Company Accounting: Adjustments Made by Chapman in Response to ASIC Scrutiny

Running head: COMPANY ACCOUNTING
Company Accounting
Name of the Student:
Name of the University:
Author’s Note:

2COMPANY ACCOUNTING
Executive summary
In this report an effort will made to ensure that relevant data pertaining to Chapmans
financial statements, in relation to the adjustments made by it in response to the scrutiny done
by ASIC, is reflected clearly and efficiently. The importance of revealing the same to the
stakeholders of the company is that they will be able to understand the basis on which the
company had to issue an amended financial report for the relevant period.

3COMPANY ACCOUNTING
Table of Contents
Introduction................................................................................................................................3
Background of Chapman Limited:.............................................................................................3
Identification of the questioned accounting treatments:............................................................4
Examination of the basis of accounting treatment previously adopted by Chapman and the
basis of accounting treatment as suggested by ASIC.................................................................5
Possible approaches available with Chapman to address the issue raised by Chapman............6
Market reaction to the announcement to the market on 18th August 2017.................................7
Recommendations in relation to the steps that can be taken for reducing the same in the
future.8
Conclusion................................................................................................................................10
Reference List..........................................................................................................................11

4COMPANY ACCOUNTING
Introduction
In the following report details pertaining to the issues raised by ASIC will be
discussed. It is a general practice for the body to ensure that periodic financial reporting
surveillance program is conducted by it for the purpose of ensuring that all the guidelines
relating to the preparation and presentation of the financial statements are adhered to by the
companies that are listed on the stock exchange. In the present case it has been found that
Chapman Limited which is a listed company has violated certain principles of reporting ( Van
Linden and Mazza 2018). In respect of the same the ASIC directed the company to make the
necessary adjustments. For the purpose of confirming to the directions as given out by ASIC
the company ensured that an amended annual report is being published on its part. In its
pursuance the company issued an amended financial report for the year ended 2016. The
news in respect of the amended financial report was released in the market on 18th August
2017. In addition to this the company issued its half yearly annual report on 5th September
2017 and in it the company made special mention of the amendments that were being
affected by it on the direction of ASIC.
Background of Chapman Limited:
It is an Australian company which is listed on the Australian Stock Exchange as CHP.
The portfolio of the operations conducted by the company can be termed as a company
mainly concerned with investment and having investment in diversified fields. The industries
in which the company is currently having its investment are engaged in operations across
diverse fields. The company mainly focusses on the industries that are concerned with mobile
technology. One of the major objectives of the company is to ensure that it establishes itself
as an active investment player across the current economic market (Trotman 2014). In
pursuance of this the company regularly engages in investing in companies that are recording