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Golf Facility

Golf Facility

Part A

Speaking about sheet balance for the golf facility, it is necessary to admit that the information, which is collected in the balance sheet, is not relevant to the actual situation in the facility very often (Jeanne, & Zettelmeyer, 2002, p.11). It can be explained by the fact that some things may be omitted subconsciously or be absent at the moment of the accounting. That is why the following balance sheet may depict not all aspects of the golf facility. First of all it necessary to mention the price of the golf field itself. It is in a good condition, and in a suitable location, so that the price for it must be a little higher than average, but not drastically. Speaking about equipment, it is to be said that there is a wide range of the equipment of various quality, so it would be easier to account the equipment as if the entire section is new, but to reduce the total price by 15%. Further, it is necessary to say about own profits of the golf facility. It is a thriving company, it has a constant, but season depending income. In addition, it is to be said that catering services are the main source of extra profits, so it can be regarded as a separate unit for accounting. All in all, the balance sheet of the golf facility is to depict the possession of it in relation to the current prices and market tendencies.

The following item which is to be discussed is a Financial Income Statement. First of all it is necessary to give a description of it. In general, the Financial Income Statement is a way to report the financial results of the company’s operations for a current period. The Financial Income Statement draws a link between profits and expenses. In such a way, it reports about the current situation in the company. The situation is to be regarded as normal in case expenses are in an adequate proportion with profits. Moreover, it excludes the profits of the partners, even though the financial accounting was performed for both companies as for one entire enterprise. Therefore, it means that it gives a chance to identify how the company depends on the others (Taparia, 2004, pp.22-23)

Taking this into consideration, it is necessary to say that according to the Financial Income Statement, the golf facility shows average results, the expenses are relevant to the profits. There is one more important point to be mentioned. As it was said before, the golf facility is a kind of business that depends much on the season and weather. That is why, the variability of “matches” between expenses and profits is not constant, so that there is no point to compare results of Financial Income Statement of various season periods.

As the Balance Sheet and Financial Income Statement have been covered, it is worth discussing the Cash Flow Statement. It is necessary to note that Cash Flow Statement describes the usage of all financial sources and targets of necessary expenses. In other words, it shows the relations between incomes and expenses, how much of income is spent on the necessary resources, staff and so on. Cash Flow Statement gives a general description of the current productivity of the company. It should be mentioned that it analyses the situation in the single company, it does not consider the partners inside the network. That is why it is important to mind that some sources of incomes and expenses may be external, and they influence the productivity as well. (Comiskey, & Mulford, 2005, p.37)

Taking this into account, it is needless to say that the primary sources of income for the golf facility are customer payment for playing golf itself and catering services provided at the facility (food and beverages) Therefore, the most cash is spent on the equipment, and consequently on the supplies for catering. As the Financial Income Statement evidences the relation between expenses and profits is normal. As a result, according to the Cash Flow Statement, the facility keeps at its average norm and is able to be resilient to the seasonal and weather changes.

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Part B

As all necessary accounting operations have been performed, it is necessary to develop a budget for the golf facility. To begin with, it is necessary to define potential areas of revenue. First, it is the fees for playing golf in the facility: it is quite widespread game, especially among people who has constant and satisfactory income. As the game usually takes long time, customers have a meal in the provided bar and restaurant. Consequently, as the male customer section is the prevailing one, it means that there is some demand for various beverages from light and alcohol free to expensive liquors. The next, but a little bit less significant revenue source is merchandise. It is usually popular with golf fans or just constant customers, but some permanent visitors sometimes buy some clothes for playing right at the facility or for casual style, as well. It is very important to mention that the facility income depends on so called revenue management which presupposes dynamic prices according to the variability of supply and demand. (McMahon-Beattie, & Yeoman, 2004, p.32) It is the most appropriate strategy for the facility because of its being dependent on the season weather peculiarities.

In contrast, it is necessary to describe all areas of expenses. Needless to say, that first of all it is equipment. It breaks down quickly in a constant and intensive usage much earlier that it is supposed to. The number of customer grows at warm seasons of the year, so that the supply is to be higher than before. Golf cars as well have to be repaired or substituted with brand new one. As it was mentioned before, the catering service needs a constant supply as well, so it has to meet the state requirements for food and drink services. It is important to note that, the sales are relevant to the sales directly. It is necessary to keep constant prices to the food and beverages. In case the sales are decreased and the price is unchanged, or vice versa, the expenses will be increasing. (Dopson, & Hayes, 2011, p.222) Food is the resource which has to be sold out very quickly in the other case it will be spoiled.

For completing a budget breakdown for 12 months, it is necessary to say that it would be convenient to estimate budget for revenues and expenses separately. It has its strategic value, in case one part of the budget goes wrong, another will point out the need to get adjusted to the current situation (Husson, 2002). All in all, the budget for the revenue areas is directly linked to the expenses, so it is necessary to focus on the watching and analysis the relations between them. A proportion between profits and expenses should not have the expenses as a prevailing part.

Part C

Without any respect to the success of the golf facility, it is crucially important to form certain controls and regulations of all functional areas of the golf facility. It can be underpinned by several reasons. First of all, some sections of the golf facility have to meet the requirements of the government control body in order to at least be legally approved. Moreover, keeping the functional area in a certain regime gives a basis for an efficient performance of the entire golf facility.

Needless to say, that the areas which requires the controls and regulations most are a food and beverage area. To begin with, the sterility should be the required number one, which is to be met very strongly. The check of the sterility of the kitchen and food serving area is to be checked before and after a certain period of meal time. The violation of this rule it is to be strictly punished: from the penalty by excluding a certain percentage of salary to the dismissal (if the employee commits violation several time). It is also important to pay attention to the actual preparation of food. It would be reasonable to set general requirements and instructions for food preparation (temperature, time, proportion of spices and sugar, calories, etc.). Speaking about beverage area, it should be noted that a scrupulous attention has to be paid to the check of the customer age, in order not to sell alcohol to citizens who are under the age.

Golf cart area can be regarded as the area which also requires special attention, but the objective of the control in this area is quite different. First of all, safety in this area should be controlled. It is necessary to have a garage for repairs on a regular basis, which will prevent carts from developing a fault. It is also necessary to set certain notices and banners with directions and rules of traffic along the facility. Furthermore, it is highly recommended to provide the sidewalks with some soft, injure-preventing material which will minimize injuries in case of an accident. In addition, it should be mentioned that for the safety sake, a customer has to have a driving license to use a golf cart in the facility. It may seem not far in some way, but it guarantees the maximum of safety in the golf cart area and safer traffic along the entire facility.

Speaking about the pro shop in the facility, it is necessary for the shop to sell qualitative equipment; it is desirable sell the same items which are used in the facility. Consequently, the shop assistants are to be professionals with a certain experience in playing golf. Moreover, the main aim of the pro shop is not additional profit, but attracting customers. That is why shop assistants have to give appropriate advice to customers, concerning the needs of the customers, but not try to sell the most expensive products.

Having discussed the pro shop controls, it is logical to speak about merchandise concession. The first strategic requirement to the merchandise shop is the authenticity of the products. Customer need to feel that they belong to a special community of golf players, and the article of clothing from the merchandise shop is a feature of style, but not showing off. That is why all items which are to be sold, have to be f a certain design, so that they are able to match not only sport style, but casual, as well. Moreover, the items are to be reasonably priced, even though they are unique. The customer should take into consideration the items in the shop such as average clothes, accessories, etc. and instead of going to an outlet, buy something at the golf facility.

Finally, it is necessary to speak about the banquet facility. For starters, it should be close to the food and beverage area, so that its supply will not have any obstacles. The area has to be especially clean and be isolated from outer noises. In general, it should also meet the same requirements as the catering service area, but the sterility is to be checked only when the facility will be used and some days after a certain banquet.

Conclusions

To sum up, it is necessary to say that according to the Balance Sheet, Financial Income Statement and Cash Flow statement, the golf facility is a thriving business section, which has its certain customer group and certain sources of incomes: fees for playing golf in the facility and catering services provided in the area. Taking this into consideration, the revenue and expenses budgets are developed; the direct relation between them is identified. That is why the 12-month breakdown is underpinned on the basis of the certain positive proportion between cash flow and expenses. In addition, particular requirements and controls to the functional areas are outlined. In general, the requirements are aimed to increase the quality of performance and draw the attention of the customers.