Detailed Business Report: NAB Financial Performance Analysis

This report provides a comprehensive analysis of the NAB (National Australia Banking) business report. It begins with an introduction outlining the importance of business report analysis in evaluating an organization's financial structure, legal framework, and auditing standards. The main body of the report examines the size of NAB as a large international financial institution, detailing its financial requirements, including income statements and cash flow statements, as well as taxation and legal obligations. It then reviews the annual report, assessing compliance with Australian Accounting Standards and the use of double-entry bookkeeping and accrual accounting. Ethical considerations, including NAB's code of conduct and its commitment to honesty and integrity, are also discussed. The report concludes with a summary of the key findings and references relevant sources, including the NAB annual report and academic journals.

NAB BUSINESS REPORT

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Size of organisation.....................................................................................................................1
Financial requirements, taxation requirements and legal requirements......................................1
Review of annual report..............................................................................................................2
Ethical consideration...................................................................................................................3
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
Business report analysis is an important task to analyse the effectiveness of financial
structure, basis, legislative system and auditing standards of organisation (Collis and Hussey,
2013). This provides a brief evaluation of annual report of NAB (National Australian Banking).
Scale of organisation, financial reporting requirements, taxation requirements and legal
requirements are addressed in respect of organisation. Financial reporting principles and the
book keeping system are considered in organisational context in this report. Ethical consideration
and its nature discussed with disclosure requirements.
MAIN BODY
Size of organisation
NAB (National Australian Banking) is an international financial institution retains 4th
position in banking industry in Australia. It has wide criteria in terms of providing financial and
banking services such as market capitalisation, funding, deposit, earning and deposit facilities. It
has ranked 21st largest financial institution in the world in terms of market capitalisation. There is
a specific criteria decided to analyse the size of organisation which is defined as follows;
 If consolidated revenue of business or entity for the financial year remains $25 million or
more
 Gross assets of company remain $12.5 mullion or more at the end of the financial year
 If company retain the employees strength of more than 50 employees at the end of the
financial year.
NAB is considered as large company because it fulfil all the required criteria as
 Net revenues are $5288 million for the year ended 30th September 2017.
 Gross assets was recorded of $788325 million for the year ended 30th September 2017.
 Employees has a strength of 33000 thousand employees in more than 900 locations.
From the above information it is resulted that NAB fulfils all the required criteria of
being a large scale organisation (Annual report of NAB, 2017).
Financial requirements, taxation requirements and legal requirements
Financial requirements: Income statement, position statement, statement of change in
equity, cash flow statements are the main financial requirement that helps in financial reporting.
There is a categorised information produced under financial statements. Income and expenses,
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information related to fixed assets and detail related to flow of cash are required to presented in
categorised form.
Taxation requirements: It is required to produce separate section subject to tax
assessment. As per the annual report of NAB assessment of tax is categorised in major three
categorises as Income tax expense, current tax liabilities and deferred tax assets and liabilities.
Recognition of tax mainly depends upon the detailed information related to unused tax losses,
credits and future tax requirement.
Legal requirements: NAB is an Australian banking and finance organisation. Being a
banking industry, it has to adhere following the rules and regulation under Banking Act 1959,
Accounting standards and interpretations issued by the Australian Accounting Standard Broad
and Companies Act 2001.
Review of annual report
AASB (Australian Accounting Standards Board) is the main body produces rules and
regulations related to financial reporting. It helps in understanding and correlating the financial
reporting needs for stakeholders perspective. The presentation format of financial reporting of
NAB is found appropriate as per the guidelines provided by AASB. As per evaluation of annual
report of it is concluded that organisation has presented all the financial statements and reports
are prepared as per guidelines given under AASB and IASB. The main purpose if of producing
financial report is properly followed by NAB. As per AASB 101 all the components of financial
statements are categorised separately in annual report in the form of Balance sheet, income
statement, change in equity and cash flow statements.
Compliance considered an important element for organisation that make structure of
organisation. Being an banking industry compliance is a separate legal requirement for financial
organisation that helps in analysing the performance the requirement. NAB has to adhere a strict
compliance rules for ethical operation and management of financial activities in Australia.
Compliance structure in organisation was formed ethical since the amendments was introduces.
Reserve bank of New Zealand issued revised outsourcing policy with focusing on banking and
financial services in Australia. It is evaluated that new compliance policies and ethical rules
impacted the interest of individual and groups. It is evaluated that non compliance with laws, risk
and models were used for better financial management and performance position. Rules and
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guidelines was introduced subject to prevent anti money laundering activities, interest mapping,
cost gap and unrecognised tax transactions and treatment.
Double entry bookkeeping system: it helps in recording the transactions in separate
two ways. As per double entry bookkeeping system every transaction affect two accounts (Ijiri,
2014). for instance if additional cash of $20000 is introduced to business than it will impact two
accounts as capital account and cash account. Both the accounts will increased by $20000.
Accrual accounting: It is a method that helps to recognise the income and expensed on
their happening basis (Tiron Tudor and Mutiu, 2012). This method helps to record those non
cash transaction which or the events which are to be paid in future.
Computerised accounting software: NAB uses a new Oracle based core banking
software that not only help in recording the transactions of employees but also helps to manage
the accounting and reporting departments. SAP is one of the accounting software that is used for
accounting purpose by its accounts departments and management (NAB direct link software,
2017).
NAB published a notes to financial accounts that contains all the complied and non
complied information that indicates that organisation is concerned with its compliance structure.
It Make make transparent structure of organisation for better evaluation and control.
Ethical consideration
Code of conduct of NAB contains information and details related to ethical consideration.
As per audit report NAB consider honesty, true and fair representation and integrity policy.
Legal and regulatory obligations are also considered while setting the ethical standards. Its
internal standards regarding compliance and corporate social responsibilities are reflect the
prominent structure of business for maintain the legal structure of organisation. It also believed
to maintain confidentiality of its customers (Code of conduct, 2017).
CONCLUSION
The above report summarises the annual report of NAB (National Australian Banking).
Scale of organisation determined by considering the measurement criteria of business in
Australia. Different requirement as financial requirements for financial reporting, legal
requirements for legal structure and taxation requirements conclude the information related to for
valid reporting. Ethical consideration summarises the disclosure requirements of company.
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REFERENCES
Books and Journals:
Collis, J. and Hussey, R., 2013. Business research: A practical guide for undergraduate and
postgraduate students. Macmillan International Higher Education.
Ijiri, Y., 2014. The beauty of double-entry bookkeeping and its impact on the nature of
accounting information. Economie Notes by Monte dei Paschi di Siena. 22(2-1993),
pp.265-285.
Tiron Tudor, A. and Mutiu, A., 2012. Cash versus accrual accounting in public sector.
Online
Code of conduct, 2017. [online]. Available
through:<https://www.nab.com.au/content/dam/nabrwd/documents/policy/corporate/
code-of-conduct.pdf>.
Annual report of NAB, 2017. [online]. Available through:<https://capital.nab.com.au/docs/NAB-
2017-annual-financial-report.pdf>.
NAB direct link software, 2017. [online]. Available
through:<https://www.nab.com.au/business/online-banking/nab-direct-link/nab-direct-
link-software>.
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