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Course ID: Corporate Accounting

   

Added on  2021-05-31

13 Pages3327 Words390 Views
Running head: CORPORATE ACCOUNTINGCorporate AccountingName of the Student:Name of the University:Author’s Note:Course ID:

1CORPORATE ACCOUNTINGTable of ContentsCash flow statement:..................................................................................................................2Requirement (i):.....................................................................................................................2Requirement (ii):....................................................................................................................4Other comprehensive income statement:...................................................................................5Requirement (iii):...................................................................................................................5Requirement (iv):...................................................................................................................6Requirement (v):....................................................................................................................7Accounting for corporate income tax:........................................................................................7Requirement (vi):...................................................................................................................7Requirement (vii):..................................................................................................................7Requirement (viii):.................................................................................................................8Requirement (ix):...................................................................................................................8Requirement (x):....................................................................................................................9Requirement (xi):...................................................................................................................9References:...............................................................................................................................11

2CORPORATE ACCOUNTINGCash flow statement:Requirement (i):By evaluating the cash flow statements of the business organisations, it becomeseasier to gain an understanding of their inflows as well as outflows of cash (Robinson et al.,2015). For this paper, CSR Limited is chosen and each item of its cash flow statement isanalysed critically as follows:Cash flows from operations:As per the latest annual report of CSR Limited in 2017, the organisation has reportedfive significant items in this section of the cash flow statement. These items include thefollowing:Money received from the customersMoney paid to the suppliersDividends received and distributions madeInterest amount earned and income tax paidFrom the sales made in credit, CSR Limited received money from the customers(DeFusco et al., 2015).Increase in this item is evident from its cash flow statement from$2,499.50 million in 2016 to $2,726 million in 2017 (Csr.com.au, 2018). The receipts madefrom the last year’s credit sales are the primary reason behind this increase. The materialsbought from the suppliers indicate the money paid to them. There is rise in cash outflow ofthis item in 2017 to $2,424.60 million from $2,246.40 million in 2016. This is because CSRLimited has made additional purchases for coping up with the rising consumer demand. Thethird item is the dividend amount earned because it has invested in its other subsidiaries.Increase could be observed in this item as well from $11.20 million in 2016 to $14.20 million

3CORPORATE ACCOUNTINGin 2017. However, interest receipt is observed to decline from $2.50 million in 2016 to $1.90million in 2017 due to the lower amount of investments made. In addition to this, massiveincrease could be identified in its income tax payment to $52.70 million in 2017 as opposedto $14.60 million in 2016. Cash flows from investing activities:In this section, CSR Limited has reported five significant items. These comprise ofpurchase of and proceeds from plant and equipment, purchase of controlled entities orbusinesses, costs of acquisition, repayment of receivables and loans obtained in advance(Gordon et al., 2017). It could be identified from the cash flow statement of CSR Limited thatreduction is made in investments related to purchase of plant and equipment and other assetsin 2017 compared to 2016, which have been $92.20 million as opposed to $120 million in2016. As the organisation has adequate asset base available, it has significantly minimised itspurchase. On the contrary, decline could be observed in the proceeds from these assets from$71.20 million in 2016 to $44.7 million in 2017. No business acquisitions have been made in2017 due to which significant fall in these expenses could be observed from $12.80 million in2016 to $3.50 million in 2017. As the acquisition amount has fallen, acquisition cost hasfallen drastically from $12.8 million in 2016 to ($3.4 million) in 2017. Along with this, CSRLimited has largely repaid its prepaid loans from $0.10 million in 2016 to ($5.30 million) in2017. Cash flows from financing activities:In this section, CSR Limited has disclosed important items like share repurchase,share acquisition, interest payment, finance cost and transactions with non-controllinginterests (Harris, 2016).

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