General assessment information | My Assignment Tutor

Assignment Assignment marks: 95 | Presentation marks: 5Total marks: 100 Personal ID:[Enter                       your Personal ID] I have read the Assignment Guide in the ‘General assessment information’ and have applied the word count principles to my work. My word count for this assignment is:[Enter                       your word count] wordsYour assignment should be loaded into KapLearn by 11.30 pm on                              the due date.All times are based on AEDT/AEST time zones. Refer to ‘Time                                remaining’ on the ‘Assignment’ page in KapLearn to ensure                             you submit your assignment by the specified due date                              and time. Checklist       I have completed my assignment using Word.v c       I have completed my assignment using Calibri, Arial, Times New Roman or Verdana fonts.       I have added my Personal ID on this page.       I have added my word count on this page.       I have added my Personal ID in front of the filename in the footer on the second page.       I have saved the file to be uploaded as PersonalID_FPC003_AS_v7 .       Each question of my assignment is within the word limit guidelines for that question as per the ‘General assessment information’ (Assessment  Assignment  General assessment information).       My assignment file size is no larger than 2 MB.       If tables were required, they are visible as text, not as links or images.       I have not removed the marking grid from the footer.       I have submitted my assignment as per the instructions in KapLearn. Marker feedback Comment on overall performance: For                   marker use only.Assignment                      background The assignment for FPC003 consists of one (1) case study. You are                         to analyse the quantitative and qualitative information provided                         about clients Graham and Anna Sutton, and produce a statement of                   advice (SOA). The SOA must address the Suttons’ goals and                   objectives and incorporate the responses to various questions they                    have posed to you as their adviser.                                             Refer to Topic 8 and the sample SOA for guidance on the structure                  and format of your SOA.                                             This assignment covers all topics and accounts for                      50% of your final grade.                     Read the following                     ‘Instructions to students’ carefully before commencing the                   assignment.Instructions                      to students • Word document: Your assignment must besubmitted                     as a Word document.                                                 • Word limit: Your response to the assignment tasks                  should not exceed 7,000 words, excluding appendices. Marks will only be awarded for your assignment response up to the                         word limit, plus 10%. Any material written in excess of the limit                     will not be eligible for marks consideration, so it is important                       to be not only communicative but also concise and selective in the                    manner of your responses. For more information on word counts                 and their rationale, go to Assessment                      Assignment                     General assessment information.                                                 • Appendices: Full workings must be shown for all                        calculations. The appendices section of the SOA should contain                      these calculations, including any supporting documentation, for                   example assumptions; tax, cash flow and any social security                       calculations; projections; charts; and referencing. Ensure that                  your appendices are correctly referenced in the body of the plan                        and labelled correctly. State all assumptions                  used in providing your answer.                                           • Disclosure and warnings: Disclosures and warnings are                     mandatory. Fee disclosures must be disclosed accurately in both                      percentage and dollar terms and comply with ASIC regulatory                 guidelines on disclosures. Refer to the format contained in the                        sample SOA.                                              • Quick Reference Guide (QRG): Rates or thresholds                    required to be used in any calculations should be based on the                  most current QRG found in KapLearn. Please make it clear within                     your assignment as to which rates and thresholds you are using.                                               • Use of software: You may use financial planning                        software to assist in modelling strategic options for the clients                      and for preparing the SOA, provided you personalise the content                    and ensure that it is clear, concise and effective and                   conforms to the structural guidelines for an SOA contained within                        Topic 8 and the sample SOA.                                                                        •      Marks will be deducted if content provided, such as an                  adviser’s name, practice name and licensee details, are not                  properly reflected in the SOA. Do not use your real name or your                     employer’s name. For this case study, you are Jess Craig,                    senior financial planner and principal of All Out Financial                       Planning, a boutique financial planning practice licensed by ABC                      Financial Solutions Pty Ltd (AFSL 222222).                                           • Product disclosure statements : If you reference a PDS                        or other lengthy hard-copy product document in your SOA, you do                   not need to physically provide that document with your SOA.                                                                   • Authorisation: You are authorised to provide advice on                      all areas on which the clients have requested advice. Marks will                         be deducted if you purposely restrict your authorisation in                       response to an assignment task.                                               •      Refer to the ‘ Criteria-based Marking Guide’ for                    guidelines on what is expected for each task.                                                                     •      The ‘General assessment information’ section in                   KapLearn contains information about format and presentation,                  word limits, citations and referencing, collusion,                        plagiarism and other policies, useful resources,                        submitting your assignment and accessing your results.• Your own work and referencing: Answers are to be in                    your own words. Reference and cite all your sources (within the                  text of your answer) when quoting or using material from external                 sources. Include a reference list at the end of your assignment.                 Refer to the ‘Referencing and Citations Guide’ available from                 the ‘Library Learning Hub’ in KapLearn for further information                       on referencing.                                               •      Indicative weightings are noted beside each question. Use                        these weightings to assist you with your allocation of time and                 resources. The weightings indicate the relative importance of each                  task.                                          • Requests for special consideration: Please do not apply                    for special consideration or information pertaining to special                    consideration by writing a request in the body of the assignment                         as it will not be considered by the assessor Refer to the ‘Special                   consideration’ section of the Assessment Policy on Kaplan’s                       website for more information.                    •      Use the                     Discussion Forum in KapLearn to ask questions and share ideas. Mark allocation grid Note: Marks will be awarded based on the areas on this grid. Mark                        allocationMax.                        marks1.                                      Research and referencing5 marks2.                                      Compliance5 marks3.                                      Executive summary/summary of recommendations10 marks4.                                      Present position/information about client5 marks5.                                      Financial objectives5 marks6.                                      Assumptions4 marks7.                                      Risk profile and asset allocation6 marks8.                                      Plan thought through and meets goals5 marks9.                                      Quality of advice and recommendations40 marks10.                            Ongoing service and review5 marks11.                            Overall structure and presentation of SOA10 marksTotal marks0 marks Criteria-based Marking Guide The Criteria-based Marking Guide is designed to assist students to understand what is expected of them in each question and to let them know how their performance will be judged. It provides advice about the criteria used in the marking of the question and what discriminates between an excellent, satisfactory and unsatisfactory answer. ExcellentSatisfactoryUnsatisfactory1.     Research and                           referencing•      clear and appropriate                               assignment layout and structure                                                           •        clear evidence of                                 independent research and analysis incorporated throughout                               assignment                                                                  •        appropriate use of                             referencing                                                               •        accurate use of Harvard                             referencing style                                                                  •        comprehensive reference                          list provided as an appendix•      adequate assignment                               layout and structure                                                                                            •      some evidence of                               independent research and analysis                                                             •        appropriate use of                               referencing                                                                 •      use of Harvard                                 referencing style                                                                                                  •        reference list provided                           as an appendix•      poor assignment layout                                 and/or structure                                                                                            •        assignment is                                 significantly under or over the word limit                                                         •        no demonstrated                            independent research or analysis                                                                 •      no use of references                                                                 •        referencing does not                           use Harvard referencing style                                                         •      no or inadequate                            reference list provided(Range: 5 marks)(Range: 4–5 marks)(Range: 2.5–3.5 marks)(Range: 0–2 marks)2.     Compliance•      compliant, clear                                 presentation and appropriate and clear wording to reflect all                         essential elements                                                           •      cover sheet includes                            full details of minimum requirements                                                                  •        full distinct warnings                           and disclosures provided•      compliant, appropriate                               wording to reflect all essential elements                                                                                            •      cover sheet includes                           adequate details of minimum requirements                                                                                              •        adequate warnings and                            disclosures provided•      not compliant,                                 incorrect details and insufficient/missing essential elements                                                                                                  •        no cover sheet or it                          includes inadequate details of minimum requirements                                                                                              •      few or no clear                                warnings or disclosures provided(Range: 5 marks)(Range: 4–5 marks)(Range: 2.5–3.5 marks)(Range: 0–2 marks)3.     Executive                         summary/summary of recommendations•      excellent and concise                             summary                                                                                           •        concise inclusion and                           coverage of essential elements pertinent to client SOA•      adequate summary in                               length                                                                •      essential elements of                               client SOA covered•      summary is wordy and                                 not concise                                                             •        poorly covers essential                            elements pertinent to client SOA(Range: 10 marks)(Range: 7.5–10 marks)(Range: 5–7 marks)(Range: 0–4.5 marks)4.     Present                            position/information about client 5.    Financial objectives 6.        Assumptions•      accurate, clear and                           complete description of client’s personal details and present                             position thoroughly based on most key valid elements                                                           •      clearly matched to                               client’s expectations                                                                                              •      clear, accurate and                             realistic identification of financial objectives thoroughly                                based on client’s financial position                                                            •      logical, specific and                               clearly justifiable assumptions clearly based on key elements•      adequate description of                            client’s personal details and present position                            sufficiently based on many key valid elements                                                                 •        adequately matched to                               client’s expectations                                                               •        adequate plausible                           identification of financial objectives adequately based on                            client’s financial position                                                                 •        adequate and                                 justifiable assumptions adequately based on key elements•      invalid, unclear or                             incomplete description of client’s personal details and present                                 position insufficiently based on key valid elements                                                           •        poorly matched to                               client’s expectations                                                               •      invalid or incomplete                                identification of financial objectives inadequately based on                            client’s financial position                                                                 •        illogical, unclear                             assumptions with little or no basis on key elements(Range: 14 marks)(Range: 10.5–14 marks)(Range: 7–10 marks)(Range: 0–6.5 marks)7.     Risk profile and                                 asset allocation•      logical advice on asset                                 allocation which clearly aligns with client risk profile                                                                •        advice based on                                 comparison of existing asset investment•      adequate advice on                          asset allocation which adequately aligns with client risk profile                                                                                                                                •        advice adequately based                                 on comparison of existing asset investment•      poor advice on asset                                 allocation with little or no alignment with client risk profile                                                                  •      advice inadequately and                                 insufficiently based on comparison of existing asset investment(Range: 6 marks)(Range: 4.5–6 marks)(Range: 3–4 marks)(Range: 0–2.5 marks)8.     Plan thought through                           and meets goals•      plan clearly meets                                 client requests                                                           •        plan clearly addresses                          all goals and objectives or reasonably explains why not                                                            •      post-implementation                                 analysis clearly connects to recommendations•      plan clearly meets                               client requests                                                            •        plan mostly addresses                          all goals and objectives and/or offers some reasonable                                explanations why not                                                            •        post-implementation                                 analysis mostly connects to recommendations•      plan does not meet all                            client requests                                                            •        plan does not address                             all goals and objectives or reasonably explains why not                                                            •        post-implementation                                 analysis does not or only partially connects to recommendations(Range: 5 marks)(Range: 4.5–5 marks)(Range: 2.5–4 marks)(Range: 0–2 marks)9.     Quality of advice and                          recommendations•      high level of quality                              advice provided specifically relevant to client questions within                                 the SOA                                                            •      advice clearly and                                skilfully integrates specific information about client situation                           and consideration of key issues                                                               •      logical, strategic and                             thoroughly reasoned plan which clearly considers effects of                           recommendations                                                                  •        plan clearly aligns                                 with client goals•      adequate quality advice                            provided which applies to client questions within the SOA                                                          •      advice adequately                                applies information about client situation and some consideration                                 of key issues                                                                 •        adequately reasoned                           plan which sufficiently considers effects of recommendations                                                                 •        plan adequately aligns                                 with client goals•      poor advice provided                           with little or no relevance to client questions within the SOA                                                          •      advice has little or no                           application to information about client situation and/or                              consideration of key issues                                                               •      poorly thought through                                 plan which inadequately considers effects of recommendations                                                                 •      plan has little or no                           clear alignment with client goals(Range: 40 marks)(Range: 30–40 marks)(Range: 20–29.5 marks)(Range: 0–19.5 marks)10.   Ongoing service and                          review•      need and justification                               for service                                                              •        implementation schedule                                                                 •      note about maintaining                                 the SOA                                                             •      fees and costs                                 disclosed fully                                                          •        authority to proceed                                                            •        appropriate warnings(Range: 5 marks)Not applicable(Range: 0–5 marks)Not applicable11.   Overall SOA                             structure and presentation of SOA•      SOA is logical, easy to                              follow and well structured, and would be understood and valued by                          the client                                                           •        essential sections                                 (e.g. cover sheet, table of contents etc.) are included                                                                                              •        material within                         sections is clear and complete                                                            •      any tables or diagrams                             are clear and easy to understand                                                            •      any supporting material                           is essential to understanding the plan and referenced within the                           plan•      SOA is reasonably well                         structured and would be useful to the client. Some aspects                             lacking clear communication.                                                                                                  •        essential sections                            (e.g. cover sheet, table of contents etc.) are mostly                                 included                                                                                             •        material within                               sections is mostly adequate and complete                                                                                             •      any tables or diagrams                                 are clear and easy to understand with minor errors                                                                 •      any supporting material                                 is useful to understanding the plan and referenced within the                          plan•      SOA is poorly                                 structured and would be confusing to the client. Lacking in its                         communication of important issues.                                                                 •        essential sections                            (e.g. cover sheet, table of contents etc.) are not included                                                               •      material within                               sections is inadequate and incomplete                                                                 •      any tables or diagrams                                 are incomplete, unclear and confusing                                                          •        any supporting material                            is incomplete, irrelevant or incorrect with little or no correct                             referencing(Range: 10 marks)(Range: 7.5–10 marks)(Range: 5–7 marks)(Range: 0–4.5 marks) Examples of the Harvard style for in-text and reference list citations are shown below. For further guidance on the recommended Harvard referencing style, refer to the ‘Referencing and Citations Guide’ available from the ‘Library Learning Hub’ in KapLearn. (5 marks) Examples of in-text citations: One author/authoring body: •      As defined by Environment Australia (2003). Authoring body with a long name: •      The Australian Securities and Investments Commission prepared the guidelines in 2002 (ASIC 2003). Two or three authors/authoring bodies: •      Derivative transactions are not well developed in China (Collier & Masters 2003). Note, however, that if the authors’ names are incorporated in the text, ‘and’ is used instead of ‘&’: Collier and Masters (2003) state that derivative transactions are not well developed in China. More than three authors/authoring bodies •      Bonds with lower coupons have greater interest rate risk, as the value fluctuates more with interest rate changes (Ross et al. 2014, p. 167). Note: The names of all the authors or authoring bodies should, however, be provided in the reference list. No author/authoring body: •      According to the Australian Master Tax Guide (2004, p. 1116) a ‘project amount’ consists of two types of expenditure. Personal communication (conversation/interview, telephone call, fax, email): •      Mr F Boyle (Australian Stock Exchange) stated on 31 May 2004 that … Note : Personal communications are only cited within the text — they are not listed in the reference list. Direct quotations A direct quotation from a text or article must also include the page references. For example: ‘After its initial heyday some 30 years ago, Monte Carlo simulation lost favour due to the high cost of computing power and the added difficulty of producing meaningful probability distributions for the individual project parameters’ (Rudenno 1998, p. 125). Examples of reference list citations: References Australian Securities and Investments Commission (ASIC) 2011, Report REP 230 ‘Financial literacy and behavioural change’, ASIC, 15 March, viewed 13 January 2018, >. Bruhn, A & Miller, M 2014, ‘Lessons about best interests duty’, Australasian Accounting, Business and Finance Journal , vol. 8, no. 4, pp. 23–44, viewed 13 January 2018, >. Brunnermeier, MK & Pedersen, LH 2004, Predatory trading , working paper no. W10755,National Bureau of Economic Research, September. Damodaran, A 2013, The dark side of valuation: India business forum , online video, 5 June,viewed 13 January 2018, >. Koller, T, Goedhart, M & Wessels, D 2010, Valuation: measuring and managing the value of companies, 5th edn, John Wiley & Sons, New York. MacMillan, D 2008, ‘Issue: retiring employees, lost knowledge’, BloombergBusinessweek , 20 August, viewed 13 January 2018, >. Metals Australia 2014, Drill program to commence at Mile 72 Uranium, Namibia , ASX announcement, Metals Australia Ltd, 2 May, viewed 13 January 2018, >. Molineaux, J 2013, ‘Enabling organizational cultural change using systematic strategic human resource management: a longitudinal case study’, The International Journal of Human Resource Management , vol. 24, no. 8, pp. 1588–1612, viewed 13 January 2018, EBSCO Business Source Corporate Plus database. Muellbauer, J 2012, ‘When is a housing market overheated enough to threaten stability’, Proceedings of the Property Markets and Financial Stability Conference , Reserve Bank of Australia and the Bank for International Settlements, Sydney, 20–21 August, pp. 73–103, viewed 13 January 2018, >. Rosenzweig, P 2013, ‘What makes strategic decisions different?’ Harvard Business Review , vol. 91, no. 11, November, pp. 88–93. Rudenno, V 2012, ‘Resource project considerations’, The mining valuation handbook: mining and energy valuation for investors and management, 4th edn, John Wiley & Sons, Milton, Qld, pp. 67–96. Thompson, J & Howman-Giles, L 2014, ‘Quantification of loss and damages in commercial disputes’, paper presented at the Business Valuation and Forensic Accounting Conference, Sydney, 29 October. Legislation Corporations Act 2001 (Cth). Corporations Amendment (Simple Corporate Bonds and Other Measures) Bill (No. 1) 2013 (Cth). Case study: Graham and Anna Sutton You are Jess Craig, senior financial planner and principal of All Out Financial Planning, a boutique financial planning practice licensed by ABC Financial Solutions Pty Ltd (AFSL 222222). You first met Graham and Anna Sutton two months ago, when they were referred to you by an existing client. At that meeting you completed a data collection form and the clients provided you with copies of the following: •      current superannuation statement for both partners •      tax return for the previous financial year (2016/17) for each of them •      bank statement of loans and savings. The clients have requested that you prepare a statement of advice (SOA) which addresses their goals and objectives and each of the questions they have raised as outlined in the following ‘Scope of advice’. They have confirmed that the following information collected through a comprehensive fact find is accurate and still relevant. Personal details Family                       nameSuttonSuttonGiven                        nameGrahamAnnaMarital                      statusMarriedHome                       address1                      White Ave, Wollongong NSW 2550Contact                     number0416                         000 0010416                         000 002Current                     age5351HealthGoodGoodSmokerStopped                    smoking 18 months agoNoExpected                   retirement age62When                        Graham retires Dependant details NameSamJodieAge1513RemarksStill                   at schoolStill                   at schoolOnce                        the children have completed their schooling Graham and Anna will                         support them, if needed, up to $10,000 per year each, up to                      age 24 Employment details GrahamCurrent position as a senior                        mining engineer at BlueScope Steel, Wollongong, NSW, finishing in                  two weeks time.                                                 Commences new position as                      site engineer at Pilbara Port Corporation, WA in two months time.AnnaHome duties at the moment                       but has accepted a position as a personal assistant to the                      training and development manager at All Brains Inc., Perth,                         commencing in three months time Background Graham and Anna have been married for over 25 years. Graham has always been the main income earner as Anna willingly left her secretarial job many years ago to be the primary carer for their children. Graham has been working as an engineer at BlueScope Steel for the last 26 years and has recently been offered a voluntary redundancy as part of a major restructure. His total redundancy benefit will be $175,000 after tax. Fortunately, he was offered an ongoing contract as site engineer for Pilbara Port Corporation in Western Australia, with the same total package that he is on now ($195,000 plus superannuation of 9.5%), which he has accepted. The family will soon move to Perth and Graham will start his new role in about two months time. Anna is looking forward to returning to the workforce and has found a part-time role in Perth as personal assistant to the training and development manager at All Brains Inc. She confirmed she will start her new job in about three months time and will earn $52,000 p.a. plus superannuation of 9.5%. Graham and Anna plan to rent initially, at an estimated cost of $650 per week. They have approached an agent to purchase a property in Perth as they would prefer to own a property rather than rent. Graham will fly-in fly-out (FIFO) to the Pilbara region. He is required to work for 10 days and then have six days off. The company will bear all his flying and living expenses in the Pilbara region. The family home in Wollongong will be rented out at an expected gross rental of $600 per week. Attitude to investing — risk profile Following the completion of a comprehensive risk tolerance questionnaire and subsequent discussions with you, Graham and Anna have agreed with your conclusion that Graham is a ‘growth’ profile investor and Anna a ‘balanced’ profile investor. Assets and liabilities GrahamAnnaJointLoanSt. George Bank online a/c$150,000St. George savings a/c$8,000Colonial First State Index                    Australian Share fund$31,000BlueScope Steel                         superannuation fund (balanced profile)$370,000CareSuper Industry Fund –                 conservative balanced option$43,000Industrial property —                         Brisbane$445,000$340,000Investment property — Gold                      coast: Unit 1$155,000$135,000Investment property — Gold                      coast: Unit 2$245,000$205,000Wollongong — family home$685,000$217,000Car$25,000Home contents (insured                     value)$65,000 Estimated annual gross income details GrahamAnnaGross salary income$195,000$52,000Gross rental income**$53,400$15,600Interest income^$2,500$2,500Managed fund income ##$1,550Total$250,900$71,650 **     Rental income of 4 × properties including Wollongong home. ^              Interest income from online savings account. ## 5% income excluding fully franked credits. Annual expenses — joint Annual rent$33,800Expected rent in Perth                        (annualised)Annual living$42,000Holidays$10,000Deductible outgoings (i.e.                   interest)$44,0004                     rental properties including family home to be rented                   (interest-only repayments)Children’s education$20,000Life insurance (held outside                     super)$5,200Motor vehicle costs$3,000Total$158,000 Graham’s redundancy Graham has advised that the after-tax $175,000 redundancy payment will be added to the joint online savings account as above when he finishes. Graham’s superannuation Graham’s superannuation is with the BlueScope Steel Employer Fund. Its current value is $370,000 (tax‑free component is $22,000 and taxed component is $348,000). Anna’s superannuation Anna has a smaller superannuation balance of $43,000 in CareSuper Industry Fund — conservative balanced option (all taxed component). These benefits were rolled over to CareSuper when she gave up work. She has not made any further contributions. Investment properties The investment properties were purchased over an 18-month period in 2011/12. Both residential investment units on the Gold Coast are now valued below their original purchase price including costs. Original purchase price plus costs of the properties are as follows: •      Gold Coast: Unit 1      $159,000 •      Gold Coast: Unit 2      $268,000 •      Brisbane industrial property:       $385,000 •      Wollongong family home:  $310,000. Graham has read many books on building wealth through property investments and has attended a few investment seminars which have recommended negative gearing into property. He was told his property investments could double in 10–15 years, but he is very concerned now that both his Gold Coast units are valued below their purchase price. He is uncertain about what to do with these properties, though he finds that overall, after negative gearing is calculated, he gets a tax advantage. Graham said he is interested in exploring the establishment of a self-managed superannuation fund (SMSF) as he has read you can borrow through an SMSF to buy property. Graham’s and Anna’s insurances Graham and Anna have clearly said that although they will require a review of their life insurance requirements, they do not want you to address this area in your SOA. They want you to address this separately at a later time. However, they do want you to address some preliminary questions they have relating to the ownership and workings of life insurance policies. Their respective superannuation statements show that Graham and Anna have basic life and total and permanent disability (TPD) cover. They have said they both hold other life insurance policies outside of the policies in their superannuation funds. Estate planning Both Graham and Anna have simple wills which were drawn up when they bought the family home in Wollongong 15 years ago. In it, they leave everything in individual names to each other. They do not have powers of attorney, nor have they completed beneficiary nomination elections with their respective superannuation funds. Graham and Anna’s retirement plans Graham plans to work for at least nine years and hopefully build enough wealth to retire at the end of that time. Anna plans to retire at the same time as Graham. When they retire they have estimated, given no debt, they will need $65,000 per year in today’s dollars, excluding major holidays, which they plan to take every second year at a cost of $15,000 in today’s dollars. Their wish at this stage is to retire in Wollongong or near the south coast of New South Wales. Anna’s mother Marie — aged care considerations Graham and Anna also mentioned that Anna’s mother, Marie Francis, age 78, who is living in their granny flat (non‑homeowner) in Wollongong has, as a result of illness, been recently assessed by an aged care team who has granted approval for her to move into an aged care facility. Marie’s only investment is $380,000 in cash and term deposits with her bank. She receives a part age pension. Graham, Anna and Marie have selected a church-operated facility in Wollongong which Marie feels comfortable with. It has a published price for a refundable accommodation deposit of $240,000 (which she will pay in full upon entry using her cash/term deposit funds). They believe that she can live comfortably on an income of $22,000 per year. Anna’s sister, who lives near Wollongong, will be able to provide support while Graham and Anna move to Perth. Assignment tasks (95 marks) Scope of advice Your task is to: 1.      Examine the clients’ stated goals and objectives for each of the following questions and issues they have raised and, after analysis, consider appropriate responses. The questions and issues raised by the clients are important in the development of appropriate strategies you believe the clients should be considering. Those questions to which the clients require a specific response should be addressed in your SOA. All goals, issues and directions raised by the clients form the agreed scope of your advice to the Suttons. 2.      Complete an SOA that incorporates, in a coordinated and communicative way, the strategies the clients should be adopting and suitable responses to each of the questions the clients want you to address. Your SOA should also conform to the content and structure of an SOA and its component parts as described in Topic 8 and the sample SOA. The following questions and issues raised by Graham and Anna are designed as prompts to help you consider the key issues. A number of assumptions are required to be determined. These assumptions should be incorporated into your responses and the SOA. Key issue •      When they retire when Graham reaches age 62, they have estimated they will require $65,000 per year in today’s dollars, excluding the cost of holidays every second year estimated at $15,000. They want your advice as to whether this is realistic and achievable, and what strategies they should be undertaking now to achieve this important financial goal, and why. They have noticed that their superannuation funds offer retirement income streams in the form of account-based pensions. They would like to know how they work and whether they are something to consider in retirement. In addressing these key retirement issues, the Suttons have also raised the following related questions and issues which they want you to address in your written advice: •      Should they be looking to establish an SMSF and what are the pros and cons of doing so? How could an SMSF assist them in accumulating wealth for their retirement, particularly if they wanted to purchase more property? What can an SMSF do that their current funds cannot? •      What is your view of them continuing to invest in residential property, coupled with negative gearing, to build wealth for retirement? Additionally, what options should they be considering with their residential investment properties given their poor performance? What are the pros and cons of purchasing a Perth property to live in compared to renting? Do you have a view as to what they should do? Graham has heard that there would be no capital gains tax if he rents his family home for a short period and he would like you to explain the current rules about this. •      Graham and Anna have never heard of superannuation beneficiary nominations and have not nominated any beneficiaries to their superannuation. What are they and what should they do about them, if anything? •      Graham has requested you to advise him on a suitable superannuation fund which can accept his rollover benefits, employer and voluntary contributions. He also wants to know what he should do with his redundancy package. •      Anna wishes to build her superannuation for retirement after hearing about the importance of saving for retirement on the local radio. When she starts her new job, she would like to invest more in superannuation and would like you to advise her on how much she should contribute. Should she continue to use CareSuper as her principal superannuation fund? •      In regard to Graham’s and Anna’s life insurance arrangements, although they wish to address precise strategies in this area separately, as they have policies both inside and outside superannuation, what are the issues they need to be aware of with each option? Is it more advantageous to incorporate all the policies they need through their superannuation funds? Marie’s aged care requirements •      Graham and Anna also want your advice on aged care and Marie’s cash flow when she moves to the aged care facility. They would like to know how the fee would be calculated, the implications for her age pension and how she should fund the refundable accommodation deposit. They also want to know approximately how much age pension Marie will get once she enters the facility. Note: You are required to address all the questions and issues described above. Clarity and conciseness in the articulation of your responses are important, with any explanations required to be sufficient for the clients to understand. Marks are awarded for assignment research and referencing. Assignment research and referencing (5 marks) You are required to research beyond the subject notes in answering the questions in this assignment. Reference and cite all your sources when quoting or using material from external sources. Include a reference list at the end of your assignment. You are required to: •      use an appropriate presentation and format for your assignment •      demonstrate independent research and analysis •      demonstrate appropriate use of relevant references •      follow the Harvard referencing style as recommended in the ‘Referencing and Citations Guide’ available from the ‘Library Learning Hub’ in KapLearn •      include a reference list at the end of your assignment following the recommended referencing style •      adhere to the assignment word limit. Insert your answers to the case study below this line End of answers to case study


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