Accounting Theory and Corporate Governance

Running head: ACCOUNTING THEORY AND CORPORATE GOVERNANCE
Accounting Theory and Corporate Governance
Name of the Student
Name of the University
Author’s Note

1ACCOUNTING THEORY AND CORPORATE GOVERNANCE
Table of Contents
Answer to Part A........................................................................................................................2
Requirement 1........................................................................................................................2
Requirement 2........................................................................................................................2
Requirement 3........................................................................................................................3
Answer to Part B........................................................................................................................4
References..................................................................................................................................9

2ACCOUNTING THEORY AND CORPORATE GOVERNANCE
Answer to Part A
Requirement 1
It can be seen from the annual report of JB HI-FI Limited and Newcrest Mining
Limited that both of these companies have provided all the information about their corporate
governance policies, procedures and practices under a separate section in the annual report
named Corporate Governance. In addition, both of these two companies have provided
numerical information along with description to disclose about their policies, procedures and
achievements. One important aspect that needs to be mentioned here is that both of these
companies have complied with the principles and standards of 3rd edition of the ASX
Corporate Governance Council Principles and Recommendations for the purpose of their
corporate governance requirements (newcrest.com.au, 2019).
Requirement 2
JB HI-FI Limited Newcrest Mining Limited
a. The board size is 7 (jbhifi.com.au, 2019). The board size is 10 (newcrest.com.au,
2019).
b. 6 non-executive directors out of 10;
85.71%.
7 non-executive directors out of 10; 70%.
c. All of the directors are independent
directors; thus, it is 100%.
7 directors are independent directors out of
10; thus, it is 70%.
d. The 2018 Annual report states that the
Chairman and Group Chief Executive
Officer are Greg Richards and Richard
Murray respectively. They have
highlighted that net sales, net profit and
gross profit of the company increased in
2018. At the same time, this year is
crucial for the company as the
management has taken certain important
The Chairman of the company is Peter
Hay. He has highlighted the generation of
positive cash flow by the company in the
whole year which contributed towards the
increased profitability. Improvement in the
net debt position is also evident in the
same year. The balance sheet position of
the firm enhanced due to the
improvements in the market conditions.

3ACCOUNTING THEORY AND CORPORATE GOVERNANCE
business decisions in this year
(jbhifi.com.au, 2019).
On the overall, 2018 has been a
remarkable year for the company
(newcrest.com.au, 2019).
e. Out of the total 114883372 shares, the
shares of executive directors are
1333919; hence, it is 1.16%.
Out of the total 767742814 shares, the
shares of executive directors are 1100691;
hence, it is 0.14%.
f. There is not any information provided on
block or institutional shareholders in the
year 2018 (jbhifi.com.au, 2019).
Out of 767742814 shares in 2018,
1134002 shares were treasury shares; thus,
it is 0.15% (newcrest.com.au, 2019).
Requirement 3
It can be seen from the above that both JB HI-FI and Newcrest Mining has sufficient
number of non-executive as well as independent directors in their Board and it indicates
towards the presence of objectivity as well as independence in the decision-making process
of these two companies (jbhifi.com.au, 2019). This is a major strength of these two
companies. After that, both of these two companies have provided the information about the
number of shares hold by their executive directors that can be considered as an important
move to establish effective corporate governance within the organizations. It can be said on
the overall basis that both of these two companies have adequately disclosed the required
information about corporate governance (newcrest.com.au, 2019).