ADACC - Chapter 2: Corporate Governance and Accounting Analysis

This assignment analyzes corporate governance and management accounting practices, primarily focusing on the financial reports and internal controls of Wesfarmers Ltd and National Australia Bank. The student addresses several questions, including the role of the board, internal controls, and ethical behavior. The analysis includes the assessment of financial figures, the importance of board composition, and the significance of ethical and responsible behavior within the company. The assignment also explores organizational policies, financial delegations, and the role of key personnel like the Managing Director and Chief Financial Officer. Additionally, the document includes a discussion on petty cash calculations and the importance of effective communication between accountants, along with a section on referencing sources. The student provides responses to the questions posed in the assignment brief, demonstrating an understanding of corporate governance principles and their practical application in financial management.

Running head: MANAGEMENT ACCOUNTING
MANAGEMENT ACCOUNTING
Name of Student
Name of University
Author’s Note

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Table of Contents
RESPONSE TO QUESTION 1:..........................................................................................3
(a).....................................................................................................................................3
(b).....................................................................................................................................3
(c).....................................................................................................................................3
(d).....................................................................................................................................4
(e).....................................................................................................................................4
(f).....................................................................................................................................4
RESPONSE TO QUESTION 2:..........................................................................................4
1. Roles and Responsibilities of the Board Management:.........................................5
2. Structure and Composition of Board:....................................................................5
3. Board Succession Planning:...................................................................................5
4. Remuneration and Evaluation of Senior Exceutive:..............................................5
5. Governance Policies:..............................................................................................5
6. Ethical and Responsible Behaviour:......................................................................6
7. Investor Engagement:............................................................................................6
8. Integrity in Financial Reporting:............................................................................6
9. Risk Management:.................................................................................................6
10. Diversity:................................................................................................................6
RESPONSE TO QUESTION 3:..........................................................................................6

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RESPONSE TO QUESTION 4:..........................................................................................7
RESPONSE TO QUESTION 5:..........................................................................................8
REFERENCING:.................................................................................................................9

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RESPONSE TO QUESTION 1:
(a)
The annual report of 2019 of Wesfarmers Ltd has been taken for the analysis of the
corporate governance of the company. Wesfarmer’s corporate governance is considered to be
one of the reasons behind the success of the company. The Board of the company aims to
provide a satisfactory return to the shareholders of the company (Wesfarmers.com.au. 2019). The
company follows ASX Corporate Governance Council rules and regulations to maintain the
corporate governance. The Management Director holds the responsibility to manage the day-to
day operations of the business. The Managing Director are being assisted by the Leadership
Teams of Wesfarmers. The Leadership Team is comprised of all the department heads that are
responsible to showcase the management’s performance in the implementation of the strategy.
(b)
As per the annual report of 2019 of Wesfarmers Ltd. the profit figure of the company
stands at $5,510 million. It can be stated that the statutory requirement mentioned by the
Corporations Act of Australia.
(c)
Appointment of the competent board members in the company helps to increase the
strength of the corporate governance. The corporate governance gets stronger in this scenario
because the company’s every operations are being monitored more efficiently. The activities that
are performed by the department heads and the executives of the company are also being
monitored by the board members of the company. The involvement of the Leadership team in the
daily operation of the company also strengthens the corporate governance.

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(d)
The best procedure that can be entered by the company to strength the corporate
governance is to create a strong and qualified board of directors of the company. The Board of
the company should contain the members who are knowledgeable and and have enough
experience to understand the business. The directors must follow the rules and regulations that
are imposed by the corporation Act of the country and also maintain the rules and regulations
that are mentioned in the rule book of the company. thus, the company needs to intensify the
procedure to choose the director of the company.
(e)
To oversee whether the operative control of the company is working or not the
management of the company must review the performance of the employees of the company and
also the management can incorporate the supervisory control.
(f)
To monitor the financial legislation of the company the chief financial officer and the
financial head of the company needs to be very conscious about the spending of the amount. The
company’s financial spending needs to be kept in control and aims to increase the income of the
company.
RESPONSE TO QUESTION 2:
Wesfarmers followed some internal controls that assist the company to remain in top and
maintain the top position in Australia. The ten internal controls of Wesfarmers are discussed
below:

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1. Roles and Responsibilities of the Board Management:
Wesfarmers always conduct the meeting with the board members where the roles
and responsibilities of the board members are discussed. This assists the company to
maintain the corporate governance.
2. Structure and Composition of Board:
The composition of the Board in an efficient manner assists the company to
maintain the corporate governance over the company.
3. Board Succession Planning:
The Board succession planning is one of the major factor that not only determines
the corporate governance of the company but it also determines the future of the company
(Hermalin, 2014). The efficient succession planning always assists the company to
improve in future.
4. Remuneration and Evaluation of Senior Exceutive:
The remuneration and evaluation of the remuneration assists the senior executive
to stay motivated and perform much better than before.
5. Governance Policies:
Wesfarmers followed the rules and regulations that are mentioned by Australian
Stock Exchange Principles. These enables the company to maintain the policies that are
abide by the law.

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6. Ethical and Responsible Behaviour:
The company always looks after the behaviour of the employees of the company.
Wesfarmers always promote ethical and responsible behaviour of the employees and
even the directors of the company.
7. Investor Engagement:
The company’s one of the main agenda is to maintain the shareholder’s interests
(Yermack, 2017). The company do so by performing well and maintain the share price of
the company intact.
8. Integrity in Financial Reporting:
Wesfarmers maintain the integrity of the financial reporting of the company by
following the rules and regulations mentioned by Australian Stock Exchange.
9. Risk Management:
Wesfarmers has the very prominent risk management program by creating a
leadership team.
10. Diversity:
Wesfarmers believes in creating a diverse and inclusive workforce.
RESPONSE TO QUESTION 3:
The organizational policies of National Australia Bank includes diversity, following
specific rules that are mentioned in the rule book of the bank, maintain the shareholder’s interest
and also maintain board of members (Nab.com.au. 2019).

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To maintain the financial delegations the bank use modern technology and well
established corporate delegations like the accounting department and the chief financial officer
of the bank.
Accountabilities of the bank are being maintained by Managing Director of the bank,
who actually heads the corporate governance of the bank.
RESPONSE TO QUESTION 4:
As per the analysis it can be determined that Jan required dates, which is one of the most
integral part of the petty cash calculation.
As per the analysis it can be determined that Ron has miscalculated and the real value,
that will be the opening balance in the next year is $16.
Amount Received Date Particulars V.N Total Postage Printing and Staionery Moscellaneous Expenses
$600
To Postage $31
To Miscellaneous Expenses $9.50
To Printing and Staionery $4.45
$600 To Balance c/d $600 $31 $4.45 $9.50
PETTY CASH BOOK
Amount Received Date Particulars V.N Total Moscellaneous Expenses Printing and Staionery
$100
To Miscellaneous Expenses $12
To Miscellaneous Expenses $45
To Printing and Staionery $27
$100 To Balance c/d $84 $57 $27
To balance b/d $16
PETTY CASH BOOK

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RESPONSE TO QUESTION 5:
It will be not a concern as long as the communication between me and accountant is
prominent and we both able to understand each other. The diversity in the company is the most
common thing and the major reason behind any company’s high performance.
The main question that can be asked to the accountant is the procedure of realizing of the
income and expenditure of the company. Another question that can be added to the question
bank is that the time that are taken for realizing any income. The next question that can be asked
to the accountant is that who are the major persons who decide for the investments and what type
of rules are followed for realizing the availability of the investments.
The accountant needs to implement new internal control that includes the decision
regarding the investment that is made by the company to improve the profit margin.

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REFERENCING:
Hermalin, B. E. (2014). Transparency and corporate governance. In Enterprise Law. Edward
Elgar Publishing.
Nab.com.au. (2019)., from
https://www.nab.com.au/content/dam/nabrwd/documents/reports/corporate/2018-corporate-
governance-statement.pdf
Wesfarmers.com.au. (2019), from
https://www.wesfarmers.com.au/docs/default-source/corporate-governance/2019-corporate-
governance-statement.pdf?sfvrsn=0
Yermack, D. (2017). Corporate governance and blockchains. Review of Finance, 21(1), 7-31.