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Marking Rubric Flyer FIN200 – Corporate Financial Management – T118 – Individual Assignment – Due Week 10 - Assessment Marking Rubric Student’s Name...

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Marking Ru
ic Flye
FIN200 – Corporate Financial Management – T118 – Individual Assignment – Due Week 10 - Assessment Marking Ru
ic
Student’s Name ……………………………………………………………………………………………………………………………………………………………………….
Student’s No. …………………………………………………………………………………………………………………………………………………………………………
Question: What are the important factors that should be considered by tertiary sector employees when they are deciding whether to place their superannuation contributions in the Defined Benefit Plan or the Investment Choice Plan? What issues relating to the concept of the time value of money, taxes tec., might be important in this decision-making process?
    Criteria
    Fail
(0 – 49%)
    Pass
(50 – 64%)
    Credit
(65 – 74%)
    Distinction
(75 – 84%)
    High Distinction
(85 – 100%)
    
Research –extent and application Value 30%
Mark awarded
    
Inaccurate, or inappropriate or no use of Defined Benefit Plan or Investment Choice Plan. No original explanations provided
    
Minimum number of sources, but not all cu
ent or relevant.
Paraphrasing used throughout but not always with clear explanations.
Limited information provided on Defined Benefit Plan or Investment Choice Plan.
    
Good selection of sources relating to Defined Benefit Plan or Investment Choice
Paraphrasing used throughout but accompanied by original explanations.
    
Insightful and appropriate discussion of Defined Benefit Plan or Investment Choice Plan. Use of good range of cu
ent relevant sources.
    
Integration and originality in identifying and discussing Defined Benefit plan or Investment Choice Plan. Wide range of cu
ent and relevant sources integrated in systematic way.
    
Analysis of the topic Value 30%
Mark awarded
    
Poor evaluation.
Significant gaps in knowledge of Defined Benefit Plan or Investment Choice Plan.
    
Simple discussion of work reflects limited engagement with Defined Benefit Plan or Investment Choice Plan
    
Identified and discussed the Defined Benefit Plan or Investment Choice Plan.
    
Identified and clearly explained key areas of the Defined Benefit Plan or Investment Choice Plan.
    
Identified and insightfully discussed key areas of
Defined Benefit Plan or Investment Choice Plan.
    Recommendations/ conclusions Value 20%
Mark awarded
    
Few or no recommendations made, on Defined Benefit Plan or Investment Choice Plan.
    
Some recommendations made, but not based on a sound evaluation on Defined Benefit Plan or Investment Choice Plan.
    
Good recommendations made, on Defined Benefit Plan or Investment Choice Plan.
    
Very good recommendations made, on Defined Benefit Plan or Investment Choice Plan.
    
Excellent recommendations made, on Defined Benefit Plan or Investment Choice Plan.
    
Presentation Value 20%
Mark awarded
    
Referencing is absent / not systematic / inco
ect.
Graphs and tables are inaccurate/ absent/not referenced
    
Acceptable presentation - obvious e
ors demonstrating lack of attention to detail.
Basic or no graphs and tables. Some attempt at referencing but obvious e
ors.
    
Good presentation overall but some obvious e
ors.
Satisfactory graphs and tables.
Referencing is mainly accurate.
    
Professional presentation – minor e
ors in some elements.
Good graphs and tables
Co
ect referencing throughout.
    
Highly professional presentation satisfies all presentation elements. Co
ect referencing throughout.
     Total Mark: / 100%
Total Mark: /30%
Answered Same Day May 22, 2020 FIN200

Solution

Brindha answered on May 25 2020
142 Votes
FINANCIAL ACCOUNTING ASSIGNMENT
    TABLE OF CONTENTS
     
    Description
    Page no.
    1.0 Introduction
    3
    2.0 Background of the study
    3
    2.1 The tertiary sector and its importance
    3
    2.2 Superannuation- Meaning and Importance
    4
    2.3 The Defined Benefit Plan
    5
    2.4 Investment Choice Plan
    5
    3.0 Defined Benefit Plan versus Investment Choice Plan- Factors to be considered while making a choice
    6
    4.0 Role of time value of money in choosing between DB and IC plans
    8
    5.0 Tax Implications
    9
    6.0 Recommendations
    9
    7.0 Conclusion
    10
    References
    10
    Appendices
    12
1.0 Introduction
It is rightly said that savings, investing and remaining invested are the primary keys to achieve success in one’s financial goals. It would be unrealistic to plan investments at the hour of retirement as it is rather the time to reap the benefits of one’s economic decisions (Bailey, W., et al, 2011). This report proposes to study the superannuation scheme of Australia by understanding its two different variants, namely, the definite benefit plan and the investment choice plan. While the former enjoys the advantage of being a secure investment, which is built over years, the latter generates extraordinary returns in the form of lump sum payments.
As the services sector is the major contributor to the GDP and hence the economy of any nation, the various factors to be considered by the employees of this sector while making a choice between the definite benefit plan and the investment choice plan of the superannuation scheme is discussed in this report. Further, the role played by time value of money and the tax implications involved in these investments is also highlighted in this report. The report also proposes to provide recommendations to the members of the scheme to make an optimal choice depending upon their age and remaining years of service.
2.0 Background of the study
2.1 The tertiary sector and its importance
The three-sector theory classifies an economy into three sectors, namely the primary sector that is engaged in the production of raw materials, the secondary sector that is engaged in the manufacture of goods and finally the tertiary sector, commonly called the services sector that is engaged in delivering services rather than end products. The services sector includes industries like telecommunications, mass media, hospitality and tourism, information technology, retail sales, education and financial management services. Statistics points out that in Australia, while agriculture and manufacturing industries contributes about 2.61% and 24.33% respectively to the national GDP, the services sector contributes about 73.07% to the same (Australian Industry Report, 2016).
2.2 Superannuation- Meaning and Importance
Commonly refe
ed to as organisational pension plans these superannuation programs are tax effective means of savings, till retirement or withdrawal. Contributions to this monetary fund are made both by the employer and the potential employee, but are paid out to the employee, only when he becomes qualified or eligible to receive the same. Upon reaching a prescribed age or owing to infirmity, the employee qualifies to receive the benefits of the fund (Bateman, H., et al., 2016).
Despite being a retirement fund, this program sees to it that the benefits are rendered to the qualifying employee not based upon the performance of the fund, but based upon a set schedule. Looking into the benefits rendered by this program, it could be seen that both the government and the Australian households have benefitted out of this program. While it has reduced the cost of Age pension to the government, compulsory investment in this program by normal households has transformed the household balance sheet altogether. A balance sheet that contained only investments in domestic residential real estate and cash, now boasts varied investments in domestic and overseas assets, equities and commercial properties, thanks to the superannuation program that has made a major contribution to the saving rate in these households. Australian treasury estimates rightly point out that the superannuation system contributes about 1.5 to 2% points to the national savings rate that is likely to grow to 3% points by 2050 (Superannuation and the economy, 2015).
The fact that the value of superannuation assets reached 1.4 trillion AUD by 2012 equivalent to 94.5% of the country’s GDP and is expected to grow by 3.7% every year shows the prominent role played by the superannuation funds in the Australian economy. (Refer chart 1 in Appendices).
The superannuation program mostly comes with two variants in Australia – the defined benefit plan and the defined contribution plan.
2.3 The defined benefit plan
This pension plan guarantees the employee a certain amount of payment for life time upon his retirement. Depending upon the employee’s salary and his total years of membership in this plan and based upon a fixed...
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