NGUYEN TAT THANH UNIVERSITY

NTT INSTITUTE OF INTERNATIONAL EDUCATION

EDEXCEL HIGHER NATIONAL DIPLOMA IN BUSINESS

SCHEME OF WORK
Unit title:
Unit code:

MANAGING FINANCIAL RESOURCES AND DECISIONS

H/601/0548

QCF level:
Credit value:
Course Facilitator:

4
15
Name:
Email:
40 hrs

Guided learning hours

Tel:

Note: the scheme of work and the assignment briefs will be sent to the students before teaching the course .

Aim
The unit aim is to provide learners with an understanding of where and how to access sources of finance for
a business, and the skills to use financial information for decision making

Unit abstract
This unit is designed to give learners a broad understanding of the sources and availability of finance for a
business organisation. Learners will learn how to evaluate these different sources and compare how they
are used.
They will learn 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 within the unit. Finally, learners
will learn and apply techniques used to evaluate financial performance.

Learning outcomes
On successful completion

of this unit a learner will:

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

Be able to evaluate the financial performance of a business.

Unit content
1

Understand the sources of finance available to a business

Range of sources: sources for different businesses; long term such as share capital; retained earnings;
loans; third-party investment; short/medium term such as hire purchase and leasing; working capital
stock control; cash management; debtor factoring
Implications of choices: legal, financial and dilution of control implications; bankruptcy
Choosing a source: advantages and disadvantages of different sources; suitability for purpose eg matching
of term of finance to term of project

Understand the implications

of finance as a resource within a business

Finance costs: tangible costs eg interest, dividends; opportunity costs eg loss of alternative projects
when using retained earnings; tax effects
Financial planning: the need to identify shortages and surpluses eg cash budgeting;
implications of failure to finance adequately; overtrading
Decision making: information needs of different decision makers
Accounting for finance: how different types of finance and their costs appear in the financial statements
of a business; the interaction of assets and liabilities on the balance sheet and on international
equivalents under the International Accounting Standards (IAS)
3

Be able to make financial decisions based on financial information

Budgeting decisions: analysis and monitoring of cash and other budgets
Costing and pricing decisions: calculation of unit costs, use within pricing decisions;
sensitivity analysis
Investment appraisal: payback period; accounting rate of return; discounted cash flow techniques
ie net present value; internal rate of return
Nature of long-term decisions: nature of investment importance of true value of money; cash flow;
assumptions in capital investment decisions; advantages and disadvantages of each method

Be able to evaluate the financial performance

of a business

Terminology: introduction to debit, credit, books of prime entry, accounts and ledgers, trial balance,
final accounts and international equivalents under the International Accounting Standards (IAS)
Financial statements: basic form, structure and purpose of main financial statements ie balance sheet,
profit and loss account, cash flow statement, notes, preparation not required; changes to reporting
requirements under the International Accounting Standards (IAS) eg statement of comprehensive
income, statement of financial position; distinctions between different types of business ie limited
company, partnership, sole trader
Interpretation: use of key accounting ratios for profitability, liquidity, efficiency and investment;
comparison both external ie other companies, industry standards and internal ie previous periods,
budgets

Textbook and reference materials: (provided by teacher)

Unit Outline (completed by teacher)

Session Topics
1
2
3
4
5
6

Suggested Contents

Resources, activities, readings

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8
9
10
11
12
13
14
15
16
17
18
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20

Course Assessment

Summary of grades
In order to achieve a pass in a unit

all learning outcomes and associated assessment criteria have

been met

In order to achieve a merit in a unit

pass requirements achieved

all merit grade descriptors achieved

pass and merit requirements achieved

all distinction grade descriptors achieved

In order to achieve a distinction in a

unit

Grading criteria for PASS

Learning outcomes
On successful completion
this unit a learner will:

Assessment criteria for pass

of

LO1 Understand the sources of

finance available to a business

The learner can:

1.1 identify the sources of finance available to a business
1.2 assess the implications of the different sources
1.3 evaluate appropriate sources of finance for a business project

LO2 Understand the implications of

finance as a resource within a
business

2.1 analyse the costs of different sources of finance

2.2 explain the importance of financial planning
2.3 assess the information needs of different decision makers
2.4 explain the impact of finance on the financial statements

LO3 Be able to make financial

decisions based on financial
information

3.1 analyse budgets and make appropriate decisions

3.2 explain the calculation of unit costs and make pricing decisions
using relevant information
3.3 assess the viability of a project using investment appraisal
techniques

LO4 Be able to evaluate the

financial performance of a
business

4.1 discuss the main financial statements

4.2 compare appropriate formats of financial statements for different
types of business
4.3 interpret financial statements using appropriate ratios and
comparisons, both internal and external.

Grading criteria for MERIT

Merit descriptors

Indicative characteristics

In order to achieve a merit

the learner must:

The learners evidence shows, for example:

M1 identify and apply strategies

effective judgements have been made

complex problems with more than one variable have been

explored

an effective approach to study and research has been

applied

relevant theories and techniques have been applied

a range of methods and techniques have been applied

a range of sources of information has been used

the selection of methods and techniques/sources

justified

the design of methods/techniques

complex information/data has been synthesised and

processed

appropriate learning methods/techniques

to find appropriate solutions

M2 select/design and apply

appropriate methods/techniques

has been

has been justified

have been applied

M3 present and communicate

appropriate findings

the appropriate structure and approach has been used

coherent, logical development of principles/concepts

intended audience

a range of methods of presentation have been used and

technical language has been accurately used

communication has taken place in familiar and unfamiliar

contexts

the communication is appropriate for familiar and unfamiliar

audiences and appropriate media have been used.

for the

Grading criteria for DISTINCTION

Distinction descriptors

Indicative characteristics

In order to achieve a
distinction the learner must:

The learners evidence shows, for example:

D1 use

conclusions have been arrived at through synthesis of ideas and

have been justified

the validity of results has been evaluated using defined

criteria

self-criticism of approach has taken place

realistic improvements have been proposed against defined

characteristics for success

autonomy/independence

substantial activities, projects or investigations have been

planned, managed and organised

activities have been managed

the unforeseen has been accommodated

the importance of interdependence

achieved

ideas have been generated and decisions taken

self-evaluation has taken place

convergent and lateral thinking have been applied

problems have been solved

innovation and creative thought have been applied

receptiveness to new ideas is evident

effective thinking has taken place in unfamiliar contexts.

critical reflection
to
evaluate own work and justify
valid conclusions

D2 take responsibility for managing

and organising activities

D3 demonstrate
convergent/lateral/ creative
thinking

has been demonstrated

has been recognised and

Links
This unit links with the following units within this specification Unit 6: Business Decision Making, Unit 9:
Management Accounting: Costing and Budgeting, Unit 10: Financial Accounting and Reporting, Unit 11:
Financial Systems and Auditing and Unit 12: Taxation.