How is your super going, ready for retirement?

How realistic are your goals?  Tools on this site will help you monitor how you're going.  Click on the Financial Tools / Calculator button to login, or register, to use this powerful resource.

Most Baby Boomers have missed out on a life time of superannuation contributions which leaves many with a gap between how they'd like to retire compared to what their assets can deliver. This is not uncommon, see article below titled 'Lack of literacy promotes unrealistic goals'. Often a better understanding of your position, and given some time, is like turning on a light and is a call to action. For many this might even mean seeking professional help.

Preparing for the retirement you want is complex and often difficult.

On this website there are tools you can use to review how your Superannuation is going compared to your retirement goals. These Tools are available 24/7 and are accessed via the Financial Tools / Calculator button. All you need do is enter the information required (this might take a bit as no one's life is that simple) and the software will automatically fill, where it can, some of the forms for you.

Once done you can go to the Toolbox and modify the Super Optimiser tool to see what might be needed to be retirement ready. While doing this you can ask you planner or accountant a question or two using the contact form on the right.

You can also prepare a budget and analyse your cash flow at the same time. 24/7 access is also very handy.

Also all information you enter is available when you next login. This means you can build a very accurate picture of your financial position over time. Once done then this information is readily available to you by simply logging back in to our site at any time of the day or night.

Don't forget either that time is important when building a 'nest egg' so offer these tools to your children as well. Every little bit helps.

Finally, if you have any questions after using this resource then simply ask us as we can help.

Your financial planner

ATO increasing data exchange with international regulators

Data sharing between tax regulators in different countries is rapidly increasing with the ATO turning in around 30,000 US expats to the IRS just last year according to a US tax lawyer.

Moodys Gartner director Roy Berg explained that under the Foreign Account Tax Compliance Act, all banks are obligated to work out who their US customers are and then turn them into the regulator in their own country who then turns them into the Internal Revenue Service (IRS) in the US.

“Last year the ATO turned over 30,000 individuals with account balances totalling $25 billion to the IRS,” said Mr Berg.

“FATCA is this worldwide snitching program that is getting people turned in and making them quite nervous. The world has changed very, very quickly in the last five years”

Mr Berg said the FATCA isn’t the only agreement like this, with the OECD creating its own initiative for the automatic exchange of tax and financial information, called the Common Reporting Standard (CRS).

Atlas Wealth Management managing director Brett Evans said even countries like Panama, British Virgin Islands, Luxembourg and Liechtenstein that have traditionally been tax haven-type environments, have signed up to this reporting standard.

“As a result of that they'll be passing on data to the ATO and we've already started to see a lot of clients both domestically and internationally,” said Mr Evans.

Under this reporting standard, Mr Evans said individuals are asked by their account provider, whether it’s a bank or an investment account, if they’re a citizen of another country and if that’s the case they’ll be asked to provide their tax file number.

“Once they do that they’ve got a record of the fact that the individual is based in Denmark for example, but they are an Australian citizen, they’ll pass that information back through to the ATO,” he said.

“Even though you may not have any required lodgements with the ATO, the ATO will still be aware of what's happening.”

Interestingly, Mr Evans said the only developed country that hasn’t signed up to the reporting standard is the US.

“So virtually the United States is in the box seat, because everyone has to pass information to them by way of the FATCA agreement but they don't have to pass information back again,” he said.

“Technically speaking the US could be the last tax haven in the world from a developed country point of view because they don't have to do it.”

MIRANDA BROWNLEE
31 Aug 2017
accountantsdaily.com.au

Our ‘hardest’ SMSF tasks

What are the hardest aspects of running your self-managed super fund (SMSF)? There are certainly more and more tasks and professional help my be needed to manage them properly.

Are they the seemingly ever-changing rules, the paperwork and administration or the challenge of choosing where to invest?

If you named dealing with the changing rules and choosing investments as your two hardest jobs, you are among hundreds of thousands of other trustees.

Comprehensive surveys for the 2017 Vanguard/Investment Trends Self Managed Super Fund Reports, released during the past week, asked SMSF trustees to list the hardest aspects of running an SMSF. Their responses include:

• Choosing investments (31 per cent).
• Dealing with regulatory uncertainty (31 per cent).
• Finding time to research investments (16 per cent).
• Handling paperwork and administration (16 per cent).
• Finding time to plan and review for their SMSFs (12 per cent).

The most positive finding was that a quarter do not find any aspect of running their fund hard.

It should be emphasised that trustees could give multiple responses to the survey conducted by specialist researcher Investment Trends. For instance, other responses dealt with such specific challenges as having too much exposure to certain asset types (9 per cent) and sticking to an investment strategy (4 per cent).

The findings that many SMSF trustees have difficulty choosing investments and in dealing with regulatory uncertainty partly explains another finding from the survey that a large proportion of SMSFs recognise that they have unmet needs for advice.

Investment Trends estimates that 277,000 SMSFs – out of 585,000 funds at the time of the survey – had unmet needs for advice. This is the highest number to date based on past annual surveys.

An estimated 152,000 SMSFs have broad unmet needs for advice on tax and super while 113,000 have unmet needs for advice on retirement strategies. And an estimated 103,000 funds have unmet needs for investment advice.

Many SMSFs recognise their unmet need for advice on inheritance and estate planning (an estimated 59,000 funds), strategies in response to recent super changes (51,000), tax planning (50,000), investment strategy/portfolio review (50,000) and identifying undervalued assets (50,000).

Other unmet advice needs include investing for a regular income (46,000 funds), Exchange Traded Funds (46,000), SMSF pension strategies (45,000), offshore investing (43,000) and longevity protection (38,000).

The finding that almost half of Australia’s SMSFs recognise that they have unmet needs for professional advice is a critical acknowledgement by trustees that they need professional guidance.

In turn, this will hopefully lead to more trustees actually going the next step of gaining that advice.

Robin Bowerman,
Head of Market Strategy and Communications at Vanguard.
22 August 2017
www.vanguard.com.au

Uber drivers hit for 10% tax

• keep records;
• have an Australian Business Number (ABN);
• register for GST;
• pay GST on the full fare they receive from passengers;
• lodge activity statements; and 
• include income from ride-sharing services in their tax returns.

Lack of literacy promotes unrealistic goals

A large proportion of Australians have unrealistic retirement goals.  (NB: There are financial tools on this site that can help as too can a financial planner)

Australians’ lack of financial literacy is contributing to unrealistic expectations about their retirement, with more than half of consumers saying they want to travel regularly in their retirement despite the fact 63 per cent say they do not have a financial plan to guide their savings.

Sunsuper’s “2017 Australian Employee Insights Report”, based on a survey of over 1000 Australians, found that although 51 per cent of consumers had nominated travel as a key retirement goal, more than 40 per cent had not thought about how they were going to use their superannuation to fund their retirement.

At the same time, the report revealed 73 per cent of Australians thought they would have to rely on the age pension when they gave up work.

Speaking to financialobserver, Sunsuper head of advice and retail distribution Anne Fuchs said a lack of financial literacy was most likely to blame for the apparent gap between what many consumers wanted to achieve in retirement versus what their actual financial situation would be.

“Because financial literacy is quite low, Australians as a consequence have quite misguided expectations about what we think we can achieve,” Fuchs said.

“In Australia we are often brought up not to speak about money and because we are not speaking about it, we don’t understand our full financial position so we are prone to having unrealistic expectations.”

At the same time, she said many Australians were reluctant to seek financial advice as they were embarrassed or afraid of having third-party confirmation that their financial situation was not ideal.

“People have dreams about what they want to do in retirement and they are scared to speak to someone because they don’t want to be told it’s not possible – living in denial can be a happy place,” she pointed out.

To that end, Sunsuper had developed a “nudge” strategy to engage small groups of fund members around the importance of specific aspects of their finance to ensure even those who avoided seeking full financial advice were being encouraged to take action to improve their situation.

“We have good data around where [a member] is at a point in time and where they should be, and we take insights from that and get small groups of people around a boardroom table to have a conversation,” she said.

“If we take that approach, we find we have greater success as opposed to a generic presentation about the value of advice – we develop trust with the members so they don’t view us with a lens of suspicion and they are quite open to it.”

By Sarah Kendell
22 Aug 2017
financialobserver.com.au

Taxpayer failed to prove that payments were “loans”

In a recent case, the Full Federal Court has found that several taxpayer companies had not discharged the onus of proving that assessments the Commissioner of Taxation issued to them were excessive. 

The amended assessments added income of some $4 million that the Australian companies received from overseas sources, which taxpayers had claimed were loans.

In agreeing with the Commissioner, the Court majority held that it would not be appropriate to find that the taxpayers had provided the required proof that the payments were genuine loans; in fact, they had made inconsistent or “alternative” arguments about the nature of the payments.

This case again demonstrates – good evidence gives the taxpayer a chance (of winning a tax debate).

AcctWeb

Client Alert – September 2017

Work-related expense claims
under scrutiny

Will you claim work-related expenses on your tax return this year? The ATO now uses real-time data to compare people’s tax returns with others in similar occupations and income brackets. This year it’s focused on identifying higher-than-expected claims for expenses related to work vehicles, travel, internet and mobile phones, and self-education, and may even check people’s work deduction claims with their employers.

TIP: Ever heard that you can make a standard claim of $300 for work-related expenses even if you don’t have evidence? This isn’t true! The ATO doesn’t ask for receipts up front for claims up to $300, but you must have actually spent what you claim, and be able to show how you worked out your deductions if the ATO asks.

The ATO’s also concerned about people’s many incorrect claims for work-related clothing and laundry expenses. In 2014–2015, around 6.3 million people made claims against clothing expenses, but work-related deductions are in fact only available for specific uniforms and protective clothing items, not for everyday clothes you buy, launder and wear for work.

Employee travel expense deductions

The ATO has also released new guidance on work-related travel deductions. To claim for transport or other employee travel expenses (like accommodation and meals) in your tax return, you must have incurred the expenses as part of gaining or producing your taxable income. Private and domestic travel expenses, including the costs of your ordinary home-to-work travel, aren’t claimable.

Transport costs for work-related travel may be deductible, but the ATO will consider factors such as:

• whether the travel is a necessary part of performing your work (you can’t pretend your family holiday’s a work trip);
• whether your employer pays you to undertake the travel; and
• whether you have to follow your employer’s instructions during the travel period.

Accommodation, meal and other incidental expenses are deductible as work-related only if your work has “special demands” or “co-existing work locations” that mean you have to sleep away from home.

TIP: We’re here to help – contact us to find out more about getting your work-related tax deductions right.

Working holidaymakers and
tax returns for 2017

If your business employs working holidaymakers – or you’ve been one yourself this year! – you need to know about the “backpacker tax” changes that came into effect from 1 January 2017.

Employers needs to issue two payment summaries to each working holidaymaker for the 2016–2017 financial year:

• one for income earned up until 31 December 2016; and
• one for income earned after 1 January 2017 (using payments code H).

All employers need to include code H on payment summaries of backpacking workers’ post-1 January income, even if the employer isn’t registered with the ATO as employing working holidaymakers.

tip: If only one payment summary is issued, the income needs to be apportioned so the before and after 1 January amounts appear separately on the working holidaymaker’s tax return.

Small businesses

Asset write-offs

Small businesses with a turnover of less than $10 million can get an immediate deduction for assets that cost up to $20,000 each in their 2016–2017 return. The $20,000 threshold now applies until 30 June 2018.

Assets that cost $20,000 or more can’t be immediately deducted. They need to be deducted over time using a small business asset pool.

Tip: It’s important to apply all of the simplified depreciation rules correctly so your business doesn’t under-claim for its eligible assets. Talk to us today for more information.

Tax debts: setting up a payment plan

Does your small business have a tax debt? The ATO encourages you to get in touch to set up a payment plan. If the debt is $100,000 or less, you can use the ATO’s self-help service to easily arrange paying by instalments.

If a business pays its tax debt late or by instalments, interest accrues on the unpaid debt. However, some businesses with activity statement debts may be eligible for interest-free payment plans.

To deal with a business tax debt of more than $100,000, you can phone the ATO on 13 11 42.

Tip: Your business still needs to lodge all of its ongoing activity statements and tax returns on time, even if you have a payment plan or can’t pay by the due date.

Federal Court rules on
PAYG avoidance

The Federal Court and Administrative Appeals Tribunal have agreed with the ATO that a business, Sunraysia Harvesting Contractors Pty Ltd, was making use of a “sham” arrangement with three other companies to avoid pay as you go (PAYG) and payroll accounting responsibilities. Sunraysia’s operators argued, unsuccessfully, that the three other companies employed Sunraysia’s workers, and those companies were responsible for PAYG deductions and payroll tax. The Federal Court said the arrangement was a “crude” structure with “no worth”, and ruled to deny Sunraysia’s input tax credits and impose penalties for GST shortfall and the business’s failure to meet its PAYG, payroll and other income tax obligations.

Tax assessments confirmed for undisclosed business income

The Administrative Appeals Tribunal has ruled that the ATO was correct to issue tax assessments of $3.7 million and penalties of $3.3 million to a business taxpayer that had underreported its income and failed to lodge several years worth of tax returns. The taxpayer, PSI Pty Ltd, argued that it owned and rented out several Sydney properties, but did not engage in other business activities or receive the significant amounts of income that the ATO had assessed to it.

In fact, evidence before the Tribunal showed that PSI made a range of expensive capital purchases, including fitness equipment, more than 30 motor vehicles, firearms and a “bomb dog”. Its bank statements included references to “consultation fees”, “gun licenses” and a “security industry register”, a loan application suggested income 20 times what the taxpayer admitted to earning, and PSI had apparently made significant loans to related parties with no returns.

The Tribunal upheld the assessments and penalties issued, and allowed the ATO to impose an extra 20% penalty for two of the taxpayer’s income years.

ASIC takes action on super fund disclosures

Under Australia’s superannuation law, super funds must disclose transparency information on a website and keep it up to date at all times.

The Australian Securities and Investments Commission (ASIC) recently investigated and contacted 21 superannuation trustees about their failures to meet the disclosure requirements.

In response, seven trustees acted to disclose the required information, five made it easier to find the information online, trustees of two small funds sought relief from the obligations, seven trustees wound up their funds, and two improved their procedures for ensuring they kept disclosed information up to date.

Tip: Transparency information needs to include details about the fund’s governance, executive officer remuneration, fund trust deeds and product disclosure statements, a summary of significant event notices and a summary of how the trustee voted in the last financial year regarding its listed shares.

Companies should consider reporting tax liabilities: AASB

Sometimes it’s unclear how tax law applies to a company transaction or circumstance and how the ATO will treat it. New guidance from the International Financial Reporting Standards Interpretations Committee (IFRIC) explains how companies should reflect this uncertainty in their accounting for income taxes.

Although the new guidance isn’t in effect until January 2019, the Australian Accounting Standards Board (AASB) recommends that all Australian companies reassess whether to record a tax liability in their 2017 reporting.

New STP dates confirmed as ATO goes on compliance blitz

The government has confirmed that the Single Touch Payroll will now roll over to small businesses with less than 20 employees, as it seeks to up its efforts to monitor employer payment obligations.

As part of a package that will give the government increased funding and penalty powers with instance of non-compliance – such as not meeting superannuation guarantee (SG) obligations – the introduction of STP will now apply to employers with less than 20 employees from 1 July 2019.

“Employers who deliberately do not pay their workers’ superannuation entitlements are robbing their workers of their wages. This is illegal and won’t be tolerated,” Minister for Revenue and Financial Services Kelly O’Dwyer said in a statement yesterday.

Employers with more than 20 employees will transition to STP from 1 July 2018.

Institute of Public Accountants chief executive Andrew Conway, who has been vocal on the subject, has criticised the lack of consultation with stakeholders in implementing such important structural reforms.

“We have long acknowledged the need for a more efficient payroll reporting system, however such a dramatic change needs appropriate consultation on the compliance cost and regulatory impact,” Mr Conway told Accountants Daily.

“For micro businesses this will pose significant compliance pressure.

“We need to see the detail of this impact and the outcomes of the Single Touch Payroll pilot program. We are particularly interested in the incentives the government will provide small business to transition to Single Touch Payroll.”

BDO tax partner Mark Molesworth also highlighted that the introduction of STP would add yet another layer of red tape to small business owners.

“Obviously, that’s a large increase in the amount of reporting that employers need to do for the tax office because at the moment employers only report that data once a year, at the conclusion of the year,” said Mr Molesworth.

“The increased regulation is designed to provide better assurance that parties within the tax system are meeting their obligations, however it is coming at the cost of requiring participants to make sure that their systems are up-to-date, so that they produce reports that can then be provided to the tax office on a periodic basis which don’t currently have to be provided.”

However, Ms O’Dwyer said the changes are necessary to give “Australians confidence that the superannuation system is working in their best interests”.

JOTHAM LIAN 
30 Aug 2017
accountantsdaily.com.au

ATO flags compliance project for FY17/18

The ATO will be upping its superannuation guarantee (SG) casework by one-third, and is poised for increased audits and penalty notices of up to 200 per cent for non-compliers.

About 95 per cent of SG payments are being made without regulatory intervention, but deputy commissioner James O’Halloran told Accountants Daily there is sufficient evidence to justify a significant increase in compliance activity.

The ATO will be increasing its “proactive” SG casework by about one-third this financial year, Mr O’Halloran said. This will involve reviews and audits, and employers who are found to have breached their obligations will be subject to penalties.

“Certainly, by the time it gets to an audit, we would be looking at the application of some form of penalty. In terms of debt collection… we often issue a garnishee notice or a director penalty notice,” he said.

The tax office will also be focusing on getting better and more timely data to assist its compliance activities.

“We are also working toward receiving better and timelier data on super guarantee obligations and payments and using predictive analytical techniques. These will enable us to be more targeted and tailored in order to influence employer behaviour and payment of super guarantee,” said a report from the ATO, released this morning.

Penalties can apply of up to 200 per cent per employee where an SG payment is not met. There is an interest component to this also.

The tax office estimates that the net superannuation gap — which is the difference between the value of SG gaps required to be paid by law minus what is actually paid — is about $2.85 billion.

The net gap has increased from 3.8 per cent in 2009/10 to 5.2 per cent in 2014/15 of the total amount that was owed to employees.

Also, about 20,000 reports of unpaid superannuation are made to the ATO each year, with key non-compliance drivers including poor cash flow management by employers, poor record keeping, and insolvency.

Education can also be a contributing factor, as can low levels of business experience.

The ATO doesn’t have an exact breakdown of problem industries, but its fieldwork indicates that problem hot spots are with small businesses in accommodation, food services, construction and retail.

Government funding

The Turnbull government confirmed this morning it will be providing additional funding to the ATO for its compliance work. 

A statement from the Minister for Revenue and Financial Services, Kelly O'Dwyer, said the government will move to boost the ATO's recovery powers, which includes strengthening director penalty notices and use of security bonds for high-risk employers.

The government will also give the tax office the ability to seek court-ordered penalties “in the most egregious cases” of non-payment, including employers who are repeatedly caught but fail to pay superannuation guarantee liabilities.

The package reflects the key recommendations in the Final Report of the SG Cross-Agency Working Group released on 14 July 2017. The government did not accept the Working Group’s recommendations to soften penalties for non-compliant employers.

“Employers who deliberately do not pay their workers’ superannuation entitlements are robbing their workers of their wages. This is illegal and won’t be tolerated,” said Ms O'Dwyer. 

KATARINA TAURIAN 
29 Aug 2017
accountantsdaily.com.au

Client Alert – August 2017

Tax cut for small business: ATO will amend returns

For the 2016–2017 income year, the company tax rate for small businesses decreases to 27.5%. Companies with turnover of less than $10 million are eligible for this rate. The maximum franking credit that can be allocated to a frankable distribution has also been reduced to 27.5% for these companies.

The reduced company tax rate of 27.5% will progressively apply to companies with turnover of less than $50 million by the 2018–2019 income year. The ATO says if a company lodged its 2016-17 company tax return early, and its turnover is less than $2 million, it will amend the return and apply the lower tax rate.

If the company’s turnover is from $2 million to less than $10 million, the company will need to review its return and lodge an amendment if required.

Instant asset write-off extended for small business entities

The Treasury Laws Amendment (Accelerated Depreciation For Small Business Entities) Act 2017 extends the period during which small business entities (SBEs) can access accelerated depreciation. The extension is for 12 months, ending on 30 June 2018.

SBEs will be able to can claim an immediate deduction for depreciating assets that cost less than $20,000, provided the asset is first acquired at or after 12 May 2015, and first used or installed ready for use on or before 30 June 2018. Depreciating assets that do not meet these timing requirements will continue to be subject to the $1,000 threshold.

SBEs will be able to claim an immediate deduction for depreciating assets that cost less than $1,000 if the asset is first used or installed ready for use on or after 1 July 2018.

ATO update on Manage ABN Connections

The ATO says feedback from tax professionals on the Manage ABN Connections identified that further work is required to meet their needs. The ATO advised that the myGov login is therefore not currently available to access the Tax or BAS Agent Portals. If a tax agent’s client already has a myGov account linked to the ATO, Centrelink or Medicare, they can now use Manage ABN Connections to access government online business services.

Work-related deductions denied: lack of documenting evidence

A pipe fitter has been denied deductions by the Administrative Appeals Tribunal (AAT) for work-related expenses. The AAT disallowed the claims because the taxpayer was unable to produce adequate documentary evidence.

Super reforms: changes to TRIS, CGT relief, pension cap and LRBA integrity rules

The Treasury Laws Amendment (2017 Measures No 2) Act 2017 makes a range of technical amendments to the super reform legislation.

TRIS rules for becoming retirement phase pension

The amendments deem a transition-to-retirement income stream (TRIS) to be in retirement phase where the recipient of the income stream has satisfied a condition of release with a nil cashing restriction (eg retirement or attaining age 65). This means that a TRIS will stop being a pension (subject to 15% tax on fund earnings from 1 July 2017) and become a retirement phase superannuation income stream that qualifies for the earnings tax exemption once the recipient notifies the fund that a nil condition of release under the Superannuation Industry (Supervision) Regulations 1994 (SIS Regs) has been satisfied.

CGT relief for TRIS assets

The period in which an asset supporting a TRIS can cease to be a segregated current pension asset of a fund and still qualify for CGT relief will be extended to include the start of 1 July 2017.

Pension balance credit for LRBA repayments

The Act provides that an additional pension transfer balance credit will arise for certain repayments of a limited recourse borrowing arrangement (LRBA) by a self-managed superannuation fund (SMSF) that shifts value between an accumulation phase interest to a retirement phase superannuation income stream interest in the fund: new s 294-55 of ITAA 1997.

Pension transfer balance cap

The Act also makes the following changes to the $1.6 million pension transfer balance cap provisions.

SMSF annual return: key changes for 2016–2017

The ATO has released the 2017 self-managed superannuation fund (SMSF) annual return and instructions. Key changes for 2017 include the transitional CGT relief for super funds as part of the 1 July 2017 reforms, reporting on limited recourse borrowing arrangements (LRBAs) and early stage investor tax incentives.

Single Touch Payroll operative for early adopters

Single Touch Payroll (STP) is here. It had a “soft” or voluntary start on 1 July 2017. From that date, employers may choose to report under STP. For those who qualify (ie employers with 20 or more employees), STP will be mandatory from 1 July 2018.

For employers with 19 or fewer employees on 1 April 2018, their reporting obligations will not change. They will not need to start reporting through STP from 1 July 2018, but may choose to start using a payroll solution to take advantage of the benefits of STP reporting.

“Netflix” tax: who is an Australian consumer?

From 1 July 2017, the supply of services, digital products or rights are connected with Australia (and so potentially liable to GST) if made to an Australian consumer by an overseas-based supplier. This is referred to as the digital import or “Netflix tax” rules.

GST Ruling GSTR 2017/1 explains how overseas suppliers can decide whether a recipient of a supply is an Australian consumer. It explains what evidence suppliers should have, or what steps they should take to collect evidence, in establishing whether or not the supply is made to an Australian consumer.

New draft GST guidelines issued

Supplies through electronic distribution platforms

Draft Law Companion Guideline LCG 2017/D4 (the Draft) deals with how the ATO intends to apply the Netflix and low-value imported goods measures to supplies made through electronic distribution platforms (EDPs).

The draft guidance sets out a four-step approach for determining whether an EDP operator is responsible for GST.

Redeliverers and supplies of low-value imported goods

Draft Law Companion Guideline LCG 2017/D5 explains the measures in the Treasury Laws Amendment (GST Low Value Goods) Bill 2017 (awaiting assent) that will make redeliverers responsible for GST on offshore supplies of low-value goods from 1 July 2018.

The Bill imposes GST on supplies of imported low-value goods, ie those worth less than A$1,000. Under the reforms, a redeliverer will be treated as the supplier if low-value goods are delivered outside Australia as part of the supply and the redeliverer assists with their delivery into Australia as part of, broadly, a shopping or mailbox service that it provides under an arrangement with the consumer.