Corporate Accounting: Cash Flows, OCI Statement, and Tax Treatment of JB Hi-Fi

CORPORATE ACCOUNTING
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The selected firm is a consumer goods retailor named JB HI-FI. The company’s 2017 annual
report is the latest and hence the financial statements used for this task would correspond to
June 30, 2017 position. The key analysis of the requisite items is carried out below.
CASH FLOWS STATEMENT
(i) The operational cash flow of the company is illustrated as follows (JB Hi-Fi, 2017).
For the items highlighted in the above screenshot, the relevant description is given below (JB
Hi-Fi, 2017).
 “Receipts are customers”– This item highlights the amount of money that the
customers have paid to the company on account of the buying of the various products.
It is noteworthy that revenue highlighted as part of the income statement is accrual
based unlike customer receipts which highlight the actual cash paid by the customers.
This has clearly increased by more than 40% driven by the acquisition of a new
business by the company in FY2017.
 “Payments to suppliers and employees” – On the end of the company, for
procurement of goods, supplier need to be paid. Further, there are employees doing
various organisational roles who need to be given salaries. Owing to the new
business, there is a proportional increase in these payments also.
Further, there certain finance revenue and associated costs besides taxes paid. These form a
very small proportion of the cash flows from operations.
The investing related cash flow of the company is illustrated as follows.

For the items highlighted in the above screenshot, the relevant description is given below (JB
Hi-Fi, 2017).
 “Payment for business combination” – This indicates the amount of money that the
company has spent during the year for acquiring business. For FY2017, the relevant
entry clearly shows that a total of $ 836.6 million has been paid for acquiring a
business.
 “Payments for plant and equipment” – This indicates the amount of money that was
paid by the company with regards to plant and property acquisition. There has been
no major change in FY2017 for this when compared to the previous year value.
 “Proceeds from sale of plant and equipment” – This indicates the amount of money
that has been realised by the company through liquidation of certain fixed assets i.e.
plant and equipment. In absolute terms, the change in this is negligible.
The financing related cash flow of the company is illustrated as follows (JB Hi-Fi, 2017).
For the items highlighted in the above screenshot, the relevant description is given below.
 “Proceeds from issues of shares” – This indicates the total money that company has
obtained through share issue in the time period given. In comparison to FY2016,
FY2017 saw a huge increase in these proceeds as it increased to $ 395.9 million from
$6 million.
 “Proceeds/(repayment) of borrowings” – This indicates the amount of money that
company has raised by taking extra borrowings or any decrease in the borrowings