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HA3032 Auditing - Fortescue Metal group

   

Added on  2019-10-31

24 Pages4172 Words172 Views
HA3032 Auditing1 | P a g e

Executive summaryThe report is prepared over the company Fortescue Metal group (FMG) which is the global leader in the iron ore industry. During the report the throughout understanding of the company operation is being conducted and key operating, financing and investing activity of the company.Also we have created the understanding over the current industry in which company operates through analyzing various factor such as size, growth, supply chain, Major Player, critical success factor and major threat. Further the understanding is conducted over the current legal environment of the company. Also the report examiners the external environment of the company through SWOT and PESTLE analyze and the way it create impact over the company current working. The assignment also conducts the understanding over the objective, strategy and business risk of the company. At last the analytical procedure is applied to entity performance and the understanding is create over management and governance.2 | P a g e

Table of ContentsExecutive summary...........................................................................................................................................................Introduction.......................................................................................................................................................................Nature of the entity............................................................................................................................................................Understanding the industry...............................................................................................................................................Understanding the legal environment................................................................................................................................Understanding external environment factor......................................................................................................................Understanding objective, strategies and assessing business risk......................................................................................Performing analytical procedure to create the understanding of the entity performance..................................................Understand management and governance.......................................................................................................................Conclusion.......................................................................................................................................................................References.......................................................................................................................................................................3 | P a g e

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Introduction The Auditing is defined as the independent examination of the financial statement of the entity for the purpose of reporting over the true and fair view of the financial statement of the entity. In the given report the company we have considered is Fortescue Metal group is engaged in the business or Iron ore. During the report various area of the business are examined in order to create understanding over the company current operation. The report analyze the different aspect of the business such as nature of the entity, industry regulation and the external factor, objective and strategy, entity performance measure, management and the governance. 5 | P a g e

Nature of the entityThe Fortescue Metal group is the global leader in the iron ore industry and is the industrial leading development of iron ore deposit has most significant mines in the world. The company has grown as one of the largest global iron ore producer and operates integrated operation spanning five mines sites in the Pilbara. The company is engaged in the exploration, processing, development production of iron ore and owns and operates integrated supply chain including fiveberths Herb Elliott Port in Port Hedland and heavy haul railway with 42 ton Axle load capacity (Fortescue Metals Group Ltd, 2017). The company owns and operates its purpose design rail and port facility to deliver iron ore from mines to port and finally to the customer.The Fortescue Metals Group Limited is the fourth largest producer of the iron ore in the world and has two main group of operation namely Pilbara region of Western Australia and Chichester Hub and Solomon Hub. The Chichester Hub is located in the Pilbara and is made up of Fortescueflagship minesite cloudbreak and the other one is Christmas creak (Fortescue Metals Group Ltd, 2017). The cloudbreak is currently mining 40 million tons of iron ore in the year and it operateson horizontal nature of deposit whereas other make the use of the vertical deposit of the ore. The processing facility of the company process and refines the product before transporting to ports. On the other hand the Christmas Creak has lifted its capacity to 50 million tons per year. The Solomon hub is located in the middle of Fortescues Pilbara Tenement area which is company second most major project. The exploration team of Fortescue has delineated 2.86 billion tons of resources at Solomon hub and targeting the same upto 2.86 billion tones. The BC iron is the smaller company with its iron ore deposit at Nullagine and is in joint venture with Fortescue Metals Group Limited where BC iron manage crushing, mining, screening and trucking and Fortescue provide haulage and port service to the JV (Fortescue Metals Group Ltd, 2017). 6 | P a g e

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