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Unit 4: Financial Awareness for Managers
QCF Level: 5
Credit value: 5 credits
Aim
This unit provides the learner with knowledge, understanding and skills relating to the financial information used in the management and decision making process in an organisation and to meet the demands of stakeholders.
Unit abstract
Organisations need to ensure that they comply with a wide range of regulations to survive, including those that regulate the financial information an organisation needs to produce. In the case of profit-making organisations, a manager needs to understand the importance of this information not only for survival but also because of the need to be competitive by controlling costs and maximising income.
In the case of public sector organisations or charities, this financial information is important in order to maximise their efficiency and provide value for money for the service or charity they offer. Managers need to know the limitations of this information and how to interpret it to enhance decision making.
This unit is designed to introduce learners to the nature, role and importance of this financial information in organisations. Learners will have the opportunity to look at the communication and interpretation of the financial information needed to manage organisations, its regulation, structuring and use in decision making. Learners will also have the opportunity to look at the principles of accounting, expected standards, and the concepts and conventions that influence the presentation of financial information.
Learners will, through the examination of financial information, learn about the important issues relating to the measurement of efficiency, profitability and solvency, and the different demands different stakeholders make on organisations. Learners will also explore the extent to which external confidence is determined by financial performance.
Learners will examine how financial information can be interpreted through ratio analysis, analysed and evaluated, how costs in an organisation can be monitored and controlled, and how the concept of contribution aids decision making.
Learning Outcomes
To achieve this unit a learner must:
1 Know the key elements of accounting
2 Understand financial information
3 Be able to interpret financial information.
