Analyzing Financial Statements of AGL Energy, Oil Search, and Santos: Corporate Accounting Report

Corporate Accounting

CORPORATE ACCOUNTING 1
EXECUTIVE SUMMARY
The main aim of this report is to understand the financial statement of the company. In this
report, three companies have been taken into consideration to analyse the financial statement
and these are AGL Energy, Oil Search and Santos. It has been evaluated that the company
has high leverage due to raising funds and increasing borrowings. The cash flow statement of
the company states that the companies invest high amount in shares, assets and acquisition. In
this report, comprehensive income statement is also discussed which reflects that the items of
comprehensive statement is not reported in the income statement of the company. The items
of comprehensive statement affect the net profit of the company. As per the analysis of the
deferred tax asset and liability, it is observed that the companies have balance amount of
deferred tax asset and deferred tax liability except AGL. The amount of deferred tax asset and
liability is increases and decreases of the companies as per the financial statements. It has
been seen that the companies have the scope to survive in the market for long time.

CORPORATE ACCOUNTING 2
Contents
Introduction..............................................................................................................................................3
Task 1- Equity and Liabilities..................................................................................................................4
Task 2- Cash Flow Statement................................................................................................................11
Task 3- Other Comprehensive Income Statement.................................................................................15
Task 4- Accounting For Corporate Income Tax....................................................................................18
Conclusion.............................................................................................................................................21
References..............................................................................................................................................22

CORPORATE ACCOUNTING 3
Introduction
Corporate Accounting is a special branch of accounting which deals with the accounting of
companies by preparing the final statement. It also analyse the financial results of the
companies and accounting for the specific events like amalgamation, absorption, preparation
of consolidated balance sheet. It is a process of accounting that calculates the operations of a
single company. The company uses this process in order to evaluate the value of assets and
liabilities. It is also use to identify the financial position of the company in the terms of
finance. There are many activities which are involved in the process of Corporate Accounting
such as creation and maintenance of a company accounting system, special expense
management, managing accounts payable, managing accounts receivable and many others. It
is necessary for the company to maintain and analyse the financial statements to evaluate the
financial position. In this report, three companies have been taken into consideration to
analyse the financial position and stability. AGL Energy Limited, Santos, and Oil search are
the companies taken to analyse the financial statements.
The report is classified into four parts to analyse the financial position of the companies. In
the first section of the report, Equity and liabilities of the companies has been analysed in
order to evaluate the debts position. After that, Items of cash flow statement have been
evaluated in order to analyse the financial position of the companies in the market. The third
section is based on the comprehensive income statement of the companies. The last section of
the report will base on the corporate tax.
Overview of the companies

CORPORATE ACCOUNTING 4
AGL Energy is an Australian listed company which is retailing in electricity and gas for the
residential and commercial use. AGL generates the energy from power station that uses the
thermal power, natural gas, wind power, and Coal seams gas source.
Santos Limited is an Australian energy company which large overseas investors and
shareholders. It is the second largest company in oil and gas producer in the country.
Oil Search Limited is the largest oil and gas exploration and development company which are
publically listed on the Australian stock exchange.
Task 1- Equity and Liabilities
I
Santos
Equity component 2017 ($m) 2016 ($m) 2015 ($m)
Issued capital 9034 8883 8119
Reserves 51 (510) (699)
Accumulated Losses (1934) (1293) 1
Total Equity 7151 7080 7421
From the above table, it has been seen that the equity component includes the issued capital,
reserves, and accumulated losses. Share Capital has been issued to shareholder is called
Issued Capital. The issued capital of the company is increases in the year 2017 as compare to
2016 and 2015. Reserves are always a credit balance of the company and part of
shareholders. Reserves of the company is increases in the year 2018 but it has been seen that
the company has the negative value in the past year such as 699 and 510 in 2015, and 2016
respectively. Accumulated Losses is the opposite of accumulating gain which means the

CORPORATE ACCOUNTING 5
business debts are greater than the earnings. As per the financial position of the company, the
company accumulated losses is reduces.
Oil Search
Equity component 2017 ($m) 2016 ($m) 2015 ($m)
Share Capital 3152.4 3147.3 3147.3
Reserves (6.4) (10.7) (12.97)
Retained
earnings/(losses)
1,791. 7 1588.7 1574.995
Total equity 4,937. 7 4725.3 4709.36
As per the above table, it has been seen that the company report the share capital, reserves,
retained earnings in its equity. The share capital of the company is increases in the year 2017
as compare to the other years such as 2015 and 2016. Reserves amount of the company states
that the company reserve more and invest less in the year 2017 as compare to the year 2016.
Retained Earnings is the accumulated income that is retained by the corporation at a
particular point of time. Retained earnings are increases in the year 2017 with the amount of
1791.7 and in the year of 2016 the amount of the earning is 1588.7 which reflect the
increasing earnings of the company (Oil Search, 2015).
AGL Energy
Equity component 2017 ($m) 2016 ($m) 2015 ($m)
Issued capital 6223 6696 6696
Reserves 16 (24) (65)