Annual Report: Statement of Profit and Loss, Financial Position, Changes in Equity, Notes, Directors and Auditors Report

This Annual Report of Desklib includes Statement of Profit and Loss, Financial Position, Changes in Equity, Notes, Directors and Auditors Report. It provides insights into the financial performance of Desklib. The report is signed by all the directors and auditors of the company. The report is beneficial for stakeholders to make strategic decisions.

Annual Report
Assignment
Table of Contents
QUESTIONS...................................................................................................................................3

1. Statement of profit or loss and other comprehensive income:...........................................3
2. Statement of financial position:..........................................................................................4
3. Statement of changes in equity...........................................................................................5
4.Notes to the financial statements:........................................................................................6
5.Directors declaration...........................................................................................................7
6. Annual directors report.......................................................................................................7
7. Annual auditors report........................................................................................................8
REFERENCES..............................................................................................................................10
QUESTIONS
1. Statement of profit or loss and other comprehensive income:
Statement of profit and loss
Particulars $ '000
Income
Sale Revenue 82,631
Service revenue 32,305

Other income 484
Total revenue 1,15,420
Capital income: Gain on sale of land 6,298
Total income 1,21,718
Expenses
Cost of Goods Sold 53,210
General operating costs 11,611
Salaries and wages 21,524
Insurance expenses 490
Advertising and marketing expenses 2,460
Retirement gift for employee 0.82
Expense for annual leave 1,698
Finance costs 361
Annual leave expenses 1,698
Warranty expenses 1,789
Provision for doubtful expenses 980
Audit and consultancy fees 950
Depreciation and amortisation 5,708
Extraordinary expense:
Survey expenses 420
Extensive training 225
App Development Expenses 250
Other Expenses 5043.18
1,08,418
Capital expenses :Loss on sale of Shop Fittings 166

Total expenses 1,08,584
Net Profit Before tax 13,134
Less: Tax @ 30% 3940
Profit After Tax 9,194
Other comprehensive income -
Total comprehensive income for the year 9,194
2. Statement of financial position:
Balance sheet as at 30 June 2018
Particulars $’000
Assets
Financial assets
Cash and deposits 851
Receivables 11,320
Total financial assets 12,171
Non-financial assets
Inventories 3,640
Property, plant and equipment 24,834
Prepayments 1,020
Total non-financial assets 29,494
Total assets 41,665
Liabilities
Payables 2,490
Accrued Expenses 785
Unearned Income 2,786

Dividend Payable 525
Provisions
For annual leave 697
For Warranties 1,011
For new apps 250
Total liabilities 8,544
Net assets
Equity
Accumulated surplus
Share Capital 13088
Retained Earning 20,033
Contributed capital
Net worth 33,121
Total Equity and Liabilities 41665
3. Statement of changes in equity
Statement of changes in equity for the year ended 30 June 2018
Particular
Ordinary
share
capital
General
reserve Retained earnings Total
Opening Balance as on 1 July
2017 12750 200 10399 23349
Net Profit after tax - - 9194 9194
Dividend Payable - - -525 -525
Transfer to general reserve - 3300 -3300 0
Bonus issued 338 -338 - 0
Share issue expenses - 112 - 112
Total 13088 3274 15768 32130

4.Notes to the financial statements:
Explanation related to the financial statements of this company shall be included in the notes,
which are as follows:
 Property, plant and equipment of company as shown in the balance sheet include the
land, building and furniture and fittings of the company in accordance with AASB 116
Property, Plant and Equipment (Dean and Clarke, 2005).
 With the context of AASB 102 Inventories, Inventory costing $2,100,000 had been
delivered to company on 29 June 2018, But due to staff shortages at this time, the details
of this transaction/event were not processed until 14 July 2018 and hence this has not
been accounted for in the trial balance. This inventory had been ordered on 1 June 2018
and an amount of $600,000 was paid in advance to secure the order. The amount
remaining was required to be paid within 2 weeks of date of delivery of the inventory and
was paid by the company on 10 July 2018.
 In this, company has tax rate is 30%. Tax expense is based on 30% of the accounting
profit before tax as per AASB 112.
 Other expenses give in income statement comprises total of various expenses shown as
other expenses in accordance with format given in AASB 101.
 Income of company is coming from various sources which includes sales revenue and
service revenue and other income.
5.Directors declaration
In this section directors declare that organisation is using appropriate accounting
principles and regulations while formulating financial reports. They also declare that the
company is able to pay all its debts, dues amount and payables. Information of possible future
gains and incomes can also be analysed with the help of this declaration (Ryerson and et. al,
2016). External stakeholders of a business entity may get insider data of enterprise and then
make decision of making investment or not. Main purpose of this testimony is to declare that
their entity is disclosing appropriate data. It is signed by all the directors and it is made on a
specific date when annual report is generated. It is very beneficial for the stakeholders to resolve
their queries about organisation's performance.
In the opinion of the directors Organisation have followed all the accounting principles
and standards including Section 296 and 297. It assures that all the legal requirements are

fulfilled by the company and it is also presenting fair and true view of organisation's financial
statements. It has resulted in total income of 121718 and net profits of 230302. The declaration is
being made on 21 September 2018 which is signed by the directors by mutual concern. “The
Company” is a reporting entity which is disclosing all relevant and necessary information in the
financial statements that may guide stakeholders to make strategic decisions. It is having assets
of 258833, liabilities of 8019, capital of 13088 and retained earnings of 237726.
All the information is presented in the final accounts are relevant, accurate, appropriate
and reliable in the opinion of directors.
6. Annual directors report
All the information of dividend to the shareholders, interest to debtors etc. are recorded in
this report. It also includes other information such as salaries to the top executives and declared
payment to the members of the organisation. It is not necessary that the payments are made they
can be proposed in the financial year. It also includes the name of directors of the company and
the appropriate information of that the organisation is registered or not. Information of that
period for which individuals worked as executives is also covered in this report. Detailed
information of them is not required to be included in it as it is not necessary.
In “The Company” on directors have declared a dividend on 7% on each share on 30 June
2018. It will be distributed from retained earnings of the organisation. They have also decided to
transfer 3300000 from preserved incomes to general reserves so that it n ca be used for
operational activities of the organisation. A declaration regarding interim dividend is also made
by the organisation in which it is proposed that one bonus share of 3 dollars each is going to be
issued to the shareholders on 50 shares. All of them are going to be issues from general reserve
of the organisation. This decision is made by them on 15 January 2018.
A major change was made in the equities as directors planned to transfer 3300000 to the
general reserve which is going to be deducted from retained earnings. As it is a part of internal
funds hence it will be considered as change in equity. The organisation has ignored the tax effect
accounting and no expenses related to it, are recorded in the books. Directors have planned to
enhance shareholder's investment by offering them bonus shares so that they can invest more
money. It will be beneficial for the better execution of business activities.
A customer was injured in the renovation process of the company on 1 May 2018 and the
lawyer advised that the company was being sued for this case (Mowry and et. al., 2016). An

unplanned expense of 1200000 has also faced by the organisation during the year. The
renovation of retail store is planned to expand and develop the business. Total equities at end of
the year were 13088 and retained earnings were of 237726.
All the above described information is accurate in the opinion of the directors of “The
Company”. It can help the stakeholders to determine possible returns that can be acquired by
them in future on their investments by assessing current year's rates. The recorded data is
accurate and this report will be added to the annual report of the company.
7. Annual auditors report
This report is generated by the auditors of the company in which their opinion about
organisation's actual performance and position is recorded. It helps the internal and external
stakeholders to determine that organisation is performing well or not. Information regarding
materiality is also covered in this report in which it is mentioned that any important data is kept
hidden by the enterprise or not. Auditors create a report and present it to the directors so that they
can analyse it and assess whether any fraud or error is made by managers, employees or
accountants of the company in the report. If there is any mistake is made in the financial
statements, the strict action can be taken on huge misconceptions and little one are resolved by
correcting them.
Auditors declare that accountants of the company have followed appropriate accounting
standards and principles. This report helps the external stakeholders to determine that a true and
fair view of final accounts is presented by the entity or not. It is also advantageous for internal
stakeholders such as managers, top management and executives as it can guide them to analyse
that accurate and appropriate data is recorded by the employees in the books of accounting or
not.
The auditors have analysed the financial reports of “The Company” and analysed that
organisation is following section 296 and 297. All the information which is recorded by
accountants and employees of the company were appropriate and accurate. In the opinion of
them as the business entity is generating profits of 230302 dollars which is higher amount hence
financial position of the enterprise if very good (Kirklin, and et. al., 2015). It is providing good
benefits to the shareholders including bonus shares and dividends.
Total revenues of the company were 115420 and other gains were resulting in higher
profitability. No materiality information is figured out by auditors in the financial statements of

“The Company”. Correctness and adequacy level of the discloser level of the final accounts is
very high.

REFERENCES
Book and Journals:
Kirklin, J.K., Naftel, D.C., Pagani, F.D., Kormos, R.L., Stevenson, L.W., Blume, E.D., Myers,
S.L., Miller, M.A., Baldwin, J.T. and Young, J.B., 2015. Seventh INTERMACS annual report:
15,000 patients and counting. The Journal of Heart and Lung Transplantation. 34(12). pp.1495-
1504.
Mowry, J.B., Spyker, D.A., Brooks, D.E., Zimmerman, A. and Schauben, J.L., 2016. 2015
Annual Report of the American Association of Poison Control Centers’ National Poison Data
System (NPDS): 33rd Annual Report. Clinical Toxicology. 54(10). pp.924-1109.
Ryerson, A.B., Eheman, C.R., Altekruse, S.F., Ward, J.W., Jemal, A., Sherman, R.L., Henley,
S.J., Holtzman, D., Lake, A., Noone, A.M. and Anderson, R.N., 2016. Annual Report to the
Nation on the Status of Cancer, 1975‐2012, featuring the increasing incidence of liver
cancer. Cancer. 122(9). pp.1312-1337.