Business Plan Development & Analysis

This business plan assignment delves into key aspects of establishing a successful enterprise. It outlines strategies for selecting optimal showrooms, implementing best accounting practices for financial credibility, analyzing various profit scopes, and leveraging advertising to attract customers. The role of a skilled sales team in driving business success is also emphasized.

FINANCIAL ACCOUNTING AND REPORTING 1
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Table of Contents
Part A) Review of the issue.............................................................................................................3
Introduction......................................................................................................................................3
Implication of AASB 112 in major accounting issue......................................................................3
New Retail Business with Shops.....................................................................................................4
Profit Scopes....................................................................................................................................4
Modes of Accounting......................................................................................................................5
Conclusion.......................................................................................................................................5
Part B) Business Letter....................................................................................................................5
Reference List..................................................................................................................................7
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Part A) Review of the issue
Introduction
In the current scenario of business, it is very important to have certain efficient business
accounting techniques so that the different areas of financing operations can be done in a precise
manner.
Implication of AASB 112 in major accounting issue
The standard recommends the bookkeeping treatment for money charges (Engel, 2016, p.21)).
The standard spreads:
 the bookkeeping treatment of current and conceded charge costs;
 acknowledgment and estimation of current expense resources and liabilities;
 acknowledgment and estimation of conceded impose resources and liabilities;
 the bookkeeping treatment of the expense outcomes of different exchanges and
occasions, including resource revaluations; (Cokins and Shepherd, 2017, p.34)
 the bookkeeping strategies material for when an element has charge misfortunes;
furthermore,
 the revelation prerequisites in connection to impose things.
According to Sudibyo and Basuki (2017, p.86), if the consumer is satisfied as well as the
precession of tax returns don’t come under the category of cheating or illegitimate transactions, it
is always good for any particular organization to perform activities to save taxes. The company
has an argument among its prime members that whether Deferred Tax Liabilities and Assets or
DTLs and DTAs can be kept unaccounted or not. There were a significant number of board
members that supported the fact that the DTAs and DTLs must be kept unaccounted so that the
company can save a huge amount of man hours and monetary assets can be saved. As per
Robson et al. (2017, p.36), it has been mentioned in Income Tax Assessment Acts that were
enacted in 1936 as well as 1997 that the income of every major and minor operations that
happens in any business organization needs to be shown to Government.
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New Retail Business with Shops
The company has decided to initiate a long-term business along with many business retailers that
are located in different parts of Australia. This can be considered as a significant step towards
business expansion. However, these retail shops need to be verified very precisely in order to
choose the right most one. Bishop et al. (2016, p.39) have mentioned that the previous sales and
number of customers that visit these stores can give a very clear idea of what the possible
amount of sales can be through these retail shops. Moreover, it needs to be kept in mind that the
prices are going to vary as per ratings and net worth of retail business shops and stores.
Hence, it is very important to ensure that stores are chosen very carefully. There should be some
stores that are located at very densely populated area and can catapult the sales quantity. At the
same time, there should be some stores that are located in some not so dense areas so that the
cost of advertising can be controlled in a desirable manner. According to Millo et al. (2016,
p.20), to cover up the losses caused due to less investment in less populated areas, advertising
through various means can be implemented so that the people consider their opinion about
visiting those places and buy the items.
Profit Scopes
The cost that is to be paid by company to advertise their products on windows is 600AUD per
month for one square meter area in one shop. Hence, it is extremely important that the area must
be decorated in a very beautiful manner along with a tag with some attractive thoughts written on
it. The advertising needs to be done through internet and television in order to reach as many
customers as possible. According to Leuz and Wysocki (2016, p.613), the advertising needs to be
done at places with maximum number of people that include metro stations, railway stations, bus
stands and other similar locations.
The inclination of customers towards items due to effective advertisements and significant
efforts by sales people and managers is likely to enhance the profit margin gained by the
organization (Mullinova, 2016, p.61).
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Modes of Accounting
Under AASB 112, the present expense of an element is required to be perceived (Schaltegger et
al. 2017, p.118). A present expense resource or obligation is characterized as the measure of pay
charges payable or recoverable in regard of the assessable benefit or duty misfortune for a period
i.e.: (Current tax liability = assessable benefit * tax rate)
As stated by Johnston and Petacchi (2017, p.1138), the records of all different entities like
inbound shipping, period of display, number of items displayed, sold items and outbound
shipping needs to be done in different sheets. This helps the administrative departments to ensure
that records are entered correctly as well as can be fetched easily whenever necessary.
Conclusion
After completing the study related to accounting and taxation modules in a particular business, it
can be said that the best way to minimize unnecessary expenses on is to remove the Business
accounting for future tax impact and do the prediction for making the business grow and impact
of different growth strategies.
Part B) Business Letter
McKenzie and Associates
From: Ms. Maria McKenzie
Sent: 25 July 2017
To: Mr. Con Pewter (Pewter Ltd.)
Reference: Identifying and resolving accounting issues (Year ended 30 June 2018)
Dear, Con Pewter
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McKenzie and Associates
Thank You for writing to us for discussing the concerns you are facing in your organization due
to various reasons. We look forward to assist you in order to resolve all your concerns that are
obstructing the desired pace of growth to your company. We have gone through all the details
related to the operations of your organization and found that certain things were not in places in
the way they are supposed to be. Hence, we have carried out a very careful analysis and
formulated some strategies as well as recommendation some of the prime areas of operations in
your company. Following are some of the key points that have been recommended in the
analysis.
1. We have found that there were some operations that were happening unnecessarily in
your firm and were resulting into some extra burden on company funds and expenses
from economic point of view. Hence, we have recommended some of the best and most
suitable alternatives to reduce the surplus expenses in your company to enhance the
profitable areas. We have also mentioned the activities that can carry out the accounting
and taxation related operations in an economic manner. The legitimate factors related to
these activities and their authenticities as per certain legislations have also been
mentioned.
2. We have also suggested you some very important operations and techniques that can
catapult the sales of your items and commodities in almost every different showroom.
The precise calculations along with the factors that are to be kept in mind while choosing
showrooms for display of your products have been stated explicitly. Moreover, the best
accounting practices in order to ensure the credibility of your operations have been also
described. The description also includes different scopes of profit and significance of
advertisements to attract customers followed by the role of sales people in making the
business successful.
We hope to see your business grow exponentially while following these strategies. However, any
concerns related to the described strategies and techniques will be welcomed at any point of
time. We expect that your business-related operations to fetch you a high margin of monetary
profit as well as enhancement in the corporate social image possessed by your organization.
Thanking you in high regards for doing business with us.
Regards:
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Ms. Maria McKenzie
Manager, McKenzie and Associates
Contact Reference:
[e-mail]
668 George Street,
Melbourne, VIC 3000
Reference List
Bishop, C. C., DeZoort, F. T., & Hermanson, D. R. (2016). The Effect of CEO Social
Influence Pressure and CFO Accounting Experience on CFO Financial Reporting Decisions.
Auditing: A Journal of Practice & Theory, 36(1), 21-41.
Cokins, G., and Shepherd, N. (2017). The power of intangibles: we need to move beyond the
narrow breadth of current financial accounting and reporting and shift to value creation.
Strategic Finance, 98(11), 32-40.
Engel, C. J. (2016). A Primer on the Accounting and Reporting Requirements for Not-for-
Profit Organizations. Journal of Public Management Research, 2(1), 14-24.
Johnston, R., and Petacchi, R. (2017). Regulatory oversight of financial reporting: Securities
and Exchange Commission comment letters. Contemporary Accounting Research, 34(2),
1128-1155.
Leuz, C., and Wysocki, P. D. (2016). The economics of disclosure and financial reporting
regulation: Evidence and suggestions for future research. Journal of Accounting Research,
54(2), 525-622.
Millo, Y., Barman, E., and Hall, M. (2016). Accounting measurement tools and their impact
on managerial decision making. economic sociology_the european electronic newsletter,
17(2), 17-23.
Mullinova, S. (2016). Use of the principles of IFRS (IAS) 39 “Financial instruments:
recognitionand assessment” for bank financial accounting. Modern European Researches,
27(1), 60-64.
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Robson, K., Young, J., and Power, M. (2017). Themed Section on Financial Accounting as
Social and Organizational Practice: Exploring the work of financial reporting. Accounting,
Organizations and Society, 56(3), 35-37.
Schaltegger, S., Etxeberria, I. Á., and Ortas, E. (2017). Innovating Corporate Accounting and
Reporting for Sustainability–Attributes and Challenges. Sustainable Development, 25(2),
113-122.
Sudibyo, A. A., and Basuki, B. (2017). Financial Accounting and Reporting. In SHS Web of
Conferences (Vol. 34). Greensborough: EDP Sciences.
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