HA2032 Corporate & Financial Accounting Final Assessment

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HA2032
CORPORATE AND FINANCIAL ACCOUNTING
FINAL ASSESSMENT
Assessment Weight: 50 total marks
Instructions:
 All questions must be answered by using the answer boxes provided in this paper.
 Completed answers must be submitted to Blackboard by the published due date
and time.
Submission instructions are at the end of this paper.
Purpose:
This assessment consists of six (6) questions and is designed to assess your level of
knowledge of the key topics covered in this unit
HA2032 Final Assessment T2 2021

Question 1 (7 marks)
Explain a disclosing entity and describe the implications of being a disclosing entity?
ANSWER: ** Answer box will enlarge as you type
Disclosing entity is a medical provider except the case of individual practitioner or a group of
practitioner. Fiscal agent are also considered as the disclosing entity. The disclosing entity on the
other hand further include all the business houses as they need to disclose the financial
presentation in front of the stakeholders (Newman and et. al., 2017). There are certain
implications also attached with disclosing entity such as they need to disclose all the financial
records in front of the stakeholder group. Disclosing entity also need to ensure a yearly audit of
its records and other such documents. The financial records of the disclosing entity must be
audited with the authorised person or professional.
Question 2 (7 marks)
Compare and contrast (list the advantages or disadvantages if any) the capital reduction and a
share buyback.
ANSWER:
Advantage:
Buyback of shares creates a positive message in front of the inversions of the business regarding
the performance of venture in respective target market. This practice support the confidence
level of investor's towards the performance of venture (Hettiarachchi, Meegoda and Ryu,
2018). Surplus funds available with the company that is not being used will also get to utilise
against buying back the stocks of company. All such stockholders sold during the repurchase
program get the opportunity to generate current market price along with the premium.
Disadvantage:
HA2032 Final Assessment T2 2021

The cash requirements are more in case of buying back of stock as it involve opportunity cost of
capital. In most of the cases companies try to increase the stock price with the use of this
practice as this allow them selling the same stock over high price range (Shi and et.al., 2020).
The discount brokers also get an unreasonable advantage against the buying back of stock like
practice.
HA2032 Final Assessment T2 2021