fnsbkpg401a - develop and implement policies and...

FNSBKG404A – Carry out business activity and instalment activity statement tasks

Student Assessment TaskStudent Name:Student Number:Student Signature: Date:Facilitator Name:

You are required to complete the following assessment tasks and ensure that any printouts of evidence is signed by yourself in the bottom right hand corner. The completed Assessment Tasks and any evidence must be provided to your facilitator in order to be assessed on the subject, and ultimately marked Competent.

What do I need to do? Read the Unit of Competency (Page 2) of this document. You may use the

Unit of Competency as a self checklist. The Unit of Competency details the elements and the performance criteria for this unit.

Part A (Page 4) of this document lists the Written (Questions and Answers) that must be completed as part of your assessment.

Part B (Page 20) of this document lists the Practical Exercise/Evidence that must be completed as part of your assessment.

Part C (Page 22) of this document refers to observation by the assessor on the learner’s competence in that element and/or unit. If applicable, the checklist should be used by the assessor in the workplace, else the observation needs to be conducted in a simulated environment and supported by an employer or supervisor. See Part D, 3rd Party Observation

If applicable, Part D (Page 24) of this document refers to 3rd Party observation. Ensure all contact details are correct and instructions are followed.

Part E (Page 25) of this document refers to Outcome. Please ensure you have provided your name, signature and date that you are submitting this Assessment Tool, and that any attachments also include your signature on the bottom right hand corner.

Application of the unitThis unit applies to individuals who are responsible for providing contract bookkeeping services and to bookkeepers working directly for organisations. These individuals may be carrying out bookkeeping activities across all industries.

This unit requires the application of skills and knowledge to identify relevant statutory, legislative and regulatory requirements and to process business taxation requirements related to various Activity Statements. This unit applies to those job functions that have responsibility for compiling and recording Activity Statement data and requires skills in working with others in order to gather and check data.

This unit may not be applicable to individuals who work on a micro level (such a sole contractors) completing their own Activity Statements as the scope and breadth of knowledge covered may be unlikely to be applicable at a micro business level.

Some of the work covered in this unit is undertaken with supervision from other parties.

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FNSBKG404A – Carry out business activity and instalment activity statement tasks

This Unit of Competency has six elements. Each element has multiple performance criteria. The elements and performance criteria are listed below.

1. Identify individual compliance and other requirements1.1. Legislative and regulatory requirements & organisational and industry

requirements relating to Activity Statements are researched, documented and expert advice is sought to clarify issues where applicable

1.2. Requirements for information, advice or services outside the individual’s scope of operation are identified & additional information, advice or services are accessed, and networks are established and used where necessary

1.3. Lodgement schedule requirements are identified and documented1.4. Entity’s cash flow and payment options are assessed and discussed with

management to ensure sufficient funds

2. Recognise and apply GST implications and code transactions2.1. GST principles are identified applied and recorded2.2. Purchases and/or payments are identified, coded as per GST classifications

and split into capital and non capital as appropriate2.3. Sales and/or receipts are identified and coded as per GST classifications2.4. Accounting data is processed to comply with tax reporting requirements

3. Report on payroll activities3.1. Total salaries, wages and other payments for the accounting period are

identified and reconciled3.2. Amounts withheld from salaries, wages and other payments for the

accounting period are identified and reconciled in conjunction with payroll department if applicable.

4. Report on other amounts withheld, pay as you go (PAYG) instalments and taxes4.1. Amounts withheld from other payments for the accounting period are

identified and reconciled in conjunction with other departments if applicable4.2. PAYG instalment amount is verified or, where applicable, calculated or,

where applicable, calculated for other taxes

5. Complete and reconcile the Activity Statement5.1. Activity Statement reports are generated where required, checked and

validated with any errors are identified and correctional bookkeeping entries are made

5.2. Adjustments for previous quarters, months or year end are made where necessary

5.3. BAS and/or IAS return is completed in accordance with up to date statutory, legislative, regulatory and organisational schedule

5.4. Figures completed on the BAS/IAS form are reconciled to journal entries, profit and loss statement, GST and other control accounts


6. Lodge Activity Statement6.1. Activity Statement is checked and signed off by an appropriate person as

identified by statutory, legislative and regulatory requirements6.2. Activity Statement is despatched in accordance with statutory, legislative and

regulatory requirements6.3. Payment/refund is processed and recorded


Part A: Written (Questions and Answer)1. Where could a bookkeeper obtain information about statutory, legislative and

regulatory requirements in relation to Activity Statements?

2. Is State Payroll Tax reportable on the Business Activity Statement? If so, where on the Business Activity Statement would it be reported?

3. How much is the fine that a contract bookkeeper can incur for providing a BAS service if the bookkeeper is not a Registered BAS Provider?

4. Explain the employer’s obligation if an employee does not provide an employer with a Tax File Number within 14 days of commencement. How does the employer fulfil and report his obligation?


5. What is the value limit for adjustments to be made on the next Business Activity Statement?

6. What website could a bookkeeper reference to check a business’s ABN?

7. Rob works at a registered Not For Profit organisation. He has previously worked in small business. He is querying the threshold for GST registration as the Not For Profit organisation turns over $80,000 per year and is not registered for GST. Where could Rob find out how much the threshold for a Not For Profit

organisation is? Is the threshold for small business and a Not For Profit Organisation the

same amount? What is the threshold for a small business? What is the threshold for a Not For Profit organisation?


8. Margie is a contract bookkeeper but is not a registered BAS provider. Explain how Margie can assist her Client without incurring a fine.

9. What are the due dates for lodgement for a business that lodges a monthly Instalment Activity Statement and a quarterly Business Activity Statement?


10. Leanne is employed as a bookkeeper and is concerned that at the end of each quarter the business is struggling to pay the GST and PAYG obligations to the ATO. Leanne has called a meeting with the Business Owner and the Accountant. List four suggestions that Leanne may make to address her concerns with the business’s cash flow.

11. The GST paid account is debited because it is:a. a decreasing assetb. an increasing revenuec. an increasing negative liabilityd. an increasing expense

12. Should all accounts in the entity’s ledger reflect only the GST-exclusive amounts? Support your answer.


13. List four types of transactions that are excluded from GST

14. Correct the following status of supplies:a. Taxable supplies - exempt supplies – no GSTb. GST-free supplies - contain an embedded 1/11 GSTc. Input taxed supplies - have a zero rate of tax

15. What date did GST come into effect?

16. Explain the differences between ABN registration and GST registration?


17. What is the extended name for these abbreviations?a. ABNb. GSTc. FBTd. PAYGe. LCTf. ATOg. TFNh. OTEi. HELP


18. Sally’s Store needs help producing the supporting documentation and the Business Activity Statement for last quarter. Using the information in the table below, where appropriate, calculate the totals for each of the Business Activity Statement labels. Define each label regardless of whether it is applicable in this instance.

Further information:Sally has a commissioner’s rate of 0.5% for PAYG instalment income$2,000 PAYG has been withheld from wages and salaries

Account Dr$

Cr$ Input tax credit Output tax payable

Taxable sales 200,000 20,000Export sales 100,000 GST-freeCommercial rent received 15,000 1,500

Residential rent received 20,000 Input taxed

Sales of fresh food 5,000 GST-free

Sale of asset (old photocopier)

200 20

Accounting fees 700 70

Bank fees 110 No GST in the priceDepreciation 2000 ExcludedOther operating expenses 50,000 5,000

Rent expense 3,000 300Superannuation 900 ExcludedWages and salaries (gross) 10,000 Excluded

Totals 66,710 340,200 5,370 21,520

Capital Purchases

Dr$

Cr$

Input tax credit

Output tax

payable

Dr$

Cr$

New photocopier 3,000 300

Totals 3,000 300

Adjustments Dr$

Cr$

Input tax credit

Output tax

payable

Dr$

Cr$

Sales returns 200 20Bad debt 300 30Discount received 50 5

Totals 500 50 5 50


Label Definition Workings TotalG1 Total salesG2 Export SalesG3 Other GST-free salesG10 Capital purchasesG11 Non-capital purchasesW1 Total salary, wages and other paymentsW2 Amounts withheld from payments at W1T1 PAYG instalment incomeT2 Commissioner’s rate1A GST on sales or GST instalment1B GST on purchases4 PAYG tax withheld5A PAYG income tax instalment9 Your payment or refund amount

If 8A is greater than 8B, then 8A – 8B is payment to ATOElse 8B – 8A is refund from ATO (or offset against any other tax debt)

19. List the types of transactions that these traditional QuickBooks tax codes are used for:

a. GSTb. FREc. INPd. EXPe. NCGf. NCFg. CAGh. CAF


20. Using GST terminology, list four types of sales or supplies that a business can make.

21. Explain reporting GST to the Australian Taxation Office on a Cash Basis.

22. Explain reporting GST to the Australian Taxation Office on an Accrual Basis.


23. What QuickBooks tax code (for payroll) should an employee have on his personal record if he is a non-resident who has not provided his employer with a Tax File Number? Would it be the same tax code if the employee was a resident?

24. In June, Pete’s Pet Shop had Gross Wages of $30,000.95, PAYG Liability of $8,500.50 and Superannuation Expense of $2,700.09. What amounts should Pete report in W1 and W2 on his Activity Statement?

25. Frankie’s Furniture Store has an Employee who has not provided Frankie with a Tax File Number within the time frame. The employee is a resident and has had gross wages of $2,000. What is the time frame that the employee should have provided the TFN

to Frankie? What tax rate should Frankie withhold tax for this employee? What is the calculated amount to be withheld for this employee? Does Frankie include this amount of his Business Activity Statement? If Frankie is to include this amount on his Business Activity Statement,

what label should he report it under?


26. Barry’s Butcher Shop has a PAYG Instalment rate of 10%. Barry reports to the Australian Taxation Office quarterly on a cash basis. He has sales for the quarterly of $11,000 (inclusive of GST) and GST-free sales of $55,000. What it the total that Barry should include at T1? What is the total that Barry should include at T11?

27. What are the options on the Business Activity Statement in relation to PAYG income tax instalment? Reference labels.

28. What label would show a PAYG instalment amount if the business chose to complete PAYG income tax instalment – Option 1?


29. Assuming the (cash basis) Business Activity Statement has been reconciled, lodged and the liability paid; and a payment of $1,100 that the business had received against an outstanding invoice for that period (which has been included in the liability paid) dishonours; what should the bookkeeper do?

30. Document the effect of accounts in relation to your answer to the above question.


31. Assuming the (accrual basis) Business Activity Statement has been reconciled, lodged and the liability paid; and the bookkeeper notices that a customer has been invoiced twice ($3,300) for the same thing; what should the bookkeeper do?

32. Document the effect of accounts in relation to your answer to the above question.

33. Explain what could be the consequences if the bookkeeper does not research and obtain information about statutory, legislative and regulatory requirements in relation to Activity Statements.


34. Explain the process of reconciling a cash based Business Activity Statement to the Balance Sheet figures.

35. Explain the process of reconciling a cash based Business Activity Statement to the Profit and Loss statement figures.


36. Who is identified by statutory, legislative and regulatory requirements, as an appropriate person to check and sign off an Activity Statement?

37. Explain the options available to lodge an Activity Statement in accordance with statutory, legislative and regulatory requirements.

38. Explain the steps involved in processing and recording a payment due on a Activity Statement.


39. Explain the steps involved in processing and recording a refund due on a Business Activity Statement.


Part B: Practical Exercise/EvidenceCathy’s Craft Shop is registered to report to the Australian Taxation Office on a Cash Basis. Each quarter, Cathy is required to complete and lodge a Business Activity Statement.

You should use the QuickBooks file “Cathy’s Craft Shop.qbw” to successfully complete this task.

Using the information below, and QuickBooks, you are to audit the company file, make any entries that Cathy has omitted, prepare and print the supporting documentation and Business Activity Statement to determine Cathy’s liability (or refund) for the quarter ending June 30th, 2008

You must make sure that Cathy’s tax settings are correct. Cathy has a PAYG instalment rate of 10%. The Business Activity Statement Report in QuickBooks has been

preconfigured for you. Note: When you are using this report there are question marks to the right of the amount fields. By clicking on the question marks, you can observe which tax codes or accounts should be selected when configuring the label button.

Everything that Cathy sells in her store has a GST component. Cathy had interest income of $100 on June 30th, 2008. Cathy has not entered in the EFT Payment to the ATO for the liability for the

quarter ending March 31st, 2008. She paid the liability of $1830.00 out of the Business Bank Account on April 28th, 2008. This amount is the tax payable (GST) for the quarter because Cathy did not hire any staff until April.

Cheltenham Girl Guides previously paid invoice 13 ($883.00) on the 28th March, 2008. On the 2nd April, 2008, this cheque dishonoured and Cheltenham Girl Guides did a direct debit ($910.50) on the 12th of April which included a $27.50 fee. Cathy on charged the bank fee and has added GST onto the fee, however she has not entered the transaction into QuickBooks.

After you enter the missing transactions (above), you will need to reconcile the bank account and print both a Summary and Detailed Reconciliation Report for the quarter ended June 30th, 2008. The balance is $27,683.04 and you should be able to mark all.

Cathy sometimes forgets to put Tax Codes on her transactions. You will need to prepare a Tax Code Detail Exception Report to determine if any transactions must be edited and coded. Print a before and an after report.

Cathy sometimes gets confused with which Tax Codes should be used for Sales and which Tax Codes should be used for Purchases. You will need to prepare a Tax Summary Report to check Cathy’s coding, make any corrections to miscoded transactions and reprint the report.

Prepare a Tax Liability Report and compare the figures to the Tax Summary Report. Print this report. Use a legend to explain your checks.

Print a Tax Detail Report and note that two reports will be produced. These are called the Tax Detail Report (Cash Tax) and Tax Detail Report (Cash Net). Compare these reports with the Tax Summary and Tax Liability Reports and include them in your portfolio of evidence.

Prepare and Print a Profit and Loss Report and use a legend to explain which figures you compared to the T1 figure.

Prepare and Print a Payroll Summary Report and use a legend to explain which figures you compared to the W1 and W2 figures.


Using the Balance Sheet, Accounts Receivable and Accounts Payable Reports, reconcile the cash based BAS. (Hint: you may want to use Microsoft Excel or a similar program).

Enter Cathy’s Liability or Refund into QuickBooks for the period ended June 30th, 2008. Cathy will pay the liability or receive the refund on the due date for the quarter.

Prepare and print the Business Activity Statement. Change the closing date in QuickBooks to the end of the newly completed

quarter. (Use the password QBOOKS) Passwords are case sensitive in QuickBooks!

As you are not a Registered BAS Service Provider, prepare a letter in Microsoft Word or similar, asking Cathy’s Accountant to review your work before he electronically lodges her Business Activity Statement. Ensure you reference all the relevant information from the Activity Statement.

Do a time and date stamped backup and submit it with your portfolio of evidence.

Notes:All workings are to be handed in for assessment, i.e. data files, reports and reference.


Part C: Observation ChecklistElement Performance Criteria C or

NYC1. Identify

individual compliance and other requirements

Legislative and regulatory requirements and organisational and industry requirements relating to Activity Statements are researched, documented and expert advice is sought to clarify issues where applicable.

Requirements for information, advice or services outside the individual's scope of operation are identified and additional information, advice or services are accessed, and networks are established and used where necessary

Lodgement schedule requirements are identified and documented

Entity's cash flow and payment options are assessed and discussed with management to ensure sufficient funds

2. Recognise and apply GST implications and code transactions

GST principles are identified applied and recorded

Purchases and/or payments are identified, coded as per GST classifications and split into capital and non capital as appropriate

Sales and/or receipts are identified and coded as per GST classifications

Accounting data is processed to comply with tax reporting requirements

3. Report on payroll activities

Total salaries, wages and other payments for the accounting period are identified and reconciled

Amounts withheld from salaries, wages and other payments for the accounting period are identified and reconciled in conjunction with payroll department if applicable.

4. Report on other amounts withheld, pay as you go (PAYG) instalments and taxes

Amounts withheld from other payments for the accounting period are identified and reconciled in conjunction with other departments if applicable

PAYG instalment amount is verified or, where applicable, calculated or, where applicable, calculated for other taxes

5. Complete and reconcile the Activity Statement

Activity Statement reports are generated where required, checked and validated with any errors identified and correctional bookkeeping entries are made

Adjustments for previous quarters, months or year end are made where necessary

BAS and/or IAS return is completed in accordance with up to date statutory, legislative,


regulatory and organisational schedule Figures completed on the BAS/IAS form are

reconciled to journal entries, profit and loss statement, GST and other control accounts

6. Lodge Activity Statement

Activity Statement is checked and signed off by an appropriate person as identified by statutory, legislative and regulatory requirements

Activity Statement is despatched in accordance with statutory, legislative and regulatory requirements

Payment/refund is processed and recorded


Part D: 3rd Party VerificationObservation / Reference Element Performance

Criteria

This is to certify that _______________________ has provided my company with:

Identify individual compliance and other requirements

Recognise and apply GST implications and code transactions

Report on payroll activities Report on other amounts withheld, pay as you go

(PAYG) instalments and taxes Complete and reconcile the Activity Statement Lodge Activity Statement

Signed: __________________________________

Name: ___________________________________

Dated: __________________________________

123456

ALLALLALLALLALLALL


Part E: Outcome

Assessment MatrixElement of Competency C/NYC Detail if NYC

1. Identify individual compliance and other requirements

2. Recognise and apply GST implications and code transactions

3. Report on payroll activities

4. Report on other amounts withheld, pay as you go (PAYG) instalments and taxes

5. Complete and reconcile the Activity Statement

6. Lodge Activity Statement

Learner is □ Competent □ Not Yet Competent

Trainer Details Name: ______________________________________

Signature: ______________________________________

Date: ______________________________________

Assessor Details Name: ______________________________________

Signature: ______________________________________

Date: ______________________________________

Further action / strategies if learner is Not Yet Competent

___________________________________________________________________

___________________________________________________________________

___________________________________________________________________

___________________________________________________________________

___________________________________________________________________


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