Advanced Financial Accounting Report 2022

Advanced Financial Accounting
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Executive Summary
This report has been undertaken mainly for the purpose of illustrating the significance of
accounting concepts and standards in the financial reporting process of business entities. In this
context, it has been depicted from analysis of the annual report of selected ASX listed entity that
is Woolworths Group, that it has effectively applied all the relevant accounting concepts in
development of its financial report. Also, the annual report evaluation of Woolworths as depicted
that through it is still adopting the sue of AASB 177 for reporting of its leases but it would apply
the new lease standard of AASB 16 in the future period. It has also provided adequate
disclosures regarding the impact of this transition on its financial performance.
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Contents
Introduction......................................................................................................................................4
Part 1: Identification and Description of the Accounting Concepts used in Woolworths Limited. 4
Going Concern Concept...............................................................................................................4
Accrual Accounting Concept.......................................................................................................5
Money Measurement Accounting Concept..................................................................................5
Cost Concept................................................................................................................................6
Part 2: New Accounting Standard Leases of AASB 16 and it’s Impact On Selected Company....7
Part 3: Summarizing the Key Disclosures that Company makes in context for Lease accounting
as per new standard and the impact of its transitional provision from AASB 117 TO AASB 16. .9
Conclusion.....................................................................................................................................10
References......................................................................................................................................12
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Introduction
The report has been undertaken to analyze and examine the annual report disclosures of a
selected ASX listed entity. The examination of the annual report disclosures is undertaken to
identifying the accounting concepts used for presenting and disclosing the financial information.
The next section of the report discusses the changes that have been incorporated within the new
accounting standard for leases AASB 16. This is done in reference to the selected ASX listed
company. Lastly, it examines the key disclosures that the company has made in relation to the
leases and analyzes the impact of the transition from AASB 16 to AASB 117. The ASX
Company selected for the evaluation purpose in the present report is Woolworths Limited, a
leading supermarket giant of Australia.
Brief Description of the Company
Woolworths Limited is a recognized and leading retail chain of Australia having the
presence of about 300 stores across the country. The major products provided by its retail stores
include items of grocery, liquor, home improvements and is also involved in carrying out diverse
businesses of hotels and pubs. It is recognized to be one of the largest companies within
Australia in terms of revenue. The company strategic priority is to create better experiences for
its customers and delivering them higher value (Woolworths Group, 2018).
Part 1: Identification and Description of the Accounting Concepts used in Woolworths
Limited
The accounting concepts largely assist the development and implementation of various
accounting principles within business entities. The different accounting concepts as provided by
the IASB (International Accounting Standards Board) guides the overall, process of developing
and presenting the financial statements. They can be regarded as wide conventions that have
been developed for the purpose of providing a basic framework to financial reporting. The
different accounting concepts that have been adopted by Woolworths in developing and
presenting its financial statements are described as below:
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