Analysis of Financial Position of Neptune Marine Services Limited and Paringa Resources Limited

Audit Assignment

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By student name
Professor
University
Date: 20 the Sep 2018.
Executive Summary
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For this assignment we have selected two companies which are listed in the Australian
stock exchange and we have also analysed their annual reports. The primary objective of this
assignment is to comment on the overall financial position of both the companies which are
operating in the same industry and are rivals to one another. We have analysed various elements
of the financial statements like debt-equity, comprehensive income statement details as well as
the elements of cash flow. The purpose of this assignment is to evaluate which company is more
viable.
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Contents
Executive Summary.....................................................................................................................................2
Introduction.................................................................................................................................................4
Owner’s Equity............................................................................................................................................4
Cash Flow Statement...................................................................................................................................7
Other comprehensive income statement..................................................................................................11
Accounting for Corporate Income Tax.......................................................................................................13
References.................................................................................................................................................16
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Introduction
In the given assignment two companies have been selected that belongs to the same industry so
that important opinions can be framed on them, NEPTUNE MARINE SERVICES LIMITED
and PARINGA RESOURCES LIMITED. Both the above-mentioned companies are listed on the
ASX stock exchange and belong to the marine sector (Andiola, Lambert, & Lynch, 2018).
Neptune Marine Services Limited is a leading company in the provision of integrated services
which also involves various services apart from inspection, repair and maintenance solutions to
the oil and gas and the various other sectors of marine as well as renewable energy sector. The
Company has its headquarters in Perth. The Company is also involved in the provisioning of
various other services as a complete solutions package and individual solutions. The other
services which are provided by the Company to the clients includes total solution package also.
The services provided by the company covers the requirement solution needs which are basic
needs of the companies (Appelbaum, Kogan, & Vasarhelyi, 2018). The various heads under
which the company is registered as a corporate are Subsea UK, IMCA, Subsea Energy Australia
and the Petroleum Club. As per the requirement of this assignment we have downloaded the
annual report of the company and discussed the various aspects which are considered as
important in detail.
Paring Resource Limited is also a very famous energy providing company which is based in
United States. It is considered as one of the largest and the biggest producer of both types, that is,
largest and the lowest coal cost manufacturing regions in the United States. It is involved in the
exploration of US marine oils (Axelsen, Green, & Ridley, 2017). The company is also involved
in providing various other kinds of services which are related to high complex energy. This
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company is involved in the development of one of the greatest existing large-scale underexplored
blocks of premium quality coal which lays out a direct access to the Ohio river, this block is the
Buck Creek Mining Complex. The company is engaged in the provision of several unique kinds
of services. We have downloaded the annual report of the company and analysed the several
important aspects which are related to the equity and various other elements are also discussed in
this assignment (Bailey, Collins, & Abbott, 2017).
Analysis
There exists a healthy competition between both the companies. We have discussed below
various significant points relating to the specific elements:
Shareholders’ Equity:
Shareholders’ Equity, in general terms, means the total amount of equity fund in a company.
This equity belongs to the shareholders of the company. That is the reason because of which the
shareholders are considered as the owners of the company. The company raises funds with the
help of issuing share to the outsiders. The company generally raises funds through issuance of
shares when it does not want to increase its debt equity ratio, and moreover, the risk involved
with such kind of investment is low in comparison to funds raised through debts and other
instruments. The liabilities are limited to the amount of investment made by the shareholders in
the company, in case of public listed companies (Bumgarner & Vasarhelyi, 2018). The company
generally pays returns to the shareholders in the form of interests / dividends at the discretion of
the board of directors. Wealth maximization of the shareholders is the primary objective of the
companies. We have discussed the various elements which are included in the shareholder’s
equity and below-
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