Assessment Type 2: Accounting Advice

Students develop their accounting advice to suit one of the following focus areas:

• managing financial sustainability
• providing accounting advice.

They demonstrate their learning across all three learning strands.

Students develop accounting information for use by stakeholders in decision-making. Students prepare authentic accounting advice, using business data to:

• prepare forecasts (e.g. budgeted income statement, budgeted balance sheet, budgeted cash flow statement, and any other relevant accounting information)
• analyse and interpret accounting information, such as undertaking break-even analysis, calculating and interpreting ratios, and analysing relevant industry benchmarks
• provide recommendations such as, but not limited to, ownership structure, finance options, location of business, and financial viability of the proposal.

Business data should be realistic and be sourced or created by the teacher and/or student. Some examples include:

• current and historical product prices
• rent, utilities, website domain costs, wages
• interest rates, equipment costs, leasing costs.

Small business benchmarks are available via the Australian Taxation Office (ATO) website. Other sources of current data that may be relevant include:

• Australian Bureau of Statistics (ABS)
• business or industry associations.

For this assessment type, students analyse and evaluate a business opportunity or address a business issue to propose authentic accounting advice. Accounting advice scenarios may include, for example:

• developing a profitability analysis in response to a business opportunity. For example, a local farmer is considering changing the crops she grows. Students use authentic data, including current and historical prices to develop and propose advice to the farmer on crop selection to inform decision-making. They contact relevant stakeholders to obtain appropriate information for use in the development of authentic accounting advice. Students explore and analyse the impact of the decision on the environment, as well as the impacts of government regulations.
• providing accounting advice to a business considering a change in its business model. For example, students review bricks-and-mortar options versus online expansion and prepare comparative budgets to present to the business manager. Students interview the business manager to obtain relevant data. They explore and analyse the impact of new markets and evolving technologies on the expansion options to tailor the advice to meet the needs of the stakeholders and their decision-making requirements.
• developing budgeted reports to determine the viability of a new business venture. For example, students calculate start-up costs and the break-even point for a new cafe. They provide advice to the cafe owner on sources of finance and suitable ownership structures to inform decision-making. Students use appropriate ratio analysis and other accounting information tailored to the owner’s needs to support their advice. They explore and analyse the impact of current and emerging social trends and government regulations.

The accounting advice could be presented in multimodal format to the equivalent of 9 minutes or 1500 words maximum, including all financial statements.

For this assessment type, students provide evidence of their learning primarily in relation to the following assessment design criteria:

• understanding and exploration
• application
• analysis and evaluation.