You will be handed a business you have never heard of, and asked to describe at least three of its interdependent financial relationships. Write every relationship both ways: the money flow going one direction, and the real flow of work or goods coming back the other.
Ten sections, about an hour all up. One section is one sitting. Do that one and stop.
Three from the lessons so far. Have a go before you open them.
A money flow is money moving from one entity to another. A real flow is the goods, the services or the work moving the other way in the same relationship. The $28.00 Five Star pays its colour wholesaler is the money flow. The box of colour that comes back is the real flow.
The opposite is not true because an organisation needs more than one person and a shared purpose, but an entity does not. Sanjay alone is an entity. So is a single client.
Five Star relies on Sanjay for the shampooing, the colour and the rinsing that cannot happen while Sierra is cutting at the chair, and pays $24.00 an hour of wages for it. Sanjay relies on Five Star for those wages and for the apprenticeship.
Remember to write two sentences, one starting with each name.
You have already done the hard part. What is left is knowing the shape of the question you'll be asked.
At the end of the year you sit one online exam for this standard. The exam gives you a case study: a short description of a business you have never heard of, with four or five entities in it, and something that has happened to them. Then it asks one structured question with parts. The exam calls those entities participants, which is just another word for entities, they mean the same thing.
Describe at least three financially interdependent relationships. Write three properly rather than five in a hurry.
Three relationships, each written both ways, with its money flow named and a dollar figure on it.
Five relationships, each in one short sentence.
Past papers have used a business that builds roads and won a government contract, a donut store that got busy through social media, and a seafood business whose overseas orders dried up. You will not have seen the business before. The exam is testing whether you can apply the words to a business you have never met.
Every relationship needs both directions on the page. One way round is half an answer.
The first sentence below looks finished. The real flow, from Sanjay back to Five Star, is missing:
Write both sides of every relationship.
Both ways round“Five Star relies on Sanjay for the shampooing, the colour and the rinsing that cannot happen while Sierra is cutting at the chair, and pays $24.00 an hour of wages for it. Sanjay relies on Five Star for those wages and for the apprenticeship that leads to the qualification.”
One way round“Five Star relies on Sanjay to wash and rinse the colour clients.”The sentence shows only Five Star relying on Sanjay. Sanjay relies on Five Star too, for his wages.
Here are three common mistakes students make when writing about money flows.
Earns“Five Star receives $190.00 of sales revenue from the client who had the foils.”
Does not achieve“The salon gets money from its clients.”“Money” is not a money flow. Name the flow, such as sales revenue, and give the figure.
Every money flow has a proper name, and you already know all of them: sales revenue, wages, rent, interest and tax. Writing money says you could not name which money it was.
A direction“The wholesaler's sales revenue increased, because Five Star ordered colour more often.”
No direction“The wholesaler was affected by the salon being busier.”“Affected” does not say which way the sales revenue moved. Say increased or decreased.
Affected, impacted and changed all need a money term and a direction - either increased or decreased.
Direction, in money“The bank's interest income from the whānau increased, because the whānau borrowed more.”
Strength, not direction“There is now a stronger reliance between the bank and the whānau.”“Stronger” does not say what changed. Name the money flow, and say whether it increased or decreased.
Don't use the words stronger or weaker without using a money term and a direction: increased or decreased.
You will be asked to write about three interdependent relationships. Three relationships means three different entity pairs (and not three entities).
Every line in the picture below is a pair. The picture holds nine pairs, and you need three.
Name the money word (sales revenue, wages, rent, expense, tax etc) for each pair before you write. If you name the same money word twice, two of your pairs are the same kind and you don't want that.
Write each pair as two entities and the money that moves between them.
Do not bring in a third entity to explain the link. If you need one, choose a different pair.
Use the link between the two entities the question names. Do not add a third party.
Sanjay relies on Five Star for his wages.
Sanjay relies on the government, which relies on Five Star.
The pair on its own“Five Star pays Sanjay wages, and Sanjay does the work that lets Five Star sell the hours it charges for.”
Joined through somebody else“Five Star pays tax to the government, and the government funds the apprenticeship scheme, so Five Star and Sanjay rely on each other.”The government is a third participant. A relationship is between two participants, so write about Five Star and Sanjay on their own.
Four sentences. For each sentence, decide whether it describes a relationship properly, and the answer will tell you why.
That answer would earn the mark: both sides are named, the money named twice and correctly, an expense on one side and sales revenue on the other. This is the shape to copy.
That answer gives one side only. The landlord appears as a noun and never as somebody who relies on anything.
“Five Star relies on the landlord for the premises it works out of, and pays $600.00 a week of rent for them. The landlord relies on Five Star for that $600.00 of rent income.”
That answer would not earn the mark. The answer has two sides, which is the hard part done, and then it says money twice. Name the money on each side: a bank pays interest on what an entity keeps with it, and charges interest on what it lends.
“Five Star relies on the bank to hold its takings safely, and the bank pays interest on what stays in the account. The bank relies on the money businesses like Five Star leave with it, because that is what the bank lends out and charges interest on.”
That answer would not earn the mark: the second half is a real relationship, but the first half is not. Tagging is attention, not a financial flow. Write the pair on what actually moves between the salon and its clients.
“Five Star relies on its regular clients for the $190.00 of sales revenue a full head of foils brings in, and the clients rely on Five Star for the colouring and cutting itself, which they cannot do at home.”
The questions this lesson makes people ask, answered simply.
Yes, and the business at the centre of the case study will appear in all three pairs. What you cannot do is write the same pair twice, because that is one relationship written out again rather than a second one.
If nothing goes back the other way, that pair is not an interdependent financial relationship, so pick a different pair. Something always comes back in a real relationship: goods, work, a service, a place to work in, the use of borrowed money.
Your regulars tagging the salon on Instagram probably brings people in, but no money moves either way, so leave it out because you and Instagram are not in a financial relationship.
No, a real flow does not have to be an object. Work is a real flow, a service is a real flow, and so is the use of something. Sanjay's hours are a real flow. The landlord's premises are a real flow. Neither of those is a thing you could put in a box.
Each relationship is two sentences: one starting with each name, each with the money word and the amount. That is about forty words a relationship. Longer is not better.
Yes, use the case study's figures wherever the case study gives you one. A relationship written with the actual amount in it is stronger than the same sentence with no amount in it, and the amounts are sitting there in the text for you to lift.
Work out what is wrong before you open the answer.
The problem. That answer gives one participant's reliance instead of both. The sentence is true and it describes half a relationship. Sanjay has not been given anything to rely on.
This is reported, report after report, as a reason students missed Achieved on this standard.
“Five Star relies on Sanjay to wash and rinse the colour clients. Sanjay relies on Five Star for $24.00 an hour of wages and for the apprenticeship that gets him qualified.”
Add the sentence that starts with the other name.
The problem. “Money” is the word the reports name explicitly. The sentence is not wrong, but the sentence is not an answer, because the money words are there so you can say which money you mean.
“Five Star receives sales revenue from its clients, $190.00 from the client who had the full head of foils.”
Name the money flow.
NZQA Examiner Reports: candidates “used the description money rather than profit or revenue”.
The problem. Affected which way? Up or down? A marker cannot award a direction that is not on the page, and affected is exactly the word the reports quote.
“The wholesaler's sales revenue increased, because Five Star ordered colour more often.”
Say which way.
Increased and decreased are the words to use.
NZQA Examiner Reports: general comments “rather than specifying whether there was an increase or a decrease”.
The problem. Banks do not collect tax. A bank holds money and pays interest on it, and lends money and charges interest on that. The government receives tax directly.
Students got this wrong often enough for it to be written up as a named failure.
Five Star pays tax to the government, and the government provides the services and the roads the salon depends on.
Write two separate relationships, with the right participant in each.
The bank is a different pair entirely.
The problem. That is three participants, not three relationships. A relationship is a pair, and three pairs need at least four names between them, or one name that appears in all three pairs, which is what usually happens.
“My three relationships are Five Star and Sanjay, Five Star and the colour wholesaler, and Five Star and the landlord.”
Write them as pairs before you write a word of prose. Then write six sentences, two for each pair.
NZQA assessment specification, AS92030: a minimum of three interdependent financial relationships.
The problem. Both sentences are in the same answer and they cannot both be true. Contradicting yourself inside one question is listed as a reason students missed Achieved in more than one report, and it almost always happens because the answer was written in two sittings and never read back.
“The wholesaler's revenue increased, because Five Star ordered colour more often.”
Read the whole answer through once before you finish. Keep the version the case study supports, and delete the one it does not.
NZQA Examiner Reports: candidates “provided contradictory answers within the same question”.
Participant is the one new word here. Interdependent financial relationship, money flow and real flow are back because this is the lesson where you have to use them precisely.
A participantThe plastics company that sells empty bottles to Bright Street Hair Supply for $1.20 each.
Not a participant (but an account with no money in it)A social media account. Attention is not a financial flow, and the exam asks about financial relationships.
Written properly“Five Star relies on the landlord for the premises and pays $600.00 a week of rent. The landlord relies on Five Star for that $600.00 a week of rent income.”
Half written“Five Star relies on the landlord for the premises.” True, but the landlord has not appeared as anything more than a noun.
Named“$2,400.00 a month of wages.”
Not named (but just “money”)“Money goes out to the staff.” Which money, and how much?
A real flowThe hours Sanjay works. The unit Five Star rents.
Not a real flow (but a feeling)“They have a good relationship.” Nothing has moved.
Five parts, on a business you have not met before. Bright Street Hair Supply mixes shampoo and conditioner in a rented unit and sells that shampoo to salons. Five Star is one of Bright Street's customers.
| Bottles sold in a month | 400 |
| Price of one bottle | $13.00 |
| Sales revenue, each month (400 × $13.00) | $5,200.00 |
| Costs, each month | $4,740.00 |
| Empty bottles, from a plastics company in the nearest city, $1.20 each | $480.00 |
| Ingredients | $1,100.00 |
| Wages: two staff, twelve hours a week each at $25.00 an hour | $2,400.00 |
| Rent on the unit | $700.00 |
| Interest on the $15,000.00 loan from the bank that bought the mixing gear | $60.00 |
| Profit, each month (Bright Street pays tax on this profit) | $460.00 |
Every entity takes one money word, and no two are the same. Drag each word onto its entity, or press a word and then press the entity.
Well done. Every money word is where it belongs, and that is the step to do before you write a single sentence.
The salons buy something, so what arrives at Bright Street is sales revenue: $5,200.00 a month, from 400 bottles at $13.00 each.
The two staff are paid for the hours they actually work, so the money word is wages, $2,400.00 a month. What they earn is wages and not a salary, because a salary is a fixed amount for a year's work rather than an hourly rate.
Buying supplies has no money word of its own on the list, so the $480.00 a month leaves Bright Street as an expense. Standing at the plastics company's end, the same $480.00 is its sales revenue.
A bank charges interest on what it lends, $60.00 a month here. The $15,000.00 is the loan itself and moved once, and the interest is what moves every month, so the interest is the money word.
The unit is somebody else's building and Bright Street pays to work in it, so the money word is rent, $700.00 a month.
Bright Street pays tax on its profit. This is the one entity the case study gives no figure for, so name the $460.00 a month of profit the tax is charged on.
a.Describe the relationship between Bright Street and its two staff, both ways. Two sentences, one starting with each name, with the money word and the amount in.
“Bright Street relies on its two staff for the hours that mix and bottle the shampoo, and pays $2,400.00 a month of wages for those hours. The two staff rely on Bright Street for that wage income, which is what they live on.”
The money is named twice and named differently on each side: wages going out of Bright Street, wage income arriving with the staff. That is the same $2,400.00 seen from two ends, and naming it from both is what makes the pair a described relationship rather than one sentence said twice.
b.Now the relationship between Bright Street and the plastics company. Both ways again.
“Bright Street relies on the plastics company for the empty bottles it cannot sell shampoo without, and pays $480.00 a month for them. The plastics company relies on Bright Street for that $480.00 of sales revenue every month.”
The same $480.00 is called two different things depending on whose side you are standing on. The $480.00 leaves Bright Street as an expense, and arrives at the plastics company as sales revenue.
c.Your third pair. Part a was wages and part b was an expense, so pick one whose money word is neither: the bank, the landlord, the government, or the salons that buy from Bright Street. Write it both ways.
“Bright Street relies on the bank for the $15,000.00 it borrowed to buy the mixing gear, and pays the bank $60.00 a month in interest for it. The bank relies on Bright Street for that interest income, which is how a bank earns from lending.”
The bank is the harder one. What the bank relies on is the $60.00 of interest, not the $15,000.00 it handed over, so the interest is the money named on the bank's side.
“Bright Street relies on the salons for $5,200.00 a month of sales revenue, which is all the income it has. The salons rely on Bright Street for the shampoo and conditioner they use on their clients every day.”
The salons are the easiest of the four pairs, because the money has one plain name on both sides: $5,200.00 of sales revenue arriving, and the shampoo going back.
“Bright Street relies on the landlord for the unit it mixes and bottles the shampoo in, and pays $700.00 a month of rent for it. The landlord relies on Bright Street for that $700.00 a month of rent income.”
The same $700.00 is named twice and named differently on each side: rent going out of Bright Street, rent income arriving with the landlord.
“Bright Street relies on the government for the roads its deliveries run on and the other services the business uses, and pays tax on its $460.00 a month of profit. The government relies on Bright Street for that tax.”
The government is the one pair where the case study never gives you the money itself. It gives you the $460.00 of profit the tax is charged on, so that is the figure to name.
d.Read your three relationships back and add up your sentences. How many did you write, and how many should there be?
You should have written six sentences, three relationships, two sentences each. If you wrote five, one of your relationships is written one way round.
Six is the number because three relationships need two sentences each, one starting with each name. An odd number is the giveaway: it means a pair has a sentence missing, and the missing one is always the second direction.
e.One of these is not an interdependent financial relationship. Which, and why? The plastics company · a rival shampoo maker in another city · the bank · the landlord
“The rival shampoo maker in another city. Nothing moves between them in either direction, no money, no goods, no work. They compete for the same salons, but competing is not a financial flow.”
The answer names the test rather than the feeling. The question is not who matters most to Bright Street, it is whether anything financial moves, which is the test the social media account fails.
Go Sierra, go!
You wrote three relationships on a business you had never heard of until an hour ago, both ways, with the money named in every one. That is the whole Achieved criterion for this standard, and it is half of the exam.