Report on Financial Management

Business

6/19/2017
OZ Assignment Help
Emma Zoe
Summary of Contents

This section consists of the following assessment tasks:

1. Part 1 Learning Activity questions if not already provided to you please email
support@financeinstitute.com.au to obtain the link to complete this task online
2. Part 2 Learning Activity questions if not already provided to you please email
support@financeinstitute.com.au to obtain the link to complete this task online
3. Assignment 1 - CASE STUDY 1 You are required to complete 1 submission to
a lender on behalf of these clients
4. Assignment 2 - CASE STUDY 2 -You are required to complete 2 submissions for
these equipment finance clients
5. Assignment 3 - THEORY ASSIGNMENT -This is an open book assignment on the
units studied within this course
6. Assignment 4 SERVICING AND RESEARCH ASSIGNMENT -You are required to
use what you have learned and your research skills to obtain information
necessary to understand the complex legal requirements and risks when providing
broking services to clients with complex loan needs
7. Assignment 5 SUSTAINABILITY PLANNING Business Plan -You are required to
use the information provided in Unit 1 along with research on the internet to
prepare a Sustainability Business Plan
8. Compulsory Education Department Feedback form

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Instructions Instructions help you understand the questions and complete the
assignment

Questions/Scenario There may be one or more questions relating to the competencies

you are required to demonstrate.
Trainees must ensure that the Cover Sheet provided is included with the full completed 5
Assignment submissions (i.e. use the provided cover sheet as the front page to your 5
assignments and submit together).

The Assessment is comprised of online questions + 5 assignments that as a whole make

up the complete Assessment. You are required to complete the online questions then
submit the remaining 5 assignments together.

Please note, extensive answers are not always required. Brief answers may be appropriate
for some questions as long as you ensure your response adequately addresses the
question.

Important: Presenting your Assessment submission in a format that is clear and

appropriately structured forms part of your assessment and also demonstrates your
ability to communicate ideas and concepts and use technology.
After NFI has reviewed your Learning Activity question answers and your 5 Assignments
have been marked, your marks will be advised put into the online platform.

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All Assessments tasks should be submitted together i.e. At the same time, either by mail
or email or by uploading into the online platform.

Your completed assessments will NOT be returned to you as they are retained for audit
purposes as required.
The assessment tasks will also be used to assess your language and literacy skills. The
assessor will check your assignments to ensure that they are accurate with correct
grammar and punctuation

that they are appropriate to the target audience

that they show planning and organisational skill
That they demonstrate your ability to search for products and service information
and use problem solving approaches to identify customer needs and expectations.

Time limits you have six (6) months in which to complete all of your course
assessments. You may submit your assessments at any time within this six month period.
Extensions are only available after this time for an additional fee. If your six months
expires you will no longer have online access available.

Pass mark the assessments above together form the full assessment content of this
Diploma course and you are required to achieve 80% on each assessment task in order
to pass the course.

Keep a copy With all assessments submitted you should ensure you retain an electronic
or scanned or photocopied record of your submissions for your own files and in case of
possible loss in transit.

Assignment 1
Overview: The purpose of this task is to allow you to demonstrate that you can complete
the major steps required in broking or writing a moderately complex loan for a customer
through identification, development and implementation of loan options while
assessing and managing risks. The samples in Appendix A may prove helpful. Remember

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that what you prepare will need to be presented to the client orally and thus must be
understood by them.

Instructions: Read the scenario provided and using the information and data supplied,
prepare a formal loan submission for a lender using the following headings. Use
subheadings where appropriate to ensure your submission will be easily read and
understood by the lender. The client file should contain the standard client information
and data that would be included in a typical submission for a loan of this complexity.
Your lender submission should include as a minimum the following headings:

Borrowers Details
Background
Loan Purpose
Facility Details
Funds Position
Servicing Capacity
Security
Risk Assessment and Management (according to lender policy, guidelines and
relevant legislation). Consideration must be given to any environmental, heritage
or native title implications
Recommendations
Attachments

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Scenario
Andrew Bisset has been a real estate agent for over 20 years and jointly with his wife
Jane own 6 shops at 55 Park Road, Belmont. Mr and Mrs Bisset own the shopping Centre
under the Bisset Family Trust. The property was valued 2 years ago at $1,450,000 and has
a current ABZ Bank Mortgage of $625,000.

Five of the shops are rented out for $96,000. The sixth shop is occupied by Mr Bissets
real estate business, Bissets Real Estate Pty Ltd, which pays annual rental of $42,000 to
the family trust. For tax purposes Bissets Real Estate pays rent which is $20,000 in excess
of the fair market rental value of the shop it occupies.

Bissets Real Estate Pty Ltd was formed at the beginning of the last financial year to take
over the real estate agency business, which was previously conducted by a partnership
between Mr Bisset and Joseph Hooper. Bissets Real Estate Pty Ltd took over the business
when Mr Hooper retired.

Mr and Mrs Bisset now wish to acquire 3,000m2 of land near their existing shopping
Centre and hold it for 1 2 years pending rezoning.. The purchase price is $600,000. The
land was previously used as a State Government Health and Dental Centre, but the

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building was demolished when it became obsolete. The land is currently zoned Special
Purpose, but the local council earmarked the land for future Commercial use in it
recently released Town Planning Scheme. The land is located at 423 Belmont Road,
Belmont and has a two street frontage with considerable passing traffic.

The Bissets have contracted to purchase the property in their capacity as trustees of their
family trust and settlement is due with 60 days. They wish to raise 100% of the purchase
price plus $25,000 for stamp duty, financing and conveyancing costs. They are willing to
offer both the land and their existing shopping Centre as security for the proposed loan.
They will contribute a further $20,000 over the next 1 2 years to cover the costs
associated with re zoning of the property and obtaining approval to develop another
shopping centre.

Unfortunately ABZ Bank policy does not allow them to lend against land zoned Special
Purpose and cannot assist with the purchase. The Bissets have appointed you to
approach an alternative lender to refinance their ABZ Bank Loan and obtain the
additional funds required. Assume an interest rate of 7% for a commercial loan, 9% for
an overdraft.

Work History
Andrew has been a real estate agent for 22 years in the Brisbane South East area, he
specializes in commercial and industrial property (rent roll comprises 75% commercial
and industrial properties). His gross salary last financial year was $78,000. In the previous
financial year he drew $55,000 from the partnership with Joseph Hooper.
Jane has worked as the property manager since Bissets Real Estate Pty Ltd took over the
agency after the partnership. Her salary last financial year was $43,000. She did not work
in the previous financial year.

Financial Information

Last Financial year Bissets Real Estate Pty Ltd recorded the following financial results:

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 Gross Revenue $346,000

Net Profit $72,000

Depreciation $14,000

Directors Superannuation $11,000

In the previous financial year the partnership of Andrew Bisset and Joseph Hooper

trading as Bissets Real Estate recorded the following financial results:

Gross Revenue $422,000

Net Profit $ 84,000

Depreciation $ 16,000

Directors Superannuation $ 11,000

The Bisset Family Trust purchased the shopping centre at Park Road Belmont 18 months

ago and its financial statements for the past financial year are as follows:

Gross Rental Income $138,000

Loan Interest $ 52,000

Management Fees $ 11,000 (paid to Bissets RE Pty Ltd)

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 Net Profit $ 50,000

Depreciation $ 25,000

Financial Position Andrew and Jane Bisset

ASSETS

House at 12 Currumbin Close Carindale QLD $560,000

Share Portfolio (Blues Chip Listed Shares) $345,000

Motor Vehicles $ 60,000

Furniture $ 85,000

Cash at Bank $ 45,000

LIABILITIES

Home Loan with ABZ Bank $190,000

ABZ Bank Credit Card (Limit $20,000) $ 10,000

Financial Position of Bissets Real Estate Pty Ltd Assets

Business Goodwill $250,000

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Plant & Equipment $35,000

Debtors $30,000

Liabilities

ABZ Bank Overdraft (limit $40,000 secured by

$25,000
residence)

(Keep in mind that, in the absence of actual tax returns which would confirm the income
distribution of the trust, any profit would be distributed and taxed in the hands of the
beneficiaries. For the purposes of this assignment, assume company tax of 30%, even
though in "real life" of course you cannot assume and the distributions would be clear in
real life financials.)

Property being purchased

Vacant Land

423 Belmont Road, Belmont QLD 4171

Lot 84 on RP 9564 Zoning Special Purpose Area 3000m2

Existing Property

Shopping Centre

55 Park Road, Belmont QLD 4171

Lot 43 on RP 9542 Zoning Commercial Area 1850m2

Tenancies

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 Tenant Rent Term Rent Review

J & R Blend
$22,000 pa net 3 + 3 years Annually by CPI
T/A Blend News

Copelin Accounting Pty

$18,000 pa net 1+ 1 +1 years Annually by CPI
Ltd

R Spragos
$28,000 pa net 5 + 5 years Annually by CPI
T/A Rogers Deli

Vu Nguyen
$20,000 pa net 3 + 3 years Annually by CPI
T/A Care Pharmacy

M Goodson
$8,000 pa net 3 + 3 years Annually by CPI
T/A Good Alterations

Bissets Real Estate Pty

$42,000 pa net 3 + 3 years Annually by CPI
Ltd

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 For More visits: Financial Assignment

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