Working effectively in finance - osbornebooks.co.uk · Effective working in the finance 2 function ... 2.7 The correct definition of working capital is: (a) The profits of a business,

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2 w o r k i n g e f f e c t i v e l y i n f i n a n c e t u t o r z o n e

The finance function – roles andresponsibilities1

1.1 Select whether each of the following is an external or internal stakeholder of the finance functionof an organisation:

External Internal

The Sales Department of the organisation

The Sales Department of a customer

The inance company who lends money to the organisation

The Finance Department of a supplier

The HR Department of the organisation

1.2 Management accounting and financial accounting are different functions within an organisation.You are to complete the table below, indicating with a tick whether each of the listed activities ismost closely related to management accounting or to financial accounting.

Management Financial accounting accounting

Drawing up budgets

Producing the trial balance

Calculating the costs of producing a product

Financial planning for the future

Managing the accounts of trade receivables

c h a p t e r a c t i v i t i e s 3

1.3 The Departments in the list on the left-hand side are provided with accounting information bydifferent sections of the Finance Function. You are to match the types of information on the right-hand side with the type of Departmentrequiring information on the left. Draw lines as appropriate.

Department needing information Accounting information provided

Sales Department The insurance costs of running the business

Administration Department Customers who are exceeding their credit limit

Production Department The cost of material

1.5 The three people listed in the left-hand column of the table below work for Mellstock Limited:

Fiona Robin (Finance Director)

Don Everdene (Payroll Line Manager)

David Barry (Sales Ledger Assistant)

Enter in the right-hand column the person to whom they are most likely to report on a routine basis. Choose this person from the following list: Costing Line Manager, Managing Director, Accounts Manager, Accounts Line Manager, SalesManager.

1.4 An external auditor is:

(a) An inspector employed by HM Revenue & Customs who checks the accounts of a business

(b) An independent accountant appointed by a business who checks the accounts of that business

(c) An employee in the Accounts Department of a business who checks the accounts of that business

(d) An employee of the local Environmental Health Department who checks the noise levels in the workplace

Tick the one correct option.


1.6 Which of the following policies and procedures is not likely to affect people working in a financefunction? Choose one option.

(a) Use of the Health & Safety at Work Accident Book

(b) Grievance procedures

(c) Limits on hours spent driving maintenance vehicles

(d) Recycling of paper

1.7 What type of accounting information is most likely to be required by a bank lending money to abusiness? Choose one option.

(a) Wages and salaries figures

(b) Cash forecast figures

(c) Purchases ledger information

(d) VAT figures

1.8 The balances of accounts held in the Sales Ledger will be of most use to which one of the followingthree departments of a business?

(a) Sales & Marketing

(b) Production

(c) Human Resources


1.9 An organisation’s Policies and Procedures are likely to cover which two of the following activities(tick the appropriate activities):

(a) Signing arrangements for issuing of cheques

(b) Resolving private disputes between employees

(c) Retaining written records for a specific period of time

(d) Organising an office social night out at a club

1.10 Match the finance function in the left-hand column with the appropriate finance activity in the right-hand column. Draw lines as appropriate.

Finance function Finance activity

Purchases ledger Topping up an imprest system

Payroll Checking supplier invoices

Petty cash Maintaining a cash book

Issuing invoices

Preparing budget reports

Deducting tax

1.11 The accounting information needed by a Production Department includes which two of the followingoptions? Tick the appropriate options.

(a) Direct costs of manufacturing an item

(b) Indirect costs of manufacturing an item

(c) Income tax paid by employees

(d) Irrecoverable debts written off


1.12 The diagram below shows an extract from the organisation chart of a services business which hasthree directors and various managers, line managers and assistants.Complete the empty boxes with the appropriate job roles, using job titles included in the followinglist:

Finance Director Administration Manager Sales Representatives

Managing Director Accounts Assistants Production Assistants External Auditors

Human Resources DirectorMarketing Director

Finance Manager Sales Manager

Accounts Line Managers

Administration AssistantsSales AdministrationAssistants


1.13 Match each statement produced by a limited company with the correct definition:

Statement of profit or poss

Statement of financialposition

Statement of cash flows

The amount of moneyflowing into and out of a

business

The income less expensesfor a financial period

The net worth of thebusiness, how it is financed

and how much it owes


2.1 Maintaining the solvency of an organisation means:

(a) Keeping cash on the premises under lock and key at all time

(b) The organisation being able to pay debts when they are due

(c) Ensuring that the organisation always has an overdraft at the bank

(d) Ensuring that all internal disputes are resolved at the appropriate level

Tick the one correct option.

Effective working in the financefunction2

2.2 Identify which of the following actions will help the solvency of a business which purchases andsells on credit terms.Tick the appropriate actions.

(a) Chasing up late payments due from customers

(b) Completing the VAT Return on time to avoid a fine

(c) Paying employee wages direct to the bank by BACS rather than in cash

(d) Giving customers a longer credit period in which to pay their invoices

(e) Paying money received from customers into the bank promptly

(f) Settling up invoices from suppliers as quickly as possible

(g) Negotiating long credit terms with suppliers


2.3 Which two of the following policies and procedures are most likely to be relevant to the financefunction?

(a) Quality control in production

(b) Employee code of conduct

(c) Energy saving instructions and guidance

(d) Guidance for lifting of heavy packages

Tick the two correct options.

2.4 UK legislation affects the working conditions and methods.You are to complete the boxes in the text below with the following laws and regulations.

Working Time Regulations

Health & Safety at Work Act

Living wage regulations

Data Protection Act

Employers are bound by the which ensures that the workplace

is a safe place in which to work. The also affect employers and

set down restrictions on the hours that employees will be expected to work.

The protects employees by setting out the lowest amounts

employers are allowed to pay their employees. Confidentiality is important in the workplace and this

principle is supported in law by the .

1 0 w o r k i n g e f f e c t i v e l y i n f i n a n c e t u t o r z o n e

2.6 In order for communication to be effective it should be:

True False

(a) Incomplete

(b) Easily understood

(c) Long winded

(d) Late

2.7 The correct definition of working capital is:

(a) The profits of a business, the excess of income over expenditure

(b) The money a business has in the bank, plus the amounts owed by itscustomers, plus inventories, less the amounts that must be paid to suppliers

(c) The amounts the business owes to the bank in the form of loans andoverdrafts

(d) Large items such as plant, machinery, office equipment and motor vehiclesthat a business owns

2.5 The solvency of an organisation is a measure of (choose one option):

(a) The balance of cash in the petty cash tin and the bank

(b) The ability to repay its debts when they are due

(c) The length of time it takes the organisation to pay invoices

(d) The extent to which the organisation adopts sustainable objectives

c h a p t e r a c t i v i t i e s 1 1

2.8 The accounting records of a business should usually be kept for a minimum of:

(a) 6 months

(b) 1 year

(c) 2 years

(d) 6 years


Financial information, documentationand data security3

3.1 When checking a purchase order to an invoice received from a supplier which of the followingshould be agreed (select five):

(a) Rate and calculation of VAT

(b) Rate and calculation of trade discount

(c) Rate and calculation of prompt payment discount

(d) Correct type of goods received

(e) Correct quantity of goods received

(f) Payments made

(g) Whether the purchase order had been authorised

(h) Credit notes received

(i) Due date for payment

(j) Balance brought forward

3.2 When preparing the amount to be paid to a supplier which of the following should be agreed(select four):






(f) Payments made






3.3 When checking a supplier statement to the purchases ledger which of the following should beagreed (select three):






(f) Payments made





3.4 Complete the sentences below by selecting the correct words:

A bank statement is an external document received from the bank.

It shows the customer’s balance at both the start and end of the period.

A balance will mean that the account is overdrawn and it will have interest deducted.

deducted debit external drawings

balance internal added credit


3.5 Select True or False for the following statements:

True False

(a) The total fixed cost will remain the same regardless of thelevel of output

(b) The total variable cost will remain the same regardless ofthe level of output

(c) The total fixed cost will change according to the level ofoutput

(d) The total variable cost will change according to the level ofoutput

3.6 Complete the table below by selecting Adverse or Favourable for each cost variance:

Budget Actual Variance Adverse Favourable£ £ £

Direct material 12,000 10,000 2,000

Direct labour 11,000 15,000 4,000


True False

(a) Sole traders pay corporation tax based on their profits

(b) Sole traders pay income tax based on their profits

(c) Limited companies pay corporation tax based on theirprofits

(d) Limited companies pay income tax based on their profits


3.8 Below is an incomplete cash budget for three months for Warehouse Ltd:

April May June £ £ £

Receipts

Sales 10,200 9,700 10,100

Other income 0 3,000 0

TOTAL RECEIPTS 10,200 10,100

Payments

Purchases 5,800 4,500 11,600

Other expenses 3,200 2,000 4,800

TOTAL PAYMENTS 9,000 16,400

Net cash flow for month 1,200 (6,300)

Balance brought forward 5,800 7,000

Balance carried forward 7,000

Complete the sentences below by selecting the correct figures:

The total receipts for May are £ 12,700 and the total payments for May are £ 6,500 .

The net cash flow for the month of May is £ 6200 .

The balance carried forward at the end of May and brought forward at the beginning of June is

£ 13,200 .

The balance carried forward at the end of June is £ 6,900 .

£(5,500) £800 £6,200 £6,500 £6,900 £12,700 £13,200



True False

(a) If a cash budget has a negative balance carried forward itmeans that further cash should be injected into thebusiness

(b) If a cash budget has a negative balance carried forward itmeans that surplus funds can be withdrawn from thebusiness

(c) A VAT refund should be shown in payments in the cashbudget

(d) A VAT refund will not be shown in the cash budget

3.10 Data protection means (select the correct answer):

(a) Allowing all staff to have unlimited access to all financial information as long as itis held in a database

(b) Ensuring all personal data is kept confidential and only used for its intendedpurpose

(c) Backing up data on a regular basis


4.1 ‘Its’ or ‘It’s’? These words are often incorrectly used.You are to study the four sentences below and tick the two correct uses of the words.

(a) Its time to watch TV

(b) It’s time to do some revision

(c) I love coffee; it’s aroma makes me think of dark rich chocolate

(d) I love coffee; its aroma makes me think of dark rich chocolate

Effective business communications4

4.3 ‘There’ or ‘their or ‘they’re’? These words are often incorrectly used.You are to study the five sentences below and tick the two correct options.

(a) Their is no point worrying about their chances of winning their game

(b) There is no point worrying about their chances of winning their game

(c) There seems to be some misunderstanding whether they’re eligible or not

(d) They’re seems to be some misunderstanding whether they’re eligible or not

(e) Their seems to be some misunderstanding whether there eligible or not

4.2 ‘Too’ or ‘to’ or ‘two’? These words are often incorrectly used.You are to study the four sentences below and tick the two correct uses of the words.

(a) To study accounting is too difficult and learning to drive is too

(b) To study accounting is to difficult and learning to drive is too

(c) To lose one set of keys is bad luck but to lose two sets of keys is a disaster

(d) To lose one set of keys is bad luck but too lose to sets of keys is a disaster


4.4 Your name is Jan Steen and you work as a Finance Assistant at Hiburnum Limited. You have beenasked to compile the draft of an email to everyone in the Finance Department about a departmentalmeeting being held next Tuesday, 3 December.The email is a request to all Finance staff to attend the meeting, which is being held at 10.30 in theConference Hall. The purpose of the meeting is for management to brief staff about thereorganisation of the company during the following year; this reorganisation may result in staffredundancies and the possibilities for some early retirement.The email is to be sent in the first instance to Imogen Strega, the Senior Finance Manager([email protected]), for approval before it is released. The email will eventually be sent outin Imogen Strega’s name.You are to insert the email address of the recipient in the appropriate box and then complete theremaining boxes (they are numbered for reference) with the most appropriate words or phrasesfrom the lists shown below (also numbered for reference).

Option ListsPick one word or phrase for each numbered box from the following numbered lists:

1 Redundancy meeting; Staff meeting; Issue of P45s

2 the staff restaurant; Meeting Room 31; the Conference Hall; the Gymnasium

3 10.00 on 3 December; 10.30 on 4 December; 10.00 on 4 December; 10.30 on 3 December

4 optional; compulsory

Regards; Yours faithfully, Bye

1

23

4

From [email protected]

To

Subject

For the attention of Finance Department staff

Please attend a meeting to be held in

at . This meeting is

and will lead the way to significant changes in the way the

Department is operated in the future.

Imogen Strega

Senior Finance Manager

1

2

4

3

5

5


4.5 You have been passed the following draft letter (to a Mr Clutterback) to check. There are five major errors which could include wrong spellings, bad grammar or wrong use ofwords. You are to:(a) Identify the five incorrect words and enter them in the left-hand column of the table below.(b) Enter your correction of these five words on the appropriate line in the right-hand column of

the table below.

Dear Mr Cumberbatch

Account credit limit

We note that over the last two month’s your account with us hasconsistently been over the agreed limit of £50,000.

We shall be gratefull if you will make payment in order toregularise the situation.

We look forward to recieving your payment in the near future.

Yours faithfully,

Incorrect word Correction


4.6 You are writing an email to the Finance Manager of a customer of your business. His name isAntonio Gelato and you are setting up a meeting between him and your own Finance Manager. Itwould be best to sign off the email with the following wording:

(a) Yours faithfully

(b) Regards

(c) C U soon

Tick the most appropriate option.

4.7 A business report normally contains seven sections, each with a distinct function. The sevensections are:Title page, Summary (Executive), Introduction, Findings (Main body), Conclusions,Recommendations, AppendicesYou are to match the five selected sections on the left with the appropriate descriptions on the right.Draw five lines as appropriate.

Section title Section contents

A single page stating what the report is about, whowrote it, and the date it was written.

A short explanation (often for managers andexecutives) summarising the areas the report

examines.

This section tells the reader how the report cameabout and explains the nature of the tasks and the

people involved.

This sets out the information gathered by the reportand is the basis for the conclusions.

This sets out and analyses the results of theinvestigations of the report.

The suggested course(s) of action which are basedon the report.

Conclusions

Recommendations

Additional information which supports the report but isnot contained in the findings.

Appendices

Summary (Executive)

Title page


4.8 Select the most appropriate type of communication to deal with the following:

(a) Your Line Manager has requested a meeting to discuss next month’sbudget forecasts. He is currently out of the office and would like to knowyour availability tomorrow.

(b) A supplier has left a message to say that an invoice has been paid butthey don’t know which invoice it relates to.

(c) The sales manager would like to know how much is outstanding on tencustomer accounts.

(d) You need to remind yourself to process the petty cash payments onFriday as the cashier will be on holiday.

Report Email Note Telephone


5.2 Round the following figures to two decimal places:

(a) 31.455

(b) 31.445

(c) 31.437

(d) 97.7652

(e) 97.7399

(f) 97.7091

5.1 Round the following figures to the nearest whole number:

(a) 175.5

(b) 175.4

(c) 175.764

(d) 175.991

(e) 175.534

(f) 174.534

Calculations and spreadhseets5


5.3 You are helping to organise a marketing event for a new product. 240 individual invitations have been sent out to customers to attend the launch.For the 240 invitations that were sent out, there were 180 acceptances, but only 120 guests turnedup to the event.You are to work out the following in terms of a percentage, ratio or fraction of the number of peopleinvited. Percentages should be worked out to the nearest whole number.

(a) The number of people who came as a fraction of the people invited:

(b) The number of people who came as a percentage of the people invited:

(c) The ratio of people who came to those who stayed away:

(d) The number of people who came as a fraction of the people who accepted the invitation:

(e) The number of people who came as a percentage of the people who accepted the invitation:

5.4 You are given six receipts to enter into the accounting records, all of which are incomplete. You are to enter the missing figures in the table below.The VAT rate applicable is 20%.

Total amount VAT amount Net amount £ £ £

(a) 36.00

(b) 17.00

(c) 8.95

(d) 17.90

(e) 1.90

(f) 378.00


5.6 Below is the list of monthly sales for Tenby and Co for the last six months.Calculate the monthly sales as a percentage of the total sales for the six months to two decimalplaces:

Monthly sales Monthly sales £ %

March 14,600

April 15,800

May 13,500

June 18,100

July 17,300

August 14,300

Total

5.5 Trade discounts are being offered to customers of Twin Power Ltd.Complete the table below by calculating the trade discount deducted, the VAT charged (20%)and the total for each customer:

Price Trade Trade VAT Total (before discount) discount discount £ % £ £ £

Alexandra Ltd 140.00 5%

Maddie and Co 160.00 4%

Vapo Tool Ltd 175.00 10%

Digital Settings Ltd 190.00 20%


5.7 The employees in the Sales Department of Toys and Co are entitled to a bonus if their actual salesexceed their target by 10% or more.Complete the table below by calculating the percentage of actual sales in excess of the target andstating if each employee is entitled to a bonus (select Yes or No):

Target sales Actual sales Actual sales in Employee entitled excess of the to a bonus? target Yes/No £ £ %

Alan Bench 10,000 10,900

David Wear 12,000 11,100

Danielle Barker 5,000 6,500

Alisha Singh 14,000 17,220

5.8 The following information is taken from the stock cards for Alicia and Co:

Product ACX2 In stock 100 units at 25p 150 units at 26p

Calculate the weighted average cost per unit of product ACX2.


5.9 The following spreadsheet shows the monthly sales forecasts for Joanne and Co.The cost of sales is 25% of the sales figure.Insert the correct formulas into cells C5, C6, C7, C8, D5, D6, D7 and D8:

5.10 The Accounts Manager of Hartford Limited has asked you to extract the sales, costs and profitfigures for the company for the last three years (20-1, 20-2 and 20-3). Profit equals sales minus costs. The Manager says he thinks that costs have risen substantiallyover the three years. The figures you produce are set out in the table below.

Hartford Limited – sales, costs and profit figures Year 20-1 Year 20-2 Year 20-3

Annual sales £590,000 £760,000 £834,920

Costs £522,480 £700,700 £779,220

Profit £67,520 £59,300 £55,700

Calculate the percentage (to the nearest whole number) of profit to annual sales.

The formula is (profit ÷ annual sales) x 100.

Year 1 %

Year 2 %

Year 3 %


6.1 You work as a Sales Ledger Accounts Assistant in a busy office. You arrive twenty minutes late at09.20 because you have been delayed by bad traffic. You are to prioritise the following four tasks and enter the appropriate task numbers in the tablebelow in order of priority.

TASKS1 Spending two hours carrying out your normal routine, which is preparing invoices from sales

orders.2 Responding to an email request for sales figures needed by the Sales Manager at 11.00 that

day for a meeting.3 Looking at your post in your in-tray and opening emails on your work computer and deciding

if there is anything that needs immediate attention.4 Apologising and explaining to your Line Manager why you are late.

Priority Task number (1 to 4)

Priority 1

Priority 2

Priority 3

Priority 4

6.2 You work in a busy accounts office. In which of the following circumstances are you likely to needto change the priority of your work? Tick one option:

(a) Your Line Manager asks you to make sure that the Health & Safety manual is circulated within your department by the end of the week

(b) The Finance Director asks for some costing figures to be sent to himfor a meeting which is taking place in two hours time

(c) You notice that a colleague is not checking her work properlywhich means that suppliers may not be paid the correct amount

(d) Your Line Manager asks you to make sure that the payroll isready by the end of the day; this means that some of your routinework may be delayed

Planning and managing your work6


6.3 There are a number of planning aids that can be found in an accounting office:

action plan ‘to do’ list schedule diary

Complete the following table by entering the appropriate planning aid for each situation.

Recording future activities for future reference

Activities planned for a one day sales conference

A list of activities that have to be done by you

A list of activities to be done by different people

6.4 Tasks can be classified in terms of importance and urgency.

You are to state which one of the following options should be given priority.

Tick the appropriate option.

(a) A task that is important but not urgent

(b) A task that is not important and not urgent

(c) A task that is urgent and important

(d) A task that is urgent and not important

6.5 Efficiency and effectiveness are both essential factors in the running of a successful office.

You are to complete the sentences below using the two terms:

Efficiency Effectiveness

is getting the result that you want, which in the case of a workplace

means targets are met and the workforce well motivated.

means getting a job done with the minimum waste of effort and

resources.


6.6 You work in an accountancy practice and carry out numerous tasks and your priorities change ona daily basis.

Place the following in order of priority (number from 1 to 4):

A client has dropped off a pile of invoices and you have been asked to put them indate order so they can be processed next week

The Payroll Manager has asked you to check the overtime rates for the employeesof a client who need to be paid this week

There are three VAT returns that need to be submitted by the end of next month. Thethree clients need telephoning to remind them to bring in the relevant paperwork

The receptionist is off sick and you have been asked to answer the telephone anddistribute the mail


6.7 You are an Accounts Assistant employed by Epstein Limited. You work mostly on the PurchasesLedger section. You are employed for a four day week and work Monday to Thursday.Your working hours are 09.00 to 17.00 with an hour for lunch from 13.00 to 14.00. Your duties during the week are set out on the schedule below. Your morning duties are fixed andhave to be completed before lunch. Your afternoon tasks are more flexible.

Task description Scheduling of tasks Time taken Day Time for task

Dealing with emails and the post and Daily 9.00 2 hoursprocessing purchase orders

Checking documents received Daily 11.00 2 hours

Processing remittance advices to suppliers Wednesday 14.00 1 hour

Posting to the ledger using a Wednesday 15.00 1 hourcomputer accounting program

Preparing bank payments to suppliers Wednesday 16.00 1 hour

Getting quotes from suppliers Thursday 12.00 1 hour

On Wednesday afternoon, just before 3 o’clock when you are about to start inputting transactionsto the Purchases Ledger on the computer, your Line Manager calls you in and asks you toundertake an urgent task for him.

He has a meeting with the Finance Director at 4.00pm that afternoon and has to produce asummary setting out the credit terms given by suppliers to Epstein Ltd. The Finance Directorreckons that the business cash flow would benefit greatly from getting better terms, ie payingsuppliers later.

There are approximately 20 suppliers who between them account for 80% of purchases. It will takeyou about an hour to go through all the paperwork for these 20 suppliers and set out the results ona spreadsheet.

You normally complete your computer inputting and preparing the payments to suppliers onWednesday afternoon.

Your Line Manager says to you, “I am sure you can fit this in; it is really important for me to haveall the facts and figures for the meeting.”


(b) If you do not carry out the instructions of your Line Manager there could be problems. Tick theone likely outcome that would occur if you did not reorganise your order of tasks correctly.

(a) Dealing with emails and the post and processing purchase orders would not be completed on time

(b) Checking documents received would not be completed on time

(c) You would not be providing the necessary support to your work team

(d) You would be in breach of the Working Time Regulations

(a) Write the ‘to do’ list for Wednesday afternoon and Thursday set out below by listing the six tasks inorder of completion. Write the task descriptions in the column on the right.Choose from the following tasks (remember that the morning tasks cannot be retimed): Dealing with emails and the post and processing purchase orders Checking documents received Posting to the ledgers using a computer accounting program Preparing bank payments to suppliers Getting quotes from suppliers Preparing the figures for the Line Manager

WEDNESDAY AFTERNOON AND THURSDAY ‘TO DO’ LIST (in order of completion)

Task 1

Task 2

Task 3

Task 4

Task 5

Task 6


6.8 You work in the Sales Ledger section of the Accounts Department, processing financial documents,for example invoices, credit notes and statements. Normally these documents are produced on the computer, but there is a problem with the mainserver and the software has been corrupted. It is decided that your section should prepare thedocuments manually using an old system. You are given the job by your Line Manager at lunchtimeof checking them for numerical accuracy. It turns out that there are over 100 invoices to check andthere is no way in which you can carry out this task by the time the office closes at the end of theday.(a) Select the appropriate action to take from the list provided in the table below. Tick the

appropriate option.

(a) Do as many invoices as possible before the office closes; youestimate you could do about half of them

(b) Give all the invoices a quick look over but without checking every calculation

(c) Complain to the Senior Accounts Manager that you have been given too much work to do in the given space of time

(d) Speak to the Line Manager, explaining the situation andsuggesting that she allocates some of the work to acolleague who has time available to help out

(b) If you are unable to finish the checking in (a) above, the following could result (tick theappropriate option):

(a) There would be no effect on the office workflow at all(b) You are likely to be criticised by your Line Manager for

inefficiency(c) Invoices sent out late could mean that payments received

from credit customers may be delayed


Interpersonal skills and teamwork7

7.1 There are a number of ways of identifying an effective team. Identify three characteristics of aneffective team in a Finance Department from the list below. Tick the three selected options.

(a) Members work as much overtime as they can

(b) Members are familiar with the departmental Policies and Procedures

(c) Members are good communicators

(d) Members must have accounting qualifications

(e) Members report only to their Line Manager

(f) Members support their colleagues if they need help

7.2 You work as an assistant in a company Finance Department. You notice that one of your colleaguesspends a lot of time accessing social media sites such as Facebook on his computer. This is notallowed under the company Code of Conduct. As a consequence he is not efficient at his work andyou find that you are having to correct errors that he makes.

What action should you take? Tick the one appropriate option.

(a) Get on the same sites yourself so that he can see what effect it has on the team

(b) Tactfully point out to him that he is breaking the company Code of Conduct; it may be possible that he does not realise that he is breaking it

(c) No action at all; it is not your responsibility


7.3 Dissatisfaction within a team can seriously affect its performance. Sometimes problems are centredaround one individual and can be sorted out personally with an individual, sometimes they will needto be referred to a Line Manager. Assume that you are a Finance Assistant and indicate below which issues can be resolved by you,and which will need to be referred to a Line Manager.

By you By manager

You know for sure that one of your colleagues has been takingcash out of the petty cash box and forging vouchers

You notice that one of your colleagues is not checking supplierinvoices properly

You are asked to cover for a colleague who is on paternity leaveand normally deals with the payroll processing; you have little experience of payroll but say that you are happy to do it

7.4 A formal complaint by an employee who believes that he or she is not being treated fairly by anemployer can take action by using (tick the correct option):

(a) Policies and Procedures

(b) The Health and Safety tribunal

(c) The Grievance Procedure


7.6 Objectives in the CPD (Continuing Professional Development) process are (tick the correctoption):

(a) Special, Meaningful, Achievable, Realistic, Time bound

(b) Specific, Measurable, Achievable, Realistic, Time bound

(c) Specific, Measurable, Accurate, Realistic, Time bound

7.5 The CPD (Continuing Professional Development) process follows a very specific series of stages.You are to complete the sentences set out below with the following phrases:

assess your achievements identify your objectives achieve your objectives identify your development needs

In order to start the CPD process you must .

This will enable you to .

As the CPD process carries on you will hopefully .

and then be able to .


7.7 You work in the Sales Ledger section of a busy finance office. You have recently been for a staffappraisal during which there was discussion of your CPD.There are two areas which need special attention: one is a weakness in your range of skills and theother is a positive strength which could see you promoted within the next twelve months.You are to match the strength and the weakness in the left-hand boxes with the appropriateimprovement and development opportunities on the right. Draw lines to link the boxes.

Attending an external collegespreadsheet evening class

Work-shadowing the Credit ControlLine Manager

Studying for a Level 3 AAT qualificationby taking a home-study course

Reading textbooks on bookkeeping inyour spare time

Attending a Customer Services SkillsCourse at the local Chamber of

Commerce

Taking part in a team building event –paintballing

Italian language course – eveningclass

Work-shadowing a senior colleaguewho operates the department’s

computer accounting

You are a very politeperson by nature butfind it difficult to talk tocustomers over thetelephone, particularlywhen it comes toasking them aboutoverdue invoices.

You have an excellentgrasp of the credit control

procedures in yourorganisation and wouldlike to get promoted in

that area of the accountsfunction.


7.8 You have been asked to attend a team meeting with your manager and four new trainees whohave just started to work for the team. It is company policy to inform all staff members of anychanges to meetings via email.In the meeting you observe the following:• Dale arrived 20 minutes late and said that he was told by Lucy that the meeting started at

10am rather than the 9.30am start that was given in the email. • Lucy is very keen to impress the Line Manager and constantly interrupts the others when

they are speaking, often belittling them.• Kevin spends most of the meeting looking out of the window and yawning, he looks bored

and his appearance is slovenly.• Sadie is very shy and is obviously intimidated by the other members of the group. She is

keen to learn and will speak to you when asked a question.Your manager has asked you to identify the most important change in characteristic for each newteam member to enable them to work in an effective and efficient team.Select the most important change in characteristic for each of the four team members:

Dale

Lucy

Kevin

Sadie

Respecting othersPresenting a professional imagePunctuality and reliabilityGaining confidence


7.9 As part of your CPD programme your Line Manager has reviewed your performance and indiscussion with you has identified your strengths and weaknesses. You are currently working in the Sales Ledger section of the Accounts Department but are lookingto move into a new area of work in one month’s time. One of the areas in which you would like toimprove your skills is working on Sage computer accounting software.(a) Choose from the list below the two most appropriate suggested development activities which

will match your requirements. Tick the appropriate boxes on the right.

1 Work-shadowing (ie working alongside someone else operating theSage computer accounting system in your office)

2 Reading through the Sage instruction manuals in your spare time

3 Attending a week’s full-time Sage course at the local Chamber ofCommerce training centre

4 Going on a weekend ‘team building’ event to encourage your confidencein your new area of work

5 Reading a book on bookkeeping

6 Signing up for a general computer training course at the local college

(b) Decide the order of importance of the two chosen activities for your professionaldevelopment and enter the appropriate reference numbers (ie from 1 to 6) in the table below,placing the most important activity first.

The best option

The second best option


7.10 Dissatisfaction within a team can be caused by a number of factors:1 poor working conditions2 poor management3 different working styles4 personality clashesYou are to read through the situations in the table below and identify the cause of dissatisfactionin each case. Using the numbers 1 to 4 in the above list of dissatisfaction factors enter theappropriate number in the right-hand box of the table below.

(a) Mavis has been an Accounts Assistant for fifteen years. She is a good worker but she does not like criticism and is protective of the tasksthat she does. A new Line Manager has been appointed over her andwants to reorganise the processes within the office. This does not godown well with Mavis

(b) Alan is an efficient and technically able person who works efficiently at the tasks with which he is familiar. He has recently been appointed a Line Manager but is too polite to point out mistakes made by the Accounts Assistants he supervises. As a result the Accounts Assistants have becomecareless and a number of errors have been discovered in their work bycustomers of the business

(c) Meg has bad eyesight and back problems. She has to spend at least sixhours a day in front of the computer, but has an old and uncomfortablechair on which to sit. She says she wants to leave the company for the sake of her health

(d) Rajit is a fast and efficient worker. His main job is processing payroll onthe computer. He works alongside Miriam who is a slow but steady worker who likes everything to be absolutely correct and checked at least threetimes

7.11 A good team member in the workplace can be described as follows (tick the appropriate option):

(a) Pleasant, cooperative, hard-working and respectful of the opinionsof others

(b) Pleasant, rather shy, very quiet and very fast in completing all the tasksthat need to be done

(c) Hard-working, knowledgeable and always putting colleaguesright if it seems the colleague is wrong about something


Ethics, sustainability and corporatesocial responsibility8

8.1 The three situations in the table below illustrate breaches of ethical behaviour in the workplace. Youare to complete the table by entering the fundamental principle which is breached in each case.Choose from the following three principles:professional behaviour objectivity honesty

Situation Principle

The auditors find out that the Sales Manager has claimed for more expenses than she actually incurred

The Accounts Manager allows a customer extra discount and it is found that the customer is the Accounts Manager’s close friend

A person applies for an Accounts Assistant job with a company and claims he is a fully qualified AAT member. In fact he has not yet completed his exams

8.2 Identify and tick the two examples below of a breach of confidentiality in a Finance Department.

(a) An unknown person telephones the office and asks for the telephone number of one of your colleagues. He says he is an old friend just back from the USA

(b) One of your customers, whom you know well, telephones the office and asks for the telephone number of another customer. He says he has lost the number but knows you must have it (c) One of your colleagues in the Sales Department asks you for the credit limit given to a new customer you have just acquired


8.3 You hold a senior post in the Audit section of a firm of accountants. What would you do in thefollowing situations? Select in each case the course of action which is more ethical.

(a) You have recently completed an audit of a company customer and have been sent a caseof wine as a ‘thank you’. Your course of action should be (select the ethical option):

(a) Accept the wine with thanks and share it out among your colleagues(b) Politely return the wine and say that you are not in a position to

receive gifts in this way

(b) You have agreed to carry out the audit of a new company customer who has recently movedto your firm from a rival firm. The Managing Director of the company takes you out to lunchand promises you tickets for the Cup Final. Your course of action should be (select the ethical option):

(a) Accept the offer of tickets, but as you are not interested in football you hope you will be able to sell the tickets on eBay

(b) Politely decline the offer of the tickets, and say that you are not in a position to receive gifts in this way

8.4 You work in the Finance Department of a large independent travel agency which sells holidaypackages provided by a wide range of companies. Indicate which of the following situations arebreaches of confidentiality.

(a) You are having a meal out with friends and you advise them on which companies provide holidays to Southern Italy

(b) You are having a meal out with friends and you tell them the rate ofcommission your agency takes when selling holidays to Southern Italy

(c) Your partner knows the Manager of the agency and asks if youknow how much the Manager earns. You give an approximate figure

(d) You get a call from a friend while you are at work and she asks if youcan find out for her the cost of an Ingson package tour to Croatia


8.5 Identify which four of the following are examples of a sustainability policy within an organisation. (a) Having regular fire drills

(b) Recycling plastic packaging

(c) Encouraging cycling to work

(d) Using the cheapest possible coffee in the staff room

(e) Using Fair Trade coffee in the staff room

(f) Organising a staff half marathon to raise money for charity

(g) Requiring staff to have regular health checks

(h) Providing free lunches for staff in the canteen

8.6 A policy of sustainability in the workplace can sometimes provide financial savings for an organisation and sometimes it can incur extra costs. You are to indicate in the table below the effects of the following policies:

Extra cost Saves money

Turning off electrical equipment when it is not needed Using another company to recycle paper waste

The use of fuel-efficient delivery vehicles


8.7 State whether each of the following sentences is true or false. Tick the appropriate options.

True False

(a) Sustainability involves three objectives: economic growth, environmental protection and social equality

(b) Sustainability involves three objectives: economic stability, environmental protection and social differences

(c) Sustainability means using the same suppliers for a longperiod of time

(d) Sustainability means using materials which have a longproduct life

8.8 Companies that adopt sustainable policies often formalise the policies in the form of a CorporateSocial Responsibility document. Complete the text below by filling in the boxes with the followingwords:

sponsorship and donations sustainability vehicles socialstaff development and training accounting courses renewable sources

A Corporate Social Responsibility document will contain details of all a company does to promote

. It will include details of purchasing materials from

and reducing emissions from

. There is also a

aspect of sustainability and many companies record their

to charitable causes, the arts and sport. Companies are likely also to become involved in

, for example sending them on

.

Documents

Working effectively in finance - osbornebooks.co.uk · Effective working in the finance 2 function ... 2.7 The correct definition of working capital is: (a) The profits of a business,