FNSORG506 Assessment 3: Financial Codes, Compliance, and Policies

This document provides detailed answers to an FNSORG506 assessment, focusing on financial codes of practice and related compliance requirements. The assignment defines key terms such as 'Code of Practice' and 'Conflict of Interest', and explores the matters covered under financial codes, including internal steps for businesses to maintain compliance. It covers topics like company purchasing policies, variables impacting forecasted profits, and break-even analysis. Furthermore, the assignment delves into legislation such as the AML/CTF Act, the TPA, and other common company policies. Other topics include the Goods Act, legal terms like 'Appeal', and the discussion of various legislation and codes of practice such as Duty of Care, Company Law, Contract Law, Environmental Law, Freedom of Information and Industrial Relations Law. This resource is designed to help students understand and excel in their finance-related coursework.

Assessment Resource | FNSORG506
ASSESSMENT 3 – WRITTEN ASSESSMENT / PROJECT
Student Instructions
 Ask your assessor if you do not understand a question. Whist your assessor cannot tell you the answer, he/she
may be able to re-word the question for you
 Re-assessment: If you do not achieve the required standard, you will be given the opportunity to be re-assessed by
our Assessor. Arrangements will be made on an individual basis.
 Feedback: Your assessor will provide feedback to students after the completion of the assessment. The trainer
assessor will explain the appeals process.
Questions
1 Define the term CODE OF PRACTICE
Code of practice implies for the systematic and comprehensive compilation of laws, rules and
regulations which in turn consolidated & classified as per the subject matter.
2 List 3 matters covered in the financial code of practice.
Under financial code of practice, specifically 3 matters are covered such as:
 General Insurance Brokers Code of Practice
 Financial Planning Code of Ethics and Professional Conduct
 Code of Practice for Advising, Selling and Complaints Handling in the Life Insurance Industry
 Code of Banking Practice

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3 What internal steps do businesses need to undertake to maintain compliance with financial
codes of practice?
For maintaining compliance with financial code of practice business unit should undertake following
internal steps:
 Emphasis needs to be placed on understanding the same
 Assessing own business practices
 Co-ordinating business activities with code of practices
4 What constitutes conflict of interest?
Conflict of interest refers to the situation where a person or business unit is involved in multiple
interest financial or non-financial.
5 Discuss ways in which conflict of interest can be mitigated
Through assessing alternative course of action in relation to performing activities and by
creating an effectual culture issue pertaining to conflict of interest can easily be mitigated.

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6 Discuss company purchasing policy. Give examples as to what specific policies can be put in
place to protect the company.
By using economic order quantity method concerned unit can protect itself from undesirable
expenses such as holding and ordering cost. Using such purchasing policy company can manage
both expenses and profit margin.
7 List the 4 main variables that impact on forecasted profits
Four variables that have an impact on forecasted profit margin are as follows:
 Taxes
 Debt
 Capital
 Distribution or State of the economy & industry
8 What is the break even analysis? How is it calculated
Break even analysis is the most effectual tool of management accounting which in turn assist in
identifying the situation of no profit no loss. It can be calculated or assessed through using the
following formula:
BEP (in Units): Fixed cost / contribution
BEP (in figures): Break even units * selling price per unit

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9 What is the AML / CTF Act?
The Anti-Money Laundering and Counter-Terrorism Financing Act 2006 includes financial & gambling
sector, bullion dealers and other professionals who offer services that covered by such Act. Such Act
is highly effective from the perspective of international best practice that deters activities like money
laundering and terrorism financing to a great extent.
10 Give an example of an obligation imposed on reporting entities by the AML/CTF Act
Obligations under AML/CTF Act are as follows:
 Record keeping
 Customer identification and verification
 Enrolling and registering business with AUSTRAC
11  What is the TPA? What does this legislation cover?
Trade Practices Act (1974) may be presented as a legislative vehicle for competition law takes place
in Australia. Such Act promotes fair competition, fair trading and thereby offers protection for
customers.

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12 What are the stages of procedure writing?
13 What are the fundamental principles for a code of ethics?
Ethical code of practices include following aspects:
 Company should not perform activities that affect environment sustainability
 Compliance with all the legal and regulatory aspects
14 What is the goods act?

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Goods Act of Australia deals with the activities like purchasing and selling of products or services. In
Australia, all the business units are obliged to comply with such Act more effectually.
15 Define the legal term, “Appeal”
Appeal may be served as an application that is submitted to a higher court for reviewing the decision
or judgment given by lower courtyard or tribunal.
16 What are sanctions? Give an example
Australian sanction laws are introduced or enacted by Federal Parliament for taking action in
against to disobey of rule or law.
17 What is a deposition?

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In US, Australia and Canada, deposition is commonly used for litigation process or aspect. They are
usually conducted outside the court with the help of lawyers. In other words, it can be depicted that
under deposition there was the absence of judge for supervising examination.
18 Other than purchasing policy, list 4 other common company policies.
4 common policies of the business unit are as follows:
 Business unit will lay emphasis on approaching suppliers which grant credit for longer time
frame
 Less credit time or period will be offered to debtors
 Focus will be placed on maintaining 2:1 current ratio
 Ideal debt-equity ratio will be .5:1
19 Describe the following legislation / codes of practice

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Duty of Care
On the basis of such aspect, an individual is required to adhere with the standards of reasonable
care while carry out activities and functions.
Company Law
Legal structure of Australian Company law implies for single, national statue and Companies Act
2001. Contract laws which are followed in Australia are highly in line with the English legal system.
Contract Law
In Australia, contract laws are regulated by common legislation which in turn highly concerned with
the legal enforcement of promises. Hence, as per such law , for the development of legal
relationship or contract lawful enforcement of promises are highly required.

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Environmental Law
The Environment Protection and Biodiversity Conservation Act 1999 (EBPC) entails that when
anyone takes action which in turn has significant impact on environmental aspects, protected by such
Act, considered as an offence.
Freedom of Information
In Australia, Freedom of Information Act (1982) may be served as a legislation that offers right to the
members in relation to accessing official documents of the Government of the Commonwealth and of
its agencies.
Industrial relations law
Australian industrial relations law includes Fair Work Act (2009) that includes aspects
regarding safety, individual flexibility arrtangement and unlawful termination of employees.

Assessment Resource | FNSORG506