Financial Reporting

Financial Reporting

Objective: This task requires you to prepare a report to evaluate information provided in the

annual report of a chosen company listed on the Australian Stock Exchange (ASX). Your

comments or evaluation should comply with the requirements of relevant Australian

accounting standards (AASBs). The report should address the points outlined below:

1) PPE: You should refer to the requirements of AASB 116 Property, Plant and Equipment and

AASB 136 (FP) Impairment of Assets [for for-profit entities] as the guidelines for your


• Identify the PPE of the company by the end of the financial year (1 mark)

• Determine the measurement of PPE in the chosen company (2 marks)

• Comment on and discuss the depreciation method of the chosen company (1 mark)

• Explain whether there is impairment loss and how it is determined (1 mark)

• Comment on whether or not the disclosures of PPE in the annual report are sufficient

for decision making (2 marks)

• Discuss how the choice of accounting policies impacts on financial performance (1


2) Income Taxes: You should refer to the requirements of AASB 112 (FP) Income Taxes [for

for-profit entities] as the guidelines of your report.

• Comment on the recognition of current tax liabilities (assets) and tax expenses

(income) reported in the annual report of the chosen company (1 mark)

• Determine whether there are deferred tax assets (DTAs) and deferred tax liabilities

(DTLs) and explain the factors that led to DTAs and DTLs in the chosen company (2


• Discuss the measurement of current tax liabilities and assets, DTAs and DTLs in the

annual report, and comment on whether it aligns with the requirements of AASB 112

(1 mark)

• Are DTAs and DTLs offset against each other in the annual report? (1 mark)

• Are there any DTAs and DTLs that are not recognised in the profit and loss? (1 mark)

3) Equity/Shareholders’ funds: Comment on the recognition and disclosure of share capital in

the chosen company according to the requirements of AASB 101 (FP) Presentation of

Financial Statements [for for-profit entities]

• List the components of Shareholder’s Fund/Equity presented in the annual report of

the chosen company, providing details of changes during the financial year (1 mark)

• Determine whether the company has reclassified any financial instrument as an

equity instrument during the observed financial year. Explain why it is import to

classify funds appropriately as debt or equity (1 mark)

• Comment on any items that are recorded against equity rather than as part of profit

and loss (1 mark)

• Does the company provide you with sufficient information to assess its performance?

(1 mark) The report that you prepare should include an executive summary, a body of contents

covering points listed above, and a reference list. The word limit of this report is 2000 words

(excluding executive summary, references and appendix). The references should be done

using Harvard Style or ARA style. The reference list should provide all materials supporting

the report. Sections extracted from the annual report or AASB to support your report should

be included in the appendix. Remember to attach a link/copy of the financial report/statement

with your assignment. Also, provide specific page numbers of the annual report and

paragraph numbers of AASBs as in-text reference in your assignment. If you choose to

ignore this instruction, then you will lose marks. 2 marks will be awarded to effective

communication and referencing.

Each student should choose a company that is listed on the Australian Stock Exchange (ASX)

and find an annual report for the 2012/2013 or 2013/2014 financial year. Remember to pick a

complete annual report, not a concise financial report or a half-year financial report.

To ensure your choice of a company does not duplicate one already chosen by other student,

they will be allocated on a first come, first served basis. You may reserve a company by

adding a post on ‘Discussion Board’ under ‘Reserve a company here’. Write the name of the

chosen company in the description line of your post. If you add the company name in the

message and NOT in the description line, then the reservation is void because it will not be

readily visible to others.

Unless otherwise indicated, all assignments are to be submitted online via the link for Turnitin

assignment submission provided on the BB site. The link to submit an assignment will be open

4–5 weeks before the due date. After the due date, a separate link will be available for late

submission with approved extension. You must use the electronic Assignment Cover Sheet

provided, fill in details and then make this sheet the first page of your assignment. Do not send it

as a separate document. The file name should include (in order) your surname, your student

number and the name of the company you chose for your assignment. For example:


‘Parker1235456xyz’. Your assignments must be submitted as Word documents.

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