HA2032 - Equity, Liabilities, and Reporting Analysis Report

This report provides an analysis of the statement of equity and the statement of financial position for Readcloud Limited and Xero Limited, detailing the changes between them and the reasons for these changes. It discusses the differences between small and large proprietary companies and the reporting entity, including their respective compliance and reporting requirements. The report also explores the advantages and disadvantages of debt and equity financing options for companies. It further elaborates on the conditions that define a large proprietary company and the financial documents required to be filed by both small and large proprietary companies, as well as reporting entities, in accordance with Australian accounting standards and the Corporations Act 2001. Desklib is a platform where students can find similar solved assignments and study resources.

ACCOUNTING 1
ACCOUNTING

ACCOUNTING 2
Abstract:
This report talks about the statement of equity and the statement of financial position. The
changes that have taken place between them and the reasons for such of the changes.
Additionally, this report talks about the difference between the small, large proprietary
companies and the reporting entity and their respective compliance and reporting
requirements.

ACCOUNTING 3
Contents
Abstract:............................................................................................................................................2
Introduction:..........................................................................................................................................5
Part A:...................................................................................................................................................5
Part i:.................................................................................................................................................5
Part ii:................................................................................................................................................6
Part iii:...............................................................................................................................................8
Part iv:.............................................................................................................................................12
Part v:..............................................................................................................................................19
Part B:..................................................................................................................................................20
Conclusion:..........................................................................................................................................22
References.......................................................................................................................................22

ACCOUNTING 4
Introduction:
The statement of equity indicates the amounts of the money that have been invested into the
company that have and which belongs to the outsiders. And statement of financial position
shows the amounts of the amounts that are owed to the company by the outsiders and the
amounts that the company owes to the outsiders. There is a very small difference between the
small and the large proprietary companies that have been discussed in the following
paragraphs.
The companies undertaken for review are Read cloud Limited and Xero Limited, both belong
to the industry of software’s and services (ASX, 2019).
Part A:
Part i:
The following is the desired information:
Readcloud Limited:
Owners equity:
Particulars Understanding
Contributed equity
this is the amount
invested into the
company
Reserves
these are the
amounts set aside
for contingencies in
the future
Accumulated losses
these are the sum
total of the losses
pertaining with the
previous years

ACCOUNTING 5
Xero Limited:
Owners equity:
Particulars Understanding
Share capital
this is the amount
invested into the
company
Reserves
these are the
amounts set aside
for contingencies
in the future
Accumulated losses
these are the sum
total of the losses
pertaining with
the previous years
Part ii:
The following is the desired information:
Readcloud Limited:
Owners equity:
(Amounts in $)
Particulars 2018 2017 2016
Reasons for
change
Contributed equity 72,57,899.00 12,55,914.00 10,51,725.00 the change
would be due
to more capital
addition into

ACCOUNTING 6
the company
Reserves 2,99,005.00 - -
the change
would be due
to more profits
that have been
set aside by
the company
for the future
contingencies
Accumulated losses -14,17,420.00 -2,64,641.00 -4,11,711.00
change due to
an increase in
the amounts of
the losses
Total 61,39,484.00 9,91,273.00 6,40,014.00
Readcloud Limited:
Owners equity:
(Amounts in $)
Particulars 2018 2017 2016
Reasons for
change
Contributed equity 72,57,899.00 12,55,914.00 10,51,725.00
the change would
be due to more
capital addition
into the company
Reserves 2,99,005.00 - - the change would
be due to more
profits that have
been set aside by
the company for
the future

ACCOUNTING 7
contingencies
Accumulated losses -14,17,420.00 -2,64,641.00 -4,11,711.00
change due to an
increase in the
amounts of the
losses
Total 61,39,484.00 9,91,273.00 6,40,014.00
Part iii:
The following is the desired information:
Readcloud Limited:
Particulars Understanding
Trade and other payables
these are the
amounts that have to
be paid to the
outsiders by the
company
Employee benefits
these are the
amounts that the
company have to
pay to the employee
within the period of
12 months

ACCOUNTING 8
Unearned revenue
this is the amount of
revenue that has not
been earned by the
company yet
Total current liabilities
Borrowings
these are the
amounts taken on
loan from the
outside agencies by
the company
Employee benefits
these are the
amounts that the
company have to
pay to the employee
after the period of
12 months

ACCOUNTING 9
Xero Limited:
Liabilities:
Particulars Reason for change
Trade and other payables
more purchases on credit
made by the company
during these years
Employee entitlements
the increase is due to more
amounts that have become
due from the company to
the employees of the
company
Current income tax payable
the increase could be due
to more income taxes that
have become payable by
the company
Short term provisions
decrease could be due to
the use of the amounts set
aside

ACCOUNTING 10
Short term derivative
liabilities
decrease could be due to
the payment of eh
derivative liabilities
Other current liabilities
increase could be due to
the increase in he amounts
that have become payable
by the company
Total current liabilities
Deferred tax liabilities
decrease could be due to
the payment of the
liabilities
Long term provisions
decrease could be due to
the use of the amounts set
aside
Long term derivative
liabilities
decrease could be due to
the payment of the
derivative liabilities
Other long term liabilities
increase could be due to
the increase in he amounts
that have become payable

ACCOUNTING 11
by the company
Total non-current
liabilities
Total Liabilities
Part iv:
The following is the desired information:
Readcloud Limited:
Particulars 2018 2017 2016
Reasons
for
change
Trade and other payables 6,15,123.0
0
2,58,850.0
0
72,221.0
0
the
increase
would be
due to
more
purchases
that the
company
has made
from its
suppliers
in respect
of which
the
payment
has not
been

ACCOUNTING 12
made till
now
Employee benefits
49,181.0
0 - -
the
increase
is due to
more
amounts
that have
become
due from
the
company
to the
employee
s of the
company
Unearned revenue 1,05,566.0
0
1,07,294.0
0
1,05,314.0
0
the
increase
is due to
more
advance
taken by
the
company
from the
outsiders
in respect
of which
the goods
or the
services
have to
be sold or
rendered