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Legal Requirements for a Small Business - Assignment Example

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The paper "Legal Requirements for a Small Business" is a wonderful example of an assignment on business. Describe the nature of your current proposed business and state whether it is intended to be a profit or for no profit. The intended business is a cake making business that will be supplied to local restaurants, cafes, and hotels and schools…
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Topic: legal Requirements for a Small Business Name: Registration No: Institution: Name of Professor: Date of Submission: Assessment Activity 1 1. Describe the nature of your current proposed business and state whether it is intended to be a profit or for no profit. The intended business is a cake making business that will be supplied to local restaurants, cafes, and hotels and schools. The business is a profit organization because the sales are expected to be higher than the costs of sales so that employees of the business can be employed and the owner can get a profit margin. 2. What are some of the sources you could use to obtain information about the appropriate legal structure for a new business? How could you categorize them? The category below is based on the level of importance starting with the most important. i. Government ministries ii. Law firms iii. Individual layers iv. Legal structure of a similar company. 3. Choose a new business which you might be interested in starting. Identify possible options for legal structure of the business. Which business models do you think is the most appropriate? Explain your choice. The business to be formed is a soft drinks manufacturing company and the structures options for the company include the following: i. Company structure: the company can be registered using this structure where the liability of members to the company is restricted to their shares in the company. When a company is registered, it becomes s legal entity and it can hold property and sue or be sued. ii. Incorporated association: the company can be incorporated under state laws that are based in various states or territories. When the two methods are compared, it is suggested that Company structure method should be followed because it will ensure the company is created differently from its members. Assessment Activity 2 1. Use the internet or local library to locate legislation, codes of practice or other regulatory measures which could have an impact on your current or proposed business. List the correct name of three Acts, codes or other regulatory measures. Reproduce one provision in each. Describe what each provision means i. Work safety act 2008: This is a law which ensures businesses comply with safety of workers at work place by putting measures which prevents injuries that might affect the employees. ii. Dangerous Substances Act 2004: States that measure should be taken with respect to risks as a result of dangerous substance use. iii. Trade practices Act (TPA): This is a federal law that deals with conditions that exist in market place such as unfair market activities, safety of products, charging the right prices and industry codes of practice. 2. Choose a business name. It might be one which you, or another entity, use, or one which you might like to use in future. Does the name comply with the business name registration guidelines in your state/ territory? Explain why or why not. An example of a business name in my knowledge is Cashbay Restaurant in Chicago. This is a business involved in provision of various types of strong drinks, soft drinks and meals as well as accommodation for long distance travelers. The business name is unique and does not copy the name of another business in the territory. This is in compliance with business name registration guidelines. 3. Why must business owners consider legislative requirements when developing appropriate procedures? This is because legislative requirements determine what activities businesses should be involved in as well as activities that they are prohibited to do. The law allows legislature to make such laws and businesses must comply with them (Campbell and Campbell 2009). If a business does not do so, there is a possibility that such a business can face legal actions such as fines or closures, thus affecting its activities. Assessment activity 3 1. Describe some of the systems you could use to ensure the legal rights and responsibilities of your small business are identified and the business is adequately protected. i. Certificate of operation or trade license: this will be an indication that I have complied with small business operation requirements of my country. ii. Business insurance: this will show that I have insured the business against any risk it might face iii. Tax payment information: I will ensure tax records of the business are kept and available when needed iv. Compliance to standards regulating quality assurance: this is where the products and services of my business will comply with the quality standards stated by regulatory bodies. 2. Describe some of the systems which you could put in place to allow you identify the WHS responsibilities of a business. i. As a business owner, I will ensure health and safety of employees at work place by ensuring employees are not subjected to conditions which can result into harm to their physical health ii. If my business is involved in the use of machinery, I will ensure the company puts safety measures which prevents injuries to employees while using them iii. I will also ensure there are a number of safety measures available at the workshop in case of accidents such as fire extinguisher and first aid kits iv. Employees will also be provided with training and instruction on how to use facilities with care so that they do not cause injuries while using them Assessment Activity 4 1. Undertake your own research to find out why you might need a tax file number. Categorize these reasons into those which will have an impact on individuals and those which will have an impact on businesses. Those which have impacts on individuals i. To enable easy location of files ii. To prevent errors while storing or retrieval of information in the files Those which have impacts on businesses i. To enable businesses classify files based on types of files kept ii. To enable businesses ensure they make references for various activities with their clients 2. Analyze your current or proposed business and determine whether you will be liable to pay the goods and services tax. Provide reasons for your assessment. My current business is involved in the sales of soft drinks to the public in a local shop along a busy street. I will be able to pay taxes for the goods and services when I incur additional cost to the wholesale price of the drinks which I sell in my shop. Assessment Activity 5 1. List five legal documents and other records a business owner might be required to store. Trade license Quality compliance certificate Tax compliance certificate Trade mark certificate Contractual agreement forms 2. Analyze your current or proposed business. Where will you keep your legal and financial records so that they are organized and accessible but also secure from theft, fire or other damage? i. Steel cabinets: Ensures the documents are safe from fire and dampness ii. Cupboards: this keeps the documents safe from theft when they are locked iii. Chest of drawers: also keeps the documents safe from theft when it is locked. Assessment activity 7 1. Under what circumstances would you commence investigation to identify areas of non-compliance with legal and regulatory requirements? i. When the business is not registered to operate as a legal entity ii. When tax records of the business are not available iii. When the business is involved in the sale of a product or service that is prohibited by law 2. Describe some general guidelines for conducting investigations. i. The investigator should not destroy the property in a place where investigations are done ii. The investigator should conduct investigation with the aim of finding non compliance to the law which the owner of a premise has violated iii. The investigator must assume that the owner of the premise is not guilty until evidence is obtained to show that the owner of a premise has violated a law. 3. Explain ways in which you might categorize/classify a risk. Provide examples of categories you choose The causing agent. This is where risk is classified based on the contributing factor. An example is fire risk. Assessment Activity 8 1. Why should you seek legal advice on your contractual rights and obligations and to clarify business liabilities? i. It enables me understand the duties of the partner in the contract ii. It enables me understand my duties of care in the contract iii. It enables me understand implications of failure to comply with the requirements of the contract 2. Intelligent business owners do not need legal assistance prior to signing a contract. Critique this statement: This statement is not true because legal assistance provides additional knowledge about the rights of the business owners during the contract. Assessment Activity 9 1. Why is it important to investigate and assess products/ services which you intend to obtain from suppliers to determine procurement right? This ensures the buyer obtains the right goods from the supplier and also prevents the possibility of being provided with the goods that were not intended (Development 2013). It also ensures the right amount of goods and services are provided based on the agreements with the supplier. 2. Why is it important to consider granting licenses, claiming copyrights and/ registering trademarks or designs to ensure protection of your business interests? The importance of obtaining licenses is that it authenticates the products and services provided by a business. Trademarks act as a protection of the business against unhealthy competition such as the possibility of competitors using the business name to produce similar products (Fox 2013). In addition, it facilitates agreements with partners due to the fact that partners will account for intellectual property rights for manufactured products that are distributed by foreign partners. Furthermore, in order for a business to take part in fair exhibitions, it is subject to protection of its designs as a sign of protected innovative work so that novelty is not lost. 3. Explain how you could check whether or not a particular invention has been registered in Australia. It is possible to conduct an art search so that an invention can be found to have been patented or not. The invention to be patent has to be unique and if there is a similar product that has been patented, there is the possibility that it may affect your effort to patent the invention. Prior search can be carried out in patent databases, patent Cooperation Treaty databases or patents cope, literature, products, proprietary databases and the internet. 4. What is the difference between a patent and a trade mark? When would you use each? A patent is aimed at protecting an original invention of a product o ornamental design. An example of a patent is the patent for Steel kidney that was granted to Nils Alwall who invented the machine in 1946 (Steingold 2013). On the other hand, a trademark is aimed at protecting the words, name and symbols that distinguishes one source of goods and services from another. An example of a trademark is the symbol McDonalds which can only be used for products produced by McDonalds and not another company. Assessment Activity 10 1. Analyze your current or proposed business and describe the persons/ organizations you are likely to enter into commercial agreements with. They include: i. Banks which will be responsible for provision of loan services ii. Insurance companies for provision of insurance services iii. Transportation companies for provision of transport services iv. Auditing companies that audit the operations of the business 2. Why should you consider your business plan when negotiating and securing contractual procurement rights for the goods and services which you will use in your business? It ensures the terms of contract are aimed at achieving my business plan and I do not focus on activities that are not relevant to my business plan. Assessment activity 11 1. From where might you obtain information about insurance policies? Compose a list with what you consider to be the most useful source of information at the top and the least useful source of information at the bottom. Explain the choices you make i. Insurance companies ii. Government websites iii. Commercial banks iv. Published books v. Insurance brokers Insurance companies are the best because they are formed for exclusively providing insurance services to various risks that clients may be experiencing. Insurance brokers are least suitable for getting information because they may be involved in activities aimed at personal gains and may not be beneficial to the clients compared to other methods. 2. Choose one type of insurance. Use the internet and or other relevant source to research the different products which are available. What is the difference between them? An example of insurance is home owners insurance. This is the form of insurance which protects the home owner from loss of home or property within the home. 3. List the key points which you would expect to have included in a supply contract. Name of the supplier Quantity of goods supplied Signature of supplier Date of dispatch Terms of payment Terms of delivery Name and signature of the buyer 4. On what grounds is it illegal to discriminate against a person in the workplace? i. Discrimination on the basis of gender ii. Discrimination on the basis of race iii. Discrimination on the basis of ethnicity iv. Religious discrimination v. Discrimination on the basis of social class 5. What is a duty of care? It refers being held accountable for what happens at a particular time 6. What are rights and obligations afforded by a partnership? i. Right to take part I daily management of the business activities ii. Right to take part in decision making in matters affecting the business iii. Rights to access to books of accounts of the business iv. Right to share profits in the ratio that was agreed during the formation of the company v. Right to be indemnified with regards to payments or liabilities while protecting the business from losses vi. Right to continue participating in the partnership as long as the partner is willing. 7. What is the name of consumer legislation applicable to the state/territory in which you intend to operate your business? The legislation is that a business shall not take part in an activity that is destructive to the residents, vegetation and water bodies in the area in which it operates. 8. What is an industry code of practice and what are the aims of such codes? These refers to the regulations on what the business should not be involved in and the manner in which the industry should conduct its activities so that it does not violate national policies and regulations that control industrial activities. 9. Describe the differences between mandatory and optional insurances and give tow examples of each. Mandatory insurance is an insurance which is required by law of a particular country. Examples include motor vehicle insurance and business premises insurance. An optional insurance is a form of insurance that a person has the choice to get or not get and is not required by law so that a particular activity can be done. An example is life insurance and mortgage insurance. Assessment activity 12 1. What are some of the things you would consider when choosing business premises? Availability of security Nearness to transport and communication systems Ability of the premises to protect property from rain, strong winds and direct sunlight Availability of water and lighting. 2. Consider your current or proposed business. Using appropriate sources such as the internet or newspapers, locate option for leasing suitable business premises and one option for buying premises. Describe each option and state which best suits your needs. Explain your choice. The business to be set up is a roads construction and repair company. In the leasing option, the business will obtain a building with a spacious compound to act as a parking area for vehicles to be used in road construction and repair. When the lease period expires, the business stops operating and leaves the premises and the land. In the option of buying premises, the business pays for ownership of the buildings so that it becomes theirs in totality and when the business winds up, the premises still remain property of the business. The most suitable method of acquisition of premises is buying. This is because the business will own the property and thus it will become a private property that cannot be reclaimed by another person. I addition, the busyness will not incur additional costs such as rent when the strategy of buying is used. 3. List five key areas which should be addressed in a lease. i. Term: the lease should determine how long the leasing period should last ii. Repair: it should determine who will participate in repairs and should determine areas of the premises that are considered worn out and who should repair them. iii. Insurance: the lease should state the risks that the premises need to be insured with as well as state whether the landlord or the tenant should be responsible for insurance. iv. Alterations: the lease should state the landlord’s consent to alter the premises to suit the operations of a business. v. Alienation of the premises: this is the freedom to allow the use of the building to a third party. The owner of the building must state whether a third party is allowed to use the building premises. Summary This paper explains the forms of risks that a businessman needs to protect his business from and the procedures to be followed in order to protect their organizations from various forms of risks. The paper explains how legal procedures should be followed when conducting a small business such as the relationship between the business and law firms, government bodies and legal institutions. It also explains that there are legal structures that affect the performance of a business and each business must be aware of them. In addition, the paper explains acts that determine a business should be conducted. For instance, the booklet explains registration requirements that a business must comply with. There are also WHS measures that must be accounted for during the operation of a business. The acts and codes of practice are also explained in the booklet. In addition the booklet explains a number of filing systems which can be effective in ensuring its records are kept safely and methods in which the files can be stored so that they cannot be easily stolen or destroyed by fire. It also explains the legal documents that a business must ensure it keeps so that its operations are authenticated such as trade license, contractual agreement forms and tax compliance forms. This booklet also explains a number of implications that can result if a business does not comply with legal requirements of conducting a similar business in a particular region. The booklet also explains the need to seek legal rights when entering into contracts and the benefits that a business owner can get when this is done. The booklet also shows that rights such as patent rights, trademarks and copyrights are issues that a business owner must comply with so that his business is regarded as the authorized producer of a particular product or service. This is because failure to do this, the products or services that have been invented by a person can be patented by a competitor, thus putting the business at risk of losing ownership of its inventions. In addition, the booklet shows that a business must comply with trademark registration requirements so that is acquires a trademark and competitors do not design their products and services using the names of the business. There are also a number of sources of information that a business man can use to get information about legal requirements of a business. The booklet explains the role of insurance companies, government bodies, commercial banks and published materials as sources of information for legal rights when conducting a small business. There are also various methods of property acquisition that can be used by a business to acquire property. The booklet explains the processes of leasing and buying as methods that can be useful for a business to acquire premises. References Campbell, D., & Campbell, C. T. 2009. Legal aspects of doing business in North America. Salzburg, Austria: Yorkhill Law Publishing. Development, O. E. C. 2013. SME Policy Index: Progress in the Implementation of the Small Business Act for Europe. Paris: OECD Pub. Fox, R. (2013). Tax strategies for the small business owner: Reduce your taxes and fatten your profits. S.l.: Apress. Steingold, F. S. 2013. Legal guide for starting & running a small business. Berkeley, Calif: Nolo. Read More
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