Question

Identify and describe the key features of financial legislation covering taxable transactions and reporting requirements. Discuss in 180 to 220 words.

Please remember we not here to discuss Bills, because a Bill is draft law and therefore cannot be enforced!

We are here to discuss Acts. So please discuss Acts that have to do with financial legislation covering taxable transactions and reporting requirements.

(Please consider the Australian financial environment) (please type up your answer)

Answer 1

Legislation Aims to restrict TAX AVOIDANCE and to assist in the detection of crime and by preventing the laundering of money.

Three stages involved in money laundering

• Placement
• Layering
• Integration

​Financial Transactions Reports Act (1988)

1. Defines the type of transactions that are to be reported , the people who are to report them and the details of the transactions to be reported.
2. Defines a cash dealer to include:

• Financial Institutions
• Share Registrars
• Future Brokers
• Bullion Dealers
• A Body Corporate

Austrailian Financial Environment

Austrailia has long been sensitive to Global economic and financial trends. And this arrives from trade, investment and capital flows etc.. In Austrailia, low interest rates have also contributed to strong growth in household debt and housing prices in small open advanced economies.

Annual Financial Statement are prepared by all entities except small proprietary companies.

Financial Statements consist of Balance sheet , Profit and Loss statement , Cash Flow Statement.

Matters to be disclosed in the Financial Statements are contained in Accounting Standards which are made by Austrailian Accounting Standard Board(AASB).And these annual financial statements must be circulated to members of the entity and must be lodged with the Austrailian Securities and Investments Commission (ASIC).