Accounting Standards AASB 116, AASB 112, and AASB 101: A Case Study of AGL Energy Limited

Advanced Financial
Accounting

TABLE OF CONTENTS
Introduction......................................................................................................................................3
1...................................................................................................................................................3
2...................................................................................................................................................4
3...................................................................................................................................................4
4...................................................................................................................................................5
Conclusion.......................................................................................................................................5

Introduction
The present report is about the ABL Energy Limited Company which has committed to build a
shape of the sustainable energy in future for Australia. The company operates the largest
portfolio of electricity generation of the nation and is also the largest investor listed on Australia
Stock Exchange for renewable energy having 3.6 million accounts of customers (The Annual
Report, 2017 AGL Energy Limited). The company has a responsibility of providing secure,
affordable and sustainable energy to their customers. The AGL Energy Limited has an aim
flourish in the carbon constrained globe and build customer support as there is a transformation
in industry.
The report basically includes the requirement of the accounting standards AASB 116, AASB
112, and AASB 101. The objective of the AASB 116 is to describe the treatment for plant,
property and equipment in accounting so that the users of financial information can differentiate
information regarding the investments of any business (Laing, & Perrin, 2014).The mainconcern
in accounting for, plant,property and equipment are the identification of the assets, the purpose
of their carrying sum and destruction of losses and the depreciation charges to be determined
towards the business.
1.
According to the accounting standard AASB 116, there are basic requirements made under this
standard which must be fulfilled at the time of acquisition of the property, plant and equipment
of any of the company. The requirements are as follows:
 The financial statement of the company should disclose about each of the property, plant
and equipment.
 The bases of measurement which has been used to determine the total carrying amount.
 The method of depreciation used(Hanlon, Navissi, and Soepriyanto, 2014)
According to the annual report of the AGL Energy Limited the property, plant and equipment of
the company is calculated at the cost less then accumulated impairment loss and accumulated
depreciation. Thecost also includes the expenses which are directly attributed to the construction
and acquisition of the asset. The financial cost of the company associated with the construction