STUDENT ASSESSMENT
Prepare and Administer Tax Documentation for Legal Entities – FNSACC601
Instructions
You are advised to commence work on your assessment from week 1 and all tasks must be submitted by the due dates provided.
All assessments must be completed and delivered individually. Where an assessment involves group discussions, you should consider the input of your group but submit an individual assessment to your trainer.
Please read all instructions on completing each assessment. Instructions for completion are provided at the beginning of each assessment.
All written answers must be typed in a word document using Arial font, 12 size and single spacing if similar instructions are not provided in the assessment.
Your trainer will not be able to assist you in answering questions. However, your trainer will address any issues concerning questions requiring further explanation.
You may refer to your student learning resources or any other relevant resources when completing your assessment.
Assessments are due for submission as specified in the assessment schedule. Any variations to this arrangement must be approved by your trainer prior to the due date for submission.
You have access to computers which are equipped with Microsoft suite of products or any other relevant software and printing facility.
Use assessment templates if provided, to complete relevant sections of the assessment. You can also create your known templates for assessment evidence.
You must achieve a satisfactory result for all tasks to achieve competency in this unit.
All assessment answers should be submitted to the trainer in required format (soft or hard copy) as per trainer instructions with completed assessment cover sheet (if required).
Assessment Schedule
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Task |
Due Date |
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Learning Activity Only |
Week 1 |
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Task 1 |
Week 2 |
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Task 2 |
Week 3 |
These materials were originally developed by Enhance Your Future Pty Ltd but may now be altered from the original form. Enhance Your Future Pty Ltd does not accept any liability for the Materials, the content and/or any reliance thereon.’
Task 1: Theory Assessment
Student Instructions
Type all the answers in a word document if required.
You can conduct internet research to answer these questions.
Provide explanation of 2-3 lines when answering ‘Describe’ questions.
Provide detailed workings for calculations questions.
Provide answers in table format wherever possible.
Question 1 – Question and Answers
Answer the following questions in writing.
What are four things you would need to identify prior to lodging tax documentation?
Define both cash and non-cash (accrual) accounting.
Describe each of the following business structures and how the structure affects taxation.
Sole traders
Partnership
Trust
Company
Joint venture
Self-managed super fund
Describe a depreciation schedule and what it is used for. Provide an example.
What is an allowable deduction? Describe in detail.
What are the 6 types of rulings for income tax purposes?
Australian residents must lodge a tax return if they meet certain criteria. What are they?
Describe what will happen when you lodge a tax return.
What is an amendment? Describe the process and why you would do it.
Question 2 – Research Report
For this task you must research each of the following topics, and complete a detailed report on your findings. Your report will need to be completed and submitted in a professional, word processed, format. The report must be 1000 words minimum in length. The research topics are:
Identify and explain ethical considerations and legislative requirements relevant to the preparation of tax documentation for legal entities, including:
Conflict of interest
Responsibilities of tax agents including code of professional conduct obligations under the tax agent services act (TASA) and tax agent services regulations (TASR)
Government tax policy documents issued by reviews, treasury and board of taxation
Explanatory materials in relation to legislation
Statutes
Court and administrative appeals tribunal decisions
Commissioner of taxation’s interpretive guidance in rulings and determinations
Explain critical and key elements of Australian tax law as it relates to tax documentation for legal entities such as companies, trusts, partnerships and sole traders including:
The rules and principles of Australian tax law, with an understanding of the legal environment in which these principles operate, basics of the legal system, constitutional considerations and separation of powers
The key aspects of income tax law covering concepts of residence and source, related elements of international tax, assessable income, deductions, tax rebates and offsets, and tax accounting
Goods and services tax (GST)
Taxation aspects of superannuation law
Administrative aspects of the taxes identified above including documentation, tax collection and withholding mechanisms, assessments, obligations, rulings, penalties and audits
Specific and general anti-avoidance tax rules
Describe the key sources of information and taxable transactions data required to calculate taxable income, including:
Allowable deductions
What are Capital gains and how are they calculated or identified?
Financial adjustments such as write-offs and revaluations
Income
Payments
Purchases
Superannuation payments
Describe the key features of organisational policy and procedures relating to the preparation of tax documentation for legal entities
Outline the key accounting principles and practices relevant to the preparation of tax documentation for two different types of legal entities.
Task 2: Case Study and Practical Assessment
Student Instructions
Type all the answers in a word document if required.
You can conduct internet research to answer these questions.
Provide explanation of 2-3 lines when answering ‘Describe’ questions.
Provide detailed workings for calculations questions.
Provide answers in table format wherever possible.
Question 1 – Stephen John
Review the information provided regarding ‘Stephen John’ in appendix ‘Case Study – Stephen John’ and conduct the following.
Create a checklist that would assist you to with identifying all the relevant details from your client.
Create a cash flow summary for Stephen
Create a depreciation schedule for Stephen
Create a profit and loss statement for Stephen
Create a balance sheet for Stephen
Answer the following questions:
What rate of tax should Stephen be paying?
What is his charge for the Medicare levy and surcharge?
What superannuation should Stephen have received?
What was Stephen’s assessable income?
What was Stephen’s tax payable or refund amount?
Did Stephen have any fringe benefits? If so what were they?
How would you calculate the fringe benefits for reporting purposes?
Is there any payroll tax due or paid?
Create a BAS for Stephen for 12 months.
Lodge Stephens taxation through paper based lodgement form.
Write a short summary of the financial position for Stephen.
Role play
Meet the client (your trainer) and undertake the following:
Explain the current financial position of the client
Explain the required documents that need to be kept for current financial year
Expected tax refund/payment from ATO
Approval for lodgement
Provide opportunity to ask questions
Respond appropriately to all questions asked.
During the roleplay, you will be assessed on your communication skills including:
Content
Professionalism
Clarity
verbal exchanges
language and concepts appropriate for the audience
Handling a questions and answer session
Uses collaborative and inclusive techniques to build rapport
Asking relevant questions to clarity and confirm information and instructions.
Question 2 – Royal Watch Ltd
Use a word processor to create one document with your responses to all parts. Ensure you title each section of your response to match the assignment designation.
Review the ‘Case Study – Royal Watch Ltd’ and ‘RWL Income Tax Return’ files provided in Appendix and conduct the following:
In the Depreciation Schedule worksheet (Tab No: 3) calculate and enter the depreciation and balancing adjustments for the tax year 2014/15.
In the Franking Account schedule worksheet (Tab No: 4) complete the franking account for the tax year 2014/15.
In the Tax Computation schedule worksheet (Tab No: 5) prepare the tax computations for the tax year 2014/15.
In the ITR Profit and Loss worksheet (Tab No: 6) complete the financial data for the tax year 2014/15, by using the information from the Income Statement.
In the ITR Reconciliation worksheet (Tab No: 7) prepare the reconciliation to taxable income or loss for the tax year 2014/15, by using the information from the Tax Computation worksheet.
In the ITR Financial Information worksheet (Tab No: 8) enter the financial data for the tax year 2014/15, by using the information from other schedules.
In the ITR Calculation Statement worksheet (Tab No: 9) calculate the tax amount due or refundable for the tax year 2014/15, by using the information from other schedules.
Appendix
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Case Study – Stephen John |
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RWL Income Tax Return |
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References / recommended resources
Prepare and administer tax documentation for legal entities – FNSACC601, Enhance Your Future.
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