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Buisness man > Unit 2 - Outcome 1 Business Idea + Legal Requirements + Work and Health Safety Regulations + Financial Systems > Flashcards

Unit 2 - Outcome 1 Business Idea + Legal Requirements + Work and Health Safety Regulations + Financial Systems Flashcards

1
Q

Innovation

A

The process of creating a new or significantly improved good, service or process (way of doing something). Many businesses concepts are an innovation of a existing product

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2
Q

Entrepenuership

A

The will to take the risk to set up, operate and work towards the business. Entrepueners display creativity and will find new ways to grow their business

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3
Q

Changing customer needs

A

The needs of customers in the market change due to: changing incomes, tastes, prices of complementary and substitute product, and changing population. If any of these factors change, then the demand from customers for a product to satisfy a need will change

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4
Q

Market oppurtunites

A

Are open windows for business owners to take advantages of. Examples of market oppurtunities are gaps in the market where you can fill in the spaces and create something new

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5
Q

Research and development

A

A set of activities undertaken to improve existing products and to creat new products. R&D can also provide business owners with many oppurtunities such as developing superior products in response to actions of competition

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6
Q

Technological advances

A

The applications of knowledge that have changed people’s lives and changed the way in which buisneses have operates. An example of technological advanced are the internet and mobile phones

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7
Q

Global market

A

Mobile phones and globalisation helps open global markets and can be tapped by potential business owners

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8
Q

Sources of business oppurtunity

A

Is a set of circumstances that presents itself an avenue to success. Potential business owners are always searching for new and innovative oppurtunities

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9
Q

Motivation on starting a business

A

The success of a business largely depends on the owners abilities, characteristics, skills and motivation.

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10
Q

Reasons behind a persons motivation to start a business

A
  • Desire for independance
  • To make a profit
  • To fufill a market need
  • To fufill a social need
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11
Q

Desire for independance

A

The independance to choose when to work, where to work (From home) and with whom they work. Some people also desire financial independeance as they grow old

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12
Q

To make a profit

A

The belief that if you work hard and put in extra effort, you will rewarded with profit. This reward may not be immidiate but it will eventually happen

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13
Q

To fufill a market need

A

You may realise that if there is a market need which means a good or service is demanded but is not avalible in the market

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14
Q

To fufill a social need

A

Some business owners may desire to make a profit but also to concentrates on a community or enviromental need eg

  • providing oppurtunities for local unemployment
  • focusing on waste minimalisation
  • Developing skills and vocational training for the disadvantaged
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15
Q

Why is it important to plan set goals?

A

It is important because without a goal, a business has no clearly defined purpose and nothing to aspire to. Goals provide a business with direction and help to measure results

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16
Q

The characteristics of a succesful business entrepuneer

A

*Having a shared vision- being able
To understand what the business will be like in the future. This gives the business a clear direction
*Initiative- taking a series of steps without someone telling them to do it
(Independant descion)
*Innovation and enterprise- Enterprise is the effort made by someone to creatively or boldly achieve something new

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17
Q

Characterisitcs of Business managers

A
  • Being self motivated with a desire to succeded
  • Being self- disciplined to start and follow through long projects
  • Having the ability to learn new skills
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18
Q

How these characteristics contribute to a businesss success

A

If people have an honest understanding of their own personal qualities then failure can be minimised.

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19
Q

Why is business concept development so important

A

It determines whether or not the business owner has the motivation and personal qualities to start a business. Potential businesses owners need to have a concept of what they wish to sell

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20
Q

Relationship between business opportunities and business concept development

A

As the business owner develops their business concept, they will need to protect their idea and then determine how feasible it is by conducting market research and initial feasibility studies.

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21
Q

Feasibility studies

A

An assement of the business ideas potential for success.

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22
Q

Market research

A

A process involving, gathering and analysing information concerning a specific market

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23
Q

The contribution that businesses make to the economic wellbeing of a nation

A
  • Business contribution to employment and taxation revenue
  • Business contribution to economic growth
  • Business contribution to export earnings
  • Business contribution to research and development
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24
Q

The contribution that busnisess make to the social wellbeing of a nation

A
  • Business contribution to career and social wellbeing (Provides people to feel as thought they belong within the business as well as a contribution to society)
  • Business contribution to innovation
  • Business contribution to corporate social responsibilty (Employess will want to work for businesses that are socially responsible
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25
Q

Market research involves

A
  • Identifying what info is needed to make a decision about the businesses potential
  • Gathering relevant info from appropriate sources
  • Analysing and interpreting the results to extract some clear information which will assist in desicion making
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26
Q

A feasibility study should include

A
  • An assessment of the market
  • A consideration of the operations
  • An analysis of commercial feasibility
  • An understanding if others have tried this idea
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27
Q

Registering a business name

A

A sole trader must be registerd if the name is different from the owner.
If a owner operates a business under his own name, then they do not have to register the business name however if it is more than their name then they have to register on the ASIC website

28
Q

Legal and government requirements

A

There are licenses, permits, approvals and authorities to be taken into account by business owners. They establish guidelines and behaviours of the business

29
Q

Consequences of not obeying Legal and Government requirements

A

May risk loosing customers and their repuatation, getting fired or loosing the right to continue trading.

30
Q

Registering a domain name

A

If the business has an online presence , A domain name is a nessicity. A domain name is the address of the business’ website. It is recommended to have a domain name that is easy to remember and spell so that customers can easily find the webiste

31
Q

How to register a domain name

A

By visiting the Australian Domain Adminstration

32
Q

Taxation Regulations (Define)

A

The compulsory payment of a proportion of earnings to the government. It is important for a business owner to is familiar with all tax regulations

33
Q

Taxation Regulations (ATO)

A

The Australian Taxation office is the government body in charge of adminstiring and collecting tax for the federal government.

34
Q

Taxation Regulations (Income Tax)

A

Taxes that is calculated differently for indivduals and companies.
Companies pay a flat rate tax of 30% for large businesses or 28.5% for businesses with a turnover less than 10 mill.
Individuals pay income taxes on a progessive tax rate which increases as the individual earns a higher income

35
Q

Taxation Regulations Federal Tax- PAYG

A

Taken from an employees salary or wage directly and are imposed on the employee

36
Q

Taxation Regulations Federal Tax- GST

A

A Tax of 10% on the supply of most goods and services cosumed in Australia.

37
Q

Taxation Regulations Federal Tax- FBT

A

Fringe benefits tax is a tax on the provision of a benefit to an employee.

38
Q

Taxation Regulations State Tax- Stamp Duty

A

Placed on the document that give evidence to transactions and are imposed on the business

39
Q

Taxation Regulations State Tax- Land Tax

A

Annually levied on the owner of the land

40
Q

Work Health and Safety Act 2011 (Define)

A

A federal law that provides a nationally consistent framework to ensure the health and safety of workers.

41
Q

Work Health and Safety Act 2011 Ensures..

A
  • To protect workers from harm
  • That there is fair and Effective representation
  • Encourging unions and employer organistations
  • Promoting the provision of advice, information , education and training
42
Q

Three Legal Frameworks

A

Work Health and Safety Act 2011.
Work Cover Insurance
Trade Practise legislation

43
Q

Work Cover Insurance (Define)

A

Worksafe provides Workcover insurrance which can cover

  • Replacement of lost income
  • Medical and rehabilitation treatment costs
  • Legal Costs
  • Lump sum compensation in the event of a serious injury
44
Q

Worksafe Victoria (Define)

A

A government agency that aims to reduce workplace injuries and support injured workers.

45
Q

Who Pays for Work Cover?

A

Employees

46
Q

Trade Practise Legislation (Define)

A

Australia has both federal and state laws in place to ensure that business and consumers are protected from unfair trading practises. Each major industry has its own Code of practises.

47
Q

Trade Practise Legislation- Codes of Practises

A

Provide businesses with guidelines for dealing with customers. examples are;

  • Respect- Expecting to treat other staff with respect, Being courteous and fair when dealing with others and avoiding discrimination
  • Integrity- The staff and trainees should be honest in relation to; The usage of any form of social medial that may compromise the business, Financial records and Student confidential information.
48
Q

Trade Practise Legislation- Federal Law

A

The Competition and Consumers Act is a federal law that spcifies what business behaviour is acceptable on a wide range of issues from product safety and pricing

49
Q

Trade Practise Legislation- State Law

A

The Fair Trading Act 1999 is a victorian state law designed to complement the federal CCA (Consumer Affairs VIctoria) by providing state specific laws. Some of the issues addressed in the act include; Warranties, Vouchers, Unfair Contracts, false advertising and product safety.

50
Q

Establishing Bank Accounts (Define)

A

It is recommended that the transactions of the business are performed through a separate bank account.

51
Q

Reasoning to use a seperate account (Seperate Entity)

A

The seperate entity accounting principal states that transactions of the owner and business is seperate

52
Q

Reasoning to use a seperate account (Monitor)

A

It is easier to monitor the financial performance if it has a seperate account to that of its owner.

53
Q

Reasoning to use a seperate account (Calculating expenses)

A

Calculating a business expense such as bank fees and revenue is simpilar and less time consuming

54
Q

Consideration of Banks (Define)

A

Operating a business bank account can be simple however choosing the right bank account from the right financial institution requires consideration of a few factors

55
Q

Factors to consider when choosing the right Financial Institution.

A
  • Bank Fees
  • Interest Rates
  • Overdraft facility
  • Credit Cards
  • Covenicence and support
56
Q

Consideration of Banks (Bank Fees)

A

While the fees are generally stated in the terms of the agreement, it is the customers responsibility to read all of the paperwork.

57
Q

Consideration of Banks (Interest Rates)

A

The interest rate will determine how much money the business will earn on the amount of money they have in the bank account.

58
Q

Consideration of Banks (Overdraft Facility)

A

Some Financial Institutions allow a business to withdraw more money than they have available in their account.

59
Q

Consideration of Banks (Credit Cards)

A

Different cards have different features including the max amount that can be used, as well as the interest rate on unpaid balance.

60
Q

Consideration of Banks (Convenience and support)

A

While smaller banks and credit unions can offer a lower interest rate, they lack the infastructure to support the business owner with their banking needs in a way that a larger bank can.

61
Q

Financial Control Systems (Define)

A

The process that allows a business to accurately monitor, manage and report its financial performance

62
Q

Financial Control Systems (Record Keeping System )

A

Business are required by law to keep records of their financial transactions for at least 5 years for tax purposes. Maintaining accurate recrods serves a valuable tool for descion making. Without accurate records, the owner has a restricted understanding in how the business is performing

63
Q

Financial Control Systems (Record Keeping Strategies)

A
  • Use Bookeeping such as MYOB which involves the keeping and processing of a business’ financial record.
  • Establish a good filing system
  • Keep records as simple as possible to understand all information
  • Make sure bookeepers dont let record keeping duties pile up
  • Not to mix up personal records with business records
64
Q

Financial Control Systems (Auditing)

A

The process of testing and evaluating a business accounting process and internal controls. Auditing can be done internally or externally where another business performs the audit.

65
Q

Financial Control Systems (Cash Flow Management)

A

If a business does not have the cash needed to pay for its day to day expenses, it will find itself in a great deal of trouble. Managing the cash flow ensures that such issues do not arise.

Buisness man (9 decks)

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