We will be using the canon FFG timeline.
The events of this game will take place in March of 1119, i.e. the default pre-Scorpion coup setting of a lot of L5R games and most of the books, regardless of editions.
The great picture
The Empire is at peace under the rule of Doji Satsume. As Crane Clan Champion, Emerald Champion, and someone who has the ear of Emperor Hantei the Thirty-Eighth, he is without a doubt the most powerful man in the Empire, and has poured all that power into ensuring the Empire's stability and the Crane's prosperity. The clan of Doji is living through a golden age, dominating in politics, economics, and even on the battlefield.
Resentment is going strong among the other clans, in particular the sidelined Lion and Scorpion. For lack of a proper alliance however, little has come from it. Furthermore, the fact that the man holds so many of the strings personally and isn't getting any younger encourages a wait-and-see policy.
There will be turmoil as soon as Doji Satsume draws his last breath. But, for now, he lives, and the Empire is at peace.
More detailed information about each clan can be found on the wiki, in the TCG subcategory.
Zooming in
The monastery of Circle's End sits in the southern half of the Seikitsu mountains, near the Crane, Lion and Scorpion. The place is neutral ground in theory, and, with only a tiny estate and a small dozen of monks, insignificant enough to be neutral in practice too.
The arrival of Sensei Wu a few months ago at first changed little to that state of things at first. The man had been wandering the Empire for decades now, and it wasn't unusual for him to rest for a few days in the oddest places before resuming his endless journey.
But then, days turned to weeks, weeks to months, and the Sensei remained. And finally, the man, who had always been extremely reluctant to teach anyone, announced he was looking for new pupils. Favors he has been sleeping upon for decades were called in, lords were asked by their own lords if they didn't have some promising youngsters that would profit from out-of-the-box teaching by a revered sensei, rumors started spreading among other monastic orders and among the ronins.
Sensei Wu did not specify a single criteria about who he is expecting, only that he was awaiting prospective students on the week of the spring equinox.
Who knows who will be there on that week, and for what reason. Genuine interest? Obligation? Looking for an excuse to visit a maybe isolated but still strategically positioned place, near the borders of no less than three clans? Just hoping for a free meal?
Nonetheless, people will be there. And where people go, things happen.
Practical information
The monastery is atop a significant mountain, and it's the end of winter. Warm clothes are recommended. Snowfalls are to be expected.
To attain the monastery, one must travel through either the Lion or the Scorpion. Sensei Wu must have some good friends in Otosan Uchi however, as travel permits to the monastery were quite easy to obtain, even for the most distant clans.