Corporate Accounting Analysis of MYOB Annual Report

CORPORATE ACCOUNTING 1
HI 5020 Corporate Accounting
Submitted By: Rajwinder Kaur Samra
Student ID: AC8418

CORPORATE ACCOUNTING 2
Table of Contents
Introduction......................................................................................................................................3
Critical analysis of statement of cash flow......................................................................................3
Critical analysis of other comprehensive income............................................................................7
Corporate income tax computation..................................................................................................8
References......................................................................................................................................11

CORPORATE ACCOUNTING 3
Introduction
The most significant aim of this particular assignment is to analyse in detail the annual report of
a company and provide comparative analysis on the cash flow statement for the 3 year period
from FY2015 to FY2017. The student then analyse the other comprehensive income aspect of
the company, the various particulars included in the OCI of the annual report and last part is to
perform a detailed analysis on the corporate income tax paid by the company. The organisation
which is considered for the analysis is MYOB, a primary software solutions company which is
involved in offering software solutions to the small and medium sized enterprises on the various
area which includes taxation, accounting system, payroll maintenance etc. The company main
clients are the small and medium sized enterprises which are located in Australia, New Zealand
and other Asian countries. The company offers solutions to its clients through cloud computing
and other software soutions like MYOB Advanaced module, Payroll MYOB, Direct Pay. The
company also offers various other services like taxation filing, payroll management of the
employees, GST computation, and record management system of key financial and non-financial
information.
Critical analysis of statement of cash flow
Basically, cash flow statement is regarded as a complete account of changes in the balance sheet
and income statement. In this case, attention is primarily focused on money in these sectors.
Cash flow statement can be categorized into cash flow from investing activities, cash flow from
operations and cash flow from financial activities. The main aim of the statement of cash flow is
to give more information on the total payments and revenues over a given time period which is
usually one financial year. Cash flow statement helps the business in understanding the business
total liquidity, evaluates time to time solvency and forecasts future cash flows.
In this case, the most significant elements of the statement of cash flow are mostly based on the
accounting abilities that the business has to define when comparing costs and revenues. It is
important to note that the statement of cash flow encompasses only the funds and resources that
were released. Generally, statement of cash flow disregard an operation that are not in monetary
form. From the critical analysis of cash flow statement of MYOB it is noted that the cash flow
from the beginning of the period were 61,434,000 in FY2017 but in the year FY2016 it stood at
36,384,000 and 5,044,000 in FY2015. This shows that the cash flow of the business is
consistently increasing over the period of time.

CORPORATE ACCOUNTING 4
Cash flow analysis of based on the operating activities
From the annual report of the company it is noted that the net cash flow based on the operating
process was 97,860,000 in FY2015 whereas it was 145,833,000 in FY2016 and it has grown to
163,919,000 in 2017. This shows that the business has grown to a larger extent in the past three
years. The cash receipts of the company were at 362,211,000 in 2015, but this has significantly
increased to 406,711,000 in FY2016 and 414,224,000 in FY2017. Similarly the payments to the
suppliers and others has been made to a level of 213,879,000 in FY2015, and this has increased
to 246,153,000 in FY2016 but due to continuous effort of the management the expenses has been
reduced to 233,781,000 in FY2017. The net cash flow from the operating activities were at
97,860,000 in 2015, increased significantly in FY2016 and stood at 145,833,000 in FY2016 and
increased even further to 163,919,000 in FY2017.
2015 2016 2017
Net cash flow from the company operating activities AU$97,86
0
AU$145,83
3
AUD163,919
2015 2016 2017
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
Net cash from operating activities
Net cash from operating
activities
Analysis of investment activities of MYOB: This section is mainly involved in understanding the
various investment activities which has been carried out by the company during the period
FY2015 to FY2017. The firm made a major investment in creating new product development in
FY2015 for this purpose 13,822,000 has been invested in FY2015, whereas in FY2016 the new