BSBESB402 Legal & Risk Framework for New Business Ventures

Project Assessment

Criteria

Unit code, name and release number

BSBESB402 - Establish legal and risk management requirements of new business ventures (1)Qualification/Course code, name and release number

CPC40920 - Certificate IV in Plumbing and Services (2)

Student details

Student number

Student name

Assessment Declaration

This assessment is my original work and no part of it has been copied from any other source except where due acknowledgement is made.

No part of this assessment has been written for me by any other person except where such collaboration has been authorised by the assessor concerned.

I understand that plagiarism is the presentation of the work, idea or creation of another person as though it is your own. Plagiarism occurs when the origin of the material used is not appropriately cited. No part of this assessment is plagiarised.

Student signature and Date

Version:20210521

Date created:03/07/2018

Date modified: DATE @ "dd/MM/yyyy" * MERGEFORMAT 05/03/2023

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This file can be found at: Learning BankThe contents in this document is copyright TAFE NSW 2021, and should not be reproduced without the permission of the TAFE NSW. Information contained in this document is correct at time of printing: DATE @ "d MMMM yyyy" * MERGEFORMAT 5 March 2023. For current information please refer to our website or your teacher as appropriate.

Assessment instructions

Table SEQ Table * ARABIC 1 Assessment instructions

Assessment details Instructions

Assessment overview The objective of this assessment is to assess your knowledge and performance as would be required to establish legal and risk management requirements of new business ventures.

Assessment Event number 2 of 3

Instructions for this assessment This is a skill based assessment and will be assessing you on your ability to demonstrate skills required in the unit.

This assessment is in two parts:

Project

Assessment Feedback

Submission instructions On completion of this assessment, you are required to hand it to your assessor for marking.

Ensure you have written your name at the bottom of each page of this assessment.

What do I need to do to achieve a satisfactory result? To achieve a satisfactory result for this assessment all questions must be answered correctly.

What do I need to provide? TAFE NSW student account username and password. If you do not know your username and password, contact your campus or service centre on 131601.

Computer or other device with word processing software and internet access

Writing materials, if required

Australian Standards and Codes.

These may be opened and referred to during this assessment

What the assessor will provide?

Access to this assessment and learning resources, including the student workbook and any supporting documents or links, such as.

legislation, regulations, codes of practice and standards relating to business

workplace documentation and resources

These may be hard copy or made available online.

Due date and time allowed

Location Fully online students should refer to their Training Plan for due dates, other students should refer to the Unit Assessment guide for due dates.

The estimated time for a student to complete this assessment is 8 hours. However there is no time limit for students to complete this assessment. Students may complete the assessment outside of the classroom and submit to their teacher for marking.

Assessment feedback, review or appeals Appeals are addressed in accordance with Assessment Guidelines for TAFE NSW.

Supervision This assessment briefing and site inspection will take place in the classroom and at the worksite on campus. Details may be commenced in the classroom and completed as a take-home task.

The student shall access their referenced text, learning notes and other resources.

Specific task instructions

The instructions and the criteria in the tasks and activities below will be used by the Teacher/Assessor to determine if you have satisfactorily completed this assessment event. Use these instructions as a guide to ensure you demonstrate the required knowledge and skills.

Assessment Conditions

This unit must be assessed in the workplace or a close simulation using realistic workplace conditions, materials, activities, responsibilities, procedures, safety requirements and environmental considerations.

Part 1: Report

To complete this part of the assessment, you must complete Tasks 1- 9 by documenting a report or providing information to complete tables as required table on the legal and risk management requirements relevant to a small business.

The small business may be either a simulated plumbing or hydraulic consultancy entity. The only requirement is that the business must have at least three staff, including you as the proprietor), an apprentice or junior designer and an office administrator.

Your business will start with a minimum of three staff and signed contracts worth $95k and $75k for a couple of large projects to be completed over the next 12 months. It also has the likelihood of ongoing new contracts of approximately $250k per annum. You are also estimated to turnover another $120k in non-contracted and maintenance/design alteration (hydraulic) work.

Against this, you will have minimum staff costs of $13,500.00 per month ($7.2K tradesperson, $2.7K apprentice and $3.6 K administrative) and fixed business costs (phone account, Internet, etc.) of at least $1,500.00 per month. Use the template provided as Appendix A to document your report and table information using

You may modify the template if required. Once completed, submit this assessment to your Teacher/Assessor for marking.

Task 1. Introduction:

Outline the type of business entity you have chosen to operate (Plumbing or Hydraulics). Provide sufficient detail to give a clear picture of the business structure you are planning including details of the business operational and legal structure.

This includes whether you intend to operate as a sole trader or other business type, the type of work being undertaken to raise sufficient revenue (new homes, maintenance, etc.), how large you foresee the business at its inception and the rate you intend it to grow to over a determined period of years and type of premises you would operate the business from.

Task 2. Business Structure

Having outlined the type of business you envisage in Task 1, you are now required to research and analyse two possible types of business legal structures suitable for your business plan.

You must provide a list of the advantages and disadvantages for each of the two options and an analysis of this data to show which choice would be most suitable to your planned business. The analysis should be clear in defining how it supports your original business plan/needs, or if not, why the other option would then be preferable.

Task 3. Staffing and Industrial Relations

Having determined how the business will be legally structured you are now required to confirm your anticipated staff numbers, taking account of whether you intend to increase staff from the minimum requirements listed in the opening instructions or in alignment with your predicted business growth and projected revenue and costs.

Provide a job description for each staff position within the business and the legal/industrial relations requirements of their employment, such as, Workers Compensation, PAYG withholding, Fair Work and National Employment Standards, The Apprenticeship Act, etc.

Task 4. Business Premises

You are now required to analyse all three alternative options for premises in the geographical area you wish to operate the business (as tabled below), taking into consideration the following:

You will need to keep an amount of expensive stock to meet your contractual work obligations, approximately 60m of undercover storage space will be required.

You must provide a list of the advantages and disadvantages for each of the three options and an analysis of this data to show which choice would be most suitable to your planned business. The analysis should be clear in defining how it supports your original business plan/needs, or if not, why the other option would then be preferable.

Your analysis should include projections of the business revenue and running costs to determine whether your financial position suits leasing or purchasing one of the commercial premises, or maintaining working from the garage of your home property until your financial position improves. You may decide to take a risk that one type of operating premises will increase the profitability of the business and therefore cover the extra cost or you may take a more cautious business development pathway and build the business base slowly. Weigh the financial risks involved and provide a rationale for your choice. Describe how your analysis of financial risk might change with business growth and operation over the first 3 years.

Table SEQ Table * ARABIC 2 Options

Option 1 Option 2 Option 3

Potential address Factory type unit located in separate industrial area away from passing trade and limited visible presence. Commercial shopfront in main street of local business area Residential area, Home property garage.

Approximate Office/ Shop Floor area Small office at entry and 180m undercover storage with roller door access.

Showroom entrance (30m) and service desk with rear office. Rear lane access to undercover storage area (80m) at rear with doors. Free standing 7m x 10 m double garage with front entry roller doors. No office facility but could set up a desk in a second bedroom.

Amenities. Unisex toilet and kitchenette.

Male and female toilets and kitchenette facility. House bathroom and kitchen.

Parking Multiple parking positions available

One staff parking position on site. Limited and timed on street parking close to public transport Trading hours 7 days a week

6 days a week Local government noise limitation regulations would be applicable

Zoning / Permitted use rights Industrial zoning

Commercial zoning Residential zoning check local government regulations

Lease Term and Options $35k per annum for 2 years rental with extended 2 year option available.

Option to purchase outright ($1 million) or payments of $5,600 per month on a 20 year mortgage

$45k per annum rental with rent review at end of 1 year lease.

Option to purchase outright ($1.8 million) or payments of $9,000 per month on a 20 year mortgage 25% of property being utilised for business purposes. Can be claimed against mortgage payments as a personal tax offset. $25k annual mortgage would generate a $7.5k personal tax offset.

Task 5. Legal considerations BLIS

You must now determine the legislative and regulatory obligations to establish and maintain the business according to your selected structure, location and environment.

Conduct a Business License Information Search (BLIS) https://ablis.business.gov.au/ for your business and location, to help identify the legislation, permits and codes you will need to abide by. Attach your BLIS Report as an appendix to your assessment.

Complete the table (Task 5) in the Appendix template for each relevant area of compliance and address all licence and permit requirements identified in the search and any others you feel are relevant. Also identify any Codes of Practice which may apply to your business.

In the How compliance will be met and monitored column you must outline procedures to make sure the business complies. You must clearly explain how the compliance requirement can be met, as well as, a monitoring procedure to ensure compliance. Dot point the compliance issues that require legal advice and where this legal advice might be obtained.

Further information on legal essentials for business can be found at the link below.

https://business.gov.au/planning/new-businesses/legal-essentials-for-business

Task 6. Taxation

You are required to identify the taxation requirements relevant to the business.

In the table (Task 6) in the Appendix template, identify the relevant legislation for each of the kinds of tax listed, and then explain the procedures required to ensure the business is taxation compliant.

Relevant procedures should include procedures for:

collecting and storing information (while abiding by all relevant legislation such as privacy, etc.),

meeting timeframes for submitting documentation and payments (quarterly BAS payments, annual income statements, etc.).

Task 7. Identify and maintain legal documents

You are required to identify the legal documents required in the operation of the business and the procedures to be used for secure storage, accessibility and maintaining currency.

In the table (Task 7) in the Appendix template, identify the documents required for each of the listed areas of compliance, then identify a method of storage (either electronic or physical) for each, based on the documents information sensitivity.

As some of these documents will require regular checking and updating, describe procedures to ensure currency. These processes should align with the needs of the business, and be feasible and efficient.

Task 8. Risk Management

You are required to conduct a risk management assessment for three different risks specific to your business.

In the table (Task 8) in the Appendix template, identify, assess and prioritise these risks in accordance with highest probability of occurrence and greatest negative impact on the business and describe management strategies. For example, a default on a payment is of greater risk to a business than an earthquake or pandemic.

You can include the purchasing of insurance as a management strategy, Task 9 investigates insurances in more detail.

Task 9. Insurance

You are required to document three insurances that you would take out to help manage risks within your business. You are to explain the risk to the business and/or staff covered and how this is negated or lessened by each of the nominated types of insurance.

Research online and provide a reference or web link for cost estimations on the three levels or types of cover you would purchase and an analysis on whether the insurance is worth purchasing or is the risk involved acceptable to be covered internally by the business and what other strategy could be used to reduce the risks.

Part 2: Assessment Checklist

The students copy of the Assessment Checklist will be used by you to capture evidence of their performance in any type of project. This checklist outlines all the required criteria you will be marking the student on. All criteria described in the Assessment Checklist must be met. The following checklist contains benchmark responses for you to use when assessing to ensure reliability of judgement.

Table 3 Assessment Checklist

Task Instructions S U/S Assessor Comments

1 Outline of type of buiness

2 Business structure

3 Staffing and Industrial Reations

4 Business Premises

5 Legal consideriations

6 Taxation

7 Identify and maintain legal documents

8 Risk Management.

9 Insurance

Part 3: Assessment Feedback

NOTE: This section must have the assessor signature and student signature to complete the feedback.

Assessment outcome

Satisfactory

Unsatisfactory

Assessor Feedback

Was the assessment event successfully completed?

If no, was the resubmission/re-assessment successfully completed?

Was reasonable adjustment in place for this assessment event?If yes, ensure it is detailed on the assessment document.

Comments:

Assessor name, signature and date:

Student acknowledgement of assessment outcome

Would you like to make any comments about this assessment?

Student name, signature and date

NOTE: Make sure you have written your name at the bottom of each page of your submission before attaching the cover sheet and submitting to your assessor for marking.

Appendix A: Report Template

1. Introduction

2. Business Structure Structure Advantages Disadvantages

3. Staffing

Worker Role and Skills offered Legal requirements of employment to be met

4. Business Premises

5. Legal considerations BLIS Area of compliance Description of activity relevant to the business Relevant Legislation/ Regulation Business responsibilities How compliance will be met and monitored in my business?

Example 1: Other Using music during boot camp training sessions Copyright Act 1968 Australian Government

Copyright Regulations 2017 Australian Government Need a current Background Music Licence issued by OneMusic Australia. This allows the business to play copyrighted music in the background at my business. Apply for a licence through OneMusic Australia (www.onemusic.com.au), the fee is about $1500 for 12 months and can be paid quarterly.

In order to make sure the business remains compliant the licence needs to remain current. To ensure we dont forget a payment, I will add reminders to the business calendar, additionally I have requested a recurring direct debit to be made from the business account to cover this payment. The reminder in the calendar will be a prompt to check that there are funds in the account to make the payment.

Planning (environment) Business Registration Industrial Relations Human Resources WHS

Consumer Protection (Supply of goods and services) Other

6. Taxation

Taxation requirement Relevant legislation Relevant procedures to follow to ensure compliance.

Tax GST Tax PAYG Tax Payroll Superannuation guarantee

TFN Registration

7. Identify and maintain legal documents

Legal area Relevant legal documents Secure Storage option (Original and Electronic) Procedure for maintaining and updating

Business Registrations Example: Registration of Business Name. Australian Business Number (ABN) or Australian Company Number (ACN). Original in frame on wall of office.

Electronic cloud storage password protected. 23/3/2020 new registration valid for 3 years. Needs renewal by 23/3/2023. Calendar reminder set for 23/2/2022.

Consumer Law Records Contracts Employment Records Other

8. Risk Management

Risks (Internal) Likelihood Consequence Priority for treatment Management strategies

Describe the risk and potential impact to your business Highly Likely, Likely, Unlikely. Highly Unlikely High, Medium, Low Combine Likelihood and Consequence to determine Priority. For example Highly Likely and High would be High priority, Unlikely and Low would be Low priority. Outline the things you can do to minimise the risk from occurring. Or minimise the severity of the consequences.

9. Insurance