Case Study Of An Organization

Introduction

Case Study

(i)

From:

 

To:

Giovanni@xyz.com

Subject:

Regarding changes and meeting

Message

 

 

 

Hello Giovanni,

We want yo to take part in the meeting related to your tax and financial issues. It will be helpful to you and for your firm to overcome the issues.  

  • In case of Giovanni, the main reason behind the poor performance of the firm was may be the multitasking. He was 60 years old and handles many businesses at one time. He may not be able to give full-time to his firm and that may be the reason for reporting neither investment returns nor tax returns. This example can be highlighted in the induction programs to collogue to avoid these conditions (Bovens, Goodin and Schillemans, (2014).
  • To avoid these kinds of situations, employers needs to have focus on one business at a time rather having multi interest on numerous business. Multitasking is a good thing but it requires higher level of concentration. The focus needs not to shift from one activity to another. All the tasks requires equal time allocation.

b)

  1. In this situation, Giovanni himself accountable for this situation. Records show that He has replied to other email and did not respond towards his obligations regarding investment and tax returns.
  2. Giovanni requires services of financial and legal advisor, who can give him financial advices about what to do in this scenario. We need to analyse the whole situation and get to the best possible result.
  3. In this scenario our role is to collect all the financial and email records of Giovanni and provide him the best advice to overcome from this issue. The records will help in analysing the situation and it will provide assistance in coming to the best possible output from this situation (Cowie, Eckard and Eady, (2012).

C)

1 In terms of ongoing improvements, the staff of the company are going to offer training sessions which leads to improving their performance. In addition to it, the management of the firm needs to make proper backup of the mails so that confusions will not create.

2 In order to develop relation with Giovanni, the firm can communicate face to face with him.

3 Earlier, Giovanni did not respond to the first mail by the firm but later on he replied to the second mail whereas there was no official documentation and written evidence was there. In order to take Giovanni concern, the firm has acknowledged the relevancy of staff training in this case.

D).

1 In this case study, the major inconsistency was no written document and physical evidence of the response of Giovanni mails.

2 In order to test and assess the integrity of information supplied can be done with the help of  face to face interaction with Giovanni. In addition to it, the management will be asked to firm's IT specialist to recover all the mails which was not received to the firm.

3 To make Giovanni be more accountable in the future, coaching and mentoring sessions will be conducted. This will help him to guide for future operations and work Bovens, Goodin and Schillemans, (2014)

Case Study 2

a)

  1. In order to solve this case, the firm needs to outsource services. This matter can not be solved by the internal members of the firms. He will require some outside people to solve this issue.
  2. We will consider financial tax advisor or consultant to outsource the services. We can also consider a well reputed agency in this field that can outsource services for the firm. The financial advisor and tax consultant can be helpful tax preparation & filing returns
  3. The activities such as accounting & bookkeeping, tax preparation & filing returns and payroll processing can be outsourced in this case. We will select, engage and monitor suppliers in same way that will be beneficial for the firm Turner, (2014).

b)

  1. The following are the websites that can be helpful in knowing provisions of corporate act and superannuation industry act of Australia:
  1. The service providers need to have in-depth knowledge of products and services, they are required to provide quality services and they need to be flexible in working anytime during the period of workload.
  2. We will suggest Giovanni about the outsourcing services by telling its benefits. It will provide expertise services and helpful in doing the task in the most efficient and effective manner. It will have a huge scope in the future and firm can take maximum advantage from it.

C )

1 At the time of monitoring service provision, formulation of quality norms are required. In addition to it, this is necessary to analyse the changes in order to implement further improvements.

2 In order to monitor and measure the performance standard, an evaluation form will be prepared . Whereas, performance measures will be identified. In addition to it, feedback guidelines will be set up. Further, this will communicate with the help of emails to the clients or with the use of telephonic conversation (Cowie, Eckard and Eady, (2012)

3 Reporting process is relevant in the business organization because in this process certain observation are made by the observer on which corrective actions are taken. On other hand, documentation is a process of maintaining written form of the observations. This will help to take measures by the management.

D)

1 Briefing document

Purpose

The purpose of this document is to lower down the tax effect of Giovanni.

Businesses

Giovanni is a cardiologist where he is a member of SMSF and also a director of a corporate entity. In addition to it, he is passionate for Wedgwood where he offers lustre collections of Australasia.

Plan

The motive of this document is to lower dower down the tax impaction of different businesses. This will help the firm to analyse the actual income of the person from his different business.

2 The accountant will be formally engaged with the help of account termination letter where the accountant will be formally engaged to the processing of the organization. In addition to it, there are different terms and conditions will be included to the independent contract agreement where nature of service, relationship of parties, compensation and reimbursement etc. will be included.

3 The account performance will be reviewed where the response time will be slow and the accountant will meet the negotiated completion date. Here the performance of the accountant (De George, Ferguson and Spear, (2012).

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Case Study 3

a)

1.Giovanni needs to consider various legal aspects before investing their SMSF in the new business of pasta divita. It states that diversification can be done by using various forms of assets and their classes, ensuring liquidity of the funds, ability of fund to pay several benefits and needs of the members are required to be consider in different circumstances.

2. There are various investment objectives of Giovanni while taking this investment opportunities is to help their family member by making passive investment without getting in to the front picture, cover all short term expenses comes in the business life and strengthen the existing business.

3.According to the legal and organisational requirements of the existing business which suggest that the small business investment techniques will be used which is franchisee form in which the money invested by the owner will demand royalty in return and another form is using Self managed fund of Giovanni which is collected fund of superannuation fund which is gathers by the person which is utilising by them in their family business as they want to help their business seeking much recognition (Deegan and Rankin, (1996)

b) 1.

The selection of the product is the cash amount which can be taken up by the owner from family and friends in order to invest this in their business with the clear objective to earn high amount of sales and the revenue. The equipment in form machines which is used to make pasta which will hold in the business for long term will also act as a fixed asset for an enterprise.

2.

The major categories of the allocation of the asset will be used that is current and fixed asset which is determined by the owner as per the time period that asset will be hold in the enterprise. The machines and all the equipments purchased by the business will form part of fixed and non-current asset and on other hand cash amount will be one of the party of current asset as it will help an enterprise in order to strengthen its liquidity position in the entity.

3.

The selection of the best suitable investment strategy will further get affected with several strategic variables which helps an entity in order to analyse the positive and negative implication of the variables which also forms part of the business. These strategic variables are future liabilities such as this investment will generate higher sales and produces loss, liquidity means the cash balance held by an entity after meeting all the expenses (Guthrie, (1998)

c)

1.

Service providers will be in this kind of business the raw material suppliers which supply all  the raw stuffs such as flour which is the basic ingredient in making pastas, suppliers who provide machines of making pasta, confectionery raw material suppliers, rent charged by the premise owner. There various performance indicators will be used in this business are measuring the success of an enterprise on the basis of number of customers held by an enterprise, quality of services provided by the owner to attract wide number of customers.

2.

The results obtained from the business are directly communicated by sending copy of all the accounts which forms legal evidences of all the business transactions which also helps in ascertaining r the sales. This account statements will be helpful for an entity in order to determine the profit or loss generated by the enterprise. The vouchers and copy of bill which is generated electronically can be checked by Giovanni at every time interval matter of doubt.

3.

The rules and regulations will be greater importance in the every business in this business. The disclosures form integral part of the business which helps to ensure that the minor change has occurred in the business by explaining their reasons for changing any method or procedure. The disclosure can only be made if the changes has material effect of their overall, performance of the business (Henderson, Herbohn and Howieson, (2015).

d)

1.

Investment reports prepared by an enterprise which is further bifurcated in to two categories that is both short term and long term as per their nature of the investments held by them in the business. The investment reports may range from different risk profiles of an enterprise in the different business situations kept by them with a clear motive to get inform ll the investment standards and policies to be incorporated. The investments report will  include diversification, asset allocation which is also one of the part of asset management and ascertaining the long term returns generated by an entity by making investment in specific quantity in their business enterprise.

2.

The allocation of assets which will transforms all the assets into the investments as the wastage of all the assets is not appropriate. The diversification is that approach in which all the existing assets are utilised by an entity in establishing a new business as their main motive is to achieve all the goals and objectives and able to improve their financial performance.

3.

The relocation of assets has been done when the enterprise owner will think that the objectives framed for meeting all the business friend requirement will be changed with the external market changes and recession takes place in the external market which will increases the fund's requirement then the business enterprise will take the decision of re-allocating all its goal;s as per the external business requirements (Hussey and Pittock, (2012).

Case Study 4)

a)

1.

The guidelines imposed by the Australian taxation officer which prescribes various rules and guidelines in order to support all the individuals who invest their funds in SMSF. The income generated from this kind of fund will be generally taxed at the rate of 15% which is also regarded as individual income tax rates. There are different kinds of income which are taken as assessable income for determining the SMSF includes net gains generated from capital gains, interest, dividends and rent. All the financial records need to be maintained under this category as these statements will help in determining the true information regarding the incomes of an individual.

2.

In the given case, the taxation has immense scope in the SMSF in which the role of assessable contributions also form one of the integral part. The owner needs to comply with vagarious rules for the taxation on the individual rate of 15% and non-corporate will be 47%. Various contributions includes employer contributions including the sacrificing of the salary, personal contributions made by an enterprise in claiming the tax deductions (Jacobs, (2012)

3.

Calculation of CGT payable

sale considerations             $450000

  • expenses                           ($25000)

Capital gain                      $425000

The taxation of capital gains will be attracted with the different situations which has also mentioned on the website of ATO which will changes as per the existing situations of the business enterprise.

b)

1.

The monitoring of the superannuation fund will be done by the superannuation industry which prescribes various rules and regulations which needs to be followed by Giovanni in order to ensure its working as per the standard regulations. The legislations of the SIS will be helpful for the owner as their main motive is to comply with all the rules and regulations which are related with administration fees, licensing and maintenance fees as their main motive is to ensure the proper safety of the fund. The owner can claim the money which has preserved by the government authority in the form of SMSF which is the money generated by the employer by working as employee in another business organisations.

2.

Challenges form part of the business held by Giovanni as they face several challenges in form of all the positive and negative reactions generated by them in accordance with the taxation authorities. The tax compliance is necessaries in the situation of the self employed business of an entity which states that the business owner should ensure its correct income by determining the true income from the all hidden as well as known facts which helps an entity in return to assess its real business obligations (Nobes, (2013).

3.

The transferring of title is possible when the seller sells it property in due considerations to another seller without having defective tilt of the goods. In this process the sales of goods act will cone into existence as any asset whether of any category will be sold an enterprise for generating cash in return. On other hand superannuation fund will be attracted as all this process will roam around the SMSF fund invested by the owner in other entity.

c)

1.

Specie contribution is one of the form of this SMSF fund in which various assets are transferred in this specie contributions such as ASX listed securities, widely held managed funds, business or commercial property and all the cash based funds such as bonds and debentures. The basic benefit an enterprise can get is the taxation savings of around 3% of the income in proportion with the total amount transferred in the category.

2.

There are various obligations which needs to be taken into considerations by the Giovanni is to check the compliance of the act in terms of quality criteria used by an entity owner in order to ensure that the tax exemptions will be proved beneficial for an enterprise. The age criteria will also be used here as it is one of the preservation age of the total contribution in the category. It also includes stamp duty in order to legalised the agreement (Nobes, (2013).

3.

The changes are made in the existing situations with a clear motive to resolve all the weakness in the existing strategy of the investment adopted by an organisation. The changes take place in the investment strategy are important as compliance of all the rules and regulations is important in order to move ahead in a complete direction without getting affected with the external changes and heavy imposition of tax.

D )

1 For Giovanni it is necessary to have appropriate information where for tax assessment he is required to individual tax file number at the time of lodging income tax return. Tax implications of funds are in case of dividends the tax distribution tax is required to be paid.

2 Then Giovanni gets past the age of 65 years, he will be entitled for some extra tax credits from ATO. He can also get tax relief. He will have the same general tax rules as everyone else have. He will also be entitled to have pensions and social welfare payments.

3 Yes, there are two types of fund reserves i.e. self insurance and contingency reserves. These reserves helps individuals from certain obligations.  Significant contingencies include those related to litigation and state tax assessments. Self-insurance are determined based on the insurance companies’ incurred loss estimates, industry development factors, actuarial estimates and management’s judgement (Cowie, Eckard and Eady, (2012).

Case Study 5

  1. a) Risk Profile Tool:
  2. Risk profile is willingness to take risks and in case of Raymondo and Chontelle, there product risk profile falls between moderate assertive and assertive where they have pursued greater long term returns. They have growth rate between 75 to 90%.
  3. The risk profile can be identified by the cross questions during an interview. To determine the accuracy of the risk profile, the cross questions on a same topic will be helpful tool.
  4. In the interview process we can ask for the reason and purpose behind investment of funds. Why the needs of investment has generated and what amount the client is ready to invest can also be asked during the interview process.
  5. b) ATO:
  6. Raymondo and Chontelle needs to provide these following documents to ATO such as invoices, Quotes, Order forms related to SMSF, receipts and other documents. These documents will ascertain that acquisition would be prohibited by SIS act.

The superannuation industry that is sis prescribes various legislations regarding submission of various documents to know prohibitions on acquisition of assets are given as below:

  • Documents that show legal ownership of asset
  • Details describing relationship between party who owns the asset and owner of SMSF
  • Details regarding type of asset that may includes listed shares, business real property
  1. The form for requesting ATO for SMSF has 6 sections under it and all the required details needs to be filled. It contains details related to registered tax details in form of tax, phone and FAX numbers. It will require other contact details, fund details, facts, audits and declarations. All the details need to filled on behalf of Chontelle (Cowie, Eckard and Eady, (2012).

The request form contain three major sections such as A, B and C. Section A will provides complete details regarding employee by choosing super fund with supporting documents, Section B, in which employer details of their nominated super fund and Section C will cover choice process of employee. Section A includes information regarding nominating APRA fund or RSA.

  1. By cross checking the mentioned details we can assess that the details are current and accurate. There should not be any mismatch in the form. Only the tax agent, tax professional or legal personal are eligible to give this form to the authority. The signature will also ensure that the form is current and accurate.  

The accuracy and current information has been assessed by filling the self declaration form that helps both employee that is client and employer that is the owner.  

C ).

1 In terms of financial goals, they can budge, save and further invest the amount. In addition to it, they can manage the funds with the use of investment gearing strategies and retirement savings. In addition to it, they can manage the credit and debit cards and mortgages. This will help them to achieve financial goals in an effective manner. This will also help Raymondo and Chontelle to make their SMSF.

2 The associated risk which is highlighted is between moderate assertive and assertive. For the same, they need to require the balanced portfolio where the aggressive investment can be included. In addition to it, the investors need to compromise the portfolio balances to pursue potentially greater long term returns. The investment choices are diversified but it carries high level of risk.

3 The SMSF are used by some people where they want control that comes with managing their own super but taking control of funds by them. This can be suitable for managing the retirement funds with lot of skills and involve significant time and efforts. In order to run the fund it is necessary to provide $8000 for advice on $600,000 in assets. In addition to it, the operation ratio on the expenses for SMSF is 1.06%.

D).

1 There are different types of super annuation products which are currently exists are retail funds, industry funds, public sector funds, corporate funds, eligible roll-over funds, self managed super funds and different accumulation and defined benefit funds. The major motive of these funds are to save money where it provides different investment options in order to meet the financial needs of the people. It is seen that they are generally of low or mid cost funds. Where it needs high cost of management and administration which is associated with this (Nobes, (2013).

2 Intermediaries and issuers play a major role are in relation with planning of funds, insurance broking, and securities dealing. Theses intermediaries assist the clients to meet their regulatory obligations and effect the commercial arrangements with the product issuers which contains risk and returns.

3 For Raymondo and Chontelle the appropriate super fund is self managed super fund which is a private fund regulated by Australian Taxation office. This fund can have four members as it is stated in the case study. Both of them are required and manage the funds as they are responsible for complying with all the relevant laws.

Case Study 6

a)

SMSF is private superannuation fund which is managed by an individual itself as it is regulated by Australian taxation officer. The maximum members can be 4 members to be part of this fund. In this kind of fund Raymondo and chontelle be part of this fund in the Bonano family.

 

The process of establishing this kind of fund includes carry put the role of trustee and then sent and follow an investment strategy and the next step is to use money to retirement benefits and lastly keep comprehensive record and arrange audit by SMSF auditor (Nobes, (2013).

3.

The establishment of SMSF fund will be possible to incorporate by involvement of 4 members of a family who acts like a trustee or director in managing their superannuation fund. Segregated assets are used in this fund as tax exemption is available on the usage of these kinds of assets.

b)

1.

There are types of insurance funds are mentioned in the act such as life insurance, total and permanent disability insurance are taken into considerations in this fund. In the given case, the Raymond can claim all the insurance amount that is life and disability in the SMSF.

2.

Basic challenges faced in estate planning that the owner of the house should provide power of attorney to their family members in case they get incapacitate to handle their estate as superannuation funds are regarded as their majority asset. In the given case, Raymondo and chontelle both have funds of superannuation and their property are also had further litigation such as mortgage value and personal loan.

3.

In the given case, Raymondo receives both age pensions and disability allowances which needs to be incorporated with him under the control. The house and all other assets needs to kept in reserve as the pension holders will get tax exemption.

c)

1.

The privacy policies of the two financial institution may differ in terms of the various components used in order to cater the needs of the customers who borrow cash from these institutes. The difference is there in terms of cash handling, complying ATO rules, cheques monitoring by using APCS procedures and clearing and settling which is regulated by bulk electronic clearing stem.

2.

The basic work of financial advisor is to let their clients know the external business requirement  by arranging their funds in proper manner by complying with all the rules. The privacy policies has unique feature of complying ATO rules and legislation by incorporating proper clearing systems.

3.

Policies and procedures are prepared in order to facilitate all the clients whose breaching will impose several acts which are come into existence for the protection of the financial institutions. This breaching will affect credit reporting agencies and data breaching authorities.

d)

1.

Financial product data list which matches with the risk profile of bonnao's family are Debt collection as they have businesses, mortgage loan modifications services to amend their value of mortgage for their house, Debt settlement service is also used to mange their debts.

2.

The basic strategy behind selecting this kind of products as the nature of these products are already found in the current profile of this family inform of bank loans, mortgage value of the house, business costs, educations cost of their daughters.

3.

The recommendations are provided to both of them with a clear motive which helps to ensure that the suggestion is just to improve the existing status of these peoples. The risk profile will get minimised by choosing certain tools to mange their debts amounts by transforming them into the positive attitude of the families (Deegan and Rankin, (1996). Get online assignment help at affordable price. 

References

  • Bovens, M., Goodin, R.E. and Schillemans, T. eds., (2014). The Oxford handbook of public accountability. OUP Oxford.
  • Costanza, R., de Groot, R., Sutton, P., van der Ploeg, S., Anderson, S.J., Kubiszewski, I., Farber, S. and Turner, R.K., (2014). Changes in the global value of ecosystem services. Global Environmental Change. 26, pp.152-158.
  • Cowie, A., Eckard, R. and Eady, S., (2012). Greenhouse gas accounting for inventory, emissions trading and life cycle assessment in the land-based sector: a review. Crop and Pasture Science, 63(3), pp.284-296.
  • De George, E.T., Ferguson, C.B. and Spear, N.A., (2012). How much does IFRS cost? IFRS adoption and audit fees. The Accounting Review, 88(2), pp.429-462.
  • Deegan, C. and Rankin, M., (1996). Do Australian companies report environmental news objectively? An analysis of environmental disclosures by firms prosecuted successfully by the Environmental Protection Authority. Accounting, auditing & accountability journal, 9(2), pp.50-67.
  • Guthrie, J., (1998). Application of accrual accounting in the Australian public sector–rhetoric or reality. Financial accountability & management, 14(1), pp.1-19.
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