Case study 1: Residence and source Fred, an executive of a British corporation specializing in management consultancy, comes to Australia to set up a branch of his company. Although the length of his stay is not certain, he leases a residence in Melbourne for 12 months. His wife accompanies him on the trip but his teenage sons, having just commenced college, stay in London. Fred rents out the family home. Apart from the absence of his children, Fred's daily behavior is relatively similar to his behavior before entering Australia. As well as the rent on the UK property, Fred earns interest from investments he has in France. Because of ill health Fred returns to the UK 11 months after arriving in Australia. Requirement Discuss whether Fred is a resident of Australia for taxation purposes. ( 4 Marks, maximum 500 words) Case study 2: ordinary income Explanations of the respective outcomes reached by the courts in the following cases which all involving sales of land I. Californian Copper Syndicate Ltd v Harris (Surveyor of Taxes) (1904) 5 TC 159 II. Scottish Australian Mining Co Ltd v FC of T (1950) 81 CLR 188 III. FC of T v Whitfords Beach Pty Ltd (1982) 150 CLR IV. Statham & Anor v FC of T 89 ATC 4070 V. Casimaty v FC of T 97 ATC 5135 VI. Moana Sand Pty Ltd v FC of T 88 ATC 4897 VII. Crow v FC of T 88 ATC 4620 VIII. McCurry & Anor v FC of T 98 ATC 4487 Order Now RIP Pty Ltd is a resident private company carrying on the business of undertaker/funeral director. It operates out of premises comprising office facilities, a chapel and assembly area and professional rooms. Its other assets include a fleet of motor vehicles. For the year ended 30 June 2016 the company reported a net profit of $2.45m. Its income arises from the provision of funeral services financed as follows: Fees payable under a 'net, 30 days' invoice. Fees payable under several external insurance contracts to which bills are issued under a 'net, 30 days' arrangement. For instance, some funeral costs are paid by the Transport Accident Commission, others are paid out of private life assurance plans. Fees received from RIP Finance Pty Ltd, a company providing credit under an instalment repayment plan. Amounts paid under a funeral plan in which clients make periodic contributions to meet future funeral costs. 'Easy Funeral Plan' is a fixed price contract. When the agreed amount is paid, the client is guaranteed a 'deluxe funeral arrangement'. If the contract price in not fully paid at date of death, the deceased's estate is billed under (i) or (iii), above. The amount is not refundable or transferable. At 30 June the credit balance Easy Funeral Plan is $225,000. From time-to-time amounts paid pursuant to the Easy Funeral Plan are not drawn upon. The clients might die abroad or remains not be recovered and no funeral service is provided. No refund issues arise. At 30 June, the company transfers from Easy Funeral Plan amounts estimated to have arisen in connection with defaulting members (ie, members who have ceased making scheduled payments and who are not expected to make up arrears). These are credited to a 'Forfeited Payments Account' that has a balance at 30 June of $16,200. Required (70% of the answer) [Note: it is necessary to refer to appropriate case law on the issues.] Refer to the decision in Arthur Murray (NSW) Pty Ltd v FCT (1965) 114 CLR 314.In your own words, briefly describe the facts, issues and conclusion in that case. [Note: Case reports and extracts of Arthur Murray are widely available or the decision may be accessed via hcourt.gov.au] Advise RIP Pty Ltd when income is derived (i) generally, and (ii) when it derives its income from funeral services and related activities. Does the Arthur Murray principle apply to the company's accounting treatment of amounts in Easy Funeral Plan? Explain. Does the Commissioner or any taxpayer have a choice in the method of accounting for tax? Advise the company of the tax treatment of $16,200 in 'Forfeited Payments Account' in item (iv). Part B RIP Pty Ltd holds a stock of three types of caskets as well as a range of accessories (such as religious and secular icons). In June 2016 the company prepaid $25,000 for material to be delivered in August 2016. The company obtained considerable discounts for the advance purchase. A fully franked cash dividend of $21,000 was received from RIP Finance Pty Ltd. An amount of $57,000 was paid on 1 March 2016 for two year's rental of storage space. The lease expires on 28 February 2018. In the company's financial accounts an amount of $9,500 was expensed and $47,500 capitalised. On 1 June 2016 the managing director of RIP commenced three months long service leave and was paid $22,000 in advance. In the company's accounts the amount was debited against a Provision for Long Service Leave Account. In 2013 the company's Board of Directors decided existing accommodation was inadequate and it resolved to construct a purpose built facility. In that year $250,000 was paid for preliminary architectural designs. In 2014 land costing $1.25m was acquired and $50,000 paid to demolish an existing structure. Construction of the new premises commenced on 1 September 2014 at a cost of $2.5m. Fitting and equipment was installed on 1 June 2015; operations began on 1 August 2015. On-site car parking costing $125,000 was completed on 30 September and landscaping of the site was completed on 31 January 2016 at a cost of $40,000. Required (30% of the answer) Advise the company about the following: [You must refer to appropriate sections of the legislation and relevant case law.] The nature of trading stock, generally, whether the caskets and accessories would be trading stock for tax purposes and how the amount of $25,000 is treated for tax purposes. What adjustments (if any) should be made to the company's reported profit for tax purposes in regard to items (ii), (iii) and (iv). What deductions (if any) are available for expenditure set out in item (v). Explain. Order Now Many management practices in health service organisations have been imported from the corporate world. Many of the approaches used in quality management, for example continuous quality improvement, quality assurance, LEAN thinking and Six Sigma have been adapted from a manufacturing environment. It may be argued that health services are different. Discuss. Order Now What are the implications of growing regional integration on global business? Discuss some of the opportunities and threats of this trend, and how they might affect your business and/or profession. Topic – 2 – What is your view on whether and to what extent do MNEs establish themselves as global corporate citizens? Do you believe they are honest in their approach and make a genuine effort to helping emerging and developing markets or do they behave as opportunists and exploit cheap resources available in those regions? Use some real world examples to justify your viewpoint. Topic – 3 – Consider yourself as a manager of an Australian construction company bidding for a $60 million housing project in Vietnam. Your consultant informs you that he could seal the deal provided you pay a bribe of $2 million to the Vietnamese government officials. Your decision is crucial as both global and domestic market is not looking good, and unless you secure this contract, your company will be forced to lay off 50 staff. What would be your decision in this situation and why? You may use one of the ethical decision-making frameworks introduced in Week 4 to justify your decision. Topic – 4 – Increasing globalisation is leading to homogenisation i.e. reduced differences in culture, taste and preferences across countries. To what extent do you agree or disagree with this statement and what implications of this might have on decisions related to local responsiveness and global integration. Can you identify any industry which might not be affected (if you think they do) by this trend? Order Now Explain why globalisation is not only an imperative for survival, but also an opportunity for future growth of domestic businesses. 2. Discuss Absolute Advantage and Comparative Advantage trade theories. Explain the difference(s) between the two theories and their limitations. Use examples and evidences to support your views. Order Now Does business need IT? Why IT is important for business survival? What is required to apply IT into business? (Cost, planning, designing, equipment, installation, training, etc…) How does business use IT? (internally such as staff, employees, and externally such as customers, suppliers) What benefits and advantages does IT bring to business? (Revenue, flexibility, reduces cost, etc….) What type of risk does IT bring to business? (Security, privacy, confidentiality) 7) How can business maintain and monitor IT? Order Now B Bakery is a family owned firm with around 70 employees and sales revenue increased to more than $ 13.5 million during the past year. It has been in business for over 50 years and supplies bread and confectionary products to a number of different businesses, including supermarkets and pub-chains. The firm has experienced mixed fortunes over the years in terms of business performance, but in the last few years has experienced a growth in orders for some of its new healthy product ranges. However, the Bakery has recently lost some key accounts as a result of being unable to produce some of its products at a competitive price. Although the firm hired an accountant who was keeping their books for them and producing the financial statements each year, the firm thought they needed much more information to really run their business efficiently. They felt that they needed to make an investment in accounting software to take their business to the next level. Assignment Requirement You are required to conduct desk research on AIS/ERP Systems for your above client. Prepare a Business Report for the client detailing the following processes of selecting an AIS/ERP: Define business processes What a Baker does? Discuss the business activities/processes of the organisation to show your understanding about the business. (600 words) Develop business requirements What processes are indispensable to be performed? (350 words) What outcomes are required from these processes to achieve business objectives? (350 words) Determine the systems requirements What are some of the possible software features or functionalities that the firm should consider to achieve their IT investment objective? (700 words) Software selection Visit the web sites of accounting software package vendors (e.g. SAP, MYOB, Xero etc.). You need to visit at least 3 (three) software vendors' websites. Which category of accounting software (low, medium or high-end/ERP) suitable for the firm? Give your justifications in detail. (300 words) Vendor selection Compare and contrast the features/ functionalities of two accounting software packages offered by accounting software package vendors (e.g. SAP, MYOB, Xero etc.) within your selected category in question 4. (600 words) Which one would be the most suitable vendor (and accounting software package) for the Bakery business and why? (600 words) Order Now Consider the following situations and indicate whether consideration is present and whether Jack has an enforceable agreement: a) Jane is going overseas and she offers to give her Lotus Super 7 sports car to Jack. The market value for this type of vehicle in good condition is around $25 000. Jack accepts. (2.5 MARKS) b) Jane offers to sell Jack her Lotus Super 7 sports car for $25 000. The market value for this type of vehicle in good condition is around $25 000. Jack accepts. (2.5 MARKS) c) Jane offers to sell Jack her Lotus Super 7 sports car for $2500. The market value for this type of vehicle in good condition is around $25 000. Jack accepts. (5 MARKS) QUESTION 2 – 10 MARKS A shipbuilder had contracted to build a tanker for North Ocean Tankers. The contract was in US dollars and didn't contain any provisions for currency fluctuations. Approximately halfway through construction of the ship, the United States devalued its currency by 10 per cent. As the shipbuilder stood to make a loss on the contract, it demanded that an extra US$3 million be paid or it would stop work. The buyer reluctantly agreed under protest to pay, as he already had a charter for the tanker and it was essential that it be delivered on time. The buyer didn't commence action to recover the excess payment until some nine months after delivery. Will the buyer succeed in recovering the excess? Will the European Union survive its current crisis of confidence? If it breaks up what will this mean for international business? In relation to your country of origin what impact might disruptive technologies have on growth of international trade? Identify the top 3 ethical issues in international trade and provide an insight into how these might be addressed? What impact does cultural difference have when a company considers entering a new international market? Order Now Review the strategic plan documents of Bounce Fitness and discuss what you have learned, including what the targets and goals are and how these will impact on the staff Research emerging practices or trends that may impact on Bounce Fitness staff. Emerging practices or trends are things like changes in the way people buy or the community expectations, economic trends, labour market trends, new products or services that may be introduced, new technologies, political or legislative changes and/or qualification changes that may be required of your staff. Discuss your findings. Discuss how the information from Task 1 may impact on Bounce Fitness staffing in the future, including the number of staff you will need and what skills your staff will need to have based on the results of your findings. How will you obtain these people? Discuss how new technology will impact on Bounce Fitness, job roles and how the jobs are done. Identify appropriate technology including cost and benefit. Discuss recent or forecast changes to legislation that could impact on your staffing Discuss how you would consult with the Centre Managers. Include copies of emails, memos, minutes of meetings or notes confirming meeting discussion Discuss how you will gain agreement on the philosophies, values and policies. Your objectives and targets may include development of areas such as equal employment opportunity and diversity, human resources information systems, induction, industrial relations, job analysis and design, occupational health and safety, performance management, professional development, recruitment and selection, remuneration, staff retention and succession planning. Document your strategic objectives and targets for the agreed plan. Select at least 2 options for achieving your objectives and targets. One of these must be your final choice. These could include external provision by a consultant or contractor/s, having the work performed elsewhere (outsourcing), internal human resources provision of the service/s, and internal non-human resources provision of the service/s and/or merging of business units. Discuss each and why you made the final choice that you made. Include a Cost Benefit Analysis for each of your chosen options. Discuss your strategic human resource plan and mention how do you get support you're your senior management for the plan. Develop risk management plans to support the agreed strategic human resources plan and manage contingencies. Discuss how you will work with others to see that the plan is implemented. How you will monitor and review the plan? Discuss how you will adapt the plan if circumstance change. Discuss how you will evaluate and review the performance of the plan against the objectives.