Accounting Research Report: Business Performance Evaluation

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Accounting research
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Table of Contents
Abstract..........................................................................................................................................3
Introduction....................................................................................................................................3
Research questions.........................................................................................................................3
Literature review...........................................................................................................................4
Measuring business performance.................................................................................................6
Methodology...................................................................................................................................7
Data analysis...................................................................................................................................7
Conclusion....................................................................................................................................10
References.....................................................................................................................................12
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Abstract
The main focus of conducting the research is to identify the relationship between the
performance in terms of financial and environmental aspects. Different companies can be
evaluated on various parameters or aspects. Several business variables have been duly
considered. The major variables are quantitative in nature. Thus, the model incorporates various
business variables out of which majority of the variables are quantitative in nature. Comparative
analysis has been done so as to make a better comparison between the various business
organizations or enterprises.
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Introduction
The given report aims to explain the various and certain parameters on the basis of which
performance of business enterprises can be evaluated or measured. Some major companies have
been taken for the data analysis purpose. Such analysis will help to take various crucial
decisions. Considering the various dynamic aspects or features, it has come to the observation
that sustainability is very crucial aspect in relation to performance of any corporate enterprise or
entity.
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Research questions
Q.1 Do you think the organizations taken for the purpose of data analysis are appropriate and
represent the Australian stock index (ASX)?
a. Yes b. No c. It depends on the situation
Q.2 Do you think that the parameters taken for measuring the performance of entities are suitable
enough to comment upon the performance?
a. Yes b. No c. Can’t say
Q.3 Are you satisfied with the time involved in the completing the research beginning from the
initial phase?
a. Yes b. Difficult to say c. No
Literature review
Every business organization is assumed to continue in the long run and serve the needs and
demands of the customers and society forever. Not satisfying the customers may create a
question mark on the business performance and ultimately sustainability will be affected or
influenced. An attempt has been made to consider both the social and financial aspects of a
business entity (Trojanowska, et. al., 2018). This has been done to ensure that model takes into
consideration all the possible factors that are likely to give a clear image of the future
sustainability of the concerned business enterprise. It is important to consider the fact that the
profitable oriented organizations are very different from that of non-profit organization or those
organizations that work for the social welfare.
To consider the impact of sustainability on the performance of a business enterprise or entity, the
relevance and significance of various integrated reporting has been considered at various places
in the report. Apart from that, disclosures have a very great in understanding the impact on
business performance or progress through sustainability.
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Corporate social responsibility is not a new concept and is being following for a long time.
However, there are certain legislations which make it mandatory to follow and adhere to
principles relating to the corporate social responsibility mentioned in the legal statutes
(Orczykowski and Tiukało, 2016). Earlier, corporate social responsibility is considered as the
social obligation but in today’s terms it is treated as a legal as well as statutory obligation.
However, it is improper and not appropriate to state the corporate social responsibility is not a
quantitative variable and hence cannot be expressed in numerical terms.
There are several indicators on the basis of which any business organization can be evaluated.
The major measures are considered as accounting and market based. As the name suggests that,
accounting measure is used to evaluate the progress on the basis of accounting perspective. On
the other contrary, market based approach is used to describe the performance on the basis of
market parameters. As the name suggest, market based approach is highly dynamic and can be
applied in every aspect. Also, since market related or market focused approach is dynamic and
takes into consideration all those factors that are likely to affect or impact the business operations
or activities it is advisable to go for the market based analysis more frequent than the analysis
done from the accounts perspective (Ness, 2015).
It has to the observation that, due to the inherent characteristics, it is very difficult to judge the
performance of any business entity or enterprise on the basis of expenditure incurred towards the
corporate social responsibility and thus it is not possible to evaluate the performance on this
particular parameter. In such situation, it is advisable to select one more alternative or parameter
on the basis of which financial performance of any business enterprise or entity can be measured
or evaluated.
6

In the era of the competitive environment there are series of the barriers that can be faced by the
company that can thereby affect the sustainability and growth prospects for a long period of time.
The author in this respect further elaborates that the authorities of the company concern must
ensure the effective and suitable measures that can ensure smooth and systematic operation for
the long prospects of time. In this regard, the author further embarks that the management of the
company concern must focus on the suitable and effective participation of the entire workforce.
This will as such asset in the overall company in the effective management of the various
activities leading to the better integration of all the activities and events in the single direction.
Dates (July 2019)
Particul
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Presenta
tion of
Thesis
proposal
Literatu
re
Review
Questio
nnaire
Design
Coducti
ng
Survey
Data
Collecti
on
Data
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Analysi
s
Data
Presetati
on
Commu
nicating
the
results
Measuring business performance
In this section of the report, application of some important and widely tools have been discusses
through which the business performance of any business entity can be measured. Certain
assumptions need to be applied while measuring the business performance. For this purpose, data
has been collected from the listed companies of Australia that are performing well and as per the
expectations and requirements of the all the possible stakeholders whose decisions will be highly
affected by any change in any of the aspect of the business related decision of the business
organization.
It has come to the observation that some of the business enterprises are performing well and are
satisfying customers at the large. On the other hand, there are some companies are incurring
losses in the long run. Remaining business enterprises or companies are incurring losses in the
run. It can be said that these companies are not adopting or following going concern assumption.
These companies will not survive in the long run and hence there is a question mark on the
performance. There can be various reasons for the poor performance of these organizations. An
effort has been made to discuss all the reasons possible for the poor performance of such
organizations. Apart from that, some possible suggestions have been given which, if applied, can
help a lot in recovering from the financial crisis and company can perform well in the
forthcoming future.
Methodology
The research methodology that has been followed is associated with descriptive. In other words,
descriptive methodology has been duly followed while conducting this particular research. This
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is done so as to gain an insight into the business performance of all the entities that have been
taken for the purpose of analysis. Majorly entities belonging to the energy sector has been taken
so as to the apply uniformity in the data analysis. Major 10 companies have been duly
considered.
Data analysis
For the purpose of data analysis, some descriptive tools have been applied.
Partic
ulars
A-
CAP
ENE
RGY
LIM
ITE
D
Aca
cia
Coa
l
Lim
ited
Abi
lene
Oil
and
Gas
Lim
ited
Ada
vale
Reso
urce
s
Limi
ted
AFRIC
AN
ENER
GY
RESO
URCE
S
LIMIT
ED
ACADE
MIES
AUSTR
ALASI
A
GROUP
LIMITE
D
ALLI
GATO
R
ENER
GY
LIMIT
ED
AUR
A
ENE
RGY
LIM
ITE
D
AUST
CHIN
A
HOLD
INGS
LIMIT
ED
Arm
our
Ener
gy
Limi
ted
Current
assets
1240
628
425
644
314
661
4045
4
366741
3
2661900
0
156664
9
2928
976
408649 9037
623
Total
assets
5481
7834
669
800
566
914
1
4045
4
134689
73
7250300
0
139957
29
2062
4968
168260
69
1015
2132
7
Reserv
es
7076
119
303
985
1
942
940
0
3274
09
25852 NA 7450 6383
87
352804
3
7474
762
Profit/
Loss
after
income
tax
expens
e
1457
842
-
772
224
198
925
1224
51
-
148465
4454000 -
104802
1
-
1987
057
-
951981
-
1155
7788
Total
compre
hensive
income
2163
7
-
930
972
-
113
137
0
1656
00
-
416164
3
4467000 -
104802
1
-
2086
789
-
951981
-
1007
0288
For the purpose of data analysis, graph has been presented in such a manner that total
comprehensive income can be properly evaluated. This will help to understand the financial
performance of all the 10 entities. Several graphs have been prepared to depict the comparison
between the entities and that too on the basis of variables.
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1 2 3 4 5 6 7 8 9 10
-12000000
-10000000
-8000000
-6000000
-4000000
-2000000
0
2000000
4000000
6000000
Total comprehensive income
Total comprehensive income
1 2 3 4 5 6 7 8 9 10
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Profit/ Loss after income tax expense
Profit/ Loss after income tax
expense
Another important observation is that some entities are better in some respect but are worst in
another respect. Thus, it is very difficult to state the name of an entity which is performing well
in all the respect. The parameters that have been taken for the purpose of measuring business
performance are value of current assets, total assets, reserves, profit/ loss after income tax
expenses and lastly total comprehensive income (Lassala, et. al., 2017).
It is pertinent to note that all the five variables are expressed in terms of absolute amount, i.e., $.
The year that has been taken for the purpose of comparison amongst all the enterprises is 2018
since it denotes the most recent performance.
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Current assets
Mean 4624969.7
Standard Error 2588044.143
Median 1403638.5
Mode #N/A
Standard
Deviation
8184114.176
Sample Variance 6.69797E+1
3
Kurtosis 7.143022207
Skewness 2.616456045
Range 26578546
Minimum 40454
Maximum 26619000
Sum 46249697
Count 10
Total assets
Mean 30013729.50
Standard Error 10892611.76
Median 15410899.00
Mode #N/A
Standard
Deviation
34445462.82
Sample
Variance
1186489908828300.0
0
Kurtosis 0.60
Skewness 1.29
Range 101480873.00
Minimum 40454.00
Maximum 101521327.00
Sum 300137295.00
Count 10.00
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Profit/ Loss after income tax
expense
Mean -1023231.8
Standard Error 1298297.167
Median -460344.5
Mode #N/A
Standard Deviation 4105576.128
Sample Variance
1.68558E+1
3
Kurtosis 5.846207284
Skewness
-
1.979659618
Range 16011788
Minimum -11557788
Maximum 4454000
Sum -10232318
Count 10
Total comprehensive income
Mean -1572682.7
Standard Error 1166593.597
Median -1000001
Mode #N/A
Standard
Deviation 3689092.869
Sample Variance
1.36094E+1
3
Kurtosis 3.444863113
Skewness
-
1.108597211
Range 14537288
Minimum -10070288
Maximum 4467000
Sum -15726827
Count 10
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