CMI 706 Assignment Example

Each task in this assessment brief is designed to help you demonstrate the achievement of the learning outcomes and assessment criteria for CMI 706 Finance for Strategic Leaders. To successfully complete the unit, you must achieve a passing outcome for each assessment criterion.

Leaders need to understand the Finance function to make effective decisions in their role. Finance affects every part of an organisation and plays a key role in shaping and achieving strategic goals. The CMI 706 assessment brief is designed to help leaders demonstrate their knowledge of Finance’s scope, complexity, and role in an organisation. It also helps them understand how Finance influences strategic decision-making.

Assessment Questions

Task 1

The scope of the Finance function within an organisational context

LO1 Understand the scope of the Finance function within an organisational context

A clear understanding of the Finance function is crucial for an organisation’s success. Financial decisions impact all areas of the business, so it’s important to grasp the full financial picture. This includes analysing larger aspects like taxes, loan structures, and international regulations, as well as smaller tasks like budgeting and managing cash flow. By taking this approach, organisations can better manage their resources and get the most out of their investments.

AC 1.1 Critically appraise how the Finance function supports organisational success

The Finance function is vital for an organisation’s success. By carefully monitoring and making informed decisions, the Finance team can ensure that financial resources are used effectively to create value and support the organisation’s goals. They can also develop a strong operating model with proper controls to reduce risks and ensure compliance.

By actively managing finances, stakeholders can expect better returns on their investments over time. It’s clear that a reliable Finance department is essential for running a successful business. Such a department should be able to assess situations accurately and continuously seek improvement to drive the organisation’s success.

AC 1.2 Discuss the scope, boundaries and governance of Finance within an organisational context

The scope of finance in an organisation involves decisions about managing capital, investments, and risks. By analysing financial information, proper governance is established to meet objectives while considering cost efficiency and sustainability.

Finance is also bound by compliance with regional standards and regulations, including accounting practices, tax rules, and other legal frameworks. Ensuring that financial services follow safety protocols is another key aspect of finance governance. Together, these elements create a comprehensive view that supports financial stability within organisations.

AC 1.3 Critically assess current and emerging technological factors which impact on Finance

Current and emerging technologies are rapidly changing how the Finance industry operates. Innovations like algorithmic trading, robo-advisers, and cloud computing are transforming financial transactions and management. However, organisations need to critically analyse these technologies to determine which tools align best with their specific goals, capabilities, and culture.

Companies should assess how these innovations can help them address challenges like inefficiency and rapid scaling, while also considering any potential risks associated with their use. To achieve this, businesses should invest in ongoing research into new technologies, support continuous learning initiatives, and develop clear policies to maximise the benefits of certain technologies. In summary, it’s crucial to recognize the significant value of technological advancements in banking and finance, while also evaluating how these new solutions fit into the future of modern organisations.

Task 2

The role of Finance in strategic decision making

LO2 Understand the role of Finance in strategic decision making

Finance plays a key role in the strategic decision-making of any successful business. Understanding financial concepts helps organisations grasp the impact of major investments, allowing them to make informed choices that support long-term growth and sustainability. When making decisions, it’s essential to consider all possible scenarios by analysing available data and performance benchmarks. This approach ensures that organisations understand how each option could influence revenue, cash flow, and other important financial factors.

Approaches to legal and ethical financial reporting

AC 2.1 Critically assess how strategic decision making is informed by financial and cost analysis

Strategic decision-making is crucial for running any business, as it helps organisations identify the investments needed to achieve their long-term goals. While careful thought usually goes into choosing the best actions, financial and cost analysis can provide valuable insights into which decisions are most cost-effective and profitable.

By using these concepts, a company can evaluate the potential risks and rewards of each option, leading to more efficient strategies that can lower overhead costs over time. Strategic decision-making relies heavily on financial and cost analysis, not just educated guesses; without considering financial details, businesses may underestimate or overestimate the costs of their actions. Ultimately, using financial and cost analysis to guide strategic decisions is essential for organisations that want to stay competitive in their markets.

AC 2.2 Discuss approaches for legal and ethical financial reporting

Ensuring legal and ethical financial reporting is extremely important. Organisations need to create a comprehensive framework that helps them follow regulations and promote good corporate governance practices. This includes setting up a strong internal control system and standardising accounting policies, with management responsible for maintaining these processes.

Training should also be provided for staff on financial regulations, emphasising the ethical consequences of breaking the law. Financial standards need to be updated regularly to ensure accurate reporting in line with current regulations and changes in the business environment. Finally, organisations should have strong internal audit functions to verify financial results and monitor compliance issues. These steps are essential for ensuring legal and ethical financial reporting in any organisation.