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Superannuation and Retirement Planning - Assignment

   

Added on  2021-06-17

9 Pages2369 Words23 Views
FINANCIAL ACCOUNTINGFACTORS TO BE CONSIDERED BEFORE PLACING SUPERANNUATIONCONTRIBUTION IN DEFINED BENEFIT PLAN OR INVESTMENT CHOICE OF PLAN INAUSTRALIANameCourse: Professors NameInstitutionCityDate

FINANCIAL ACCOUNTINGSuperannuation plan is an Australian scheme organized and managed by the government to see into it that its citizens save and pull funds for future income redemption upon retirement. This accumulation of funds by the persons offering services in Australia is deemed compulsory and every employee in service is mandated by the government to contribute to this scheme. Tertiary employees are regulated by the Australian labor laws that see into it that all tertiary employees are enrolled in a defined benefit plan while others get into an investment choice plan.Australian government likewise have set rules and regulations that ensure both the interest of the contributor or rather the tertiary employee in our case and that of the scheme firm are equally protected but more so on contributor whereby they seem to take caution of the contributors future by making the contribution compulsory. The same government has been seen to be strict on this to the extent of even imposing and introducing taxes on any activity or process that tend to negatively affect this activity of saving for future fund investment.Superannuation contribution by the tertiary employees currently stands at the rate of between 8% to 9.5%. This percentage contribution portions from employees income are what is deemed compulsory such that employers on behalf of the scheme are tasked and obligated by thestate to contribute to the scheme the portion of the employee income during the payment period without fail. The employers and the superannuation contribution agents are likewise expected to urge encourage and lobby to sacrifice and contribute more than the minimum rate portion for their own good. They need to voluntarily top up their contribution an amount higher than the minimum rate expected. Ideally, this contribution to defined benefit plan or investment choice plan is a mechanism of caring for the future plan by the state so as to ensure that its citizens do not strain in future especially during retirement. Defined benefit scheme involves many parties and the core protagonist who is money thus raising the issue of trust and decision making aspect. It should be agreed that this scheme is

FINANCIAL ACCOUNTINGas similar to any investment such that just as one has to evaluate and examine the overhaul process before investing the same approach is likewise expected here. Tertiary employees are therefore expected to have contempt in the scheme they engage with so as to confidently be contributing this amount with ado.This room of allowing contributor weighs option and chooses the best option that suits their interest is a great show of independence and legitimacy. This choice of making own decision on where to place one's superannuation as well as government intervention through tax office has seen to it that interest of the contributor is protected as well asreduction of conflict of interest between the scheme, employer and employee is controlled . All tertiary employees, as well as any other persons willing to save with either defined benefit plan or investment choice plan, has to consider the following factors and consequences so as to be saved, contempt and assurance of the security of the funds invested.This choice is optional whereby one can decide to choose that he deems suitable or if not aware which to choose he can opt to consider enquiring or using the employer or the Australian Tax Office to provide list and advice on the best option to consider. Therefore the superannuation regulation expects the employer and the tax office to be as sincere as it can be when advising free from favors or criticism so as to create satisfaction to the contributors. All information concerning the superannuation fund should be accessed via the company website, brochure, magazines as well as via tax office department at the convenience of the contributor.The following below factors is that which is expected to be factored and sieved appropriately and wisely when making decision on where to save pension funds; For example in case the employer is the one choosing the scheme for the contributor, the latter is therefore expected to figure out whether there is a legal agreement existing between the employer and the scheme fund firm PSM (2018.Pg 42.) The employee should get this info from the employer free of charge and at the most convenient means. If there exist legitimate agreement the contributor

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