Audit Strategy for JB Hi Fi Group Pty Limited

AUDIT STRATEGY
STRATEGIC AUDIT

AUDIT 1
Contents
Introduction................................................................................................................................2
Part A: The Client......................................................................................................................2
Information about the client.......................................................................................................2
Industry, regulatory and other external factors..........................................................................3
Nature of the entity.....................................................................................................................3
Accounting Policy......................................................................................................................4
Related Parties and Transactions with Related Parties..............................................................5
Part B: Analysis of the client and impacts on the future audit work..........................................7
Changes in accounting policies and the impact of the changes.................................................7
Ratio Analysis............................................................................................................................7
Measurement and Review of Financial Performance..............................................................10
Objectives, Strategies, and related business risks....................................................................11
Conclusion................................................................................................................................11
References................................................................................................................................13

AUDIT 2
Introduction
The following report is aimed at evaluating the various aspects of audit in relation to the
entity “JB Hi Fi Group Pty Limited.” The report will shed light on the corporate, regulatory,
accounting, and operational aspects of the company. These would be in addition to the
analysis of the various factors such as changes in accounting policies and the impacts of the
same in future years, major ratios and their significance in terms of comparison with the last
year performance, business risks and their impacts; and the overall evaluation of the financial
performance of the enterprise.
Part A: The Client
Information about the client
Mr. John Barbuto (JB) had established the entity JB Hi-Fi in the year 1974, with an aim to be
Australia's largest and fastest growing company in terms of the retailer of home entertainment
(JB Hi Fi, 2019a). Back then, the entity had a single store in East Keilor, Victoria. The
company’s current headquarters and registered office are located at Office Tower 2, Level 4,
Chadstone Shopping Centre, 1341 Dandenong Rd Chadstone, Victoria. The company JB Hi-
Fi was floated on the Australian Stock Exchange in the month of October 2003. The
company’s ASX code is “JBH.”
The company is engaged in the business of retailing the branded home entertainment
products. The standalone destination sites and the shopping centres are the primary means of
operation of the entity. These are in addition to the company’s online stores mainly in New
Zealand and Australia. The products of the company are mainly comprised of the consumer
electronics, appliances, whitegoods, and a varied range of software including the games,
music, and movies (JB Hi Fi, 2019a). Further, the primary services include the
telecommunication services, digital content, consulting and information technology services.
Thus, company earns its revenues mainly through the sale of the consumer electronics
products and services.
The year in consideration for the report is the financial ended on 30th June 2018. The financial
statements that would be evaluated would be the consolidated financial statements.

AUDIT 3
Industry, regulatory and other external factors
There have been recent growth trends in Victoria for the retail industry. It is significant to
note that retail trade in Victoria grew up by 4.5 percent as reported in the beginning of the
year 2018, as compared to last year figures (Premier of Victoria, 2018). This accounted for
the highest growth in retail industry as compared to the other states. The growth trends have
driven positive results for the company in terms of revenue generation.
Some of the chief laws that are applicable to the entity are stated as follows. One of the chief
set of laws are the discrimination laws in the form of Fair Work Act 2009 (Cth), Sex
Discrimination Act 1984, and others. In addition, the Employment laws such as the Equal
Opportunity Act 2010 and the data protection and privacy laws such as the Privacy Act 1988
are also applicable on the company. Further, the Anti-trust law in Retailing industry,
Copyright, patents / Intellectual property laws, Environmental legislations, Corporations Act,
2001 (Cth), ASX Corporate Governance Council Corporate Governance Principles are also to
be abided by the entity.
With the increase in the e commerce practices, globalisation and increased use of the
technology driven and mobile-based products, there has been consistent increase in the
demands of the electronics, mobiles, and other such technology driven products.
The company faces a high level of competition in terms of retailing industry both in terms of
the local medium and big players and the global giants like that of Amazon. Some of the
main competitors of the company are the Harvey Norman, Fantastic Furniture, Scaale
Capital, IKEA, Simon, Ashley, Freedom Furniture, and GPT Group among others in the
speciality retailing industry.
Nature of the entity
The JB Hi Fi stores are engaged in offering leading brands of computers, cameras, speakers,
TVs, portable audio systems, varied range of games, recorded music, DVD movies, TV
shows, home appliances, DJ and musical instruments, drones and robotics, software,
consulting services, information technology, telecommunication services and more. The
company serves wide range of customers form government agencies, schools and colleges,
organisations, households and others. Because of wide variety of products, the consumers are
not limited to one class; rather belong to varied income and spending capacity groups.
However, one significant characteristics about the consumers is that they are tech savvy.