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Corporate Accounting | Docx

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Added on  2020-02-24

Corporate Accounting | Docx

   Added on 2020-02-24

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Running head: CORPORATE ACCOUNTINGCorporate AccountingStudent’s NameCourse Code
Corporate Accounting | Docx_1
CORPORATE ACCOUNTING1Executive SummaryFinancial Position of Surfstitch Ltd is under evaluation in this report with its relevant conditionsin the years 2015 and 2016. The following discussion will focus on the present financial situationof Surfstitch Ltd which will help investors to identify new investment options. The discussionincludes articles, research papers and ASX disclosures which describes majorly the propermeasures that needs to be preserved by Australian authorities. It becomes important for theorganizations to keep track of the monitoring operations. The use of measures for disclosurecould be applied with definite boundaries on wrong display of news. For stopping unethicalmeasures to get implemented Article 3A can be invoked by the companies as shown by DavidJones in his latest article. Thus it can be established that measures of continuous disclosurewould certainly assist in the reduction of risk for the investors in their respective investments.
Corporate Accounting | Docx_2
CORPORATE ACCOUNTING2Table of ContentsPart I:...............................................................................................................................................31.Identification of the financial crisis scenario faced by Surfstitch Ltd:.................................32. Determining the intangible asset goodwill and investment in subsidiary and cash positionduring the year 2015....................................................................................................................33. Determining the impairment costs, selling & distribution and administrative expenses in theprofit and loss statement during the year 2016:...........................................................................34. Relevant recommendations whether to buy, hold or sell Surfstitch Ltd shares and why:......4Part II:..............................................................................................................................................5Mentioning about: Why is it necessary to have a continuous reporting regime for disclosureentities and is it effective?...........................................................................................................5References......................................................................................................................................10
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CORPORATE ACCOUNTING3Part I:1.Identification of the financial crisis scenario faced by Surfstitch Ltd:Identification of the financial crisis is mostly done from the annual report submitted bySurfstitch Ltd in which the decrease of capability of operations is portrayed after Justin Cameronexited in 2015 (surfstitchgroup.com 2017). Moreover, Surfstitch Ltd had a weak managementwhich could not control the incremental expenses which hampered the financial condition of theorganization. In addition to this, the organization had very high costs of distribution,administration and sale which were ever increasing and affected the net profit of theorganization. These cumulative expenses restricted the company from making any significantprofits which could have held its financial activities together in the future. These factors causedthe rise of predicament in context of the financial strength of the organization.2. Determining the intangible asset goodwill and investment in subsidiary and cash positionduring the year 2015The assessment of the yearly report of Surfstitch Ltd for 2015 primarily representedgoodwill of $73,832,000 (surfstitchgroup.com 2017). Moreover, the subsidiary investment wasprincipally recognized at $70,197,000 and the cash & cash equivalent point of Surfstitch Ltd wasdiscovered at $40,837,000 (surfstitchgroup.com 2017).3. Determining the impairment costs, selling & distribution and administrative expenses inthe profit and loss statement during the year 2016:In 2015, there was no mention of the impairment costs in the respective annual report,whereas in 2016 the damage cost increased to $88,999,000, as depicted in the annual report(surfstitchgroup.com 2017). Additionally, the assessment of annual report also showed an
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