Accounting Practices and Financial Reporting at Pearson Plc

ADVANCED CORPORATE
REPORTING

TABLE OF CONTENTS
1. INTRODUCTION.......................................................................................................................3
Q2. A)..........................................................................................................................................3
Q2. B)..........................................................................................................................................5
Q2. C ).........................................................................................................................................7
3. CONCLUSION............................................................................................................................8
REFERENCES................................................................................................................................9
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1. INTRODUCTION
The report is on accounting practices in an organisation and it speaks about the impact on the
organisation. Pearson Plc is a UK owned education publishing company which provides
assessment service to corporations and schools for students. Pearson has investment and owns
brands like Addison-Wesley, Peachpit, Prentice Hall etc. Pearson has been part of Pearson Plc
which was owned formerly by Financial Times. Pearson has been in partnership with high-
education publishers for creating CourseSmart, which is company selling text books of college in
e-Textbook format. The regulatory framework for the financial reporting for Pearson Plc is
compliance oriented and follows rules of IASB under framework of International Accounting
Standards. These hold value for both internal and external stakeholders of the company.
Q2. A)
Cash generating units according to IAS 36 is defined to be the identifiable smallest group of
assets which generate cash inflows which are independent of cash inflows from other group of
assets. Pearson CGU nature and composition vary from entity to entity and determination is done
largely through specific factors of entity (Kabir and Rahman, 2018). Cash generating unit can
represent:
Entire entity
Departmental or business unit in entity
Production within department or entity
Groups of property items.
The carrying values of intangible assets and goodwill depend on the future cash flow estimates
of cash generating units underlying. The impairment reviews done by management have a
number of prominent estimates and judgements. Change in assumptions may result in
impairment charges which are different.
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