to organisation policy and financial reporting periods.

1.4

Interpret financial information correctly.

2

Apply financial information to work activities.

2.1

Identify financial information that applies to particular areas of work operation.

2.2

Review financial information in terms of its impact on day-to-day work operations and take action accordingly.

2.3

Share appropriate financial information with colleagues in a timely manner.

This section describes the essential skills and knowledge and their level, required for this unit.

The following skills must be assessed as part of this unit:

critical thinking skills to evaluate financial information and determine its impact and importance for day-to-day workplace operations

literacy skills to interpret a wide range of business documentation

numeracy skills to interpret and use financial reports.

The following knowledge must be assessed as part of this unit:

understanding of the basic features of accounting and how it provides information for business management, including:

charts of accounts and account categories, such as assets, liabilities, equity, cost of sales, income and expense

basic rules underpinning double-entry accounting and the concept of debits and credits

accrual versus cash accounting

profit and loss statements and balance sheets as key financial statements used to measure business performance, including their role; how these reports are generated; and the format, features and key information an operational manager should look for

reporting periods, including variations different financial years observed by different businesses

concept of reconciliations

concept of costing, including fixed and variable costs

general features of computerised accounting packages, including the types of packages suitable for different industry sectors

overview of the financial record-keeping process and key terminology, including:

ledgers, subsidiary ledgers and journals

transactions, receipts and disbursements

invoices, accounts payable, debtors and creditors

reconciliations, including purpose, different types of reconciliation and the impact of unpresented cheques, bank charges, direct debits and credits on reconciliations

cash flow

financial terminology used specific to different industry sectors, e.g. average spend, cover, ullage and Travel Compensation Fund requirements

overview of GST accounting and reporting processes for business and the impact of this on day-to-day operations.

The evidence guide provides advice on assessment and must be read in conjunction with the performance criteria, required skills and knowledge, the range statement and the Assessment Guidelines for this Training Package.

Critical aspects for assessment and evidence required to demonstrate competency in this unit

Evidence of the following is essential:

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 and specific resources for assessment

Assessment must ensure:

use of commercially realistic financial data and reports.

Methods of assessment

A range of assessment methods should be used to assess practical skills and knowledge. The following examples are appropriate for this unit:

case studies that 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.

Holistic assessment with other units relevant to the industry sector, workplace and job role is recommended, for example:

SITXFIN004A Manage finances within a budget

SITXFIN005A Prepare and monitor budgets

SITXFIN008A Manage financial operations.

Assessing employability skills

Employability skills are integral to effective performance in the workplace and are broadly consistent across industry sectors. How these skills are applied varies between occupations and qualifications due to the different work functions and contexts.

Employability skills embedded in this unit should be assessed holistically with other relevant units that make up the skill set or qualification and in the context of the job role.

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 in the performance criteria is detailed below.

Financial information:

must include:

source documents

journal entries

transaction reports

account summaries and balances

balance sheets

profit and loss statements

invoices

budget reports

expenditure reports (labour or non-labour)

may include:

trial balance

receivable reports

purchase summary reports

stock reports

variance reports

wastage reports

sales reports

supporting reports, such as covers, occupancy rates, staff costs and units sold

business activity statements

labour and wages reports

cash flow reports

bank statements

bank deposit documentation

merchant statements

transaction exemption reports

cheque books

credit card transaction statements

banking summaries

merchant summaries.

Sector

Cross-Sector

Finance

The required outcomes described in this unit of competency contain applicable facets of employability skills. The Employability Skills Summary of the qualification in which this unit is packaged will assist in identifying employability skills requirements.