Business Studies Grade 12 Human Resources Essay

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Accounting Memorandum. 2012. Grade 12 Business Studies Memorandum 2012 . Section A (Compulsory). Question 1. 1.1.1 A ✓✓. 1.1.2 D ✓✓. 1.1.3 C ✓✓.

Accounting Memorandum

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Grade 12 Business Studies Memorandum 2012 Section A (Compulsory) Question 1 1.1.1 A 99 1.1.2 D 99 1.1.3 C 99 1.1.4 A 99 1.1.5 D 99 1.1.6 D 99 1.1.7 C 99 1.1.8 A 99 1.1.9 C 99 1.1.10 D 99 10 x 2 = 20 1.2.1 1.2.2 1.2.3 1.2.4 1.2.5

True 99 False 99 False 99 True 99 False 99 5 x 2 = 10

1.3.1 F 99 1.3.2 D 99 1.3.3 B 99 Copyright reserved

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1.3.4 C 99 1.3.5 J 99 5 x 2 = 10 Total Section A: 40 Section B (Answer all questions) Question 2 2.1.1 ƒ Corporate social responsibility refers to the role played by corporate enterprises in providing for the urgent needs of the community in which they operate. 99 ƒ This programme includes poverty alleviation, education and training, an HIV/Aids clinic, recreational facilities etc. 99 ƒ Commitment by the business to behave ethically and contribute to economic development while improving the quality of the workforce, their families and society at large. • Make sure alternative answers are related to the question. • Any other relevant description of corporate social responsibility that illustrates a full understanding of the concept. • An example without an explanation to illustrate the concept – no marks. 4 2.1.2 (Any three) Employees Community Shareholders Creditors Customers Government 6

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2.2 o People (Social Responsibility) – assessment of CSR/CSI involvement o Planet (Environmental Sustainability) – an assessment of environmental impact (green footprint) o Profits (Economic Sustainability) – traditional financial reporting OR o Management of finances o Management of social and environmental risks o Management of obligations and opportunities 6 2.3 • • • • • •

Union strives to improve working conditions of employees Union gets involved in the joint decision making with management Protects employees from unfair dismissal, retrenchments etc Serves as a monitor for the implementation of Legislations Act on behalf of members in dispute resolution Any relevant answer. 5 x 2 = 10

2.4 • • • • • • • •

The Human Resources Manager must prepare/evaluate job description99 The Human Resource Manager must indicate the job specification. 99 A decision must be made as to whether recruitment should be internal. If internal is unsuccessful then look at external recruitment. 99 If external, the Human Resources Manager must select the relevant recruitment source e.g. from recruitment agencies, tertiary institutions, or placing an advertisement in the newspaper. 99 The advertisement must be prepared with the relevant information, e.g. The name of the company, contact details, name of the person to be contacted regarding the vacancy.99 Place the advertisement in the appropriate media. 99 Accept any order in presentation of steps. Any 4 x 2 = 8 OR

• • • • •

• • • • •

Recruitment Planning – job analysis is carried out. 99 Recruitment Action – how, where and when recruitment should take place and who will be responsible. Several methods can be used. 99 Exploration of Human Resources – first step in the physical recruitment activity in the recruitment process. Internal and external sources can be used. 99 Screening – Applications are screened to find out if they qualify according to requirements of the post. 99 Provisionally Selected Applicants – List of qualifying applicants provides the human resources department with provisionally selected applicants and it completes the recruitment process. 99 Any 4 x 2 = 8 OR Recruitment 9 Selection 9 Placement 9 Induction 9 Allocate a maximum of 4 marks even if there are explanations. Any 4 x1 = 4

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2.5.1 Interest = P x R x T = R15 000 9 x 12/100 9 = R1 800 99 4

x 12/12 9

Note: (a) Allocate maximum marks if only the answer of R1 800 is given (Max 4). (b) Allocate a maximum of 2 marks if procedure and method is correct but the final answer is incorrect. • • •

Low risk because return is guaranteed. 99 The return of 12% may be better than other forms of investment. 99 Any other relevant answer related to the reasons why the investment is good.

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2.6 • • • •

Risk takers 99 Creative thinkers, who challenge the conventional way of thinking 99 Good leaders, as they persuade others to buy into their idea 99 Passionate visionaries who believe they can do something others have not tried/succeeded at 99 • Opportunists - who happen to be in the right place at the right time99 • Have perseverance and commitment 99 • Independent spirits & are internally motivated 99 • They either have the necessary skill, knowledge or expertise to make a success of the business, or know how to hire the right people to fill their personal shortcomings. 99 • Any four. 8 2.7.1 Public Company 99 2 2.7.2 • Easy to establish and dissolve. 99 • Inexpensive to establish. 99 • Sharing of responsibilities and risks. 99 • Makes provision for partners to make quick decisions/can easily adapt to various economic challenges. 99 • Few legal requirements. 99 • Direct control over your business matters. 99 • More capital can be gained. 99 • Creditworthiness is higher because partners are jointly and severally responsible for liabilities of the partnership. 99 • Allows for specialisation / Combination of different skills. 99 • Can be easily converted to another form of ownership e.g. company. 99 • Any other relevant answer related to advantages of a partnership. Any 3 x 2 = 6 2.8 • • • •

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Addressing and correcting imbalances in negotiating powers between consumers and credit providers. 99 Discouraging reckless credit granting by credit providers. 99 Encouraging equity in the credit market. 99 Encouraging responsible borrowing and avoidance of over-indebtness. 99 60 4

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Question 3 Line graph 99 2 Lowest = R134.61 99 Highest – R136.95 99 4 The anticipation of an increase in profits as a result of the pre-Christmas purchases by customers 99 caused many shareholders to buy Shoprite shares, which caused the share price to rise. 99 OR A drastic increase in prices during this period caused profits to increase 99 and thus there was a greater demand for the Shoprite shares which caused the share price to rise. 99 4 Loss 99 2

3.1.1 3.1.2 3.1.3

3.1.4 3.1.5 • • • • • • • • • • •

Serves as a link between investors and entrepreneurs 99 Serves as a barometer of economic conditions 99 Encourages small investors to obtain a share in the commerce of a country be buying shares 99 Provides a mechanism for securities to be priced and traded 99 Regulates the activities of its members 99 Mobilises the funds of insurance companies and other institutions Ensure that the market operates in a transparent manner Financial institutions can invest surplus funds in shares Shares of companies are assessed and valuated by experts Share prices are published daily (in cents), keeps investors well informed. Provides a Stock exchange News service (SENS) through which it distributes company news to the media. 5 x 2 = 10

3.1.6 Unit trusts 99 • A unit trust is a shopping basket of shares of different companies and other financial instruments traded on the stock market 99 • Large group pools capital for investment in stock, capital and/or money markets • Investment spread over a sequence of units • Invested on individual’s behalf by a fund manager or asset manager • Price of unit trust fluctuates depending on the performance of shares in its portfolio • Can invest with a lump sum or monthly • Low risk – portfolio managed by experts 99 Fixed property 99 • Land appreciates with time and can be sold at a profit when land prices go up. 99 • Regulations of local authority must be adhered to with regards to improvements etc • Tax payable on property and can reduce income. • Can provide ongoing income in the form of rental • Tax and maintenance costs must be accounted for • Sell property – profit • Low risk – but investment growth 99 Endowments 99 Copyright reserved

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A type of long-term insurance They are fixed investments for a minimum of 5 years 99 Money paid into a policy every month, earns compound interest Financial consultant’s commission can be high Normally saving for education or retirement Low risk, but investment growth 99

Government retail bonds 99 • An RSA Retail Bond is an investment with the government of South Africa which earns fixed interest for the term of the investment 99 • The government will issue three different bonds i.e. the two-year retail bond, the three-year retail bond and the five-year retail bond. These bonds provide a safe, secure and risk-free investment opportunity for ordinary South Africans • Low risk – interest rate is fixed 99 Offshore investments 99 • Asset managers advise that 25%-30% of an investment portfolio should be invested abroad 99 • A fund manager will use local currency t buy foreign investments • An offshore investment will give you the opportunity to spread the risk over more than one market • Low, medium or high risk, influenced by interest rate, inflation rate and overall economic performance of the country that the money is invested in 99 Linked-rate deposits99 • Short-term investment – single deposit for a fixed term at an interest rate that is linked to prime rate 99 • Low risk – interest rate is fixed 99 Notice deposits99 • Short-term investment option aimed at investors who want a high return, as well as the benefit of having access to funds at a short notice 99 • Medium risk99

3.2

Bonus deposits99 • Short-term investment, where money is invested for a specific period at a predetermined guaranteed minimum interest rate, equivalent to the starting rate 99 • Low risk – interest rate is fixed 99 3 x 6 = 18 Please note: Heading: 2 marks Explanation: 2 marks Risk involved: 2 marks The following strategies are used by different businesses to overcome specific challenges. Identify the type of strategy used for each of the following scenarios: 3.2.1 Defensive strategy 99 2 3.2.2 Backward/vertical integration 99 2 3.2.3 Market development/intensive strategy 99 2 3.2.4 Horizontal diversification or diversification 99 2 3.2.5 Market penetration/intensive strategy 99 2

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3.3.1 • • • • • •

Preferential procurement to black business entrepreneurs 99 Investment in enterprises managed or owned by black people 99 Black entrepreneurs are advantaged by human resource and skills development legislation as well as training 99 Increasing the number of black people who own, manage and control productive assets and enterprises 99 Promote the economic unity inclusive of all population groups in business in South Africa 99 Any other relevant benefit related to BBBEE 3x2=6

3.3.2 Yes 99 Justification: There is an increase in the number of black people who manage and own businesses. 99 No 99 Justification: Not all businesses adhere to the provisions of the BBBEE Act. 99 Note: (a) Yes/No without any justification allocate zero marks. (b) Accept any other relevant answer justifying the implementation of the act. 4 60 Question 4 4.1 • • • • • • • • • •

All members support each other within the team 99 Team members should be credited and not individual members 99 Members are committed to teamwork and want to perform well 99 Members work with a common desire to achieve their goal 99 The team has set out realistic goals and objectives 99 Members show respect for each team member’s skills and knowledge 99 Sharing of team values/team members show mutual respect and trust for each other 99 Each member possesses the necessary skills to perform his/her task within the team 99 Team members keep others well informed/communication 99 Any other relevant answer related to characteristics of a successful team. Any 5 x 2 = 10

4.2 Success factors: • Sets goals and objectives of the business. 99 These must be realistic and achievable 9 • Communicates mission and vision of the business to all workers. 99 Workers are continuously reminded about the mission and vision of the enterprise through workplace forums, meetings, etc 9 • Responsible for the planning and organising of business activities. 99 Prioritise business operations through thorough planning 9 • Leading the organisation. 99 Effective leadership in the performance of the general management functions 9 • Controls all the processes in the business. 99 Ensures that all the relevant functions and procedures are effectively performed 9 • Involved in the disciplinary processes of the organisation. 99 Ensure adherence to legislation regarding disciplinary procedures 9 Copyright reserved

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General management must develop a strategic plan. 99 Must consist of planning, organising, leading and control 9 • Top management activities are measured largely by the final profitability figures. 99 There should be growth in the profits of the enterprise from year to year 9 • Improvement can be achieved through the setting of high but realistic targets. 99 Targets must be reviewed with a view to improvement ie target set versus target achieved 9 • Strategic plan must be in place. 99 Report and feedback on the roll out of the plan 9 • Any other relevant answer related to the functions of general management and its contribution to success. Failure factors • Absence of no concrete goals and objectives of the business. 99 Goals are not realistic and achievable 9 • Non-communication of vision and mission of the business to all workers. 99 Management did not consult with the subordinates in the decision making process 9 • Management did not take responsibility for planning and guiding the overall management of business. 99 Not prioritising business operations through planning 9 • Lack of leadership skills. 99 Ineffective leadership in the performance of the general management functions 9 • Ineffective control of all processes in business. 99 Not ensuring that all relevant functions/procedures are effectively performed 9 • Ineffective organising of the factors of production 99 • Business cannot maximise profitability 99 • Lack of organisational skills 99 • Cannot motivate subordinates/delegate instructions 9 • Does not communicate the vision/mission to all workers 9 • Any other relevant answer related to the functions of general management and its contribution to failure. Facts: 2 Explanation: 1 Max: 10 4.3 • • • • • •

Acknowledge that there is conflict between the employee and management 99 Identify the cause of the conflict 99 Arrange a meeting between the employee and management 99 Devise strategies to resolve the conflict 99 Minutes of the meeting must be recorded 99 Prepare a memorandum of understanding that will be signed by the employee and management 99 • Any other relevant answer relating to steps in resolving conflicts 99 Any 5 x 2 = 10 OR Alternative answer: • Ignore the conflict 99 • Pre-negotiation 99 • Negotiation 99 • Post-negotiation 99 • Follow-up of the process 99 OR Alternative answer: Copyright reserved

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Approach the conflict directly 99 Bargaining 99 Mediation 99 Arbitration99 Right to appeal 99

OR Alternative answer: • Meet with conflicting parties 99 • Make sure the parties understand that it is okay to disagree 99 • Allow each party to state their mind. 99 • Consider the manager's perspective on how to resolve the conflict 99 • Set a timeframe for resolving the conflict 99 • Any other relevant step in resolving conflicts 4.4 Laissez-Faire: • This form of leadership allows subordinates to make all the decisions but within the policy of the business 99 • The manger must take responsibility for the decisions made 99 • Any other relevant answer. Any 2 x 2 Autocratic: • This form of leadership allows for no negotiations 99 • The leader tells people what to do and how to do it without any input from the people regarding their thoughts or suggestions 99 • This is a top – down one way communication 99 • Directives and instructions are given 99 • Any other relevant answer Any 2 x 2 4.5.1 Management Exercise control over personnel 99 Instructional in their approach 99 Follows the vision of the enterprise 99 Minimise and control risks 99 Ensure adherence to rules and regulations 99 Ensure that tasks are completed 99 Ensure that profit targets are met 99

Leadership Influence and motivate personnel 99 Seek to empower people 99 Provide a vision for the enterprise 99 Always on the look out for business opportunities 99 Change rules to improve efficiency 99 Provide better ways to do tasks 99 Strategies to increase profitability 99 Max 8

4.5.2 Good leader: Motivation: • He/She has vision for his/her enterprise 99 • Encourages higher productivity through motivation 99 • Consider advantages of good leader and disadvantages of weak manager99 • Any other relevant answer regarding a good leader OR Good manager: Motivation: • He/She is able to manage the enterprise effectively 99 Copyright reserved

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Calculated risks could maintain stability and long term survival 99 Consider advantages of good manager and disadvantages of weak leader 99 Any other relevant answer regarding a good manager 99

Macro Environment 99 • • • • • • •

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Political99 Minister of Finance Implemented these changes 99 Effects trading with other countries 99 Economic 99 Increase in petrol price and toll roads 99 Increases the price of commodities for consumers 99 If another answer is given and justified correctly give the marks.

2x4=8 60 Total Section B: 180

Section C Question 5: Business environments Introduction Shoprite’s involvements in the community help others that are less fortunate in a broad range of activities, including community assistance programmes; ensuring community health and safety; sponsorships; developing education and philanthropic giving. Max 3 Body Defining Corporate Social Investment The aim of Corporate Social Investments: • To contribute towards sustainable development 99 2 • To achieve social outcomes • To enhance a company’s reputation, its strategy and possibly lead to an increase in long-term shareholder value The characteristics of Corporate Social Investment: • CSI is enforced by the law 99 • The government expects businesses such as Shoprite to make a contributions 99 • CSI plays an important role in the development of communities 99 Max 4 The CSI process: • Shoprite identified certain needs within their communities – particularly needs in which they can address social economic issues 99 • Shoprite has to register each programme with the necessary authorities 99 • The financial manager at Shoprite has to develop a budget for each programme 99 • Shoprite must ensure that each programme has a legitimate track record 99 • Shoprite can only address the socio-economic issues if all the allocated funds are spend on the identified initiatives 99 Max 6 The Role of CSI in a business Benefits for the business Drawbacks for the community • Easier to recruit staff 99 • CSI is expensive 99 • CSI improves the image of • Businesses do not always have the skills to solve the business among staff and social problems 99 investors 99 • CSI requires a lot of time99 • CSI helps to build customer • Businesses feel they make a double contribution Copyright reserved

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loyalty 99 • CSI helps to attract new investors • 99 Max: 3 x 2 = 6 5.3 The Role of CSI in the community Benefits of CSI for the community • CSI improves the quality of life of communities 99 • CSI generate additional employment opportunities 99 • Education and Training can be given through CSR programmes 99 • CSI contribute towards social development 99 • CSR can change the future of employees and their families by providing bursaries 99 • CSI improves the infrastructure of the communities 99 Max: 3 x 2 = 6

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through tax payments and CSI 99 Business must prepare detailed reports on CSI99 Max: 3 x 2 = 6 Drawbacks of CSI for the community • Communities become too dependant on the business’s CSI 99 • Some businesses only participate in CSI for commercial benefit and not to help the community 99 • CSR is often undertaken by a business to distract the business from unethical business practice 99 • CSI programmes are often not sustainable and communities only benefit over the short term99 Max: 3 x 2 = 6

How Shoprite is measured in terms of CSI • Shoprite is assessed on the JSE according to the Social Responsibility Index (SRI Index). 99 • The business is assessed according to the triple bottom line, which include: o Economic Sustainability99 o Environmental Sustainability99 o Social Sustainability 99 OR A good CSI programme should also address Human Rights Issues 99 and in a business, this should include aspects such as: o Employee benefits 99 o Incentive Bonuses 99 o Promotion opportunities for staff’ 99 o Staff development 99 Max: 8 Conclusion Businesses such as Shoprite can make a huge contribution through their CSI initiatives to assist the government with resolving socio-economic issues. Max 2 Introduction 3 Body Aims of CSI 2 Characteristics of CSI 4 CSI Process 6 CSI for the Business - Benefits 6 Facts: 49 Max: 32 - Drawbacks 6 CSI for the community - Benefits 6 - Drawbacks 6 Copyright reserved

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Measuring CSI SRI Index OR Human Rights Conclusion

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8 2 Layout Must have an introduction, body and conclusion Application The learner generally is able to exceed minimum requirements by writing down additional relevant answers Synthesis Relevant flow and orders Originality Shoprite examples were given in the presentation Total

2 2

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Question 6: Business ventures Introduction • The three forms of compulsory insurance are extremely beneficial to the claimants 9 • This provides some source of financial relief to the claimants as a result of unemployment, injuries and accidents 9 • The three categories of compulsory insurance are the Unemployment Insurance Fund, Compensation for Occupational Injuries and Diseases and the Road Accident Fund. The main provisions will be discussed in detail 9 • Any other relevant introduction related to insurance (Max: 3) The Unemployment Insurance Fund 99 • The Unemployment Insurance Act, 2001 (Act 63 of 2001, came into effect on 1 April 2002 99 • This act governs the Unemployment Insurance Fund which is administered by the Department of Labour 99 • All employees who work for more than 24 hours per month must contribute to the fund 99 • It is illegal for employers not to make the deduction from earnings 99 • They must be registered with the UIF and contribute to the UIF 99 • The employer is responsible for the registration process with the UIF 99 • The employer and employee must pay 1% of the worker's monthly wage bill 99 • The total contribution that is paid to the Fund is therefore 2% 99 • Contributions can be made monthly and annually in advance, either by cheque or cash or on the UIF government website 99 • Recently farm workers and domestic workers have been covered by UIF 99 • The UIF covers FIVE kinds of benefits: Unemployment benefits, illness benefits, maternity benefits, adoption benefits, death benefits 99 (Allocate a maximum of 4 marks for benefits) • The UIF gives financial relief to workers who become unemployed (dismissed), unable to work because of illness, maternity or adoption leave 99 • The UIF also pays out benefits to dependants of deceased contributors 99 • Workers accumulate 1 day credit for every six days worked 99 • Benefits are paid to a maximum of 238 days or the maximum number of days' credit accumulated over four years 99 • Highly paid workers are paid 38% of the average monthly wage over the last six months and 58% for the lowest paid workers 99 Copyright reserved

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Any other relevant answer regarding the provisions of the UIF Heading: 2 Discussion: any 4 x 2 = 8 Maximum: 10

Compensation for Occupational Injuries and Diseases (COIDA) 99 • The Compensation for Occupational Injuries and Diseases Act, 1993, (Act 130 of 1993) as amended, governs workers’ compensation. 99 • This Act compels employers to insure their employees who perform certain types of work as defined in the Act against disability as a result of injuries, occupational diseases or death sustained during the performance of their work. 99 • Compensation is paid to the workers or their dependants for temporary or permanent disability or death. 99 • This form of compulsory insurance covers the employer against claims from employees as a result of injuries sustained or diseases contracted in the workplace. 99 • The Act clearly stipulates the types of injuries that can be claimed for and the occupational diseases in relation to the type of work performed. 99 • The Act stipulates that only employers contribute to the Compensation Fund. 99 • Employees are required to immediately report to the employer on any injuries/diseases, who then subjects the worker to a medical examination for a full report. 99 • Any other relevant answer regarding the provisions of the COIDA. Heading: 2 Discussion: any 4 x 2 = 8 Maximum: 10 The Road Accident Fund 99 • The Road Accident Fund Act 1996 (Act 56 of 1996), insures persons against injuries suffered at the hands of another driver. 99 • Approximately 46c per litre of petrol (amount may change according to legislation at different times) is paid towards the Road Accident Fund in the form of an insurance payment. 99 • This insurance serves to protect both the injured party and the negligent driver who caused the injuries. 99 • The protection afforded to the injured party is that there will be compensation irrespective of whether the negligent driver is rich or poor, insured or uninsured. 99 • The RAF only indemnifies the driver to compensate for losses suffered due to bodily injuries sustained, or the death of a person and not for damage to property. 99 • The RAF pays compensation to drivers, passengers and pedestrians who are injured in accidents provided that the accident is as a result of someone else's negligent driving. 99 • Amendments to the RAF in August 2008 are as follows: o Claims only for serious injuries sustained as determined by medical experts. 99 o Claims for loss of income are limited to R160 000 a year. 99 o In the case of death by road accident, dependants are limited to a maximum claim of R160 000 irrespective of the number of dependants. 99 o Claims for secondary emotional shock like witnessing a road accident is no longer considered. 99 o Claims for medical expenses are limited to the rates charged at public health centres. 99 o Any other relevant answer regarding the provisions of the RAF Heading: 2 Discussion: any 4 x 2 = 8 Copyright reserved

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Maximum: 10 Note: Any two types of compulsory insurance x 10 = 20 marks Distinguish between Compulsory and Non-Compulsory Insurance Compulsory Insurance: • This type of insurance is made compulsory by legislation, e.g. the Unemployment Insurance Fund, Compensation for Occupational Injuries and Diseases and the Road Accident Fund. 99 • These are legal requirements that companies must adhere to by making the necessary payments for premiums into the necessary fund accounts. 99 • This insurance protects both defendants (e.g. employers) and claimants (e.g. employees). 99 • Compensation for claims is paid out of the fund accounts. 99 • Any other relevant answer related to compulsory insurance. (Any 3 x 2 = 6) Non-Compulsory Insurance: • This is not mandatory by legislation. 99 • This depends on the ability of the business to overcome the losses resulting, e.g. fire, storm damage, theft, burglary, etc. 99 • The above risks can be shifted to insurance companies for a premium. 99 • Any other relevant answer relating to non-compulsory insurance. (Any 3 x 2 = 6) Explain why certain insurances must be made compulsory. • To protect the enterprise against claims from employees. 99 • To provide compensation for employees during unemployment, injuries sustained in the workplace. 99 • Provide for compensation for injuries, death of breadwinners in road accidents. 99 • Any other relevant answer related to reasons why certain insurances are compulsory.(Any 3 x 2 = 6) Conclusion • From the above discussion it is clearly evident that compulsory insurance as per legislation ie. UIF, COIDA and RAF is of vital importance to provide security and indemnification for claimants. 9 • Furthermore business persons must understand the consequences of under-insurance and noninsurance in terms of losses incurred for e.g. fire, theft, burglary etc. 9 • Should the business person have no insurance, there would be no claim and the businessperson must bear the loss. 9 • Any appropriate conclusion. (Any 2 x 1 = 2)

Compensation for Occupational Injuries and Diseases Road Accident Fund Distinguish between compulsory and non-compulsory insurance Explain why certain insurances should be made compulsory. Conclusion Copyright reserved

Maximum Heading 2 Discussion 8 Heading 2 Discussion 8 Heading 2 Discussion 8 Compulsory 6 Non-compulsory 6 12

Reduced to ANY 2 TYPES OF COMPULSORY INSURANCE (2 X 10) (Max) = 20 Max 8

Sub total 3

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Total

MAXIMUM = 32

Breakdown of mark allocation Details Introduction Unemployment Insurance Fund

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INSIGHT Analysis, interpretation Layout Synthesis Originality, examples Total marke LASO – For each component Allocate 2 marks if all requirements are met. Allocate 1 mark only if some of the requirements are met. Allocate 0 marks where requirements are not met at all.

2 2 2 2 40

Question 7: Business roles 7.1 Introduction • Enterprises realise that they cannot exist in isolation, but interact with the various environments. 9 • Many institutions in South Africa have their own code of conduct and a commitment to ethical and professional behaviour. 9 • Codes of practice have been developed to ensure that these issues are being addressed. 9 • Any other relevant introduction related to the question. (3 x 1) 7.2 • • • • • • • • • • • • • • • • • • • • •

Description of concepts/principles 7.2.1 Ethics Ethics refers to a set of values that are morally acceptable in society which define right, good and fair actions. 99 Business ethics refers to rules and principles which influence the best business practice. 99 Businesses develop their own code of ethics for best practice. 99 Any relevant description of the concept of ethics. (any 2 x 2 = 4) 7.2.2 Professional behaviour This is a set of standards of expected practices eg. treating people with respect 99 Specific occupational practices have developed their own code of professionalism. 99 Any relevant description of the concept of professional behaviour. (Any 2 x 2 = 4) AND/OR 7.2.3 Principles of ethical and professional behaviour Personal benefit to the individual. 99 Social benefit to society. 99 Benevolence to help those in need. 99 Paternalism in helping those to pursue their interest. 99 Principle of not doing harm to others. 99 Honesty and not to deceive others. 99 Lawfulness in order to obey the law. 99 Principle of justice for legal recourse, fair compensation etc. 99 Autonomy and freedom of a person’s actions. 99 Principle of rights to life, information, privacy, free expression and safety. 99 The Board of Directors is responsible for shareholders investment. 99 Each business should create a framework within which it operates. 99 Organisational structure must be well outlined. 99 Risk management must be incorporated in the management operations. 99

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Assurance processes. 99 Issues of sustainability. 99 Any other relevant principle of ethical and professional behavior.

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Any (4 x 2 = 8) Max for question 7.2 (8)

7.3

Practical examples to explain the various issues: 7.3.1 Taxation 99 • The government needs revenue from taxation to provide essential services such as housing, education, infrastructure development and medical care. 99 • Professional behaviour for businesses in this regard would be for businesses not to evade tax by falsifying financial records. 99 • Company tax, VAT and personal income tax are some of the main sources of income for the government. 99 • Tax evasion is illegal in South Africa and is regarded as a crime punishable with a fine or even a prison sentence. 99 • The SARS oversees the collection of tax. 99 Comment • Recently tax collection in South Africa have exceeded budget expectations. 99 • This has been streamlined with the introduction of the SAP system. 99 • Any other answer relating to the issue and its application. Heading: 2 Facts: any 2 x 2 = 4 Comment: any 1 x 2 = 2 Max: 8 7.3.2 Sexual harassment 99 • This is any sexual advance, gesture or remark that causes a person to feel intimidated and threatened. 99 • Sexual harassment is prohibited by labour legislation and companies must educate its employees on this issue. 99 • Sexual harassment is a basic violation of human rights which usually happens when someone has power over another person and abuses his/her position. 99 • Sexual harassment occurs when a superior offers a promotion or a raise in salary in return for sexual favours from the subordinate. 99 • The affected party is usually afraid to report it because of victimisation. 99 Comment • Increase in the number of sexual violations and the courts are addressing these issues. 99 • Any other answer relating to the issue and application. Heading: 2 Facts: any 2 x 2 = 4 Comment: any 1 x 2 = 2 Max: 8 7.3.3 Pricing of goods in rural areas 99 • It is good business practice and professional behaviour to have the same price for goods in urban and rural areas. 99 • Big businesses are reluctant to open outlets in rural areas because of poor returns on their investment. 99 • It is common practice for people in rural areas to pay higher prices for goods which in most cases are of inferior quality. 99 • Prices of goods in these areas are generally based on the personal characteristics of the consumers. 99 Copyright reserved

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Comment • Government is focusing on infrastructure development in rural areas. 99 • This includes shopping centres. 99 • Any other answer relating to the issue and application. Heading: 2 Facts: any 2 x 2 = 4 Comment: any 1 x 2 = 2 Max: 8

7.3.4 Unfair advertising 99 The Advertising Standards Authority (ASA) regulates advertising and protects the interests of the public. 99 • Advertisements should be honest and should not abuse consumers' trust or lack of knowledge. 99 • Some businesses use misleading advertising to consumers so that they can get more value for their money by supporting their products. 99 • Consumers are encouraged to lodge written complaints to the ASA regarding unethical advertising practices. 99 • Examples of unethical practice: advertising second-hand goods as new. 99 Comment • The ASA is the watchdog and several advertisements have been withdrawn. 99 • Any other answer relating to the issue and application. Heading (2) Facts (any 2 x 2) (4) Comment: any 1 x 2 = 2 Max: 8 7.3.5 Unauthorised use of funds 99 • Fraud is the theft or misuse of money that belongs to the employer. 99 • Fraud increases the cost of doing business, affects competition and discourages investors by adjusting prices upwards to absorb the losses. 99 • Business must conduct educational work amongst employees about the impact of fraud and understand that fraud prevention is a collective responsibility. 99 • Systems must be in place to reduce fraud, for eg. by internal audit and risk management. 99 • People who are entrusted with the collection of large amounts of money have misappropriated money for personal gain. 99 Comment: • Fraud cases have been highlighted in the media. 99 • Several cases have been heard in court regarding fraud. 99 • Any other answer relating to the issue and application. Heading: 2 Facts: any 2 x 2 = 4 Comment: any 1 x 2 = 2 Max: 8 7.3.6 Abuse of working time 99 • Many businesses are faced with the dilemma where employees are using working time for their personal activities. 99 •

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The business must have a policy in place for employees on the abuse of work time e.g. making personal calls, sending personal e-mails and browsing through websites, unrelated to their work duties during work time. 99 • Businesses must implement time monitoring systems and time recording procedures. 99 • There should be some flexibility when dealing with workers who are conscientious, work long hours, and miss official work breaks when there is urgent work to be done. 99 Comment: • Many of these issues have been addressed through grievance procedures. 99 • Any other answer relating to the issue and application. Heading: 2 Facts: any 2 x 2 = 4 Comment: any 1 x 2 = 2 Max: 8 Note: Consider the following responses Affirmative action and diversity in business: • Technology and innovation. • Price fixing. • Misuse of business assets/resources • Disposal of waste. 7.4 Conclusion: • Policies and legislation which have been implemented must be continually monitored and improved to lead to a successful business. 9 • Profitability is regularly affected by each of the above issues. 9 • Any appropriate conclusion. 2x1=2 Breakdown of mark allocation Details Maximum Introduction Description of ethics 4 Description of professional behaviour 4 Principles of ethics and professional behaviour 8 Practical examples to explain the various issues Taxation 8 Sexual harassment 8 Pricing of goods in rural areas 8 Unfair advertising 8 Unauthorised use of funds 8 Abuse of work time 8 Conclusion Insight Analysis, interpretation Layout Synthesis Originality, examples Total marks LASO – For each component Allocate 2 marks if all requirements are met. Allocate 1 mark only if some of the requirements are met. Allocate 0 marks where requirements are not met at all. Copyright reserved

Sub total 3

Max.64

Total

Max 32

2 2 2 2 2 40

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Accounting Memorandum

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Question 8: Business operations 8.1 Introduction - Human rights and fair labour practices have been the main basis for the passing of new labour legislation in South Africa. 9 - This was based on the fact that apartheid promoted unfair labour practices. 9 - The Bill of Rights sets out detailed rights and responsibilities for all citizens of the country. 9 (Any other relevant answer related to the introduction.) (Any 3 x 1) (3) 8.2 Basic Conditions of Employment, 1997 (Act 75 of 1997) - The Act prescribes the minimum conditions of employment that employers must legally comply with. 99 - The Act protects workers from exploitation, respect for human rights and social justice. The following are the main provisions of the Act. 99 8.2.1 Working Hours. 99 - The maximum hours to be worked per day for a five day week is 9 hours or 45 hours – normal work time. 99 - The maximum hours to be worked per day for a six day week is 8 hours or 48 hours – normal work time. 99 - Overtime must be a maximum of 3 hours per day or 10 hours per week. 99 - Payment for overtime is usually at one and half times the normal rate. 99 - Meal breaks of at least 1 hour after 5 hours of work. 99 (Max 4) (4) 8.2.2 Leave99 - The worker is entitled to 21 days annual paid leave for every 12 months of continuous employment. 99 - Maternity leave is four months. 99 - Family responsibility leave of 3 days per year is allowed for family death, illness etc. 99 - Employees are allowed 36 days of sick leave in a 36 month/3 year cycle. 99 (Max 4) (4) 8.2.3 Public Holidays99 - Employees must be paid for any public holiday that falls on a working day. 99 - If the workers are required to work on a public holiday then they must receive double their normal rate. 99 (Max 4) (4)

8.2.4 Notice of termination of employment. 99 - Employees must give 1 weeks notice during the first six months of being employed. 99 - Two weeks notice must be served if employed between 6 to 12 months. 99 - Four weeks notice if employed for more than a year. 99 (Max 4) (4) (4 x 4) (16) Max 12 Accept other conditions as stipulated in the BCEA Act. 8.3 Employment Equity Act (Act 55 of 1998) - This Act states that there must be no discrimination on the basis of race, age, gender, religion or disability in the workplace. 99 - Affirmative Action is used as a mechanism to correct the imbalances of the past with respect to access to employment, training, promotion and equitable remuneration especially for blacks, women and the disabled. 99 - Employers who employ 50 or more workers must develop specific affirmative action plans in consultation with the workers. 99 Copyright reserved

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Business enterprises must submit employment equity plans every two years to the Department of Labour. 99 - This Act also forces businesses to employ more people from disadvantaged groups and promote the same to managerial positions. 99 - The employment equity plan of the business must be built into its recruitment and selection process. 99 (Any other relevant answer related to employment equity act.) Any (6 x 2) (12) Max (12) 8.4 Skills Development Act, 1998 (Act 97 of 1998) - This Act was passed to address the effects of discriminatory labour laws, employment policies and the education system of the apartheid regime. 99 - This has resulted in a severe shortage of skilled labour, high unemployment rate and the lack of transformation in the workplace. 99 Therefore, the Skills Development Act was passed to: - Encourage workers to get involved in training programmes. 99 - Improve employment opportunities for disadvantaged people. 99 - The workplace should be transformed as a place of learning. 99 - Ensure that workers participate in learnerships. 99 - Provide quality education and training at the workplace. 99 - Reduce the high unemployment rate and skills shortage. 99 (Any other relevant answer related to Skills Development Act.) Any (6 x 2) (12) Max (12) 8.5 Success/Failure of the above Legislations - Most of the business enterprises are successfully implementing the above legislations in their business operations. 99 - This is evident in the large number of successful empowerment companies established in South Africa. 99 - These companies are complying with the equity plans, affirmative action, employment of women and disabled people. 99 - The Advisory Commission for Employment Equity advises businesses on the formulation of Codes of Good Practice and Balanced Score Card. 99 - The government imposes fines on those companies that do not comply. 99 - Some businesses may not be familiar with the legislations. 99 - Training is necessary for the successful implementation. 99 - Companies would rather pay the fines, than obeying the rules and regulations. 99 (Any other relevant answer related to success/failure of above legislations.) Any (6 x 2) (12) Max (12) NOTE: A maximum of 4 marks must be given if the success/failure is discussed under each Act. 8.6 Conclusion - From the above discussion it is clear that the new policies for labour legislation in South Africa has provided a much happier workforce in the country. 9 - More people are being educated and skilled through the SETAs, etc. 9 (Any other relevant answer related to unfair labour practices.) Sub Total: (45) Max (36) Breakdown of mark allocation Details Maximum Reduced to Sub total Total Copyright reserved

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Accounting Memorandum

Introduction Basic Conditions of Employment Act Facts 12 Employment Equity Act Facts 12 Skills Development Act Facts 12 Success/Failure of Legislation Facts 12 Conclusion INSIGHT Analysis, interpretation Layout Synthesis Originality, examples TOTAL MARKS LASO – For each component Allocate 2 marks if all requirements are met. Allocate 1 mark only if some of the requirements are met. Allocate 0 marks where requirements are not met at all.

2012

3 Max.40

40

Max 32

2 2 2 2 2 40

TOTAL FOR SECTION C = [80] TOTAL = 300

Copyright reserved

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