RAISING FUNDS FOR CORPORATE

Running head: RAISING FUNDS FOR CORPORATE
RAISING FUNDS FOR CORPORATE
Name of the Student
Name of the University
Author Note

RAISING FUNDS FOR CORPORATE1
Executive Summary
Fund plays a vital role in any business existence. It is a major source for the continuity
of business. The business has the responsibility to make payment to its staff members
in form of salaries and wages, to invest in plant and machinery, amount due to its
creditors, growth and expansion in future. In the below assignment, two energy
company has been selected that are listed in the stock exchange of Australia to
demonstrate their source of funding, advancement of the source of funds, percentage of
the internally and externally generated funds, advantages and disadvantages of the
sources of funds. The study also focusses on analyzing and recognizing the different
kinds of assets and liabilities recorded in the Balance sheet. In addition, it also
illustrates the measurement concept of the different kinds of the assets. The study
describes the provision of the AASB 137 Standard ‘Provision, Contingent liability and
Contingent Assets’ and adoption of the standard by the company while identifying and
disclosing it in its financial statement.

RAISING FUNDS FOR CORPORATE2
Table of Contents
Introduction........................................................................................................................4
Discussion..........................................................................................................................4
i. Different source of Funds............................................................................................4
ii. Advancement of the Source of fund...........................................................................6
iii. Percentage of the internally and externally generated funds..................................6
iv. Advantages and disadvantages of the source of fund............................................8
v. Recognizing and examination of the different kinds liabilities....................................9
vi. AASB 137 – Provisions, Contingent liability and Contingent Assets....................10
vii. Reference of the AASB 137 Standard at AGL Energy and Origin Energy Limited
financials..........................................................................................................................11
viii. Different Categories of the assets.........................................................................11
ix) Basis of measurement for every asset class..............................................................13
Conclusion.......................................................................................................................13
References.......................................................................................................................14

RAISING FUNDS FOR CORPORATE3
Introduction
The report examines the source of funding, development of funding, assets and
liabilities of the two companies, listed in the stock exchange of Australia. AGL energy
and Origin energy has been selected for our study. The companies are related to
energy sector and are engaged in exploration of natural gas, power generating activities
and delivering energy in Australia. The report demonstrates their source of funding,
different kinds of assets and liabilities, measurement concept of assets, implementation
of AASB 137 Standard ‘Provision, Contingent liability and Contingent Assets’. For our
study, we have taken 3-year financial period.
Discussion
i. Different source of Funds
The major source of fund come from either issuing shares or borrowings from
financial institutions. The company can also make fund raising by accumulating
reserves over the period.
By selling the equity share, shares can be issued but in that case the possession
and control is reduced. Another way of raising fund is preference shares issuance and
in this case, dividend at fixed amount has to be paid.
Borrowing is done by issuing debentures or borrowing from financial institution, in
both this case, an interest has to be paid abide by the terms.
The funding source of both the Companies (AGL Energy and Origin Energy Limited) are
shown below-
AGL Energy Ltd Origin Energy Ltd
2019 2018 2017 2019 2018 2017
Share
Capital
8,43
8
8,30
1
7,57
4
13,1
49
11,82
8
11,41
8
Borrowings
-
Non-current
2,74
8
2,92
9
3,17
3
6,6
48
6,35
0
8,3
82
Current
10
2
3
4
17
3
9
48
1,08
9
1
33