1. It is important to consider the fact that several factors are viewed by the tertiary sector staff members while deciding over the situation on placing the individual superannuation contribution that have certain benefit plan in along with the investment choice plan (Pratt 2013). On analysis, it has been found several issues that gets associated with the time value of money concept as it help in decision-making process in the most appropriate way. This study mainly deals with superannuation as it help in motivating people for the reason being it saves and invest for the future financial years as well as their retirement years looks ways for intensifying with the country Australia for past two years. Furthermore, the Australian Government had made ways for becoming proactive in action that will enhance minimum contributions and complies with the superannuation or in that case retirement funds on the behalf of employees and employers (Hoskin, Fizzell and Cherry 2014).
Several reasons are present like policy of superannuation that reveals the need for decreasing the burden from the social security systems especially used for pension payments provision for supporting the people at the stages of retirement within their lives. It is clearly mentioned in the superannuation law that explains the significant saving in the current situation there are billion dollars superannuation contributions (Picker et al. 2016).
UniSuper Limited is one of the industries that deal in superannuation funds as it provides services and deal with the superannuation within the tertiary education within Australia. The company takes into account high education institutions and also the TAFR colleges (Otley and Emmanuel 2013). There are many revolutions that are present at the time of administrating superannuation funds after looking at the provision of service in the present years that ensures deliberate increase in the superannuation funds products for presenting the options of investment as well as retirement plans.
Explained Benefit Plan is one of the plans that offer benefits to the employees at the time of retirement that is explained by the given formula. It has several factors for determining the activities such as average salary of employees, age along with number of years employed. Nevertheless, the Explained Benefit final benefit is a plan that explains calculates employee retirement benefit (Narayanaswamy 2014).
Retirement benefit= benefit salary length of membership lump-sum factor average service fraction
It is noted that employees who engage in tertiary education deals with adopting the Explained Benefit Plan. In other words, it is deemed to be engaging in superannuation contributions that are recorded and invested in assets group that is predictable by the Trustees of UniSuper Limited (Macve 2015). It looks into getting final benefit payout that is using the above formula as well as investment performance of the portfolio of assets that becomes irrelevant that fails to impact the entire retirement payout. It takes into consideration investment risk that is faced by the company named as UniSuper Limited. It reveals the fact that employees may not benefit from several gains as determined by their portfolio that defines the benefits in an effective way (Spieceland, Thomas and Herrmann 2013).
The time value of money considers as one of the main aspect that needs to be considered by the investors. The reason behind that is the dollar in hand for present time frame that is worth than more than a dollar that is promised in the future financial years. In other words, the dollar within hand in present years need to be considered for investment for earning capital gains as well as earned interest at the same time (Lovell 2014). In that way, dollar is promised in the future years that is worth decreased than a dollar due to rate of inflation. Furthermore, it can be predicted that the resultant portfolio explains the ways for getting access to surplus systematic risks for numerous people. It is the situation when individuals are deemed to have additional wealth then they have the aptitude or ability to spend in the detailed risk free assets that is not measured as an problem in an effective way (Hoskin, Fizzell and Cherry 2014).
Money can be easily employed for productive use that should have uniqueness based on time when it is either gathered or paid. It is the value that should be selected were money is deemed to be valuable than its value in the financial years (Linsmeier 2013). It is the responsibilities of the investors to consider money that have time value due to different reasons such as risk, consumption, investment opportunity, level of uncertainty as well as rate of inflation. It is the role of the investors who predicts that future is measured to be risky as well as unsure where there is cash depletion that remains within the power and persons who make or behavior expenditure to the parties. It is unspoken that there is indecision current in the prospect cash inflows as it is relied upon the bank and creditors (Spieceland, Thomas and Herrmann 2013). As mentioned in the investment selection plan, it is the investors who can choose from the various asset types or in that case portfolios where superannuation contributions are entirely invested as well as selecting from the given investment strategies as mentioned below with proper explanation:
Stable Fund considers as the investment strategies that takes mainly talks about fixed interests after aligning with the bond securities that decreases the level of exposure to either local or international property or shares (Hoskin, Fizzell and Cherry 2014).
Secure Fund is other investment strategies that employees can select from the investment selection plan when it takes into consideration mainly Australian cash and fixed asset securities (Spieceland, Thomas and Herrmann 2013).
Shared Fund is other investment strategies that employees can select from the investment selection plan that when focus mainly on investment. It deals with or relies upon the domestic and the international shares (Hoskin, Fizzell and Cherry 2014).
Trustees Selection Fund is other investment strategies that employees can select from the investment selection plan where certain balanced fund are taken into consideration that includes factors such as local shares, international shares, infrastructure investment, property assets that aligns with the private equity (Henderson et al. 2015).
It is understood from the above mentioned investment strategies that it is easy to differentiate actions after considering various features of risk and return that aligns with the secured fund. It mainly carries out the increased rate of risk that is predicted for offering increased entire average return for future analysis purpose (Spieceland, Thomas and Herrmann 2013). It is stated that employees those who are selecting the investment fund, they need to consider the entire retirement payment after gathering the returns. It can be permitted from the investment strategy that mainly focuses upon the related investment risk. Furthermore, the select company named as UniSuper Limited had offered a wide range of investment products for Explained Benefit Plan as well as several subscribers of investment selection plan after distributing the deal with various benefits of retirement (Edwards 2013). Investment options as well as pension plans are mentioned below with proper explanation:
Indexed pensions can be considered as one of the investment options and pension plans as provides regular income that is indexed that depends upon the inflation rate. It is significant to be payable as long as the person lives and then it is transferred to the person’s spouse or is relied on the death of that individual (Deegan 2013).
Individual life indexed pension can be considered as one of the investment options and pension plans that provides increased regular income after comparing it with the standard indexed pension. It mainly explains the plans but are not transferred based on the death of an individual (Hoskin, Fizzell and Cherry 2014).
Allocated pensions can be considered as one of the investment options and pension plans that provides with a regular income at level after selecting the access to capital when individuals select from the four main available investment strategies. It is where capital of people might be invested in given investment plan (Crawley and Wahlen 2014).
Roll over options can be considered as one of the investment options and pension plans that provide an individual after transferring for roll over retirement fund for person to industry superannuation. It gets approved from either personal or investment fund that aligns with an approved deposit fund with a retirement savings account (Hoskin, Fizzell and Cherry 2014).
Part-cash distributions can be considered as one of the investment options and pension plans that provide an individual with an option for gathering a distinct percentage of retirement funds of an individual that is subject to the tax as well as regulatory approvals. It is the cash that is generated from the employee investment or for the individual purpose of consumption. At the time of undertaking decisions, the individual need to consider factors such as risk and return profiles. It depends upon the factors that take into account aspects that relate with the time value of money as well as inflation (Hoskin, Fizzell and Cherry 2014).
2. This question explains the concept of Efficient Market Hypothesis that is also known to be Random Walk Theory. This theory explains the proposition when the recent stocks are considered for gaining information for the company (Weil, Schipper and Francis 2013). It is where the company gets the information and plans for generating more profits in the near future. Furthermore, it mainly deals with main issues that are present in the finance. It further states the reason after looking at the price changes that prevails in the security markets and explains the ways to which changes can be noted. It is the role of investors who need to allow or spent some time for understanding the securities that are either undervalued or overvalued. It requires predicting ways so that it increases the values as for getting benefits in the upcoming financial years. Several investors are present who act as a pension fund manager as they help in selecting the best securities that can outperform in the current market condition.
It is important to understand the real cause behind employing different valuation and forecasting techniques that are used while undertaking investment decisions. Adding to that, there are numerous factors that are taken into deliberation where the pension fund manager gets involved for transforming the important decisions that will help in gaining of substantial profits in the most appropriate way (Spieceland, Thomas and Herrmann 2013). Nevertheless, Investors need to predict the activities where market is deemed to be efficient and dedicate the prices to be deemed. This can be either low or high that mainly depends upon the market condition flow.
It is understood that if an efficient market hypothesis is true, then the pension fund manager will be allowing for picking a portfolio with a pin. Addition to that, it can be clarified by stating the results of portfolio that cannot be diversified as well as increases in the ways that correlates with the stock function (Schroeder, Clark and Cathey 2016). This fact explains where it leaves the fund with outstanding risk where it cannot be satisfied in any types. Moreover, on the opposing fact, an assortment may offer with an augmented beta in agreement with the risk inclination for the persons in certain ways. It is needed to believe the fact within the non-perfect world that is tax continuation. It is the tax location of the shareholder that is requisite to take into deliberation and imperative fact in real life situation. It is noted that the equilibrium procedure of numerous assets, surplus amount is gathered that leads to augmented taxability situation. Consequently, it is the return after tax that takes into account for given assets for individuals that are presented in the low brackets as well gain favorable condition. It is the state where the factors that are taken into account that are deemed for looking at the tax status as it is one of the main aspects that require proper attention (Saunders and Cornett 2014).
Reference List
Crawley, M. and Wahlen, J., 2014. Analytics in empirical/archival financial accounting research. Business Horizons, 57(5), pp.583-593.
Deegan, C., 2013. Financial accounting theory. McGraw-Hill Education Australia.
Edwards, J.R., 2013. A History of Financial Accounting (RLE Accounting) (Vol. 29). Routledge.
Henderson, S., Peirson, G., Herbohn, K. and Howieson, B., 2015. Issues in financial accounting. Pearson Higher Education AU.
Hoskin, R.E., Fizzell, M.R. and Cherry, D.C., 2014. Financial Accounting: a user perspective. Wiley Global Education.
Linsmeier, T.J., 2013. A Standard setter’s framework for selecting between fair value and historical cost measurement attributes: a basis for discussion of “Does fair value accounting for nonfinancial assets pass the market test?”. Review of Accounting Studies, 18(3), pp.776-782.
Lovell, H., 2014. Climate change, markets and standards: the case of financial accounting. Economy and Society, 43(2), pp.260-284.
Macve, R., 2015. A Conceptual Framework for Financial Accounting and Reporting: Vision, Tool, Or Threat?. Routledge.
Narayanaswamy, R., 2014. Financial accounting: a managerial perspective. PHI Learning Pvt. Ltd..
Otley, D. and Emmanuel, K.M.C., 2013. Readings in accounting for management control. Springer.
Picker, R., Clark, K., Dunn, J., Kolitz, D., Livne, G., Loftus, J. and van der Tas, L., 2016. Applying international financial reporting standards. John Wiley & Sons.
Pratt, J., 2013. Financial accounting in an economic context. Wiley Global Education.
Saunders, A. and Cornett, M.M., 2014. Financial institutions management. McGraw-Hill Education,.
Schroeder, R.G., Clark, M.W. and Cathey, J.M., 2016. Financial Accounting Theory and Analysis: Text and Cases: Text and Cases. Wiley Global Education.
Spieceland, D.J., Thomas, W. and Herrmann, D., 2013. Financial accounting. McGraw-Hill Higher Education.
Weil, R.L., Schipper, K. and Francis, J., 2013. Financial accounting: an introduction to concepts, methods and uses. Cengage Learning.
Essay Writing Service Features
Our Experience
No matter how complex your assignment is, we can find the right professional for your specific task. Contact Essay is an essay writing company that hires only the smartest minds to help you with your projects. Our expertise allows us to provide students with high-quality academic writing, editing & proofreading services.
Free Features
Free revision policy
$10Free bibliography & reference
$8Free title page
$8Free formatting
$8How Our Essay Writing Service Works
First, you will need to complete an order form. It's not difficult but, in case there is anything you find not to be clear, you may always call us so that we can guide you through it. On the order form, you will need to include some basic information concerning your order: subject, topic, number of pages, etc. We also encourage our clients to upload any relevant information or sources that will help.
Complete the order form
Once we have all the information and instructions that we need, we select the most suitable writer for your assignment. While everything seems to be clear, the writer, who has complete knowledge of the subject, may need clarification from you. It is at that point that you would receive a call or email from us.
Writer’s assignment
As soon as the writer has finished, it will be delivered both to the website and to your email address so that you will not miss it. If your deadline is close at hand, we will place a call to you to make sure that you receive the paper on time.
Completing the order and download