Financial Accounting and liquidation
Added on 2023-06-05
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RUNNING HEAD: Financial Accounting and decisions
Financial Accounting and liquidation
Financial Accounting and liquidation
Financial Accounting and decisions 2
Executive summary
With the ramified economic changes, every organization needs to maintain liquidity
position and effective profitability throughout the time. In this report, different three companies
named HIH insurance; One Tel Company and ABC learning have been undertaken and analyzed
to determine the reasons and failure of the code of conducts and ASX listing rules which
company failed to comply and faced the destruction in the business.
Executive summary
With the ramified economic changes, every organization needs to maintain liquidity
position and effective profitability throughout the time. In this report, different three companies
named HIH insurance; One Tel Company and ABC learning have been undertaken and analyzed
to determine the reasons and failure of the code of conducts and ASX listing rules which
company failed to comply and faced the destruction in the business.
Financial Accounting and decisions 3
Contents
Introduction......................................................................................................................................4
Events and cases that led to liquidation...........................................................................................4
ABC Learning..................................................................................................................................4
HIH Insurance..................................................................................................................................5
One.Tel............................................................................................................................................6
Code of Ethics..................................................................................................................................6
ASIC – Listing rules........................................................................................................................8
Major contributing factor – Liabilities............................................................................................9
Conclusion.....................................................................................................................................10
References......................................................................................................................................11
Contents
Introduction......................................................................................................................................4
Events and cases that led to liquidation...........................................................................................4
ABC Learning..................................................................................................................................4
HIH Insurance..................................................................................................................................5
One.Tel............................................................................................................................................6
Code of Ethics..................................................................................................................................6
ASIC – Listing rules........................................................................................................................8
Major contributing factor – Liabilities............................................................................................9
Conclusion.....................................................................................................................................10
References......................................................................................................................................11
Financial Accounting and decisions 4
Introduction
The liquidation is the process which brings company’s functioning to its end. It is
analyzed that when company fails to pay off its creditors and deb holders then there are two
processes which company follows first is related to voluntary winding up and compulsory
winding up process. It is analyzed that if company wants to keep its business sustainable in long
run then it will have to comply with the applicable code of conduct and ASX listing rules and
regulations. However, there are several circumstances and factors which negatively impact the
business and result to liquidation of business. The main reasons of liquidation of business are
based on the poor management, failure of payment of liabilities, unfavourable market condition
and business failure of business. These three companies have faced the liquidation of the
business due to the imbalance of assets, failure to comply with the ethical code of conducts and
listing rules. This report reflects the understanding on the ethical code of conduct, ASX listing
rules and regulation which company should have complied if it wants to keep its business more
sustainable in long run.
Events and cases that led to liquidation
There has been done case study analysis of three different companies to identify the reasons and
facts which leads to liquidation of these three different companies. The main reason of
liquidation and winding of these companies is related to failure of companies to comply with the
ethical code of conducts and ASX listing rules. However, the main reason of failure of the
business and liquidation is not to pay off their current and future liabilities.
ABC Learning
This ABC learning company was an Australian company which was indulged in providing the
child care services. This company was incorporated in 1988 and had been offered child care
services. This company focused on offering child health care services in Australia and New
Zealand. ABC Learning was having objective of expanding its business by investing in buying
more care centres and properties in Australian market. However, after expending its business, it
got listed in Australia securities exchange and had market capitalization of AUD $ 25 million.
After, arrangement of these undertaken business activities and expanded business in other
Introduction
The liquidation is the process which brings company’s functioning to its end. It is
analyzed that when company fails to pay off its creditors and deb holders then there are two
processes which company follows first is related to voluntary winding up and compulsory
winding up process. It is analyzed that if company wants to keep its business sustainable in long
run then it will have to comply with the applicable code of conduct and ASX listing rules and
regulations. However, there are several circumstances and factors which negatively impact the
business and result to liquidation of business. The main reasons of liquidation of business are
based on the poor management, failure of payment of liabilities, unfavourable market condition
and business failure of business. These three companies have faced the liquidation of the
business due to the imbalance of assets, failure to comply with the ethical code of conducts and
listing rules. This report reflects the understanding on the ethical code of conduct, ASX listing
rules and regulation which company should have complied if it wants to keep its business more
sustainable in long run.
Events and cases that led to liquidation
There has been done case study analysis of three different companies to identify the reasons and
facts which leads to liquidation of these three different companies. The main reason of
liquidation and winding of these companies is related to failure of companies to comply with the
ethical code of conducts and ASX listing rules. However, the main reason of failure of the
business and liquidation is not to pay off their current and future liabilities.
ABC Learning
This ABC learning company was an Australian company which was indulged in providing the
child care services. This company was incorporated in 1988 and had been offered child care
services. This company focused on offering child health care services in Australia and New
Zealand. ABC Learning was having objective of expanding its business by investing in buying
more care centres and properties in Australian market. However, after expending its business, it
got listed in Australia securities exchange and had market capitalization of AUD $ 25 million.
After, arrangement of these undertaken business activities and expanded business in other
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