Accounting Strategy Evaluation: GrainCorp vs. Freedom Food

This report provides an evaluation of the accounting strategies employed by GrainCorp Company and Freedom Food Group Limited. The analysis focuses on comparing the financial reporting practices, accounting policies, and management incentives of the two companies. The report highlights how GrainCorp adheres to accounting standards, including the Corporations Act and IFRS, while also utilizing the historical cost convention. It examines the role of performance-based incentives for managers at GrainCorp and contrasts them with Freedom Food's approach. Furthermore, the report explores the companies' approaches to policy changes and transaction structuring, emphasizing how these strategies impact productivity, customer base, and competitive positioning. The evaluation draws on financial statements and academic sources to provide a comprehensive overview of the accounting strategies and their implications for the companies' performance and competitive advantage.

Accounting Strategy 1
EVALUATION OF ACCOUNTING STRATEGY
By Name
Course Title
Instructor’s name
Name of Institution
Name of Department

Accounting Strategy 2
Evaluation of accounting strategy
Flexibility in accounting choices basically enables company managers to strategically
communicate the aspect of economic information or distort performances (Drury, 2013).
GrainCorp Company is an Australian public company domiciled in New South Wales,
Australia. The company was formed in 1917 in order to transport corns from local collection
areas on railways to the corn producing areas of New South Wales. GrainCorp Company core
business is the storage and revival of grain and related products. Freedom Food Group
Limited is considered to be a diversified food company that operates in Wellness and Health
sector throughout a range of brand in Australia (Freedom Food Company financial reports,
2015 & 2016). This company offers great competition to the GrainCorp Company in the
production of products and services. This assignment attempts to evaluate the accounting
strategy by comparing GrainCorp Company and freedom Food Company as the rival
company
According to GrainCorp Company financial statements, it demonstrates that the company
prepares its reports under accounting policies that comply with accounting standard as
defined in the Corporations Act or other acceptable standards to ASX. The company ensures
that its reports are in accordance with the Corporate Act of 2001 and its accounting
interpretations and standards and are in conformity with other law requirements (Deegan,
2013). As compared to Freedom Food Company, the firm also prepares its financial reports in
accordance with the Corporation Act of 2001. This activity is vital because it often ensures
that the financial statements conform to the International Financial Reporting Standards
(IFRS) (Deegan, 2013).
GrainCorp Company also prepares its report under the historical cost convention as modified
by the revaluation of financial liabilities and assets while Freedom Food Company also

Accounting Strategy 3
utilizes this accounting policy in preparation of its reports except for the revaluation of some
of its financial instruments and noncurrent assets.
The managers in GrainCorp Company are often paid significantly, and they are provided with
diverse incentives that enable them to carry out their duties effectively. According to the
company financial statements, managers are provided with performance-based incentives that
basically enables them to work for the best of the company production. This is an important
step that GrainCorp Company employs so as to beat off its main rival (Cuganesan, Dunford,
and Palmer, 2011). The managers increase their production abilities because the increase in
the company profits means that they will also increase their wages based on incentives.
Freedom Food Company being GrainCorp Company main competitor have less incentive
plan for its managers and thus hard to beat GrainCorp Company in production.
According to GrainCorp Company financial statements, the company often change issues and
policies through voting among the shareholders (Deegan, 2013). This is done if the policy
anticipated will facilitate the production because the sole aim of this business is to make a
profit and maximize its shareholder's wealth. The company transaction is usually structured
so as to achieve productivity objective and increase its customer base in both Australia and
globally. The company also structure its transactions so as to be the leading consumer
company in Australia (Freedom Food Company financial reports, 2015 & 2016).
As compared to Freedom Food Company, the company do not have any rationale to alter its
policies which makes it hard for the company to outweigh its competitors (Drury, 2013). In
this business, the company transactions are often structured in order to achieve its primary
goal of being the best company for its customers.

Accounting Strategy 4
Bibliography
Cuganesan, S., Dunford, R. and Palmer, I., 2012. Strategic management accounting and
strategy practices within a public sector agency. Management Accounting Research, 23(4),
pp.245-260.
Deegan, C., 2013. Financial accounting theory. McGraw-Hill Education Australia.
Drury, C.M., 2013. Management and cost accounting. Springer.
Freedom Food Company financial reports. 2015 & 2016. Retrieved from
http://www.asx.com.au/asxpdf/20160831/pdf/439tq97gm9ybc4.pdf
GrainCorp Company financial reports. 2015 & 2016. Retrieved from
http://www.asx.com.au/asxpdf/20131114/pdf/42kv617pltnh1t.pdf