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Introduction : Economic and Legal Context for Financial Planning
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Business cycle
Recent issues
Current business cycle of Australia is presently going through an expansionary phase. Industrial growth of Australia has been affected by a pandemic situation that impacted by less productivity -2.3%. GDP of Australia has been decreased by less consumption growth in household consumption and a recovery in services exports. Interest rate and inflation impact on business organisations adverse the profitability simultaneous productivity of organisation has been reduced by lack of productivity growth by profitability.
Monetary and fiscal policy changes
Reserve Bank Australia has been to change the REPO rate to improve productivity of these organisations. Change in REPO rate by the Reserve Bank of Australia is going to influence the capital market for investment that creates financial liquidity in organisations along with productivity growth.
Impact on the future growth of the business
Reducing REPO rate increases productivity of organisations because of the best interest rate on debts (Musarat et al. 2021). Reducing repo rate also provides financial flexibility by adopting banking loans for business expansions reduced but consumption of expenditure of loans.
Outlook on inflation
Recent issues
Increasing inflation rate impact on hospital expenditure is positive because hospitals would face excessive cost of activities. Hospital industry suffered by huge expansion on salaries at Origins along with service taxes that would be impacted by different elements of product improvisation.
Monetary and fiscal policy changes
Managing the inflation rate banking organisation and financial department of the Australian government implement less income tax policies in a particular fiscal period. Fiscal policy impact on inflation increases availability of monetary strength to common people.
Impact on the future growth of the business
Amendment in tax policies by Australian government would provide better opportunities for Organisational with reduced expenditure by refile in calculated tax of certain fiscal period. Additionally, Future possible growth by changing tax policies in the favour of organisations helps to grow business by using extra reserves of taxes.
Wages growth
Recent issues
Haring more coders and software’s has raised issues regarding excessive cost consumption due to wages growth. Additionally, potential wages increase would impact adverse budget planning along with reducing financial expenses. Wages growth impacted on organisation as successive expenditure consumptions in business operations that increase average cost of production. Excess expenses totally flipped on productivity pricing because of managing cost of production and increasing selling price of products that reduce competitive advantage among competitors (Dharma et al. 2020). Hiring more employee’s productivity of an organisation would be affected as adverse on organisation because of excessive cash outflow due to wages growth.
Monetary and fiscal policy changes
Improvisation of Fiscal policies regarding Labour Law would be effective organisational productivity growth because it will be helpful to managing excessive cost of wages. Fiscal policies regarding wages need to be changed according to growth of wages that would be manageable by relaxation on taxable rules and regulations. Additionally, reducing sales tax in operational activities would be able to adapt to financial advantage in organisational activities. Using various advantages in sales tax organisation favoured by less expenditure that would be useful manning wages growth.
Impact on the future growth of the business
Amendment in sales tax policies organisation would be able to create financial advantages by creating financial resource management in expenses calculation. Mitigation growth of voices would be impacted as financial flexibility provisions expansion because managing total expenses to diversify elements would be favourable for organisational productivity (Yang and Shafiq, 2020). Future growth of business would be positive, producing tax policies for uncertain expenditure management.
Alternative sources of funding
Recent issues
Alternative sources of funding would be possible by angel investors' participation in this organisation. Investors' approach to this organisation's ownership equity could be reduced by new investors' participation that also provide financial funding to this organisation. Additional funding of resources would be able to repair uncle's start-up fund along with financing business with additional fundings (Vasylieva et al. 2018). Recent issues of funding start-up funds to uncle would be the reason for lack of financial resources that would affect the adverse financial operation of the organisation. Additional requirements of funding would be collected by equity financing otherwise debt financing to repay the start-up fund create financial issues as interest expenditure.
Monetary and fiscal policy changes
Monetary and fiscal change in organisation would be effective by adopting equity financing. These financial resources are effective to repay the Start-up fund and additional shares to business expansion with an excessive available fund of organisations (Zafar et al. 2019). According to equity financing adoption by management effective to available financial resources for productivity.
Impact on the future growth of the business
Equity financing helps an organisation grow financial resource selling of share percentage to investors. Additional productivity of business would be affected positively by excessive availability of financial resources. Repairing of debt of financial Resource Management impacts positively on organisational profitability because of interest in digital recording debt financing would be eliminated in future operations.
Economic issues
Recent issues
Economic issues in Business expansion in different regional organisations would face inflation, interest rate regarding problems along with government policies and rules. Business expansion would be identified as labour and business rules and regulation of different countries.
Monetary and fiscal policy changes
Government rules and regulation according to business establishment and expansion in different religions would be impacted on business operations. Relaxation in business establishment in different regions for multinational companies would be positive for business growth.
Impact on the future growth of the business
Impact on business growth would be positive by relation to government policies for new business organisation establishment. Flexible government rules and regulation would be adopted by organisations that would help to gain productivity growth along with profitability (Yang, 2020). Future possible growth by changing tax policies in the favour of organisations helps to grow business by using extra reserves of taxes. It will act as financial burden consumption and also reduce operational activity of this organisation due to lack of financial resource availability. Additionally, it would be affected on organisational establishment by taking different government rules and regulation regarding business expansion.
Reference list
Dharma, F., Shabrina, S., Noviana, A., Tahir, M., Hendrastuty, N. and Wahyono, W., 2020. Prediction of Indonesian inflation rate using regression model based on genetic algorithms. Jurnal Online Informatika, 5(1), pp.45-52.
Musarat, M.A., Alaloul, W.S. and Liew, M.S., 2021. Impact of inflation rate on construction projects budget: A review. Ain Shams Engineering Journal, 12(1), pp.407-414.
Vasylieva, T.A., Harust, Y.V., Vynnychenko, N.V. and Vysochyna, A.V., 2018. Optimization of the financial decentralization level as an instrument for the country's innovative economic development regulation.
Yang, X. and Shafiq, M.N., 2020. The Impact of Foreign Direct Investment, Capital Formation, Inflation, Money Supply and Trade Openness on Economic Growth of Asian Countries. iRASD Journal of Economics, 2(1), pp.25-34.
Yang, X., 2020. Health expenditure, human capital, and economic growth: an empirical study of developing countries. International journal of health economics and management, 20(2), pp.163-176.
Zafar, M.W., Shahbaz, M., Hou, F. and Sinha, A., 2019. From nonrenewable to renewable energy and its impact on economic growth: the role of research & development expenditures in Asia-Pacific Economic Cooperation countries. Journal of cleaner production, 212, pp.1166-1178.
