Advanced Accounting Assignment (Doc)

Running head: ADVANCED ACCOUNTING
Advanced Accounting
Name of the Student:
Name of the University:
Authors Note:

ADVANCED ACCOUNTING
1
Table of Contents
Question 1:.................................................................................................................................2
a) Mentioning goodwill impairment charge that could be reported or disclosed in QBE’s
financial statements:...................................................................................................................2
b) Stating can QBE’s use chairperson as an intangible asset, and disclose it in their financial
statement:...................................................................................................................................3
Question 2:.................................................................................................................................4
a) Mentioning the reimbursement that might be enjoyed by Lion Nathan with leaseback
transactions and sale of pub:......................................................................................................4
b) Mentioning the use of finance or operating lease for Lion Nathan:......................................4
c) Depicting whether Lion Nathan account for any profit or loss on the sale of the pubs:........5
d) Mentioning the change in depreciation if pubs are sold and then leased back by Lion
Nathan:.......................................................................................................................................5
Reference and Bibliography:......................................................................................................7

ADVANCED ACCOUNTING
2
Question 1:
a) Mentioning goodwill impairment charge that could be reported or disclosed in QBE’s
financial statements:
In the annual books of QBE, different measures could be used for depicting the
impairment charge, which could directly help in depicting the actual financial position of the
organisation. Goodwill impairment charges are relevantly imposed on the carrying value if it
exceeds the fair value. Furthermore, the impairment charge could directly be deducted from
the income statement and balance sheet statement. In this context, Baskerville et al. (2017)
mentioned that use of impairment charge could directly allow the organisation to reduce the
value of intangible assets as per their fair value. The impairment expenses needs to be
recorded in both statement of financial account, which could directly help in depicting the
actual firm value. Therefore, the overall one time impairment charge of $150 million will be
reflected in the income statement of QBE. However, the overall in payment charge of $600
million will mainly be charged in balance sheet of the organisation. Relevant decline in
Goodwill From the annual report of the organisation could be witness in the balance sheet,
where deduction of $600 million will be reported. The relevant imposition of one time in
payment charge could directly reduce the profit level of the organisation. Chaney (2017)
argued that companies use the impairment expenses to reduce the profit, which could directly
help in improving the retained income and provide exemption from the tax. Hence, QBE
could list the impairment charge and reduce the overall total assets of the organisation.