FNSACC601: Tax Documentation for Legal Entities - ATO Statement Review

This FNSACC601 report provides an overview of tax documentation for legal entities, focusing on the Australian Taxation Office's (ATO) Corporate Management Practice Statement. The report summarizes the ATO's guidelines for dealing with taxation fraud, highlighting the importance of understanding the Commonwealth Fraud Control Guidelines 2002, the Prosecution Policy of the Commonwealth, and the Australian Government Investigation Standards. It also discusses the legal requirements related to taxation, reporting entities and non-reporting entities in Australia, along with compliance standards. Furthermore, it includes examples of internal and external fraud cases, illustrating the practical implications of tax fraud. This document is available on Desklib, a platform offering a range of study tools and resources for students.

Running head: DIPLOMA IN ACCOUNTING
Diploma in Accounting
Name of the Student
Name of the University
Author’s Note

1DIPLOMA IN ACCOUNTING
Table of Contents
Assessment Task 1...........................................................................................................................2
Answer to Question 1..................................................................................................................2
Answer to Question 2..................................................................................................................2
Answer to Question 3..................................................................................................................2
Answer to Question 4..................................................................................................................3
Answer to Question 5..................................................................................................................3
Answer to Question 6..................................................................................................................3
Answer to Question 7..................................................................................................................3
Answer to Question 8..................................................................................................................4
References........................................................................................................................................5

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Assessment Task 1
Answer to Question 1
There is a jurisdiction under Federal Government of Australia to impose tax on the
income of the Australian based on worldwide sources and non-residents of Australia. Thus, the
Australians are needed to pay tax on income, capital gains, business entities, individuals,
consumption taxes and others. Some other taxes are levies are Fringe Benefit Tax (FBT),
Medicare Levy and Medicare Levy Surcharge, Superannuation Tax, Luxury car tax and others
(hallandwilcox.com.au 2018).
Answer to Question 2
Reporting entity is an entity where it can be expected that the users have the dependency
on the general purpose financial reports for gaining understanding about the financial position
and performance of the entity (aasb.gov.au 2018).
Non-reporting entities are the entities where it is determined that there is not any user
who depend on the general purpose financial reports of the company.
Answer to Question 3
The reporting entities of Australia are needed to comply with the regulations and
legislations of ASIC Corporations (Disclosing Entities) Instrument 2016/190 for the purpose of
documentation. At the same time, the reporting entities are also needed to get them registered
Federal Register of Legislation. The instrument is under subsection 341(1) of the Corporations
Act 2001 (legislation.gov.au 2018).

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Answer to Question 4
For the purpose of documentation, the non-reporting enteritis are needed to comply with
certain standards like paragraph 13 of accounting standard AASB 101 ‘Presentation of Financial
Statement’, paragraph 25 of AASB 101, paragraph 10 and 11 of AASB 108 ‘Accounting
Policies, Changes in Accounting Estimates and Errors’, AASB 132 ‘Financial Instruments:
Disclosure and Presentation’ and others (download.asic.gov.au 2018).
Answer to Question 5
The taxation parameters for the preparation of tax return are the basics like tax file
number, band details; details of income and expenses like payment summaries, details of interest
received, pension details, details of gifts, donations and others; investment details like payment
of dividend, gains or losses from the disposal of shares; details of rental properties like rental
income earned, interest charged and others (ato.gov.au 2018).
Answer to Question 6
The main purposes of Corporate Management Practice Statements are active management
of fraud risk; promotion of understanding about Commonwealth Fraud Control Guidelines 2002,
the Prosecution Policy of the Commonwealth and the Australian Government Investigation
Standards; development of framework for Fraud Control Plan; description of the referral
processes for fraud; providing employees with the guidelines for understanding fraud and others
(accountantsdesktop.com.au 2018).
Answer to Question 7
In case of internal fraud, the case of Obayedul Hoque, the owner of Subway Franchisee
and Gas Station can be mentioned. For the years from 2008 to 2013, the point of sales from

4DIPLOMA IN ACCOUNTING
Subway franchisee was $20,805,667. However, Obayedul Hoque and his staffs did manipulation
with the sales figures for the purpose of tax return. This is a major case of internal fraud (irs.gov
2018).
Answer to Question 8
In case of external frauds, the case of Baldev Tal, aka David Tal can be presented who
was sentenced to 3 years of jail for conspiring bank fraud. David Tal along with his other
companions obtained several loans and lines of credits from banks by providing false
information about income, assets and others. This is a major case of external fraud (irs.gov
2018).

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References
Aasb.gov.au. (2018). Definition of the Reporting Entity. [online] Available at:
http://www.aasb.gov.au/admin/file/content102/c3/SAC1_8-90_2001V.pdf [Accessed 19 Jul.
2018].
Accountantsdesktop.com.au. (2018). CORPORATE MANAGEMENT PRACTICE STATEMENT.
[online] Available at:
http://www.accountantsdesktop.com.au/wp-content/uploads/2012/08/ComplianceFraudControlA
ndProsecutions.pdf [Accessed 19 Jul. 2018].
Ato.gov.au. (2018). Tax time checklist. [online] Available at:
https://www.ato.gov.au/Individuals/Tax-Return/2013/Completing-your-return/Helpful-
information-about-tax-returns/Tax-time-checklist/ [Accessed 19 Jul. 2018].
Download.asic.gov.au. (2018). Reporting requirements for non-reporting entities. [online]
Available at: http://download.asic.gov.au/media/1239893/rg85.pdf [Accessed 19 Jul. 2018].
Hall & Wilcox. (2017). A Guide to Taxation in Australia - Hall & Wilcox. [online] Available at:
https://hallandwilcox.com.au/a-guide-to-taxation-in-australia/ [Accessed 19 Jul. 2018].
Irs.gov. (2018). Examples of General Tax Fraud Investigations Fiscal Year 2016 | Internal
Revenue Service. [online] Available at:
https://www.irs.gov/compliance/criminal-investigation/examples-of-general-tax-fraud-
investigations-fiscal-year-2016 [Accessed 19 Jul. 2018].

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Legislation.gov.au. (2018). ASIC Corporations (Disclosing Entities) Instrument 2016/190 .
[online] Available at: https://www.legislation.gov.au/Details/F2016L01328 [Accessed 19 Jul.
2018].