Analysis of Financial Reporting of Medibank Health Insurance Company

Analysis of Financial Reporting of Medibank Health Insurance Company 1
ANALYSIS OF FINANCIAL REPORTING OF MEDIBANK HEALTH INSURANCE
COMPANY
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Analysis of Financial Reporting of Medibank Health Insurance Company 2
Analysis of Financial Reporting of Medibank Health Insurance Company
PART 1
Stakeholders of the Annual Report of Medibank Health Insurance Company
The key users of the general purpose financial reports include potential and existing
investors, the lenders and the other creditors that utilize the information therein in making
decision on whether to hold, sell or buy equity, settling or providing loans, exercising the
voting rights or influencing the management’s actions which could in turn affect use of
organization’s economic resources (CPA Australia 2012). With these, the general
shareholders of Medibank Health Insurance Company include potential and existing
investors, customers, lenders, creditors as well as government agencies. Investors include all
individual who have invested or are planning to invest in the company while lenders or
creditors are those firms or individuals that might offer financial assistance in terms of debts
or credit to the organization. These shareholders are interested with the report since it would
assist them in assessing the organization’s prospects for the future cash inflows and in
assessing how proficiently and successfully the management had been discharging their
functions in utilizing the organization’s current resources. To access such information, the
shareholders might require income statement, management report, balance sheet as well as
cash flow statement to assist them while making decision.
PART 2
a) Objective/Purpose for the Report to Different Stakeholders Identified in PART 1
The report aims to provide relevant information to different stakeholders of Medibank
Health Insurance Company. In essence, this report would be of greater importance to the
stakeholders as particularly the existing investors or shareholders in making-decision on
whether to hold, sell or buy extra shares (IAS 2018). The report would also be of greater help
to potential or existing lenders or creditors since it would helps them understand the company

Analysis of Financial Reporting of Medibank Health Insurance Company 3
prospects for the future cash inflows which are crucial in determining the company’s capacity
to settle its debts on time once it become due. The report would also be useful to the
stakeholders since it would help them in assessing the financial strength as well as
weaknesses of Medibank Health Insurance Company. It would also assist them in assessing
solvency and liquidity and its need as well as the company’s capacity to access financing.
This information would help the stakeholders especially the lenders in prediction how future
cash inflows would be distributed amongst individuals with claims on Medibank Health
Insurance Company.
b) Summary Of The Environment In Which Medibank Health Insurance Company
including Principal Activities as well as Proposed Direction in Future
Medibank Health Insurance Company is the leading health insurer within Australia. Its core
operations include Health insurance, whereby the company distributes and underwrites health
insurance policies under some of its key brands, Ahm and Medibank (Medibank Health
Insurance Company 2017). The company has a group of the related business operations
referred to as the Medibank Health that was referred to as the Complementary Services in the
past. As the company maintains assets in order to satisfy some of its regulatory reserves, it
could also be said to generate substantial investment returns from some of its portfolio of the
investment assets (Medibank Health Insurance Company 2016). It is committed in enhancing
client experience, generating shareholders’ value, maximising business performance and
financial returns as well as sustaining significant success and growth of the firm. The
summary of the environment in which the firm is operating is crucial in analysing the
organization’s financial report for different stakeholder’s identified above since it help them
to understand the demand and supply of different products and the impact of the trends to the
organization’s performance. Besides, the summary is crucial since it would help in decision-
making regarding the financial strength or weakness of the organization which is crucial in