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Financial Analysis of Three Australian Listed Companies in Electronic and Telecommunication Industry

   

Added on  2019-09-30

29 Pages4818 Words334 Views
Corporate Accounting

EXECUTIVE SUMMARYWith the ramified change, each and every company needs to pay off tax to thegovernment. This report reveals the key financial information of three Australian listedcompanies operating in the electronic and telecommunication industry. The cash flowstatement of company showcase the inflow and outflow of these three companies from theinvesting, financial and operating activities. The equity shareholding capital of thesecompanies has been increased throughout the time. However, Harvey Norman has faced highincrement in its share capital due to the issue of more capital. In addition to this, the tax rateon which tax is being paid by the company is also way too high as compared to other tworival companies. In addition to this, it is considered that a company can never have deferredtax assets and deferred tax liabilities in its books of account at the same time.

Table of ContentsEXECUTIVE SUMMARY...................................................................................................................2INTRODUCTION.................................................................................................................................5OWNERS’ EQUITY.............................................................................................................................6The answer to the question- (i).............................................................................................................6LISTING OF ITEMS OF EQUITY............................................................................................................6Evaluation of the equity items of the all these three companies......................................................7Answer to the question- (ii)...................................................................................................................9Answer to the question- (iii)..................................................................................................................9COMPARATIVE ANALYSIS OF DEBT AND EQUITY...............................................................................9Changes in Cash Flow Statement.........................................................................................................10Answer to the question- (iv)................................................................................................................10UNDERSTANDING OF THE MAIN ACTIVITIES OF CASH FLOW STATEMENT AND THE CHANGES IN THE CASH FLOW ACTIVITIES OF VOTH THE COMPANIES OVER THE PAST YEAR..............................10Answer to the question-- (v)................................................................................................................17Comparative analysis of three cash flow activates of three companies..........................................17Answer to question no- (vii)................................................................................................................18COMPARATIVE ANALYSIS OF INSIGHTS OF COMPANY....................................................................18Comprehensive income statement......................................................................................................19Answer to question no-- (vii)...............................................................................................................19Reported items in the comprehensive income statement of these three companies................19Comprehensive income statement of JB HI-FI Company.................................................................19Comprehensive income statement of Harvey Norman Company...................................................20Comprehensive income statement of Flexi Group..........................................................................20Answer to question no- (viii)...............................................................................................................21Reason to record these items in the Comprehensive income statement........................................21Answer to question no- (ix).................................................................................................................21Comparative analysis of these items shown in the comprehensive statement and its impact on the profit and loss account....................................................................................................................21Answer to question no- (x)..................................................................................................................22Evaluating the performance of manager.........................................................................................22Accounting recorded for income tax...................................................................................................22Answer to question no- (Xi).................................................................................................................22

Tax expenses of these three companies..........................................................................................22Answer to question no- (xii)................................................................................................................23Computation of the effective tax rate.............................................................................................23Answer to question no- (xii)................................................................................................................23Deferred tax liabilities and assets recorded.....................................................................................23Answer to question no- (xiii)................................................................................................................24CHANGES IN THE DEFERRED TAX ASSET OR LIABILITY.................................................................24Answer to question no- (xiv)................................................................................................................24CASH TAX AMOUNT.........................................................................................................................24Answer to question no- (xv) and (xvi)..................................................................................................25Computation of the tax cash rate....................................................................................................25Answer to question no - (xvii)..............................................................................................................26CASH TAX RATE VS BOOK TAX RATE................................................................................................26CONCLUSION...................................................................................................................................27REFERENCES....................................................................................................................................28

INTRODUCTIONFinancial analysis is used to assess the financial performance of company. In thisreport, three companies have been selected for the financial analysis purpose. It has becomeeasy for the investors to assess the financial data of these companies. In this report, JB Hi-Fi,Harvey Norman and Flexi Group Limited Company have been selected for evaluating theinflow and outflow of cash and recording of the tax transactions in the books of account ofcompany. These all three companies are Australian listed companies. In the starting of thisreport, assessment of the cash flow statement of these three companies have been analysed.After that equity capital changes and recording of the tax in the books of account have beendone. In the end, description related to recording of the deferred tax assets and deferred taxliabilities have been evaluated. Afterward, assessment of the compressive income statementof three companies have been analysed which will help in changes in the profitability ofcompany throughout the three years. In the end of this report, evaluation of the tax rate ofthese three companies have been assessed to determine which company is imposed high taxrate and paying high tax to the government. This report has divulged the key financialinformation of these three companies and evaluating the possible changes since last threeyears.JB Hi-FiCompany Harvey NormanCompany FlexiGroupLimited BUSINESSThis company isindulged inselling retail saleof products likeDVD, CD andvideo games andmobile phonesales business.This company isoperating in thebedding,communication anddevice electrical andfurniture business. .Thiscompany isfocusing onthebusinessprocess forthe retailsale ofproducts

like DVD,CD andvideogames andmobilephone salesbusiness BUSINESSOPERATIONThis business isfocusing on theshopping centerto offer electronicservices inMelbourne. This business isoperating its businessthrough the franchiseprogram It hasseveralshoppingcenter andhavingonlineportals tosell itsproductsandservicesthrough anonlineportal.

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