8.

0 FINANCIAL ESTIMATES

8.1 Introduction

The success of a business is depending on their financial plan. Financial Planning is the process of
estimating the capital required either in the short or long-term financial in order to start new
business. A financial plan is important for a business run and function with effectively. By
planning the business, it can determine the process of framing objectives, policies, procedures,
programs and budgets regarding the financial activities of a concern.

Other than that, a financial plan will help to cover all the financial data from the operating budget
which are the marketing, operations, and administrative budgets. This financial budget information
is then transformed into financial budgets or estimates. Financial plan management is one of the
best ways for the business ventures to remain profitable. To effectively manage your venture
finances and realistic budget, by determining and preparing several pro forma statements, namely
cash flow, income (profit and loss) statement and balance sheet is very important in long-run
survival of the business.
 8.2 Budget

8.2.1 Administrative Budget

Table 8.21 Administrative Budget

Particular Fixed Assets Monthly Other TOTAL
Expenses Expenses (RM)
(RM) (RM)
Land and Building 300,000.00 300,000.00

Office Equipment 5,000.00 5,000.00

Office Furniture and 2,000.00 2,000.00

Fittings

Salaries, EPF and SOCSO 8,625.00 8,625.00

Utilities Bill 250.00 250.00

Deposit (Rent, utilities, etc) 1,800.00 1,800.00

Business Registration and 1,850.00 1,850.00

Licenses

Other Expenditures 1,600.00 1,600.00

Total 321,125.00
8.2.2 Marketing Budget

Table 8.2.2 Marketing Budget

Marketing expenditure

Fixed Asset / Capital Capital Expenses (RM) Working Capital (monthly)

Expenditure (RM)

Signboard 500 -

Promotion & advertisement - 1500

Total 500 1500

Grand total 2000

 8.2.3 Operational Budget

Table 8.2.3 Operational Budget

ITEM FIXED ASSETS (RM) MONTHLY OTHER

EXPENSES (RM) EXPENSES (RM)
Machine and Equipment 600 600

Furniture and Fitting 705 705

Raw materials and 8,409.60 8,409.60

packaging
Premise 2,000
Renovation 2,000
Salary (EPF+SOCSO) 2,300 2,300

Van 15,000 15,000

Petrol Expenses 300 300

Maintenance Expenses 300 300

Vehicle maintenance 500 500

Overhead Cost 1,000 1,000

Road tax and insurance 4,268 4,268

Total 35,382.60
 8.2.4 Start-up Cost

Table 8.2.4 Start-up Cost

PORTABLE BAMBOO WATER FILTER
PROJECT IMPLEMENTATION COST & SOURCES OF FINANCE

Project Implementation Cost Sources of Finance

Requirements Cost Loan Hire- Own

Purchase Contribution

Fixed Assets Cash

Land and Building 300,000.00 200,000.00 100,000.00
Office Equipment 5,000.00 3,000.00 2,000.00
Office Furniture and Fittings 2,000.00 2,000.00
Signboard 500 500

Machine & equipment 300 500 500

Furniture & fittings 705.00 705.00
Van 15,000.00 15,000.00
Working Capital 1 months
Administrative 8,875.00 8,875.00
Marketing 2500 2500
Operations 12,509.60 12,509.60

Pre-Operations & Other Expenditure 11518.00 11518.00

Contingencies 5% 17945.38 11501.38 6479
TOTAL 358,907.60 241,528.98 136,059.00
8.2.5 Working Capital

Table 8.2.5 Working Capital

Working Capital RM

ADMINISTRATIVE BUDGET

Administrative

Salaries, EPF & SOCSO 8,625.00

Utilities Bill 250.00

Operational

Raw Materials 8,409.60

Salaries, EPF & SOCSO 2,300.00

Fuel Expenses 300.00

Maintenance of Vehicle 500

Overheat Cost 1000

Working Capital 1 month 21,384.46

Contingencies 5% 1,069.22

Total Working Capital 22,453.68

9.0 PROJECT MILESTONES

Table below shows the milestones that Techno Diva Sdn. Bhd. strive to achieve within its
development period of 3 years.

Table 9.1 Activities and Deadlines

Activities Deadlines
Incorporation of venture January 2019

Completion of design and development May 2019

Completion of prototype June 2019

Obtaining sales representative July 2019

Signing of distributors and dealers July 2019

Ordering material September 2019

Starting of production or operation October 2019

Receipt of first order November 2019

Delivery of first sales December 2019

As can be seen from the project milestones, the total time for the company to fully open
their business is approximately 11 months. This is mainly due to the Design and Development
phase that take almost 3 months to be completed. Then, followed by the Completion of Prototype
phase which is for a month. This is to ensure that our company’s product is of the highest quality
and able to withstand the real condition at the required spaces.

The graphical representation of Table 9.1 is included in the appendices part in a Gantt chart
form for easier viewing. The success of these milestones will be measured by means of a meeting
at every end of month. On these meetings, the actual progress will be compared with the milestones
and if the progress is later than the planned, alleviation steps will be taken, such as increasing the
working hours and by executing two or more activities at the same time to make the work complete
on time.