Hi, welcome to silkysteps. Its asking about the methods you use to monitor and track children's development/enabling you to make assesments eg. the observations you make in the setting -
types, the way you share moments/observations of what's happening or happened with colleagues, parents and the children, create children's journals together, or diaries maybe, keep records of development, use other resoures to support your assessments eg. development charts, books, professional advice.
Reflect on the implications means to look at what you discover about individual children's development and how that might change practices eg. have activities that can be adapted, have positive parent partnerships, organise meetings that enable the setting to support the children and parents, know external service providers and referal systems.
Have you asked if the LA are offering funding for level 2s? If you haven't completed one already you might find it a helpful foothold xx
Enjoy the site :)