Accounting Business Reporting for Decision Making

CHAPTER 1 Introduction to accounting and business decision making 39

3

Conrm

goals

8

Evaluate the plan

2

Conduct initial research

using secondary data

1

Set preliminary

goals

6

Critically assess the

proposed plan

5

Write the

business plan

4

Conduct subsequent

detailed research

7

Implement

FIGURE A1. 2 The planning process

Summary

A business plan is a written outline of a business. It may be devised for an existing firm or for a new busi-

ness entity that has not yet been launched. The main advantages of business planning include more complete

information gathering, balanced decision making and assistance in raising finance. Disadvantages of a plan

can include skewed information, incorrect assumptions, inflexibility and unrealistic expectations.

All business plans, whatever their structure, should cover the key issues of marketing, operations and

finance. The major elements of a typical plan include an executive summary, background on the firm (if

an existing enterprise), marketing details, operational arrangements, financial projections and a timetable

for implementation.

Plans vary from one business to another. The format and sequence are often quite different, although

all business plans should cover the basic issues. In addition, written business plans may have different

levels of specificity, be written for different audiences, and cover short-term or long-term time frames.

The business planning process is an ongoing process by which plans are constructed, implemented

and evaluated. It includes the steps of preliminary goal setting, initial information gathering, formulation

of set goals, detailed research, plan preparation, critical analysis of the proposed plan, implementation,

and subsequent evaluation and revision.

Sample business plan

Note: The business plan in this appendix is hypothetical, and is provided solely for the purposes of illus-

trating the nature and content of a completed plan. The business name, personal details, statistical data

and references are fictional; no link with any actual person or organisation is intended.

Murphy Recruiting Pty Ltd

Section 1: Executive summary

1.1 Business idea and goals

The main goal is to establish a small private (proprietary limited) company that specialises in IT recruitment

services for the small and medium-sized enterprise (SME) sector in Brisbane and other cities within the state

of Brisbane, Queensland, Australia. The services to be provided are IT recruitment services for SME firms.