JB Hi-Fi: Risk Assessment Report

Running head: JB Hi-Fi 1
JB Hi-Fi: Risk Assessment Report
Student’s Name
Institution Affiliation
Data

JB Hi-Fi 2
Introduction
This report is centred on the evaluation of advance accounting in the JB Hi-Fi group.
The composition of this research will include the annual report of the company to identify the
possible extent to which industries need to operate according to the Australian Accounting
Standard Hoard (AASB) (Barth, 2006). Moreover, the paper will compared various standard
objectives of auditing in planning for the process effectively. The paper will apply the ASA
300.4 standard aimed at drawing appropriate opinions and conclusions, including the
possibility of regulation modification, The company’s auditor need to establish an general
editing strategies in reference to the Auditing Standard ASA 315, 2015. To complete the
auditing, this paper will begin when an analysis of the business, its suppliers, customers,
among other external and internal aspect affecting the business.
Knowing the Company
Company’s Business – Overview
The JB Hi-Fi Company is one of the leading retail organizations in Australia and has
been in existence since its inception in 1974. The company is located in 210 different places
dealing with electronic products, including DVDs and CDs (Imhof, Seavey & Watanabe,
2018). According to the annual financial report in 2018, the organization has earned an
income of about $135,555,000 whereas the gross revenue amounted to $3,456,016,000. This
overall amount of the company’s equity in the year amounted to about $344,461,000.
Customers
For about three decades now, the JB Hi-Fi organization has continued to expand in
more than 200 places in Australia. One of the single stores is located in Melbourne suburbs in
the eastern Keilor linked to more than 30 super store networks that span most of the Australia
states. The customer basis in the organization is stimulated by the strategic discount
warehouse technique that leverage the philosophy of the industry’s website, which stresses on

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being a brand that offer cheap, but quality entertainment products (Cullinan, Earley & Roush,
2013). The spanning of the entertainment spectrum ranges from TVs to home theatre, Hi-Fi
audio speakers, digital cameras and motor audio systems.
Suppliers
The company has achieved a considerable strategic supply chain network via the
integration of product supply from local and foreign suppliers. One of the most famous
supply chain management technique used in the company is its executive purchasing
authority programs. The system and process of the supply chain network is controlled by
actual time tracking framework, which allows quicker and higher information to be available
for use in making strategic decisions (Chen, 2017). The supply and leaner chain network is
operative at a faster and efficient rate, which enables the delivery of produces on time.
Resultantly, this reduces the risk of the company to incur unnecessary costs hence a
proper logistic management scheme. The company greatly depends on the supply products
originating from abroad to maintain their operation and working capital hence lowering the
interests (Nguyen & Gong, 2014). Complete and timely procurement of products from
oversees suppliers, the company has appoints various agents across the world from where the
products are purchased (Hsu, Jung & Pourjalali, 2015). Suppliers from United States have
products which are of the best quality and the availability of an agent with direct access to the
distributers limits the risks of middle men.
Unions Selection and Application of Accounting Policies
According to the auditor’s opinion, the accounting policy selection and union evaluation are
based on the status of the transport workers’ union in Australia. The union governing the
employees in the county is reference in December 31, 2016, with its financial evaluation and
cash standards evaluated according the Australian Account Standard (AAS). An analysis of

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selection regarding other legal accounting necessities according to auditors’ opinion implies
that:
- The JB Hi-Fi limited has maintained satisfactory record of its accounting system for
the financial year ended 31 December 2018. This record includes information about
the nature and sources of the company’s possible income and customer subscription to
membership, including other possible income from other members. This record
reflects on the company’s expenditure.
- The financial report supply during the end of the year properly draws actual facts
about the organization and its financial conditions in a given fiscal year. Moreover, it
provides data regarding the organization’s expenditure, income and surplus for the
entire year.
Reasons for Change
Change is pertinent in the JB Hi-Fi Company and should be executed according to the
available accounting standards and entity’s section as referenced from the P A36, ASA
315.11. In such case, the company’s auditor needs to evaluate if the company’s accounting
standards are effective for the organization and dependable with the available financial
statements frameworks and accounting standards applicable in relevant industries. The AASB
116 property, plant and equipment indicate the accounting calculations for the entity,
properties and equipment that comprise their recognition and determination of executing
accounting information, depreciation and impairment losses.
Non-current assets in the company do not complete the present asset characteristics
and definition as referenced in the IAS 16, 2003. There are two forms of accounting
standards in the non-present JB Hi-Fi’s assets (Harding & Xu, 2011). These include the cost
models and revaluation model. The state expects the company to predict a dismantle cost,