M2-Topic 2 part 3 influence of government, global market influences Flashcards
what is ASIC
an independent government commission that act s as Australia’s corporate regulator
what does ASIC do(2)
enforce the Corporation Act (2001)
protects consumers in the areas of banking, investment
what do companies have to provide to ASIC
companies must give ASIC access to their annual reports for investigation
what happens if business’s fail to give ASIC access to their annual reports
result in harsh penalties like imprisonment, fines, negative publicity
what are all incorporated business’s required to pay
incorporated business’s are required to pay company tax on their profits
what is the flat rate of company tax
27.5%
what is a benefit of lowering the company tax rate (3)
attracts businesses to open up in Australia
bring a more competitive market place
improve quality of goods and services
what is the global economic outlook
the projected changes in the world economy
what happens during a positive period (boom)
exporting businesses are likely to have more potential buyers
what happens during recessionary periods
lead to significant loss of sales + revenue
what does availability of funds refer to
the ease in which businesses can borrow money
why would businesses be hesitant to expand overseas (3)
restrictions on borrowing
tighter lending criteria from international lenders
exchange rate fluctuations
what are interest rates
the cost of borrowing money
how does risk effect interest rates
the higher the risk the higher the interest
