Financial Services. Total marks 80. Section I Pages marks Attempt Questions 1 15 Allow about 20 minutes for this section

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1 2016 HIGHER SCHOOL CERTIFICATE EXAMINATION Financial Services Total marks 80 Section I Pages 2 6 General Instructions Reading time 5 minutes Working time 2 hours Write using black pen Board-approved calculators may be used Write your Centre Number and Student Number at the top of pages 9, 11 and marks Attempt Questions 1 15 Allow about 20 minutes for this section Section II Pages marks Attempt Questions Allow about 50 minutes for this section Section III Page marks Attempt Question 21 Allow about 25 minutes for this section Section IV Pages marks Attempt ONE question from Questions Allow about 25 minutes for this section 1410

2 Section I 15 marks Attempt Questions 1 15 Allow about 20 minutes for this section Use the multiple-choice answer sheet for Questions What is the main purpose of professional codes of conduct for financial services workers? (A) To ensure ethical behaviour and competence (B) To limit liability to clients for negligent advice (C) To impose penalties for illegal business behaviour (D) To promote financial services in the wider community 2 Many businesses nominate a person to be employee of the month. What is this an example of? (A) Prioritising work tasks (B) Managing time efficiently (C) Providing positive feedback (D) Working effectively as a team 3 During a safety audit an employee has noticed exposed cables. What immediate action should be taken? (A) Remove the cables (B) Prepare a written report (C) Alert emergency personnel (D) Isolate the area around the cables 2

3 4 The cost price for an item is $120. The selling price is $175. What mark-up has been applied to the item? (Ignore GST.) (A) 31% (B) 33% (C) 46% (D) 61% 5 Two members of a team are having an ongoing disagreement which is affecting their work. What approach should be implemented by the team s manager to resolve this conflict? (A) Ignore the problem (B) Document the problem in a work diary (C) Discuss the problem with the whole team (D) Arrange for mediation for the two team members 6 What is the main aim of work performance appraisals of employees? (A) To provide research data (B) To improve work practices (C) To increase company profits (D) To decrease employee absenteeism 7 Which of the following measures financial performance? (A) Trial balance (B) Balance sheet (C) Business activity statement (BAS) (D) Income statement 3

4 8 A supervisor sends the following message to a worker on a daily basis: Your appearance is unacceptable and your performance is disappointing. You should seek guidance. What form of harassment is this? (A) Physical (B) (C) Psychological Racial (D) Sexual 9 Which of the following is a responsibility of the Reserve Bank of Australia? (A) Managing Australia s gold and foreign exchange reserves (B) Maintaining and promoting Australian business competition (C) Controlling superannuation fund contribution rates in Australia (D) Enforcing and regulating Australian company and financial services law 10 A business has assets of $90 000, expenses of $18 000, owners equity of $ and revenue of $ What is its liability? (A) $ (B) $ (C) $ (D) $

5 11 How are the fees charged on overdue debtors accounts recorded? (A) Debit accounts receivable Credit late fee income (B) (C) Debit late fee expense Debit GST paid Credit accounts receivable Debit bank Credit late fees income Credit GST collected (D) Debit accounts receivable Credit late fee income Credit GST collected 12 A new motor vehicle with an estimated life of five years was purchased by a business for $ and depreciation was not recorded. What would be the effect of this on the financial statements? (A) Profit and net assets would be overstated. (B) (C) Expenses and net assets would be understated. Profit would be understated and equity overstated. (D) Expenses would be overstated and equity understated. 13 What legislation prevents an employer disclosing an employee s work history to another employer? (A) Privacy Act 1988 (Cth) (B) Anti-Discrimination Act 1977 (NSW) (C) Workplace Relations Act 1996 (Cth) (D) Workers Compensation Act 1987 (NSW) 5

6 14 A new staff member is trained to replace an injured employee. What type of cost to the workplace does this training represent? (A) Economic (B) Human (C) Organisational (D) Social 15 A bank offers the following term deposit interest rates. Personal Term Deposits Competitive interest rates, fixed for the term. Minimum opening deposit of $ Term Interest rate % p.a. 90 day rate day rate day rate day rate year rate 2.80 Loyalty bonus Receive a 0.10% p.a. loyalty bonus on your new term deposit when you reinvest. Lee has invested $ in a 180 day term deposit at the bank. Upon maturity of the term deposit, Lee plans to reinvest the entire amount in a new 120 day term deposit. Which row of the table correctly identifies the amount that Lee can reinvest and the applicable interest rate of his new term deposit? Amount (to nearest dollar) Interest rate (% p.a.) (A) (B) (C) (D) $ $ $ $

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8 BLANK PAGE Board of Studies, Teaching and Educational Standards NSW

9 2016 HIGHER SCHOOL CERTIFICATE EXAMINATION Financial Services Section II 30 marks Attempt Questions Allow about 50 minutes for this section Centre Number Student Number Answer the questions in the spaces provided. These spaces provide guidance for the expected length of response. Show all relevant working in questions involving calculations. Question 16 (6 marks) (a) Outline the difference between legal and ethical behaviour. 2 (b) Explain how a long-term loan is affected by making fortnightly rather than monthly repayments. 2 (c) Explain how negative feedback can be used effectively in professional development

10 Question 17 (7 marks) (a) Describe TWO factors which may influence the form of communication used by an employee to interact with clients. 2 (b) Explain how barriers to communication may contribute to potential conflict when working with colleagues. 3 (c) Explain how conflict could be positive for a team Board of Studies, Teaching and Educational Standards NSW

11 2016 HIGHER SCHOOL CERTIFICATE EXAMINATION Financial Services Section II (continued) Centre Number Student Number Question 18 (8 marks) (a) Describe the responsibilities of both the employer and the employee in the implementation of work health and safety (WHS) requirements. 4 (b) A business manufactures and sells a single product at a price of $15 per unit. The variable cost of producing the product and selling it amounts to $7 per unit. The total fixed costs are estimated at $ (i) Calculate the break-even point for the business in dollars (ii) Calculate the number of units that would need to be sold to meet a target of $ profit

12 Question 19 (3 marks) Enter the following details in the general journal of Mr Smith s business. 3 4 May Mr Smith, the owner, withdrew inventory worth $550 inclusive of GST from his business. 1 June Mr Smith wrote a cheque for $198 from his personal bank account to pay for stationery for the business. 25 June The business received payment of $165 for financial services previously sold on credit. General Journal Date Account details Debit ($) Credit ($) Board of Studies, Teaching and Educational Standards NSW

13 2016 HIGHER SCHOOL CERTIFICATE EXAMINATION Financial Services Section II (continued) Centre Number Student Number Question 20 (6 marks) Please turn over

14 Question 20 (6 marks) The following information has been extracted from petty cash vouchers for the month of March Date (March) Petty cash voucher Details 2 A petty cash float of $600 was established, cheque number Purchased stationery for use in the business $44.00 includes GST Cash to purchase milk $ Reimbursed a staff member s bus fare $8.80 includes GST Reimbursed a staff member s taxi fare $82.50 includes GST Purchased cleaning products from supermarket $49.50 includes GST Reimbursed a staff member for stationery $14.30 includes GST Reimbursed a staff member s taxi fare $45.60 includes GST 31 Balanced petty cash and reimbursed petty cash float, cheque number 256 Question 20 continues on page 15 14

15 Question 20 (continued) Prepare the petty cash book for the month of March Date Received Details Reference Payment Stationery Staff amenities Travel Cleaning GST paid Cash on hand Total Balance b/d Reimbursement End of Question 20 15

16 BLANK PAGE Board of Studies, Teaching and Educational Standards NSW

17 2016 HIGHER SCHOOL CERTIFICATE EXAMINATION Financial Services Section III 15 marks Attempt Question 21 Allow about 25 minutes for this section Answer the question in a writing booklet. Extra writing booklets are available. Your answer will be assessed on how well you: demonstrate knowledge and understanding relevant to the question communicate ideas and information using relevant workplace examples and industry terminology present a logical and cohesive response Question 21 (15 marks) Explain the impact of poor work practices on the client, the workplace and the financial services industry. Please turn over

18 Section IV 20 marks Attempt ONE question from Questions Allow about 25 minutes for this section Answer this question in TWO SEPARATE writing booklets. Use one writing booklet to answer parts (a) and (b) of the question. Use the other writing booklet to answer part (c) of the question. Extra writing booklets are available. Question 22 Accounting (20 marks) Answer parts (a) and (b) of the question in a SEPARATE writing booklet. (a) (b) Explain the differences between the accounts receivable status of doubtful and bad debts. Finserve Pty Ltd is a financial services business. An extract from its policy and procedures for dealing with customers and a schedule of aged accounts receivable are shown Advise the company accountant of any accounts over 30 days due. 2. Check with customers if there are any disputes for accounts over 60 days. 3. If no dispute, do not sell to customers with debts over 60 days. 4. If no dispute, proceed with legal action against customers with debts over 90 days. Finserve Schedule of Aged Accounts Receivable as at 31 March 2016 Name Balance ($) Current ($) days ($) days ($) 91+ days ($) Debtor Debtor Debtor Debtor Outline an appropriate course of action for the credit manager of Finserve Pty Ltd in relation to the schedule given. Question 22 continues on page 19 18

19 Question 22 (continued) Answer part (c) of the question in a SEPARATE writing booklet. (c) The table shows account balances for Finance Consulting Pty Ltd. The balance for capital is not shown. 10 Account name $ Drawings Debtors (Accounts Receivable) GST Payable Insurance Prepaid Creditors (Accounts Payable) Mortgage Bank Net Profit Allowance for Doubtful Debts 500 Land and Buildings Income Received in Advance 600 Capital? Prepare a classified balance sheet, including the balance for the capital account, for the year ending 30 June OR Please turn over 19

20 Question 23 Financial Services (20 marks) Answer parts (a) and (b) of the question in a SEPARATE writing booklet. (a) (b) Explain the purpose of balancing cash register transactions at the end of each day. Describe procedures to ensure the accurate and secure creation, maintenance and disposal of financial records. 4 6 Answer part (c) of the question in a SEPARATE writing booklet. (c) A major bank has closed its branches in a number of rural areas. The bank s automated teller machines (ATMs) have been retained. Agencies have been set up in post offices but over-the-counter withdrawal and deposit limits have been changed. What advice should be given to post office staff in order to deal with common customer inquiries and provide quality customer service? 10 OR Question 24 Financial Markets and Systems (20 marks) Answer parts (a) and (b) of the question in a SEPARATE writing booklet. (a) Explain the functions of a business activity statement (BAS). 4 (b) Describe how the Australian Federal Government raises revenue through taxation. 6 Answer part (c) of the question in a SEPARATE writing booklet. (c) Explain why the Australian Securities and Investments Commission (ASIC) is concerned about online lenders providing easy access to credit and loans. 10 End of paper Board of Studies, Teaching and Educational Standards NSW

Cambridge International Examinations Cambridge International General Certificate of Secondary Education

Cambridge International Examinations Cambridge International General Certificate of Secondary Education *1008785551* ACCOUNTING 0452/22 Paper 2 May/June 2016 1 hour 45 minutes Candidates answer on the