National Occupational Standards in
Archaeological Practice

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AJ14 Manage finance in the business unit

AJ14.3 Maintain the financial viability of the business unit

Performance Required

This will involve:

1. clearly specify financial management objectives that are in line with the financial strategy of the business
2. accurately calculate the income and expenditure of the business and periodically compare against cash-flow targets and financial management objectives
3. calculate the financial viability of the business using reliable information and generate forecasts that can be assessed against the business plan
4. correctly identify discrepancies between forecast and actual income and expenditure and explore the reasons for them
5. control the income and expenditure of the business to meet financial management objectives
6. calculate and regularly report to relevant people on the financial viability of the business in accordance with organisational formats and procedures

Occupational Context

1. Income
   • income received less costs of sales
   • interest on cash balances
   • dividends
   • grants
   • disposal of assets
2. Expenditure
   • service / project delivery and related overheads
   • personnel and related overheads and costs of employment
   • premises and related overheads
   • interest on loans
   • depreciation
   • allowable asset costs
   • direct and indirect taxation

Knowledge Requirements

You need to know and understand how to:

• Calculate basic statements of financial viability, forecasts and simple ratios; key margins by service type and market; high and low forecasts, basic risk assessment
• Monitor financial viability, and how frequently this should be done

You need to know about:

• What type of trade-offs need to be determined in the business
• What the appropriate margins are for the business and its services and how to differentiate between gross and net profit
• Basic means of dealing with tax liability and appropriate sources of advice on this
• The financial manager's liabilities under current legislation including statutory reporting duties
• What sources of internal and external support, advice and information are available to support the financial manager

Required Skills

N/A

Evidence Required

You should provide evidence that you can maintain the financial viability of the business unit

The candidate should be questioned, based upon the documentation provided, to explore how they:

• maintain the financial viability of the business unit

Evidence Rules

The candidate should have been involved in managing the finance in the business unit over a period of time

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Today's date: 31/7/2010
This page last updated: 6/8/2007 11:58