Financial management and risk simulation

Risks, laws and tax issues are some of the internal and external environmental constituents that affect business companies. An Australian company producing into plastic production could be affected by more risks some of which are directly attached to the company and others indirectly attached. The primary risks are on the level environmental factor impacts the company. The dangers the company poses or cause. Legislation issues, outlines laws and policies that affect the operation of a company directly or indirectly. They are primarily a product of policy and law making which affect and control companies either nationally or internationally. Taxation issues outlines the levies imposed on companies to grant permission for their continued operation. They affect the financial growth of the company either positively or negatively.
Risks
Risk Category: Competitive risk Description of risk: This is the situation where the company is on the verge of facing competition from other plastic producing companies including Mulford Plastics and Kingston Plastics among other companies. The competition is on the same products competing for the same market share. Likelihood: Likely Consequences: Major Risk Level: Very High Risk Management: Performing a concrete market research that will help to identify the competitors strategies, quality of products they produce, the available market share and the competitor_x0092_s mission and vision
Improving the quality of products produced by adding special and unique features to have a new brand on the market.
Identifying new market within or outside the country.
Developing robust strategies and missions. Risk Category: Innovation risk Description of risk: This is the likelihood of the company_x0092_s innovation level or capability to be challenged by competitors. The competitor_x0092_s innovation level might outdo the company_x0092_s level with time. Likelihood: Almost certain Consequences: Severe Risk Level: Extreme Risk Management: Conducting market research on the innovative abilities of the competitors.
Employment of highly trained and innovative staff in the company
Establishment of an innovation hub within the company that will provide opportunities for nurturing new ideas
Using of the up to date technological equipment and systems Risk Category: Demand risk Description of risk: The company might fail to meet the level of demand for the products in the market due to issues like inability to produce expected quality and quantity of products. Likelihood: Moderate Consequences: Minor Risk Level: Medium Risk Management: Increase in investment on the company to boost production.
Improving the quality of products to meet the expected level
Increasing the distribution channel to capture large supply market area for products Risk Category: Products liability risk Description of risk: The manufacture of plastics is associated with pollution effects due to their non-biogradability. Hence, the company may in future suffer the consequence of blame for environmental pollution. Likelihood: Almost certain Consequences: Major Risk Level: Extreme Risk Management: Mitigating the level of effluents released to the environment by using filters and gas absorbers to reduce release of harmful gases into the air. The company can also use proper waste disposal management.
Modifying the products into a form that is bio-gradable to avoid future environmental catastrophe. Risk Category: Technological change
Description of risk: The company is likely to go into oblivion with the view of current technological advancement. The use of plastic products in the near future is likely to be laid down due to introduction of new technological substitute products Likelihood: Likely Consequences: Significant Risk Level: High Risk Management: Market research to stay updated on new market ideas
Products modifications to suit the changing technology
Improving and encouraging innovation Risk Category: New Products development risk Description of risk: There is fear that the company_x0092_s new products might fail to have ground in the market. The customers might be unable to change and adapt on the new product because of uncertainty issues. Likelihood: Unlikely Consequences: Minor Risk Level: Low Risk Management: Employing the strategy of product awareness and education on the usefulness of the new product to the customers.
Limiting or ceasing the production of the old product to give an avenue for the new product to grow.
ii. Taxation Issues
The company is liable to pay the following taxes to the Australian government;
Capital Gains Tax (CGT)
This is the amount of cash payable after profits or gains have been made by the company due to asset sales. The kind of assets that are subject to CGT include both tangible and intangible assets of the company. The company is therefore bound to pay CGT on the sale of its assets. This might significantly affect the company_x0092_s income growth in the future.
Goods and Services Tax (GST)
This is tax payable by the company as a result of sales of products and services. The company is supposed to pay 10% of the total sales of its goods and services. GST is also payable by the common consumers when buying the company products. In the event that the company_x0092_s sales go down the imposing of GST would lower the company_x0092_s growth and inability to pay further ta.The Superannuation Guarantee Charge (SGC)
This is the tax payable by the company to its employees every year to make sure that in the event of their retirement, they have enough package. This tax rate is around 9.25%. There is a trend in which further amendments might result to increment of the rate to 12% (Hannigan 115-18).
Tax on Income
This is more the same as the CGT except that it is not based on the assets of the company. This is the tax the company is bound to pay with respect to its annual income or rather profit
Medical Levy Surcharge
This stands at 1.5%. It is mainly based on individual_x0092_s income.
iii. Legislation
These refer to policies and laws that govern the operation of the company.
Consumer laws
This regulation is bound to bar the company against exercising its roles in contrary to the dictates of the law. It inhibits the company from issuing unfair contracts and the bridge of consumer agreements. It protects the rights of the consumer for fair treatment, representation, and remuneration. The company is held liable in the event of violating this law under the Australian Consumer Law Act (Hannigan, 98-99).
Competition Laws
The Australian government is committed to ensuring a fair competition between businesses and enterprises. This is well articulated in the National Statutory Framework. The framework is enforced by the Australian Competition and Consumer Commission (ACCC). It is meant primarily to enhance fair and sound competition among companies.Environmental Legislation
This law is enforced by the Australian government mainly to ensure that businesses respect the decency of the environment by avoiding pollution. It is executed both at the national level and local level.
Privacy Laws
This is pioneered by the Office of the Australian Information Commissioner (OAIC). It is meant to enhance the National Privacy Legislation Act. It controls the manner in which companies can access and conceal sensitive and personal information in the company database. Each of the Australian states has its own privacy laws that advocate for companies to protect the information of the customers and employees.
Fair-work Legislation
This is based on the Fair Work Act of 2009 in collaboration with the Fair Work Regulations Act of 2009 (Hannigan 100-12) This regulation is meant to enhance a good employer-employee relationship. It enhances the establishment of rapport between the company and its employees that ensure fair treatment.
Fringes Benefits Tax (FBT)
This is the tax that is payable by employers for the benefits offered to the employees. The benefits may be part of the employee_x0092_s salary or wages.
Conclusion
A plastic manufacturing company based in Australia has got a big opportunity to grow to base on the internal and external environmental factors. The majority of the consequences of the business risks are not severe and so that gives a positive glimpse of the company_x0092_s ability and potential to grow and improve its market share.
Works Cited
Hannigan, Brenda. Australian Company law. Oxford University Press, USA, 2015: (98-150)
National Museum of Australia, (2012). Collection care and preservation policy. Retrieved from  http://www.nma.gov.au/about_us/ips/policies/collection_care_and_preservation_policy