Ebio enterprise living map

Financing the small business: You add value to others and exchange value including finance. (18 credits)

Manage finances of a new venture (4.09) - Core Unit Standard

Specific Outcome

Assessment criteria

Ebio Competency Programme: Information and Examples

Organize and Review your competencies

Manage finances of a new venture with your accessed and engaged expertise and resources by growing your Council of Many and Wise.

MIT open courseware: Entrepreneurial finance

Business planning: financial planning

Biz/ed: Accounting

SO 1

Open and operate a banking account for own business.

J. Welch (Chap. 12: 189-204): Budgeting

AC 1.1

The necessity of banking and banking accounts are discussed.

AC 1.2

The various forms of accounts are identified and the differences explained.

AC 1.3

Procedures to open a specific account are explained and demonstrated.

AC 1.4

The impact of interest rates on the venture’s profitability is determined.

AC 1.5

Documentation necessary for banking is completed in detail.

AC 1.6

Bank statements are interpreted correctly.

SO 2

Explain financial aspects involved in managing a business.

NetMBA: Finance

AC 2.1

Concepts, start-up and working capital in relation to own business are explained.

AC 2.2

The relationship between ‘cash flow’ and ‘profit’ is explained.

AC 2.3

The difference between short-term finance and long-term debt finance is explained.

AC 2.4

The difference between fixed and working capital is explained.

SO 3

Establish accounting systems.

AC 3.1

Establishment of a sound accounting system.

AC 3.2

The recording of financial transactions in the accounts.

AC 3.3

Interpretation of the balances in the financial accounts.

AC 3.4

Calculation of the tax liability of the firm for a specific financial year.

SO 4

Analyse the elements of an income and expenditure statement.

AC 4.1

Assets and liabilities are determined in business context.

AC 4.2

The purposes of an income and expenditure statement are explained and an indication is given of how often these statements are required for own business.

AC 4.3

Sources of income and expenditure are identified for own business.

AC 4.4

Sources of income and expenditure are explained with reference to an income and expenditure statement.

AC 4.5

Income and expenditure statements are examined and evaluated in terms of financial viability of the enterprise.

SO 5

Analyse a balance sheet.

AC 5.1

The purpose of a balance sheet is explained and an indication is given of how often a balance sheet is necessary in business context.

AC 5.2

The concept of an asset is explained and the assets in a balance sheet are classified in terms of fixed and current assets.

AC 5.3

A balance sheet is analysed and evaluated in terms of equity or financial net worth.

AC 5.4

The concept of a liability is explained and the liabilities in a balance sheet are classified in terms of long term and current liabilities.

SO 6

Use evidence in financial statement to make a financial decision.

AC 6.1

Use evidence in financial statement to make a financial decision.

AC 6.2

The financial strengths and weaknesses of own venture are analysed and suggestions are made of ways to improve income and reduce costs.

AC 6.3

The concepts of financial ratios are explained and suggestions are made on how to improve the ratios of own business.

AC 6.4

The relationship between turnover, income, revenue, sales/earnings and profit is explained using own venture as example.

AC 6.5

Prepare a cash flow to determine the financial well-being of the business.