LSB2605 2025 Semester 2
Assignment 2 solutions 2025
, Scenario:
A small bakery generates an average of R100,000 monthly turnover by baking brown
bread. The proprietor wishes to expand operations next financial year by registering as a
private company, appointing two staff members, and purchasing kitchen equipment to
double production.
Question 1: Aside from SARS, with which other government bodies
must the business register, and for what purposes?
In addition to registration with the South African Revenue Service (SARS), a bakery
expanding to a private company must register with the following government bodies:
1. Companies and Intellectual Property Commission (CIPC) – The bakery must
register as a private company (Pty) Ltd under the Companies Act 71 of 2008.
This registration provides the business with a separate legal personality, limited
liability, and compliance with corporate governance requirements (Davies &
Worthington, 2020: 45).
2. Department of Labour / Employment Services – The bakery must register with
the Unemployment Insurance Fund (UIF) and Compensation Fund to comply
with labour laws and ensure employee protection in case of injury or
unemployment (Visser et al., 2019: 102).
3. Municipal Health or Environmental Health Department – Registration may be
required for compliance with health and safety standards, particularly food
hygiene regulations. Local municipalities often require food businesses to obtain
a health clearance certificate before operations (Coetzee & Graaff, 2021: 78).
4. South African Police Service (SAPS) – Optional, if the bakery handles cash and
high-value equipment, the owner may need to comply with security regulations.
5. Local Municipality / Trading Licence Authority – Registration for business
premises or trading licences ensures compliance with zoning and local
business regulations (Van der Merwe, 2018: 134).
Summary: Registration with CIPC, Department of Labour, municipal health
departments, and local authorities ensures legal operation, employee protection, and
compliance with safety standards.
Assignment 2 solutions 2025
, Scenario:
A small bakery generates an average of R100,000 monthly turnover by baking brown
bread. The proprietor wishes to expand operations next financial year by registering as a
private company, appointing two staff members, and purchasing kitchen equipment to
double production.
Question 1: Aside from SARS, with which other government bodies
must the business register, and for what purposes?
In addition to registration with the South African Revenue Service (SARS), a bakery
expanding to a private company must register with the following government bodies:
1. Companies and Intellectual Property Commission (CIPC) – The bakery must
register as a private company (Pty) Ltd under the Companies Act 71 of 2008.
This registration provides the business with a separate legal personality, limited
liability, and compliance with corporate governance requirements (Davies &
Worthington, 2020: 45).
2. Department of Labour / Employment Services – The bakery must register with
the Unemployment Insurance Fund (UIF) and Compensation Fund to comply
with labour laws and ensure employee protection in case of injury or
unemployment (Visser et al., 2019: 102).
3. Municipal Health or Environmental Health Department – Registration may be
required for compliance with health and safety standards, particularly food
hygiene regulations. Local municipalities often require food businesses to obtain
a health clearance certificate before operations (Coetzee & Graaff, 2021: 78).
4. South African Police Service (SAPS) – Optional, if the bakery handles cash and
high-value equipment, the owner may need to comply with security regulations.
5. Local Municipality / Trading Licence Authority – Registration for business
premises or trading licences ensures compliance with zoning and local
business regulations (Van der Merwe, 2018: 134).
Summary: Registration with CIPC, Department of Labour, municipal health
departments, and local authorities ensures legal operation, employee protection, and
compliance with safety standards.
