Business Practice Report: Birchfield Ltd Compliance Requirements

This report provides a comprehensive analysis of the internal and external compliance requirements for Birchfield Ltd, a coal mining company in New Zealand. The report begins with an executive summary highlighting key compliance areas, including health and safety, data protection, and financial reporting. The introduction emphasizes the importance of compliance and provides background information on Birchfield Coal Mines. The report then delves into internal compliance, focusing on health and safety regulations, hazardous substance management, and the use of safe equipment, with reference to relevant legislation such as the Health and Safety at Work Act 2016 and the Hazardous Substances and New Organisms Act 1996. An internal compliance issue regarding the need for updated security information is also discussed, along with the impact of non-compliance and recommendations for improvement. The report further examines external compliance, covering industry-specific requirements such as adherence to the Crown Minerals Act 1991 and the submission of annual reports, including the implications of the Coal Mines Act 1979. The report concludes by summarizing the key findings and emphasizing the importance of compliance for the operational success of Birchfield Coal Mines. References are provided to support the analysis and recommendations.

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Executive Summary
The entire piece of the report highlights on the internal and external compliance requirements in
the context of Birchfield ltd. Birchfield is a popular coal mining industry of New Zealand. Health
and safety of the labor during the mining is a major internal compliance requirement for such
industry. For this reason, Health and Safety Act should be followed by this organization. The
arrangement of the safety equipment is another internal compliance. However, this organization
has faced an issue in order to update the security information. Hence, it is important for such
organization to protect the data of the organization. Submission of the annual report and the
franchise tax are the major external compliance requirement. Therefore, compliance with the
environmental law should be done by this firm to avoid the legal restriction in their business.

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Table of Contents
I. Introduction..................................................................................................................................4
A. Importance of Compliance......................................................................................................4
B. Business background...............................................................................................................4
II Internal compliance......................................................................................................................5
A. Internal industry compliance requirements.............................................................................5
B. Internal compliance issue........................................................................................................7
III External Compliance..................................................................................................................9
A. External industry compliance requirements...........................................................................9
B. External Compliance issue....................................................................................................11
Conclusion.....................................................................................................................................13
References......................................................................................................................................14

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I.Introduction
A. Importance of Compliance
Compliance can be defined as the state in which it is necessary to work accordance with the
established rules and guidelines. Compliance in context of an industry means to abide by the set
industry regulation and government legislation.Compliance with the government rules and
regulation is crucial for a firm in order to operate the business legally. Company transactions,
safety procedures, and labor practices are the vital components of the compliance. An
organization should know about the proper rules and regulation of the industry otherwise the
business might be affected (Yakovleva, 2017). Internal and external are the two types of
compliances. However, the internal compliance ensures that a firm is running the business with
full integrity and is free from corruptions. External compliance focuses on the environment in
which the business is running. Various reprimands are considered as the internal compliance and
government issues restrictions on noncompliance in external environment.Noncompliance may
cause operational risk in an organization. This study deals with the compliance nature of
Birchfield Coal Mining firm that is situated in New Zealand.
B. Business background
Birchfield Coal Mines is a well-known coal mining industry in New Zealand. This
organization extracts coal from Rotokohu coal measures, which is situated near the Giles Creek
basin. Such coal is sub-bituminous and contains low in Sulphur. Birchfield Coal Mines is a
private company and is owned by a family. The director of this organization has established their
business on the West Coast. In 1984 this organization is established their infrastructure in order
to extract and process the coal. Their coal product is cleanest burning coals and popular in the

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energy market. The fine clean ash does not burn the chimney. Their coal product contains higher
heat value and faster burning feature. BirchfieldCoal Mines supplies their coal to dairy, meat,
horticulture and wood processing and service industries. They try to comply with the rules and
regulation of the government as well as the industry (Birchfieldcoal, 2017).
IIInternal compliance
A. Internal industry compliance requirements
Internal Compliance requirement
Internal compliance of the mining industry includes health safety of the worker during
their work. The company needs to follow three major internal compliances that in their mining
fields. Health and safety is a big issue for the mining industry that needs to be carried out by the
organization (Murray, Peetz, &Muurlink, 2017).It is essential for the workers to comply with the
organizational policies during their work to get compensation for any work-related injury.
Defining hazards substances is an internal compliance for the mining industry. It is vital, as the
miners of the company should be well informed about these substances. Use of latest and safe
equipment is another vital requirement of the internal compliance in the coal-mining factory
(Reveley& Singleton, 2017).
According to health and safety compliance, the company needs to maintain standards like
first aid, protective equipments, ventilations and precautions against dust, explosions and
others.Suchstandards of the company fall under Health and Safety at Work Regulations Act
2016.Health and Safety at Work Regulations Act 2016 is a crucial law of New Zealand.
According to this legislation, it is crucial for the company to maintain the health safety of the

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worker during the coal mining. Compliance with these internal codes, policies and the practices
is important for the company.
According to the compliance with the Hazardous Substances the company needs to
maintain a limit in exerting harmful and toxic substances in the environment.Noncompliance
with this policy may affect the employees badly by affecting their health (Fang, Zhang& Li,
2017). Hazardous Substances and New Organisms Act 1996 is the desired legislation that is
responsible to reduce the hazards substances in the coalmines(Worksafe, 2017).
Lastly, keeping safe equipment in the mines for the miners is essential to making the
mining process faster and facilitating the miners to do their job effectively. The company should
carry out regular equipment check to make the mining process proper and reliable. Mine Safety
and Health Administration is an agency responsible for carrying out the necessary steps towards
maintaining safe equipments in the Birchfield Mines.
In the context of Birchfield Coal Mines, such three internal compliances are necessary to
minimize the operational risk. However, safety equipment is mandatory for the coal mining
industry in order to comply with the internal requirements.
Application of the internal compliance in the context of Birchfield ltd.
Implementation of the framework to comply with the internal legal requirements is
necessary for Birchfield Coal Mines(Yakovleva, 2017). Health and safety is the major internal
compliance in the context of Birchfield Coal Mines. Health and Safety at Work Act 2016 will
help the organization to ensure safety requirements of labors in Birchfield mines.

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On the other hand, defining the hazardous substances in the Birchfield Mines is another
compliance that the company needs to follow. In order to comply with this requirement,
Brichfield needs to follow the principles of Hazards Substance and New Organisms Act 1996.
Birchfield Coal Mines should research about the hazardous substances that may result from their
mining activities and take necessary precautions to reduce the effect on the miners as well as on
the environment.
Compliance from the company’s end also include the maintenance of safe equipments for
the miners. Safe equipments and their usage should be taught to the new miners through training
to reduce their effects. Mine Safety and Health Administration agency will help the company to
guide and formulate safe equipments in their mines.
Application of such Act within the organization will enable the miners to remove the
hazards and keep them safe during the coal mining (Clapcott, Goodwin& Harding, 2016).
B. Internal compliance issue
Analysis of the issue
Keeping the updated record of the business operation is an important and new internal
requirement for the mining industry (Wright, Belmer& Davies, 2017). The security update is
mandatory for Birchfield Coal Mines such as well-protected mines, data maintenance and
offering security to the employee. However, this organization has fulfilled this requirement
partially but not completely that is a big issue for this organization. It is important for Birchfield
Coal Mines that their employees should be fully equipped with proper information of security.
For this reason update, security information is required that is not done properly by this

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organization. The firm to update the security information should follow data Protection Act
2017.
Impact of lack of security onBirchfieldCoal Mines
Lacking the updated security information may affect the business of the Birchfield Coal Mines.
Such effect can be severe for the organization as this will affect the safety law of their mining
operation (Lu, et al., 2017).In order to update the security information, the organization should
disseminate the information while hiring. This is because the new hires will readily get to know
about the security policies of the company at the time of entrants. Old employees can be
informed through meetings and trainings. However, if the employees are not updated with the
security information then the operation process using new technologies will be hampered.
Breach of the information can occur in Birchfield mining industry, which may affect the entire
business operation. On the other hand, breach of the information may disseminate the company
information that will increase the competition in the market for Birchfield.
Recommendations
Password protection: In order to maintain the security password protection is necessary for
Birchfield Coal Mines. This will enable to protect their company information and to comply with
the security in the information update system that is a crucial internal compliance.The agency
that would help Birchfield to implement password protection in their information system is
Standards New Zealand.
Audit via external agency: Involvement of the external agencies to ensure the safety and
security of the mining operation in the context of Birchfield Coal Mines is essential. Secure
Systems Ltd. is one of the important external agencies of New Zealand that carries out the

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inspection process to ensure the safety and the security of the operation process of the mining
industries. Involvement of such audit agency in the safety and security assurance process will be
beneficial for BirchfieldCoal Mines.
The response of the employees during the emergency: The employees of Birchfield should
respond during time of emergency such as failure in the usage of certain equipments, sudden
deteriorating health of a miner and others. In a mining industry, an emergency can come during
the technical operation and field operation. Thus the employees of the organization should
respond to any operational risk including security and safety. They should inform such situation
to the higher authority or take up sudden step by themselves in severe cases.
III External Compliance
A.External industry compliance requirements
Description of the compliance
Types of the miningthat can be permitted in a region are the basic external compliance
for the mining industry (Liu, et al., 2017).This is because, in every area, similar types of mining
cannot be done. Thus, it is important for Birchfield Coal Mines to follow Crown Minerals Act
1991 and the minerals program that is The Minerals 2013. These two programs are associated
with the detection of types of mining based on area.
Submission of the annual report of the business is another external requirement for the
mining industry (Vasin, Kozyreva&Tyuleneva, 2017). This annual report should be submitted to
the state government. In the context of Birchfield, their annual report should be submitted to the
New Zealand government. Annual reports help the state to determine the condition of a mining

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company and the chances of growth it has in future. Coal Mines Act 1979 can be followed to
implement such compliance system.
In order to carry out the business in New Zealand, franchise tax should be given by the
mining factory to the government (Hofmann, Burke, & Zohar, 2017). Franchise Tax is a tax that
a company needs to give to the state government for running their business organization in that
state.This can be done by following the principles of Coal Mines Act 1979. New Zealand
government uses different formulas for the franchise tax in the context of different mining
industries.
Application of the compliance requirements in context of Birchfield
Mining is based on the different types of permits under the Crown Minerals Act 1991 and
Minerals Act 2013 (Valluru, Dekker& Rae, 2017). In the context of Birchfield, it is important to
follow Crown Minerals Act 1991 to mine the minerals. For this organization, mining permit is
required as it provides right to the permit holder to mine for the minerals specific for their
business such as for coal. Thus, mining permits are given to this organization according to this
Act.
According to the Coal Mining Act 1979, the annual report of the mining industry should
be submitted to get the green signal from the government (Oliveira, Camanho, &Zanella,
2017).Depending on the report the government will advice the company to carry out their
operations. In the context of Birchfield, this organization needs to show their annual operation
report to the New Zealand government to get the license for mining in this country. Based on the
annual report the government will allow such organization for further operation in this particular
country.

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The company needs to give franchise tax to the government to carry out their business
without any legal obstruction (Salvioni, Gennari&Bosetti, 2016). Tax is a big part of any
business as it allows the government to give legal permission to a business owner to carry their
business. Birchfield Coal Mines and its partners should volunteer themselves in the Filing
Compliance Agreement of their state and disclose all their files by making full payment that they
are liable for. In the context of Birchfield, they need to follow Coal Mining Act 1979 in order to
understand the government rules regarding the mining in New Zealand. However, for a coal
mining factory it is essential to give the tax to the government within a scheduled time otherwise
the operation can be forced to stop due to legal restriction.
B. External Compliance issue
Evaluation of a critical external compliance
Lack of environmental sustainability is the main issue of the mining industry because
waste coming from the mining industry affects the environment (Clapcott, Goodwin& Harding,
2016).Having a state of environmental sustainability in the mining plant is another important
external compliance for the company.Thus it is necessary forBirchfield Coal Mines to comply
with the appropriate environmental law before conducting exploring and drilling activities in the
soil. However, the research activities in the context of minerals are taken under the exclusive
economic areas. It is mandatory for the mining factories to comply with Environmental or
Exclusive economic zone and Continental Shelf Act 2012. Thus, non-compliance with
environmental monitoring could lead Birchfield to face the issue in future. Some of the impacts
that the company will face due to non-compliance to sustainability are increasing diseases,
pollution, increased death rate and increased emission of harmful gases.

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Evaluation of the impacts of such external requirement
Non-compliance with the environmental law may force the business to change their
operational process (Oliveira, Camanho, &Zanella, 2017).In the recent years, the New Zealand
government focuses on the environmental protection from mining companies. Thus, for this
reason, Environmental or Exclusive economic zone and Continental Shelf Act 2012 needs to be
followed. However, if Birchfield will comply such environmental law then it can be beneficial
for this organization to carry out their business without any legal restriction. On the other hand,
people are more conscious about the environmental sustainability. Thus, non-compliance with
the environmental protection Act may affect the brand image of Birchfield. On the other hand,
lawful judgment can be made against Birchfield if they fail to maintain the environmental
sustainability Act. Therefore, the company assets may be considered as vulnerable, which affects
the business profitability. For controlling the situation the company and the government can take
certain steps such as:
 The company can make the employees sign a bond in which they will be deemed to
follow the compliance policies of the company
 Government can charge penalties from the company for not complying by the rules of the
states
 Government can also stop the operation of the mining firm for causing negative impact
on the environment and human resources
Recommendations
Analysis of risk: Risk analysis is an important factor to minimize the noncompliance with
government regulation. In the context of Birchfield, it will be effective for them to analyze the