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Managers Accounting Strategy and Reporting choices

   

Added on  2019-10-30

12 Pages3656 Words164 Views
MANAGERS ACCOUNTING STRATEGY AND REPORTING CHOICESStudent Name: Student ID:

EXECUTIVE SUMMARYThe title of the report is managers accounting and reporting choices. As the title suggests, thereport has been flowed on the analysis of the financial statements of the company. The mainobjective of the report is to conduct an investigation of the annual report of the company as tohow the company’s management is accounting for the transactions that the company usuallymade over the year. Along with the procedures, strategies that the company has followed forcompleting the accounting have been analysed. The second main objective of the report is toconsider and analyze the strategy that the company has adopted for the reporting of the financialand non financial information in the annual report of the company. In order to achieve theseobjectives, the investigation report has been presented with division into separate headings andsections. ContentsEXECUTIVE SUMMARY.................................................................................................................................2INTRODUCTION...........................................................................................................................................2HISTORY OF COMPANY AND ADOPTED KEY ACCOUNTING POLICIES..........................................................2ASSESSMENT OF ACCOUNTING...................................................................................................................2EVALUATION OF STRATEGY IN ACCOUNTING..............................................................................................2EVALUATION OF QUALITY DISCLOSURE.......................................................................................................2IDENTIFICATION OF DISCREPANCIES...........................................................................................................2COMPLIANCE WITH THE CONCEPTUAL FRAMEWORK.................................................................................2CONCLUSION...............................................................................................................................................3REFERENCES................................................................................................................................................3

INTRODUCTIONThe function of finance of every organization whether small or whether big plays a veryimportant role. It is because it’s only the finance function around which the working of the wholeof the organization depends. For instance in order to make the purchases, finance is required andin order to receive the payments from the customers then also finance is required. Finance isperformed by following the correct method of accounting and underlying accounting rules andprocedures. Through this report the annual report of the company – Woolworths Limited havebeen analysed for the year ending 30th of June 2016 and 30th of June 2015. In the first section, theaccounting policy of the company for key items have been discussed and simultaneously theassessment of the flexibility in accounting have been done as to what extent it can be distorted bythe managers of the company. In the third section, the strategy that the company has adopted indoing the accounting has been critically evaluated with reference to the position of thecompetitors. Section four has evaluated the quality of the disclosure that the management hasmade in their financial statements of the company. In the section five, the issue that has shownsome discrepancies in the accounting policy or the strategy adopted by the management has beenanalysed. In the last section of the body of the investigation report, it has been analysed whetherthe company has followed the conceptual framework of accounting or not. With these sections,the report has been ended with the appropriate conclusion. HISTORY OF COMPANY AND ADOPTED KEY ACCOUNTING POLICIESFor the purpose of conducting the investigation report, the company – Woolworths Limited hasbeen selected. The company is a listed company in stock exchange of Australia and has beenfounded in the year of 1924 when it was the small store providing daily items for the consumer.With the passage of the time, the company has been growing with the multiplicity of factors onyear on year basis and has stepped into the market of India by opening the joint venture asCroma. Since its formation, the company has made the focus on the daily consumer needs andhas changed their products according to the needs of the consumer. In the current scenario,company is working as the supermarkets where all the items are readily available for the

consumers at the cheap price. It includes from the products like fresh fruits, vegetables to theelectronic items which in the today’s era is very necessary for every household (CompanyOfficial Website, 2017). The financial year of the company usually ends as defined in the Corporations Act, 2001 ends on25th of June every year. On looking after the financial statements of the company for the financialyear ending 25th of June 2017, the following key accounting policies and estimated haveestimated have been mentioned below:-As per note number 1.3 of the financial statements of the company, the directors areauthorized to make the judgments, estimates and assumptions that will affect the items asreported in the financial statements. The estimates, judgments and assumptions are basedon the historical experience of the company as to how they have made the above in theearlier years. The matters involving the higher risk of having the material effect over theitems as shown on the financial statements have been mentioned separately under theseparate heads for Useful life assets for estimating the depreciation, impairment of theassets, onerous leases and operations that have been discontinued which includes theimpairments and other details (Anastasia, 2015). -For instance the company has adopted the accounting policy for the assets of thecompany is that the asset will be value at the cost incurred to bring asset to the presentlocation and condition less the value of the depreciation as calculated on the basis of theestimated useful life of an asset less the amount of impairment loss if any as indicated bythe conditions. -With the aforesaid accounting policy, the major accounting estimate taken by themanagement is the measurement of useful life an asset. It is also regarded as the keysuccess factor for every organization as the noncurrent assets forms part of the net worthof the company and the investors are at first willing to have the asset informationimmediately after knowing the earnings per share. There are other accounting policies too that is regarded as the critical success factor of thecompany – recognition of the revenue, measurement of inventories, etc.

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