Reference no: EM132294359

RESEARCH REPORT

Instructions

You will need to research information to assist with your responses for this task.

What you will need to complete this task

• Research materials such as books, internet, magazines, workplace documentation etc.
• Access to legislative and regulatory documentation relevant to own state or territory.

You should use a variety of sources to gather information including training resources, workplace policies and procedures (if you are able to access these) and government and industry bodies.

You are required to provide information about the following points. You must prepare a written response to each point, which can be supported by example documentation as required. Ensure material is referenced appropriately.

Long Answer

Your task is to research the following topics then outline your findings in a report. Use the questions below as a guide to your research:

1. Explain the following ethical considerations and legislative requirements which are relevant to the preparation of tax documentation for legal entities:
a. Conflict of interest
b. Responsibilities of tax agents, including the Code of Professional Conduct obligations which are outlined in the Tax Agent Services Act (TASA) and Tax Agent Services Regulations (TASR), especially those relating to disclosure and confidentiality requirements for the preparation of returns
c. Government tax policy documents which are issued by Reviews, the Treasury and the Board of Taxation
d. Legislation explanatory materials
e. Statutes
f. Decisions in the Court and Administrative Appeals Tribunal
g. The Commissioner of Taxation's interpretive guidance in Rulings and Determinations

2. Explain the critical and key elements of Australian taxation law for each of the following areas, as it relates to tax documentation for legal entities:

a. The rules and principles of Australian tax law, including the legal environment, and the legal system, constitutional considerations and separation of powers.
b. Income tax law, as it relates to:
i. Concepts of residence and source
ii. Related elements of international tax
iii. Assessable income
iv. Deductions, tax rebates and offsets
v. Tax accounting
c. The key aspects and relevant principles of the following taxes that extend the ordinary income tax base:
i. Capital Gains Tax (CGT)
ii. Fringe Benefits Tax (FBT)
d. Goods and services tax (GST)
e. The taxation aspects of superannuation law
f. The various administrative aspects of the taxes identified above, including:
i. Documentation
ii. Tax collection and withholding mechanisms
iii. Assessments
iv. Obligations
v. Rulings
vi. Penalties
vii. Audits
g. Specific and the general anti-avoidance tax rules

3. Describe the following key sources of information and taxable transactions data that is required to calculate taxable income:
a. Allowable deductions
b. Capital gains
c. Financial adjustments such as write-offs and revaluations
d. Income
e. Payments
f. Purchases
g. Superannuation payments

4. Describe the key features that should be included in organisational policies and procedures relating to the preparation of tax documentation for legal entities.

5. Identify and discuss the key accounting principles and practices which are relevant to the preparation of tax documentation, for the different types of legal entities.

6. What are the financial management strategies used to optimise tax position?

THIRD-PARTY REPORT ACTIVITY

The following task must be conducted in a safe environment where evidence gathered demonstrates consistent performance of typical activities experienced in the accounting field of work and include access to:

• Common office equipment, technology, software and consumables
• An integrated financial software system and data

For this task you are to complete the following steps to evaluate the tax obligations for a client, and then develop implement and evaluate tax plans.

Prepare for the task by completing the following steps to assess the legal entity's tax obligations:

1. Use standard accounting techniques to quantify the history and the trends of the legal entity's tax obligations which arise from its historical taxable transactions. Provide a copy of the documented information.

2. Analyse data from the current transactions to resolve any discrepancies and ambiguities and confirm the suitability of the legal entity. Provide the data analysis, including any discrepancies and ambiguities resolved, and confirmation of the suitability of the legal entity.

3. Conduct some research to identify and to critically evaluate updates and/or additions to legislative compliance requirements, relevant to maximising the client's benefit, to establish the recording and reporting requirements. Accurately document the requirements established and the sources accessed.

4. Analyse the data on taxable transactions to identify the legal entity's tax obligations. Document the analysis and the identified tax obligations.

5. Schedule the payments of tax obligations, applying methods of determinations and tax bases. Document the methods of determinations used and the payment schedule.

Develop tax plans for the legal entity by completing the following steps:

6. Assess the implications of the schedule on the tax entity's operations and structure. Document the assessment.

7. Develop financial management strategies which ensure the alignment of cash flow with incidence and schedules of tax obligations, complying with taxation law, ATO rulings, lodgement schedules, accounting principles and practices and the entities policies and procedures. Provide copies of the strategies developed.

8. Develop the management process and record-keeping systems required to implement the financial management strategies, complying with taxation law, ATO rulings, lodgement schedules, accounting principles and practices and the entities policies and procedures. Provide copies of the processes and systems developed.

9. Accurately complete and ensure the maintenance of the audit trail documentation, complying with taxation law, ATO rulings, lodgement schedules, accounting principles and practices and the entities policies and procedures. Provide copies of this documentation.

10. Document management processes that include the application of the compliance requirements. Provide copies of these processes.

11. Use standards accounting technique with income and expenditure forecasts to estimate the future taxation obligations. Provide the documented estimates.

Evaluate and advise on the tax plans by completing the following steps:

12. Use the income and expenditure forecasts to prepare budgets. Provide copies of the budgets.

13. Conduct periodic reviews of the prepared budgets to ensure the accuracy of the tax obligation estimates. Document any variances.

14. Analyse variances between the actual tax obligations and the tax plan to identify any errors or adjustments that are required to the financial management strategies or management process. Document the adjustments required.

15. Monitor and evaluate the performance of tax plans, to advise the client accordingly, and in line with their individual requirements. Document all advice provided.

16. Monitor and review the tax documentation to ensure it complies with legislative and professional requirements. Document instance of non-compliance.

17. Analyse the evidence of non-compliance to accurately diagnose the origin and to develop a resolution. Document the analysis, including the origin and the resolution.

SHORT ANSWERQUESTIONS

1. List at least five of the types of taxable transactions that should be used, along with standard accounting techniques, to quantify the history and trends of a legal entity's tax obligations.

2. What can you do with an analysis of the data from current transactions?

3. Identify at least four of the sources of information that would be accessed, when conducting research, to identify updates or additions to compliance requirements, relevant to maximising a client's benefit.

4. What data/information would you analyse, relating to taxable transactions, to identify a legal entities tax obligations? List at least six examples.

5. What are the methods of determination that could be used to identify, calculate and schedule tax obligations and requirements?

6. What are the types of implications on tax entity's operations and structure might you identify? List at least four.

7. What are two types of financial management strategies that could be developed to ensure the alignment of cash flow with incidence and with the schedules of tax obligations?

8. Why is it essential to develop and implement management process, record-keeping systems and financial management strategies to ensure the maintenance of the audit trail?

9. What should be included in the documented management processes?

10. Explain how using income and expenditure forecasts can assist with estimating future taxation obligations.

11. What information will be used to prepare the budget?

12. Why is it important to periodically review the budgets?

13. What types of variances might be identified between actual tax obligations and the tax plan, and analysed to identify errors or required adjustment to the plan?

14. What are some of the key performance areas in tax compliance which would need to be monitored to evaluate the performance of the tax plans? List at least five examples.

15. What questions might you use when monitoring or conducting a review of tax documentation to ensure it complies with legislative and professional requirements?

16. Identify six of the common origins of non-compliance that may be identified through an analysis of evidence and used to develop a resolution.

Attachment:- implement tax plans and evaluate tax obligations.rar