CODE: ACC 1995

TITLE: Foundations in Financial Management for Artists & Artisans

MQF LEVEL: 5

ECTS CREDITS: 4

DEPARTMENT: Junior College

DESCRIPTION: 

The Foundations in Financial Management for Artists and Artisans course aims to provide quality learning opportunities for learners seeking to build expertise in personal finance and facilitate continuous career development in the cultural and creative sectors. The short course will provide artists and artisans with the necessary tools to make informed financial decisions. Learners will understand and appreciate that a going concern must be financially stable to meet its obligations and continue its business. Financial Management skills will guide participants in planning and controlling cash flows, and in decision making.

Participants will learn how to plan their finances and gain valuable insights into good financial management practices. The study-unit will address the primary financial concern, that of remaining solvent, and explores ways in which to improve profitability. The financial management functions of accounting and tax are discussed at a foundation level, engaging learners in the following types of Financial Management:

• Working Capital Management

The aim of working capital management is to ensure that a business venture can meet its day-to-day obligations by managing current assets and current liabilities efficiently. The 'cash to come' of a business must be sufficient to pay the short-term debts and expenses while making certain that the best possible investment in assets is made.

• Profitability

Profit maximisation is the primary aim of a business. To assess profitability learners are introduced to a simple Statement of Profit or Loss, and a Statement of Financial Position. Profitability ratios will help learners analyse the return on an investment. Income Tax and VAT are discussed at an elementary level to ensure tax compliance and basic computations are introduced.

• Capital Structure

The capital structure of an entity will determine its long-term solvency and success. A business entity must decide on the optimal mix of long-term debt and equity financing. A business venture which is heavily in debt may fail since the earnings may be insufficient to meet the servicing of finance obligations. In contrast, little or no long-term borrowing may mean that the business entity is missing out on profitable business opportunities.

Learning Outcomes

1. Knowledge and Understanding

By the end of the Study-Unit the student will be able to:

• Demonstrate a full understanding of the benefits of good financial management;
• Prepare and analyse a simple statement of profit or loss;
• Prepare and analyse a simple statement of financial position;
• Calculate profitability ratios;
• Calculate basic income tax and VAT computations;
• Evaluate working capital requirements;
• Calculate liquidity ratios;
• Understand what is gearing (leverage) and how it affects business performance;
• Prepare a simple cash budget;
• Engage in financial discussions relating to finance and investment.

2. Skills

By the end of the Study-Unit the student will be able to:

• Think critically and evaluate different courses of action;
• Transfer financial skills to the place of work;
• Apply learning to the financial needs of artists and artisans;
• Bridge theory and practice;
• Utilise learning for career and professional development in the cultural and creative sectors;
• Develop a comprehensive knowledge base to support creative entrepreneurship.

Main Reading List

• Study Material Provided by the Course Coordinator and put on VLE.

Supplementary Reading List

• Izhar, R. & Hontoir, J. (2001). Accounting, costing and management. (Available in the library);
• Sangster, A., Gordon, L. & Wood, F. (2021). Frank Wood's business accounting: an introduction to financial accounting. (Available in the library);
• Lucey, T. (2015). Management accounting. (Available in the library);
• Pace, A. & Xuereb, J. (2019). Cost and management accounting: principles and practice. (Available in the library);
• Brigham, E.F. & Houston, J.F. (2009). Fundamentals of financial management. (Available in the library);
• Nobes, C. (2014). Accounting: a very short introduction. (Available in the library);
• Atrill, P.E. & Mclaney, J. (2015). accounting and finance for non-specialists. (Available in the library).

STUDY-UNIT TYPE: Lecture

METHOD OF ASSESSMENT:

Component                                        Weighting

Portfolio                                              100%