Nswer each question follow in order instructions
Read the following continuing factual scenario and answer each of the 4 Questions.
The word limit applies to the entire assignment, not to individual responses to each Question.
Gino runs a successful house building and renovation business. His wife Marcia keeps the accounts and lodges the tax returns and they share the income generated by the business which trades under the name a?G & M Constructionsa?. They employ two full time tradespeople.
Gino breaks his leg whilst at work and is incapacitated so that he has to employ another person.
He asks you whether he can claim compensation under the workeras compensation policy for G & M Constructions. Advise Gino whether this is possible and give reasons for the advice.
The accounts and tax returns for G & M Constructions become more and more complex over time and Marcia seeks the assistance of an accountant to prepare the tax returns. The accountant suggests that G&M Constructions should incorporate because this would give them limited liability.
Gino & Marcia ask you whether limited liability means that they will never have to be at risk of paying the obligations of their business and does this mean that they will have to issue shares to other people who might buy them from then stock exchange and then share profits with them?
(a) Advise Gino and Marcia about the true nature of limited liability and any risks that they might face.
(b) Advise Gino about the different types of company that can be formed and what company type would best suit them.
Gino and Marcia consider your advice and decide to incorporate a company but they want to involve their children in the business. They have three children: Margaret, Nancy and Leon. Leon is still at school and Nancy is at University studying Nursing. Margaret has always helped doing minor trades work on the building sites and office administration and she knows a lot about the construction business. Gino and Marcia want to know who would make the decisions in the company if each of the three children were given an interest in the company, in other words, if there were five people with interests in the company would Gino and Marcia end up being a minority of two.
(a) Advise Gino and Marcia about the different organs of the company and their respective roles.
(b) Suggest an internal company structure that ensures Gino and Marcia retain control of the companyas business.
Gino and Marcia incorporate a company based upon your suggestion in Question 3(b) above.
After a few years, G & M Constructions continues to grow strongly and Gino wishes to spend less time on the worksites. His children, particularly Margaret, are unhappy with many of Ginoas managerial decisions and they want him to retire. An argument erupts and Gino says that G & M Constructions owes its success to his decision making and to the tools and equipment that he has built up over the years. Margaret says to him that they will a?vote him outa and that they will keep all of the tools and equipment.
Advise Gino whether the other company members can a?vote him outa, and if they are able to do so can he sell the tools and equipment that he has acquired over the years because he paid for these before it became a company.
This assessment item will allow you to demonstrate:
A· Your knowledge of the law of partnerships;
A· Your knowledge of the meaning and characteristics of incorporation and different types of company;
A· Your understanding of the internal organs of a company and their respective roles in management;
A· Your ability to synthesise your knowledge of corporations law to provide a workable model for a company
A· Your ability to conduct research using provided materials as well as other resources;
A· Your ability to communicate advice in a clear writing style that presents a logical well supported response;
A· Your ability to apply academic standards of presentation and referencing; and
A· Your ability to undertake a task relevant to professional practice in a timely manner.
It is expected that you will use the ILAC method of preparing a response to a problem question. The ILAC method is explained under the Learning outcomes heading in this Subject Outline. The following marking criteria matrix applies to this assignment only and is based upon the use of the ILAC method.