Free Custom «Taxation Analysis» Essay Paper

The real productivity of an organization lies in the fact that how effectively, it uses its funds and how effectively the funds of the company would be utilize in a place from where the likelihood of earning would be on a high scale (Bruce, 2006). Among different departments, which work closely with the organization as a whole, the name of finance department is one of them which have its own recognition and importance, because it is the only department that deals with the managing of funds of the company as a whole (Bruce, 2006).

Organizations instigate its financial department to utilize the funds of the company effectively because the financial information of the company would be present and interpret among different stakeholders of the company, including, shareholders, government officials, bankers and upper management (Bruce, 2006). Financial Statements are the end product of an organization in which all the information regarding the company, as well its financials would be recorded in a manner that it can be measures from different angles. Sometimes, finance officials try to misinterpret the results of the financials of the company merely to deceive investors and shareholders regarding the financials (Lawrence J. Gitman, C. D.2008).

 

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Finance is one of the largest fields in the world, which has number of things and models strides under in it. The literature of finance has its recognition for companies and for countries as well. Continuous arrival of models and theories in this particular field make the concept of the same quite difficult to grab and understand (Bruce, 2006). There are number of concepts that come under the ambit of finance, and taxation is one of them, which has its own recognition and importance in a broad nutshell. The main perspective of this assignment is to write a sort of memo in which an issue pertains to taxation would have been analyzed accordingly.

Memorandum

Subject: Informing about the tax liability and donation

The scenario mentioned in the given case study is quite clear as it is analyzing about donation as a whole on different amount spent on different things in total (Lawrence J. Gitman, C. D.2008). Steve is a Volunteer, which has been discussed all along in the vase study, in fact the entire case study has been depend upon Steve (Lawrence J. Gitman, C. D.2008). Steve works as an Usher at the local church, in which he getting the church to be ready for the ad hoc services and greetings in particular with helping them for the worshipers, as they arrived at the church. According to the content mentioned in the case study, Steve usually incur some amount of money on the account of travelling expense which commutes to the church in every week (Lawrence J. Gitman, C. D.2008).

Now Steve needs some sort of recommendations related to taxation as he likes to know, if he can deduct as a charitable contribution of his time (Lawrence J. Gitman, C. D.2008). Apart from that, he also like to know if he can deduct as a charitable contribution those out of pocket travel expenses that he incurs on the Sundays he serves as an usher. Both of the answers should be mentioned in the required form and according to the tax jurisdiction law (Lawrence J. Gitman, C. D.2008).

Though the laws pertaining to taxation and organizations vary from country to country and organizations always try to comply with the tax jurisdiction authority in order to prevent them from all sorts of tax liability and legal obligations (Lawrence J. Gitman, C. D.2008). In the case of Steve, mentioned in the case study, all the money, which he is intending to incur as a travelling expense always come under the ambit of charitable donation not as the personal expense. Usually, churches and NGOs initiated the same thing in total and getting the money from different donation based services and activities, therefore the church mentioned in this assignment also looking forward to have the donation from the people as a whole (Lawrence J. Gitman, C. D.2008).

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Steve, who used the funds of the church, is not at all right, because the amount is actually for the poor and needy people, not for using it for personal tours and expenses (Lawrence J. Gitman, C. D.2008). When people donate in the Church, they thought that, all of their money would be utilized by the church for the sake of different good purposes including free education and other needy services, but if the funds could be used like this, then it would not be a sin and not acceptable from the standpoint of a law as well. Steve in this scenario, has to abrogate the idea to utilize the funds of the church for his personal use, regardless with the fact that he is going somewhere for the Church purpose as well. He has to pay the Usher on all of the used money and should donate again in the church in order to decrease the level of sins.