Advance Financial Accounting - Assignment2

Running head: Advance Financial Accounting
Advance Financial Accounting
Name of the Student:
Name of the University:
Author Note:

ADVANCE FINANCIAL ACCOUNTING1
Executive Summary
Every entity which reports the GPFR is a reporting entity, and they are accountable for their
performances to the dependent user as they evaluate the performance of the entity to decide
whether to invest in the company or not. The entity also has to follow the concepts like
relevance and representation of faithfulness while they prepare their annual financial report.
Here in this report company Dexus is focused and evaluated whether it is a reporting entity or
non-reporting entity and do they follow the concept of relevance and faithfulness or not.

ADVANCE FINANCIAL ACCOUNTING2
Table of Contents
1.1 Introduction..........................................................................................................................3
1.2 Discussion............................................................................................................................3
1.2.1 The entity is reporting or non-reporting entity..............................................................3
1.2.2 Representational faithfulness and Relevance................................................................7
1.3 Conclusion..........................................................................................................................10

ADVANCE FINANCIAL ACCOUNTING3
1.1 Introduction
An entity is known as reporting entity when it follows the concept of General Purpose
Financial Reporting, which will help the entity’s dependent user to analyze the company’s
performance and their past decisions regarding the sales and objectives. The entity is
supposed to follow all the rules and regulations under the Australian Accounting Standard
Board and the Corporation Regulations 2001. When they prepare their annual financial
report. For presenting the true and exact picture of the entity’s financial position, the
company needs to follow the concepts like relevance and representational faithfulness while
the auditor is collecting the data and information regarding the annual report and preparing
the financial statement accordingly. This below report shows that the company Dexus in
Australia is a reporting company and it uses the concepts of the relevance of the financial
information and their representation faithfulness while they provide the annual financial
report to their external and internal dependent user so that they can make their investment
decisions accordingly and retain their trust over the company. This report also provides
details regarding what criteria are needed to become an entity to be a reporting entity and
how relevancy and faithfulness can be represented in the annual report by the company.
1.2 Discussion
1.2.1 The entity is reporting or non-reporting entity
A reporting entity uses the concept of General Purpose Financial Reporting (GPFR),
where it has to report the dependent user about their financial performance and present the
true picture of their financial position. The entities which follow this concept of GPFR are the
listed private companies, public interest entities like educational institutes and those large
private companies added to the external stakeholders who are not allowed to access any other
financial information of the company apart from the annual report (Dexus.com 2020).