Financial Accounting Analysis of Macquarie Group

Accounting

EXECUTIVE SUMMARY
This report presents about the financial accounting done by the Macquarie group. It
covers the fundamental accounting theories, standards which are required to be adhered while
preparing the financial report. This report has been focussed on the accounting policies being
followed by the Macquarie group along with the reporting strategies. Based on the findings, it
can be concluded that the Macquarie group has been very effective in complying with all the
relevant accounting standards and frameworks such as AASB 139. It has effectively used
qualitative characteristics for the financial reporting purpose.

TABLE OF CONTENTS
INTRODUCTION......................................................................................................................4
ANALYSIS................................................................................................................................4
Adherence to the objectives of the conceptual framework with its reporting........................4
Adherence with the recognition criteria for reporting assets, liabilities, equity, revenue and
expenses.................................................................................................................................5
Adherence with the qualitative enhancing characteristics of financial reporting..................7
Assessment of satisfaction of enhancing qualitative characteristics of financial report........8
CONCLUSION........................................................................................................................10
REFERENCES.........................................................................................................................11

INTRODUCTION
Macquarie group is an Australian multinational investment bank having offices
globally. The MGL is headquartered in Australia and listed in Australia stock exchange
(ASX). It was founded in 1969. The company has employed over 14000 employees all
across its 30 offices around the world. The group has the total assets of $A203.2 billion and
the total of equity as on 31 march 2019 is $A18.4 billion. The company is the world’s largest
infrastructure asset manager and also it top ranked as the mergers and acquisitions (M&A)
adviser. The MGL group is having two operating groups, which are, Macquarie Asset
Management and Macquarie Capital.
For this report, Macquarie group is selected to critically analyse whether the company
has complied with all the accounting requirements. The report has put emphasis on the
accounting policies of Macquarie group. The core objective of this report is to analyse the
accounting policies and reporting strategies followed by the company. It also includes the
issues which might to suspicious. The theoretical concept of accounting framework includes
two, positive and normative theory. The former states to conduct accounting analysis on
historical data and also conclusion is drawn based on the information present currently in
hand. But the normative theory provides advises to the policy makers with respect to what
should be done which is completely based on the theoretical principles.
ANALYSIS
Adherence to the objectives of the conceptual framework with its reporting
Standards Board (AASB) is responsible for creating financial report for all types of
business entities. The significant contributing role of AASB has been considered with the
“Australian securities and investment commission at 2001”. The AASB is considered as the
basis for preparing the general purpose financial report of Macquarie group (Goodacre, Gaunt
and Henry, 2017). Also, the compliance with the Australian Accounting Standard (AAS)
makes sure that the annual report is prepared in accordance with the International Financial
Reporting Standards (IFRS) which are issued by the IASB (International Accounting
Standards Board). Historical cost convention is the basis of preparation of financial report.
The Board of the group is committed to oversight the performance and risk
management. The group heads of the company is responsible for introducing the risk
management framework to attest the key risk identified. The “Macquarie’s risk management
framework” completely includes its systems, structures, policies and processes and even