Comparison of Financial Statements of Atmos Energy and AGL Energy

A Comparison on the Financial Statements of Atmos Energy of the US And AGL Energy of
Australia
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Part 1: Introduction and Background of the Companies Selected
The present report is developed for undertaking a comparative analysis of the financial
statements of two selected business entities in order to gain an understanding of their major
financial issues. In this context, the two business operating within the different countries but
carrying out similar business operations is selected. The business entities selected for the purpose
are, Atmos Energy and AGL Energy. Atmos Energy of the US is listed on Edgar while AGL
Energy of Australia is listed on the ASX and both are operating within the energy sector.
Background of Companies Selected
Atmos Energy Corporation, a business entity headquartered within Texas, is attributed to
be one of the largest natural gas distributor companies that is serving about three million of
customers in about 1,400 communities in about nine states. The company was established in the
year 1906 and is listed on the New York Stock Exchange (NYSE) as ATO. The company
conducts its operations through two subsidiaries, that are, Atmos Pipeline and Storage LLC. It is
having a total asset base of about $7.940 billion and revenue realization of about $3.886 billion.
The company develops its consolidated financial statements as per the Generally Accepted
Accounting Principles (GAAP).
On the other hand, AGL Energy Limited, is a public listed company on the ASX that is
involved in generation and retailing of electricity and gas both for residential and commercial
purpose. It has been established in the year 2006 and is headquartered within Sydney. The
company subsidiaries include ActewAGL and other large number of subsidiaries companies that
are involved in generation and retailing of electricity and gas. The company adopts and complies
with the AASB (Australian Accounting Standards Board) that has been developed in accordance
with the IFRS (Internationally Financial Reporting Standards).
Part 2: Observing and Comparing the Balance Sheet and Income Statement of Two
Selected Companies
Comparison of the Balance Sheet of Two Selected Companies
 Format: On comparing the format of both companies it has been found that there are
some similarities but many differences. In case of both Atmos Energy and AGL Energy
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items of assets and liabilities have been shown properly under proper heading and sub
heading such as current assets, fixed assets, current liabilities, equity and long term
liabilities. However, there are differences in the names of headings and sub-headings in
case of both the companies (Shamrock, 2012). For example, in case of AGL assets side
has been divided into current assets and non-current assets but in case of Atmos Energy,
asset side has been divided into current assets and fixed assets. Similarly, liabilities side
has been divided into shareholder equity, long term debt and current liabilities in case
Atmos Energy but in case of AGL Energy it has been divided as current liabilities, non-
current liabilities and equity (Warren, 2016).
 Terminology: The balance sheet of Atmos Energy has used the terminologies such as
property, plant and equipment and common stock whereas that of AGL Energy has used
the terminologies such as non-current assets under which details of property, plant and
equipment have been included and issued capital in comparison to common stock
provided in the balance sheet of Atmos Energy (Atmos Energy Limited: Annual Report,
2018).
 Level of Detail: Low level of detail discloser in balance sheet in case AGL Energy but in
case of Atmos Energy some of important items have been disclosed in details. For
example, balance of common stock have been properly shown in case of Atmos Energy
but has been shown in case AGL Energy (AGL Energy Limited: Annual Report, 2018).
.
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(Source: https://www.2018annualreport.agl.com.au/xmlpages/resources/TXP/agl_energy/
finrep/pdf/AGL_Energy_Annual_Report_2018.pdf)
Source: http://www.annualreports.com/HostedData/AnnualReports/PDF/NYSE_ATO_2018.pdf)
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