Integrated Report on JB Hi-Fi: Opportunities, Risks, and Material Capitals
Added on 2023-06-04
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ADVANCE FINANCIAL REPORTING
Advance financial reporting
Name
Course
Professor
Institutional affiliation
Date
WC: 2560
Advance financial reporting
Name
Course
Professor
Institutional affiliation
Date
WC: 2560
ADVANCE FINANCIAL REPORTING2
Organizational Overview
JB Hi-Fi is a company based in Australia that specializes in consumer goods that
range of telecommunication, audio-visual and electronics such as the mobile phones,
electrical home appliances, electronic hardware, CDs, DVDs Blu-rays Ultra Blu-rays and
video games as well as a number of Telstra services. Moreover, the company offers
professional services to wholesale markets, government and corporate including education
and hospital sectori.
JB Hi-Fi is a listed company on the ASX with its head offices at the Chad stone
Shopping Centre in Melbourne. The company generated a total of $ 6,855,400,000 in sales
and other revenues in the year 2018 and is ranked at position 53 out of the 2000 listed
companies. The company has managed to employ well over 12200 employees who are also
employed under the company subsidiaries.
The chief executive officer Mr. Richard Muray and the non-executive chairperson Mr.
Gregory Richards head the company. The company has over 180 outlets across Australia and
New Zeeland
The company operates in a highly competitive market both from existing and new
entrants. Such competition may lead to decreased profits and therefore the company plans to
strategize on competitive advantage to maintain its market position. Moreover, the company
hopes to give customers quality online offers that are available in the general stores to ensure
that they get ahead of their competitors.
On the other hand, the company hopes to focus on compliance of the management
team in an effort to mitigate risk through adequate staff training. This will ensure that
litigation and breach of regulatory requirements are avoided. Reach of legal requirements
might have detrimental effects such as adverse monetary penalties as well as high legal
Organizational Overview
JB Hi-Fi is a company based in Australia that specializes in consumer goods that
range of telecommunication, audio-visual and electronics such as the mobile phones,
electrical home appliances, electronic hardware, CDs, DVDs Blu-rays Ultra Blu-rays and
video games as well as a number of Telstra services. Moreover, the company offers
professional services to wholesale markets, government and corporate including education
and hospital sectori.
JB Hi-Fi is a listed company on the ASX with its head offices at the Chad stone
Shopping Centre in Melbourne. The company generated a total of $ 6,855,400,000 in sales
and other revenues in the year 2018 and is ranked at position 53 out of the 2000 listed
companies. The company has managed to employ well over 12200 employees who are also
employed under the company subsidiaries.
The chief executive officer Mr. Richard Muray and the non-executive chairperson Mr.
Gregory Richards head the company. The company has over 180 outlets across Australia and
New Zeeland
The company operates in a highly competitive market both from existing and new
entrants. Such competition may lead to decreased profits and therefore the company plans to
strategize on competitive advantage to maintain its market position. Moreover, the company
hopes to give customers quality online offers that are available in the general stores to ensure
that they get ahead of their competitors.
On the other hand, the company hopes to focus on compliance of the management
team in an effort to mitigate risk through adequate staff training. This will ensure that
litigation and breach of regulatory requirements are avoided. Reach of legal requirements
might have detrimental effects such as adverse monetary penalties as well as high legal
ADVANCE FINANCIAL REPORTING3
cost.The company is also exposed to economic sustainability risk that has prompted the
preservation of the shareholders’ value. In addition, the company aims to consider its
operations and its impact on the environmentii.
Governance
The JB HiFi directors and management are committed to ensuring that ethics is
observed during the normal operations of the business and in accordance with the corporate
governance, standards. The company has put in place a board that continually reviews and
keeps track of development in corporate governance.
The board is tasked with the responsibility of ensuring that company policies are in
line with the 3rd edition of ASX Corporate Governance Council Principles and
Recommendations. The organization has provided a law that directs the board to undertake
relevant checks before appointing a director or presenting a candidate to the shareholdersiii.
Opportunities and risks
The company’s opportunities have been increased greatly as a result of acquiring the
Good Guys. With the Good Guys on board, there has been an increase of 35.5% profit, which
is expected to rise in the coming years. Moreover, a double-digit growth is expected soon as
the company has booked a full year sale from the Good Guys thereby reducing cost and
saving to $ 15 million thereby offering better buying terms and increasing the profits.
On the other hand, the company might fail to realize the expected growth in the
future. This might be brought about due to plans by Amazon in expanding to Australia or the
plans y Best Buy to set up a shop in Australia. Moreover, as the profits sore higher there is a
possibility that the company might require incremental capital.
cost.The company is also exposed to economic sustainability risk that has prompted the
preservation of the shareholders’ value. In addition, the company aims to consider its
operations and its impact on the environmentii.
Governance
The JB HiFi directors and management are committed to ensuring that ethics is
observed during the normal operations of the business and in accordance with the corporate
governance, standards. The company has put in place a board that continually reviews and
keeps track of development in corporate governance.
The board is tasked with the responsibility of ensuring that company policies are in
line with the 3rd edition of ASX Corporate Governance Council Principles and
Recommendations. The organization has provided a law that directs the board to undertake
relevant checks before appointing a director or presenting a candidate to the shareholdersiii.
Opportunities and risks
The company’s opportunities have been increased greatly as a result of acquiring the
Good Guys. With the Good Guys on board, there has been an increase of 35.5% profit, which
is expected to rise in the coming years. Moreover, a double-digit growth is expected soon as
the company has booked a full year sale from the Good Guys thereby reducing cost and
saving to $ 15 million thereby offering better buying terms and increasing the profits.
On the other hand, the company might fail to realize the expected growth in the
future. This might be brought about due to plans by Amazon in expanding to Australia or the
plans y Best Buy to set up a shop in Australia. Moreover, as the profits sore higher there is a
possibility that the company might require incremental capital.
ADVANCE FINANCIAL REPORTING4
The company faces a number of risks factors ranging from natural to those specific to
the organization. Such risks are a threat to the company’s financial performance as well as the
future operations. Financial performance will vary depending on various economic conditions
such as economic and business conditions, interest exchange, inflation, government
regulations as well as access to debt and capital markets.
Other risks include competition, in that the market in which the company is operating
on remains highly competitive in which may lead to decreased profits and sales in case
another competitor enters the marketiv.
Reputation is another risk that the company is likely to suffer, as the acquiring of the
Good Guys has elevated the loyalty and trust of the customers. According to the corporate
reputation index, JBHi-Fi ranked third which puts the company in a position where in case
something of bad popularity is tied to the company the reputation will spiral down. However,
the company has laid down measures in dealing with most of the risks.
The company seeks to ensure that its reputation stays intact by carefully monitoring
the prices set by their competitors, market share data, customer engagement analytics,
customer compliance as well as the latest innovations. Another risk that might lead to poor
reputation is the security breach of the IT systems; this risk is to be handled through investing
in IT security measures.
The risk related to health and safety incidents will be mitigated by having the
necessary work health and safety procedures in position for all sites. Moreover, a breach of
the regulatory requirements will be handled through staff training.
The six-core capitals include natural capital, social and relational capital, human
capital, intellectual, manufactured and financialv.
Financial capital
The company faces a number of risks factors ranging from natural to those specific to
the organization. Such risks are a threat to the company’s financial performance as well as the
future operations. Financial performance will vary depending on various economic conditions
such as economic and business conditions, interest exchange, inflation, government
regulations as well as access to debt and capital markets.
Other risks include competition, in that the market in which the company is operating
on remains highly competitive in which may lead to decreased profits and sales in case
another competitor enters the marketiv.
Reputation is another risk that the company is likely to suffer, as the acquiring of the
Good Guys has elevated the loyalty and trust of the customers. According to the corporate
reputation index, JBHi-Fi ranked third which puts the company in a position where in case
something of bad popularity is tied to the company the reputation will spiral down. However,
the company has laid down measures in dealing with most of the risks.
The company seeks to ensure that its reputation stays intact by carefully monitoring
the prices set by their competitors, market share data, customer engagement analytics,
customer compliance as well as the latest innovations. Another risk that might lead to poor
reputation is the security breach of the IT systems; this risk is to be handled through investing
in IT security measures.
The risk related to health and safety incidents will be mitigated by having the
necessary work health and safety procedures in position for all sites. Moreover, a breach of
the regulatory requirements will be handled through staff training.
The six-core capitals include natural capital, social and relational capital, human
capital, intellectual, manufactured and financialv.
Financial capital
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