HI5020 Corporate Accounting: Analyzing Harvey Norman Limited's Financial Statements

HI5020 Corporate Accounting
Company name: Harvey Norman Limited
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Contents
CASH FLOWS STATEMENT..............................................................................................4
(i) From your firm's financial statement, list each item reported in the CASH FLOWS
STATEMENT........................................................................................................................4
(ii) Provide a comparative analysis of your company’s three broad categories of cash
flows (operating activities, investing activities, financing activities) and make a
comparative evaluation for three years..................................................................................5
OTHER COMPREHENSIVE INCOME STATEMENT......................................................6
(iii) What items have been reported in the other comprehensive income statement..........6
(iv) Explain your understanding of each item reported in the other comprehensive
income Statement...................................................................................................................7
(v) Why these items have not been reported in Income Statement/Profit and Loss
Statement:...............................................................................................................................8
ACCOUNTING FOR CORPORATE INCOME TAX..........................................................9
(vi) What is your firm’s tax expense in its latest financial statements?.............................9
(vii) Is this figure the same as the company tax rate times your firm’s accounting
income? Explain why this is, or is not, the case for your firm.............................................10
(viii) Comment on deferred tax assets/liabilities that are reported on the balance sheet
articulating the possible reasons why they have been recorded...........................................11
(ix)Is there any current tax assets or income tax is the income payable recorded by your
company? Why tax payable not the same as income tax expense?.....................................12
(x) Is the income tax expense shown in the income statement same as the income tax paid
shown in the cash flow statement? If not why is the difference?.........................................13
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(xi) What do you find interesting, confusing, surprising or difficult to understand about the
treatment of tax in your firm’s financial statements?...........................................................14
References:...........................................................................................................................15
Appendix:.................................................................................................................................16
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CASH FLOWS STATEMENT
(i) From your firm’s financial statement, list each item reported in the CASH
FLOWS STATEMENT.
Cash flow statement is the financial statement that shows the amount that affects cash and
cash equivalent on the balance sheet or the income statement. Cash flow statement includes
all operating, investing and financing activities.
Operating cash flow includes the items such as net receipts from the customers and
franchisees, payment to suppliers and employees, distribution received from joint ventures,
GST paid, interest and dividend received, interest and finance cost paid, income tax paid. The
major change which has occurred from the previous year is in income tax paid by $ 36919.
The major change is also in the net receipt from franchisees which has decreased from the
previous year by $ 66766 (Annual Report, 2017).
Investing cash flow include the items such as payment for the purchase of the property, plant
and equipment and intangible assets, payment for purchase of investment activities proceeds
from the sale of property, plant and equipment and properties held for resale, payment for the
purchase of units in trusts and other investment, equity accounted investments, listed
securities, proceeds from the sale of listed securities, loans granted to joint ventures entities
and partners. The major change has occurred in the sale of the property, plant, and equipment
by $ 19541 and there is no sale of listed securities in the current year 2017 ( Annual Report,
2017).
Financing activity cash flow includes the items such as proceeds from the share issued, the
dividend paid, loans received from the related parties, repayment of the borrowings, proceeds
from the syndicated facility. The change which has noticed is in the proceeds from the
syndicated facility has occurred which was not in the previous year.
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