Accounting Requirements for Investment in Wakefield Ltd. - Desklib

Advanced Financial
Accounting
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Table of Contents
Question. 1......................................................................................................3
Question 2.......................................................................................................6
References.......................................................................................................8
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Question. 1
MEMORANDUM
Date: 19 August 2019
To: Angela Kirk, CEO of Wakefield Ltd.
From: Mathew, Investment Consultant of Mercer
Subject: The accounting requirements for the proposed investment
Introduction
The main aim of this Memorandum is to explain the AASB 10 needs which
based on “Consolidated Financial Statements” under section 334 of the
Corporation Act, 2001.
Consolidated Financial Statements
The consolidated financial statements are the group statement in which the
income, expenses, assets, flows of cash and liabilities of the parent and its
subordinates shown as single entity statements (Bisogno, Santis, &
Tommasetti, 2015).
Objective
The foremost objective of this accounting standard is to make the standards
for creating and present the consolidated financial statements when a
company manage or controls one or more companies (Bini, 2019).
Meeting the objective
To achieve the objective of this standard following points should be
considered:
a. To present the consolidated financial statements, this standard requires a
company, i.e. parent company that manages and controls one or more
companies, i.e. subordinate companies;
b. This standard defines and establishes the control principle as the basis for
consolidation; and
c. This standard establishes requirements of accounting for the making of
consolidated financial statements.
Scope
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