BSBSMB421
Manage small business finances


Application

This unit describes the skills and knowledge required to implement and review financial management strategies on a regular basis, including by using new and emerging digital technologies.

It applies to individuals who operate a small business that stands alone, or that is part of a department within a larger organisation. Individuals in this role interpret financial reports and other numerical data to develop financial management strategies.

No licensing, legislative or certification requirements apply to this unit at the time of publication.


Elements and Performance Criteria

ELEMENT

PERFORMANCE CRITERIA

Elements describe the essential outcomes.

Performance criteria describe the performance needed to demonstrate achievement of the element.

1. Implement financial strategy

1.1 Identify financial information requirements and obtain specialist services, as required, to profitably operate the business

1.2 Produce financial budgets or projections, including cash flow estimates, as required for each forward period, and distribute to relevant people in accordance with legal requirements

1.3 Develop a plan to negotiate and manage business capital to best enable implementation of the business plan

1.4 Develop and maintain strategies to enable adequate financial provision for taxation in accordance with legal requirements

1.5 Develop, monitor and maintain client credit policies, including contingencies for debtors in default, to maximise cash flow

1.6 Select key performance indicators to enable ongoing monitoring of financial performance in line with the business plan

1.7 Record and communicate financial procedures to relevant personnel to facilitate implementation of the business plan

2. Monitor financial performance

2.1 Use available digital technologies to regularly monitor and report on financial performance targets, and analyse data to establish extent to which the financial goals have been met

2.2 Monitor marketing and operational strategies for their effects on the financial goals

2.3 Calculate and evaluate financial ratios according to own or industry benchmarks

2.4 Assess financial plan to determine whether variations or alternative plans are needed, and change as required

2.5 Undertake research regularly to identify opportunities to implement new and emerging technologies to boost business profitability in accordance with the business plan

Foundation Skills

This section describes those language, literacy, numeracy and employment skills that are essential to performance but not explicit in the performance criteria.

Skill

Description

Reading

Evaluates complex text to determine legislative, regulatory and workplace documentation

Writing

Prepares written reports and workplace documentation that communicate complex information clearly and effectively

Oral Communication

Articulates clearly using specific and relevant language suitable to audience to convey requirements, and employs listening and questioning techniques to confirm understanding

Participates in verbal negotiations using tone and language suitable to audience

Numeracy

Interprets numerical information to calculate all relevant financial information

Navigate the world of work

Appreciates implications of legal and regulatory responsibilities related to own work

Interact with others

Selects appropriate form, channel and mode of communication for a specific purpose relevant to own role

Get the work done

Develops plans to manage relatively complex, non-routine tasks with an awareness of how they may contribute to longer-term operational and strategic goals

Makes a range of critical and non-critical decisions in relatively complex situations, taking a range of constraints into account

Uses formal and informal processes to monitor implementation of ideas and reflect on outcomes


Sectors

Management and Leadership – Small and Micro Business