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Budgeting and Controlling Group Assignment

MIB GROUP ASSIGNMENT BRIEF (v1.0)

PLEASE READ THE FOLLOWING BRIEF CAREFULLY.
Weightage

This assignment is worth 40% of your final score.

Group Formation

Minimum of 2 and maximum of 3 members per group on self selection basis. Students responsibility to find a group for
themselves.

Effort

This assignment is expected to take about 10 to 15 hours per

member of the group.

Submission mode

Soft copy to be uploaded.

File name and subject of your e mail should be:
MIB7 Feb 2013 name of group leader

Due date

As per the schedule.

Notes

a)
b)

c)
d)
e)
f)
g)

h)
Content

Each group will upload a single doc file (word 97 2003

version) per group.
All assignments are to be typed to a professional standard
on standard A4 paper using 1.15 line spacing in Times New
Roman font size 12.
Word limit of 2,000 words The word limit excludes charts,
diagrams, tables, graphs, contents page, header, footer etc.
Any appendices are not included in the page limit.
Reports should follow (generally) a format for a professional
report.
You are expected to research the topic in other relevant
accounting/finance texts.
This research should be well referenced. Sources should be
appropriately referenced, acknowledging all sources of
information that are not yours.
Please clearly indicate the make-up of formula used.

Your report must have deliverables mentioned on the next page.

See next page for details.

Copyright to Manek. 2012.

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Budgeting and Controlling Group Assignment

Assignment details
The assignment consists of development of financial component / financial plan for a new
business that you have decided to establish in Singapore. Your business involves retailing
& / or service covering multiple (at least 2) products in food and beverage. A product or
service is defined as having a unique cost and sale price.
Assume your first planning year will be from 1 April 2013 to 31 March 2014.
REPORT: - The report should include the following:

One doc file (word 97 2003 version) containing following:

a) Content page that clearly shows each of the following items with their page
number. An excel file (see next page for details) should be embedded on top
right hand corner.
b) Executive summary
c) Clear description of your business idea. You may describe your business idea
in terms of location, target customers, capacity, value proposition etc
d) Key Assumptions. these must be documented, clearly presented and must be
credible / realistic. Key figures need more persuasive / convincing evidence.
e) All budgets that are mentioned on the next page.
f) Commentary on key figures from the three budgeted annual financial
statements.
g) Commentary on annual Break Even Point (in $) and also annual Margin of
Safety (MS) in $ and as a % of budgeted revenue.
h) Brief discussion of five critical success factors of non-financial nature for
your business
i) Create a Balanced Score Card for your business detailing identification of at
least three (3) (Key Performance Indicators) KPIs in each of the four
perspectives covered by BSC.
j) Commentary on ROA (return on assets) ratio using (Net Profit / Total assets).
Using 10% cost of investment (assets), compute Residual Income (RI).
k) Conclusion - Provide strong justification for your recommendation on the
business idea (Go / No Go) in terms of financial indicators, future prospects
for business etc.
l) References and bibliography
Total word limit for the entire assignment can not exceed 3000 words. The word limit
excludes charts, diagrams, header, footer, figures, contents, appendices etc.

Copyright to Manek. 2012.

(v1.0)

Budgeting and Controlling Group Assignment

EXCEL FILE DETAILS

One excel file (MS Excel 97 2003 format) with multiple spread sheet. This excel spread
sheet will be inserted in top right hand corner of your page (1) one of word document and
will contain all your computations in following order:
Sheet No
1
2

Contents
Group members details (name and roll number)
Raw data sheet The data sheet contains all of the raw data used in
preparation of budgets. You can use formulae in the data sheet.
The budgets will be linked to the data sheet and to each other so that if
any data are changed in the data sheet the budget(s) will self-adjust
through to the Balance Sheet and adjust related calculations such as BEP
as well as ROA (return on assets) /RI (residual income). There will be
NO quantitative data input directly in the following budgets from tab 3
onwards. Failure to observe this requirement will automatically result
into a failed grade.

Annual budgets for all functions such as sales, production (if applicable),
purchase, staffing, advertising, utilities, depreciation expenses, etc

Annual budget for non current or fixed asset (itemised)

Annual Cash budget

Annual Budgeted Income Statement for the year,

Annual Budgeted Cash Flow Statement for the year
Annual Budgeted Balance Sheet at end of the year and.

Annual Break Even Point (BEP) in $ and Margin of Safety (MS) in $.

Draw annual Break Even Point graph and Profit Volume graph

Annual ROA (Return on assets) and RI (residual income) computations

based on annual budgets.

Copyright to Manek. 2012.

(v1.0)

Budgeting and Controlling Group Assignment

GRADING SHEET
All members of the group will share a common grade.
#

Description

Breach of any of following conditions:

No content page.
No documentation for key assumptions.
Submission of report in any form other than MS word 97 2003 version.
Submission of more than one file per group.
Absence of excel file as an attachment embedded in the assignment on the
executive summary page at top right hand corner.
Absence of data sheet linked approach to self - adjusting budgets and related
computations of BEP, Margin of Safety, Return On Assets and Residual Income
RI.

-100

Executive summary (600 words limit) Summary is expected to summarise the main
points / central ideas / key figures and arguments. You can only complete an executive
summary after you have completed all the calculations.

10

Clear description of your business idea. You may describe your business idea in terms
of location, target customers, capacity, value proposition etc.

Key Assumptions. Assumptions these must be documented, clearly presented and

must be credible / realistic. Key figures need more persuasive / convincing evidence.
Identification and discussion of five critical success factors.
Annual Cash budget
+ commentary on it (maximum of 100 words)
Annual Budgeted Income statement,
Annual Budgeted Cash Flow Statement for the year
Annual Budgeted Balance Sheet at end of the year and.
+ commentary on it (maximum of 100 words)
Annual Break Even Point (BEP) in $ and Margin of Safety (MS) in $.
Draw annual Break Even Point graph and also Profit Volume graph
+ commentary on it (maximum of 100 words)
Annual ROA (Return on assets) and RI (residual income) computations based on
annual budgets.
+ commentary on it (maximum of 100 words)
Create a Balanced Score Card for your business detailing identification of three KPIs
in each of the four key areas.
+ commentary on it (maximum of 100 words)
Conclusion - Provide strong justification in support of your conclusion as to viability of
your business idea (Go / No Go) in terms of financial indicators, future prospects for
business etc.

15

Overall readability & presentation

10

E
F
G

Total

Copyright to Manek. 2012.

5
5
5
5
5
5
10

5
5
5

100

Your
score