Analysing the Annual Report of Automotive Holdings

Running head: ANALYSING THE ANNUAL REPORT OF AUTOMOTIVE HOLDINGS
Analysing the Annual Report of Automotive Holdings
Name of Student
Name of University
Author’s Note

ANALYSING THE ANNUAL REPORT OF AUTOMOTIVE HOLDINGS1
Table of Contents
Introduction......................................................................................................................................2
Background of Automotive Holdings..............................................................................................2
Accounting Concepts Used..............................................................................................................2
AASB 117........................................................................................................................................4
AASB 16..........................................................................................................................................6
Importance of AASB 16..................................................................................................................6
Changes Incorporated in AASB 16:................................................................................................7
Conclusion.....................................................................................................................................10
Reference.......................................................................................................................................11

ANALYSING THE ANNUAL REPORT OF AUTOMOTIVE HOLDINGS2
Introduction
This report explains the newly implemented Standard of AASB 16, which deals with the
lease of the property held by the company. The differentiation is also made between the AASB
16 and AASB 117 (Aasb.gov.au. 2019). The changes which are brought by AASB 16 are also
being discussed. The report also states how efficiently Automotive Holdings Group Limited has
taken care of the change by implementing new management board.
Background of Automotive Holdings
Automotive Holdings Group Limited is an Australian Company which is also the listed
company that associated with the Australian Stock Exchange with the name of AHG.
Automotive Holdings deals with retail business and also involved in the logistics business.
Automotive Holdings Group Limited inaugurated in the year 2004. The company’s total
workforce is estimated to be 8400. As per the 2017 data, Nick Politis holds the highest stake of
22.8% in the Automotive Group through AP Eagers Ltd. The automotive group holds 190 motor
franchise over 110 dealership locations which are operating in the geographical areas of
Australia and New Zealand. The company’s logistics segment contains the company’s cold
storage and transport operations. The other logistics part consists of the company’s automotive
parts warehousing and distribution businesses, bus and track distribution and vehicle storage and
engineering (Pawsey 2017). The company also involves in refrigerated transport in Australia.
The company’s total revenue is $5.92 billion.
Accounting Concepts Used
The general accounting procedure used by Automotive Holdings Group Limited is
following the Australian Accounting Standard and Interpretations, which is issued by the

ANALYSING THE ANNUAL REPORT OF AUTOMOTIVE HOLDINGS3
Australian Standards Board and the Corporations Act 2001 (Aasb.gov.au. 2019). The financial
statement of the company has mainly complied with International Financial Reporting Standards
(IFRS). The International Financial Reporting Standards as issued by the International
Accounting Standard Board (IASB). The company had implemented the following standards and
amendments in the annual report of the company (Aasb.gov.au. 2019). The accounting standards
which are implemented by the company in its annual report are as follows:
 AASB 2016-1 Amendments to Australian Accounting Standards- Recognition of Deferred Tax
Assets for Unrealized Losses.
 AASB 2016-2 Amendments to Australian Accounting Standards- Disclosure Initiative:
Amendments to AASB107
 AASB 2017-2 Amendments to Australian Accounting Standards- Further Annual Improvements
20114-2016 Cycle.
All the above standards and amendments are implemented by the company in the annual
report of Automotive Holdings Group Limited in the year of 2017 (Aasb.gov.au. 2019). The
company also wants to implement new financial standard in the creation of the financial statements
are as follows:
 The standard which replaces AASB 139 Financial Instruments: Recognition and
Measurements. This standard attends the classification and measurement of the
assets (Lamb, Erskine and Fletcher 2015). The above mentioned standard
introduces an expected loss model rather than the incurred loss model for the
impairment of the financial assets. The standards also help to change the
requirements for the hedge accounting, which helps in enhancing the risk