Corporate Accounting

This report provides an analysis of the Australian gambling company Tabcorp Holdings Limited, including its revenue, business segments, CSR and sustainability activities, and competitors. The report also discusses the company's financial statements and accounting policies.

Running head: CORPORATE ACCOUNTING
Corporate Accounting
Name of the student:
Name of the University:
Author Note:

1CORPORATE ACCOUNTING
Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................4
Conclusion:......................................................................................................................................9
References:....................................................................................................................................10

2CORPORATE ACCOUNTING
Executive summary
The Australian gambling company named Tabcorp Holdings Limited is the largest group and has
recently marched with the Tatts group limited in the industry of gambling. The company has
three business segments that is the Lotteries, Keno, Wagering and the gaming services. The
company earns a revenue of more $3 million. The company’s brand image and popularity is the
main reason for such a huge revenue earning of the business. The 2018 annual report of
TABCORP and Tatts Group limited have been analyzed in this report. The critical analysis of the
CSR and sustainability activity of the company has also been done in the report.

3CORPORATE ACCOUNTING
Introduction
Tatts Group Limited is an organization based in Australia. The company has merged with
the company named TABCORP under the brand name called TABCORP. This company is one
of the prime, expanded gambling entertainment group. This company serves more than 1500
people in Australia (Tabcorp. 2019). The company is the largest producer of Lotteries, Gaming,
Media and Keno. The company was founded in the year 2006 at Melbourne in Australia and
merges with the TABCORP holdings limited. The organization is listed in the (ASX) Australian
Securities Exchange. The company Tatts group along with TABCORP holdings limited manages
its wagering activities under the brand names TAB in Victoria, New South Wales, and within the
capital territories of Australia. The company operates through a hotels, clubs and agencies. The
wagering is done by using internet, mobile devices, and pay television. The revenue earned
through wagering segment is about $349 Million. The gaming service segment of the company is
operating in the supply of electronic gaming devices and machines and the company also helps
in providing licenses to the gaming venues. The revenue earned through this segment is $249.7
Million (Loh, Deegan & Inglis 2015). The Keno segment of the company includes the operation
of the keno in licensed places and the TAB’s in Victoria, Queensland and the Australian capital
territories, and also operates in the licensed venues of New Whales. The net revenue earned by
the company through this segment is $1,390.7 Million.
Discussion
Tatts group Limited operates in gambling industry. Gambling means the money wagering
or something valuable on a purpose with an uncertain outcome with a motive of winning money
or something precious. Many Australian people in interested in gambling and over 80% of adult
people does gambling. In the year 2015 to 2016 the revenue generated form gambling was up to
7.7% of the state revenue. It is a rising industry as because the industry is very entertaining and
availability of internet and interactive gambling. The interactive gambling is rising as due to the
availability of mobile phones and the computers in using it. The online gambling was evaluate as
US$ 40.59 Billion in the year 2013, and is expected to reach US $50Billion by 2018 (Smith,
Wenn & McKinnon 2014). Globally it has been recorded that the biggest online gambling is
done through wagering. The other companies who are operating in this industry are Casinos
Austria International Ltd with a revenue of $740.8 Million, Coder, S.A revenue earned $3
Billion, The star Ply Limited revenue earned $1.8 Billion, Unbent Limited earned revenue of

4CORPORATE ACCOUNTING
about $504.2 Million and many others.( Leung & Gray 2016). All these companies are the
competitors of the Tatts group limited Limited. The competitors of the companies are increasing
their sales promotion and trying to personal selling as well. The companies that are operating in
this industry all are trying to promote their brand image this is the main that attracts peoples to
their venue where they operate. The internal origins of finance for the organization is through the
sale of shares, fixed assets and debt collection. The external sources for the funding of the
company are though the financial institutions, taking financial loans from the bank, lease
financing, trade credit and many other ways (Lock & Seele 2016). The structure of finance of a
company refers to the equity and debt mixture of a company that is used for financing its
operation. The long term debt to equity ratio of the company is 50% and for the industry it is
117.75. The total debt to equity ratio for the company is 51.73 and for the industry it is 121.46.
The total equity of the company is 7238.6. The financial manager of the companies mainly prefer
equity or debt for financing of the company. The more debt to equity ratio the more debt
company has. The key elements to the performance of finance reported by the company in their
audit report is the Income statement, balance sheet, cash flow statement and the statement of
changes in the equity. The key elements of the financial statement that is known as the balance
sheet are the assets, liabilities, equities and the revenues and expenses of the income statement
(Hing et al 2014). The company have not reported anything after the reporting date there is no
data reported as of now. There are some changes in accounting policies and it has been disclosed
in audit report. There are many new and amended standards of accounting has become
mandatory for the group in the current financial year and it is applicable from the 1st July, 2018(,
Hing, Vitartas & Lamont 2014). The adaptation of these had create no collision on the financial
statements and performance of the company. Some of this changes are according to AASB9
Financial instruments that involves revised guidance on measurement of financial instruments
and new hedging accounting requirements. According to the “AASB15 Revenue from contracts
with customers” income must be acknowledge when the goods and services transferred to the
customers. According to the AASB 16 single lessee accounting model has been introduced. The
carrying amount of the goodwill is 3,378.5 for the year 2018 and 3475.5 for the year 2017. It
consists of watering and media, lotteries and keno, and the gaming services. The carrying cost of
other intangible assets are $241.4 Million for the year 2018 and $247.2 million for the year 2017.
This includes the Licenses, brands software, WIP and others. The carrying amount for the

5CORPORATE ACCOUNTING
freehold land it is $6.3 Million, for the buildings it is $25.2 Million, for the leasehold
improvements it is $29.3 Million and for the plant and equipment’s it is $62.1 Million these cost
are all for the year 2018. The carrying cost for the year 2017 for the freehold land $7.7 Million,
for the Buildings it is $26.9 Million, for the leasehold improvements it is $21.5 Million and for
the plant and equipment it is $66.9 Million (Listcorp.com, 2018). The carrying cost of the cash
balances for the year 2018 it is $263.7 Million and for the year 2017 it is $26.9 Million (Scott.
2018). The carrying cost of the premises is $75.7 Million. The company have adopted the
Australian Accounting Standards as issued by the Australian Accounting Standard Board and
other mandatory financial reporting standards that re required in Australia. The financial
statements of the company have been followed according with the Corporations Act 2001(Feng,
Wang & Huang 2014). The company have also followed the Financial Reporting Standards
issued by the International Accounting Standards Board. The numbers are presented in
Australian Dollars with the dollar amount rounded to the nearest unless specifically stated.
Accounting policies followed are “AASB 1015 Acquisition of Assets”, “AASB 1021
Depreciation”, “AAS 21 Acquisition of Assets”. The intangible Assets of the company are the
Licenses, brands software, WIP and others (Gainsbury & Russell. 2015). These assets does not
have any physical existence in nature. The assets can be indefinite and definite in nature,
generally the brand name of a company is an indefinite intangible asset. The assets that are
identified are indefinite and definite in nature. The brands and goodwill are the indefinite assets
and the software, WIP and licenses are the definite assets. An intangible assets can be create or
acquire by the company (Aasb.gov.au 2014). These identified intangible assets are very much
relevant to the company as because with the help of these assets the company gets more attention
from the peoples in Australia and all over the world. The indefinite intangible assets that has
been identified help the company to increase the value of brand image and brand value. The
accounting Policies that the company have followed Australian Accounting standards as issued
by the Australia Accounting Standard Boards. The policies that have been used and followed are
the “AASB 1013 Accounting for Goodwill”, “AASB 1041 Revaluation of Non-Current Assets”,
“AAS 21 Acquisitions of Assets”, “AAS 18 Accounting for Goodwill” (Aasb.gov.au 2014). The
audit report for the year 2018 provided by the company has a loss of impairment that is
acknowledged in the income statement. The carrying cost of an asset overreach its recoverable
quantity. The recoverable quantity is more than the loss in fair value of the costs of disposal and

6CORPORATE ACCOUNTING
value in use. This is decided for an individual assets unless the recoverable worth is approximate
as it does not generate the cash inflow for a group of assets or other assets. Receivable impaired
amount is $45.6 Million for the year 2018. The factors that had been considered for the
impairment involve ageing and timing of the receipts that are expected. Bad debts are written off
when identified. According to the CSR report 2018 of the company the CSR rating of the
company is 54 out of 0-100 scale and the CSR ranking of the company is 64 %( Tabcorp.com.au.
2019). In the financial year 2018 the company donates to the charities and organizations
community about $ 1.9 million which is 44% more than the previous year donation. The
company contributed $500000 for the earning of the golden casket business of lottery to the
maker foundation health group that is located in Queensland (Witkiewicz.2017). Charitable
games has now become a part of TABCORP holdings limited and Tatts group limited. The
company aims and focus to improve the existing community and industry mergers in the year
2019. The company aims to change the strategy of investment and focus to range with combined
groups vision and purpose launched early in the year 2019. The company contributed $2.8
Billion for the economic development of the country in the financial year 2018. The company is
the largest financial contributor towards the economic development from this industry in
Australia. The success of the company has a direct impact of the business that the company
operates in. Within the Annual Dow Jones Sustainability Index (DJSI) the company Tatts group
Limited was ranked as the global gambling industry leader. The company has received 100%
rating in the promotion of responsible gambling. The company operates its business with
integrity and in an accountable manner. The company has been awarded by WGEA for the third
for employer of choice in gender equality (McCredie & Sadiq 2019). The company have
implemented responsible gambling tools. Sky Racing was the major sponsor of the inaugural
Greyhound Adaptation Program Day. According to the appendices given in the report the
consumption of resources increase from the previous year, in this year it is 17,920,369 KWH,
Gas consumption is 1,959,353KWH which decrease from the previous year, in the previous year
it was 3,136,859 KWH, consumption of paper increase from the previous year the value
4,732,750 and total fuel consumption is 1,295,212 liter. Emission of vehicle fuels and electricity
increase and the emission of Gas decrease from the previous year. Corporate social responsibility
and sustainability has become crucial to companies over last several years. The companies are
trying to contribute towards the society by recruiting women, helping the environment, or trying

7CORPORATE ACCOUNTING
to end poverty. The companies are more operating in an ethical and sustainable way deals with
environment and impact of the society. The 2015 Cone communications CSR study states that
91% of global customers wants business to operate ethically. The public image, brand awareness,
advantages over competitors are some key benefits of CSR.
Conclusion:
This has been concluded from the above discussion that the company has a very good
brand image in Australia. As the company merged with the brand TABCORP. The business
segments of the companies are operating well and the company earned as they have expected.
The company is trying to improve their financial position and brand awareness. The Net profit of
the company is 35.2 which is 6.7 more than the previous year. The company has a net asset of
2918.6 and the total revenue earned by the company is $349 million the company has many
competitors in the industry, this company remains in the position where they belong. The
company follows the accounting principles correctly so that financial judgments can never be
wrong. The company has launched and implemented digital products across the country. The
company is the biggest contributor in the industry of racing and has provided $1.9 million of
community support and the return the company gets is of $916.8 million. The company has taken
a lot of steps towards corporate social responsibility and sustainable development. The company
passes federal legislation on banning the use synthetic lottery products. Restrictions on
advertising introduced by the company and has announced tax consumptions rule on wagering
segment of business.

8CORPORATE ACCOUNTING
References:
Aasb.gov.au. (2004). ACCOUNTING STANDARD. Retrieved 31 August 2019, from
https://www.aasb.gov.au/admin/file/content105/c9/AASB116_07-04.pdf
Aasb.gov.au. (2014). ACCOUNTING STANDARD. Retrieved 31 August 2019, from
https://www.aasb.gov.au/admin/file/content105/c9/AASB138_07-04_COMPjun14_07-
14.pdf
Feng, Z. Y., Wang, M. L., & Huang, H. W. (2014). Research note: Corporate social
responsibility and equity financing in the global tourism industry. Tourism
Economics, 20(4), 869-883.
Gainsbury, S. M., & Russell, A. (2015). Betting patterns for sports and races: A longitudinal
analysis of online wagering in Australia. Journal of Gambling Studies, 31(1), 17-32.
Hing, N., Gainsbury, S., Blaszczynski, A., Wood, R., Lubman, D., & Russell, A.
(2014). Interactive gambling. published.
Hing, N., Vitartas, P., & Lamont, M. (2014). Promotion of gambling and live betting odds during
televised sport: Influences on gambling participation and problem gambling. Brisbane:
Queensland Department of Justice and Attorney-General.
Leung, T. C. H., & Gray, R. (2016). Social responsibility disclosure in the international gambling
industry: A research note. Meditari Accountancy Research, 24(1), 73-90.
Listcorp.com (2018). Tatts Group Annual Report 2018 - Tatts Group (ASX:TTS). [online]
Listcorp.com. Available at: https://www.listcorp.com/asx/tts/tatts/news/tatts-group-
annual-report-2018-1979063.html [Accessed 12 Sep. 2019].

9CORPORATE ACCOUNTING
Lock, I., & Seele, P. (2016). CSR governance and departmental organization: A typology of best
practices. Corporate Governance: The International Journal of Business in
Society, 16(1), 211-230.
Loh, C. M., Deegan, C., & Inglis, R. (2015). The changing trends of corporate social and
environmental disclosure within the A ustralian gambling industry. Accounting &
Finance, 55(3), 783-823.
McCredie, B., & Sadiq, K. (2019). CSR and tax: a study in the transition from an ‘aggregate’to
‘real entity’view of corporations. Pacific Accounting Review.
Scott, B. (2018). AUSTRAC v Tabcorp: A case study in enforcement action by Australia’s
financial crime regulator. Journal of Financial Compliance, 1(4), 373-380.
Smith, S., Wenn, K., & McKinnon, R. (2014). Digital interaction. CIO, (May/Jun 2014), 20.
LIMMER, C., & METCALF, P. OUT OF 12,000 SHAREHOLDERS, ONLY ASA WAS
GAME TO SPEAK AT AGM.
Tabcorp. (2019). CORPORATE RESPONSIBILITY REVIEW (p. 50). Australia: Tabcorp.
Retrieved from https://www.tabcorp.com.au/getattachment/28ca3509-1de6-42da-b084-
2996a98e6e06/TC_2018-Corporate-Responsibility-Review
Tabcorp.com.au. (2019). Tabcorp - Home. Retrieved 31 August 2019, from
https://www.tabcorp.com.au/
Tabcorp-Annual-Report-2018. (2019). Tabcorp-Annual-Report-2018 (p. 140). Australia:
Tabcorp. Retrieved from
https://www.tabcorp.com.au/TabCorp/media/TabCorp/Investors/Annual%20Report/
Tabcorp-Annual-Report-2018_1.pdf
Witkiewicz, T. (2017). Tax Transparency and Corporate Tax Avoidance.