Terms and acronyms you may come across in the process of finding a business or franchise.
ASIC - Australian Securities and Investments Commission
ATO - Australian Taxation Office.
Australian Business Number (ABN) - a single identifying number used when dealing with other businesses and the Australian Tax Office (ATO). For information about obtaining an ABN visit the ATO website.
Australian Business Register (ABR) - a register of information provided to the ATO by businesses and other entities when they register for an ABN.
Australian Company Number (ACN) - the number allocated by the Australian Securities and Investments Commission (ASIC) when you register a company under Corporations Law.
Australian Workplace Agreement (AWA) - an individual written agreement between an employer and employee governing terms and conditions of employment.
Award - the setting out of terms and conditions of employment, along with salary levels, through an industrial agreement between employers and employees.
Business Activity Statement (BAS) - a form used to report business tax entitlements and obligations including Goods and Services Tax and Pay As You Go Tax.
Business Broker - A person who, for a fee, acts as the agent of another, assisting in negotiating the sale for a client's business.
Capital Gains Tax - the tax on any gain you make when you sell an asset such as shares units in a unit trust and property.
Cash Flow - the measure of actual cash flowing in and out of a business.
Certified Agreement (CA) - a collective agreement made directly between an employer and a group of employees, or between an employer and a union or unions representing employees.
Corporations Law - the legal regulation of companies, securities and futures industries in Australia.
Disclosure Document - is the document that discloses information about a franchise system and the franchisor that a franchisor must supply to a prospective franchisee pursuant to the Franchising Code of Conduct.
Distribution - is an agreement whereby the distributor earns the right to sell certain products or services within a given geographical region. Unlike franchises, distibution agreements are more flexible in regards to terminations and are shorter in term. They also tend to cost less than franchises.
Excise duty - an indirect tax levied on certain types of goods produced or manufactured in Australia.
Franchise - is an arrangement whereby a franchisor gives to a franchisee a right or licence to use the franchisor's intellectual property (trade marks, brands, business name) and business system to conduct an independently owned business. Subway is a popular franchise, as are McDonalds.
Franchise Agreement - is the agreement that governs the relationship between the Franchisor and the Franchisee.
Franchisee - is the person who buys the franchise and operates an independent business using the relevant brands and business system with the permission of the franchisor.
Franchising Code of Conduct - means the mandatory code governing franchising in Australia. For more information on this and to obtain a copy visit the ACCC website.
Franchisor - is the person who generally owns the relevant brands and business system and who traditionally "sells" the franchise to a franchisee.
Fringe Benefits Tax (FBT) - a tax paid by employers, on behalf of their employees, on non-cash benefits including company cars and mobile phones.
Goods and Services Tax (GST) - a broad-based tax of 10 percent on the sale of most goods and services in Australia.
Greenfield - Refers to land that has not previously been used by the franchise to conduct business, sometimes referred to as a franchise opportunity.
Intellectual Property - laws that protect the property rights in creative and inventive endeavours including art, literature, music, films, sound recording, broadcasts and computer programs.
Licence - a legal document that grants a business or person with official permission to conduct a certain activity. It allows the licensee to use the licensor's copyright, trademark or patent. Unlike most franchise agreements, licences usually do not include much in the way of support or training.
Manual - means the manuals, documents and written directives usually produced by a Franchisor specifying, in greater detail, aspects of a franchise system, a franchisor's standards and policies with respect to the operation of a franchised business.
Marketing Fund - means a fund usually maintained by a franchisor, the proceeds of which are used to market and promote a franchise system. Contributions to such fund are made by franchisees and sometimes by the franchisor and suppliers of the franchise system.
Occupancy Licence Agreement - is the document pursuant to which a franchisor (who leases the premises from which a franchised business is conducted) grants to the franchisee a licence to use and occupy the premises.
Pay As You Go (PAYG) withholding - a legal requirement to hold back a portion of payments made to employees and other businesses, which is then paid to the Tax Office.
Payroll Tax - a state and territory government tax on industry, calculated on the amount of wages paid.
Sublease - is an agreement between a lessee and a sub-lessee pursuant to which the lessee subleases a premises.
Tariff - a type of tax levied by the federal government on imported goods or services.
Tax File Number (TFN) - a number allocated to taxpayers used by the Australian Taxation Office (ATO) to monitor income and taxation details.
Tax Invoice - an invoice for the supply of goods or services which must specify that it is a taxed invoice and must include an Australian Business Number (ABN).
Withholding Tax - tax deducted at the source on interest, dividend and royalty payments made to non-residents, and certain investments or payments to residents where the recipient has not provided their Tax File Number to the payer.