Accounting for Business - Week 1

Select an Australian business of your choice. Identify any five (5) stakeholders and explain their information requirements for making informed decisions.

The company selected for the purpose of identification of stakeholders and for explaining the information requirements for the decision making purpose of these stakeholders is Woolworths Group, it is one of the top 10 companies of Australia. The company was incorporated in 1924. The Woolworths Group is a diverse business and has various under the name Big W.

The 5 stakeholders of the Woolworths Group are as follows and what information is needed by these 5 stakeholders for making informed and effective decisions about their investments are also explained below -

  1. The shareholders of Woolworths Group - the most important information a shareholder needs is how much return they will get upon their investment? How much earnings per share is they getting from the shares they hold of the respective company? So the main information required by a shareholder is financial information of the company.
  2. The investors of Woolworths Group - in general the investor of any company look for a good idea which require big market and have a competitive edge, an efficient and trustworthy management, a company with traction and better returns on their investment.
  3. The creditors of Woolworths Group - the creditors look for such information which help them to recover their money from the borrowers. So financial information about the ability of a company to repay its debts, loans etc. the assets and liabilities of a company, liquidity of a company and the profit margins the company earn.
  4. The employees of Woolworths Group - being an internal part of the organisation the employees require information which is external information so any news about change in any government policy and change in labour laws and tax policies and so on.
  5. The customers of the Woolworths Group - they are curious to know about new products, after sales services, prices fluctuations etc.

Accounting for Business - Week 2

What is the difference between the Conceptual Framework's fundamental qualitative characteristics of relevance and faithful representation? Can you think of any trade-offs between relevance and faithful representation?

The difference between the Conceptual Framework’s fundamental qualitative characteristics of relevance and faithful representation are varied and vivid. By relevance we mean that information should be related, it should have substance and it should help its users to make healthy decisions whereas faithful representation means that the information provided is full and comprehensive it should be able to represent the facts which it supports.

We can say that any collected data becomes information when it is able to be used by a user and any information to be used by a user should be accurate, in time, relevant, complete, neutral and free from any manipulations.

Though there are many trade - offs which have possibilities to occur between relevance and faithful representation but the most important trade - off between relevance and faithful representation can be explained with the help of a simple example - it is important for any business to keep a provision of its doubtful debts as it is a relevant decision making information.

This is done so that the expenses are even out and actual profit of the period may be recorded but as the doubtful debt is a provision which is based upon some of the accounting practices and standards and not upon actual facts hence the provision of doubtful debts does not give a faithful view of the financial information to the user. So there are chances that the figures of provision of doubtful debts may have a certain amount of error but in an overall scenario the process of provisioning an uncertain expense is useful for a decision maker.

So it can be concluded from above that the figures presented in the financial statement or annual report of a company are relevant to the users but on the other hand some of the figures which are though relevant yet they do not show a true and fair picture to a user of that financial statement.

Accounting for Business - Week 3

Explain why ethics and corporate governance are important topics in the study of accounting and the business environment?

Ethics and corporate governance play vital roles in the accounting and the business environment. When a business comes into existence it has a responsibility attached to it towards the society ethics and legal and commercial aspects also. On the other hand corporate governance is also an important issue globally.

The role of corporate governance is different for different companies; on the other hand corporate governance has different understanding among the internal members of the company and the external members of the company. There are 3 basic areas where corporate governance is utilized - in financial functioning of a business such as banks, financial institutions, markets and so on; investment functioning and financial management of a business. The main issues which occur while dealing with corporate governance in a business environment is due to ownership of business and its control

On the other hand business ethics are the code of conduct of a business and they are the core values of a business and its functioning such as in the area of finance etc. business ethics and corporate governance cannot go hand in hand. Business ethics come as a challenge to the corporate governance in accounting and business environment. Whereas corporate governance plays a bigger role in understanding ethical behaviours of various businesses and in identification of skills of businesses

Ethics help in solving the issue which occur in a business environment and in all phases of business may it be individual aspect of business or an organisational view of business as a whole. So we can say that business ethics are mainly about knowing the manner in which a business may be conducted whereas corporate governance is a global concept. Corporate governance is mainly related to developing and maintaining an equilibrium position between the society and the businesses as a whole.

Accounting for Business - Week 4

Prepare a balance sheet as at 30 June 2020 for Advanced Cricket Coaching Pty Ltd using a T-format.

Advance cricket coaching Pty Ltd.

Balance sheet as at on 30th June 2020

Liabilities

Amount ($)

Assets

Amount ($)

Non - current liabilities -

 

Fixed assets -

 

Loan payable

$ 7 500

Land

$ 37 500

   

Fixtures and fittings

$ 9 000

Current liabilities -

 

Current assets -

 

Tax payable

$ 7 500

Inventory

$ 30 000

Equity and earnings -

 

Accounts receivables

$ 37 500

Share capital

$ 30 000

Cash at bank

$ 75 000

Retained earnings

$ 144 000

   

Total

$ 189 000

Total

$ 189 000

Accounting for Business - Week 5

a) Prepare the statement of profit or loss for the year ended 30 June 2020.

Bulmer Ltd.

Statement of profit or loss account for the year ended 30th June 2020

Particulars

Amount ($)

Sales revenue from continuing operations for the year

$ 1 200 000

Less - expense from ordinary activities

- $ 500 000

Gross profit

$ 700 000

Less - finance cost

- $ 49 000

Less - write off of research and development costs

- $ 8 000

Net profit

$ 643 000

Less - income tax expenses for the year ended 30th June 2020

- $ 101 000

Less – interim dividend paid (ordinary shares)

- $ 40 000

Earnings available to shareholders

$ 502 000

b) Prepare statement of changes in equity for the year ended 30 June 2020.

Bulmer Ltd.

Statement of change in equity for the year ended 30th June 2020

Particulars

Amount ($)

Share capital (1 million $ 1 shares)

$ 1 000 000

Retained earnings as on 1st July 2019

$ 180 000

Total

$ 1 180 000

Net profit available to shareholders

$ 502 000

Total

$ 1 682 000

References for Accounting for Business

Bryan, B. (2000). Property as Ontology: on Aboriginal and English Understandings of Property. Canadian Journal of Law and Jurisprudence, 13, 3–31. In this article Bradley Bryan claimed that property is about much more than a set of legal relations: it is 'an expression of social relationships because it organizes people with respect to each other and their material environment' p. 4

K, Walsh. K & Flanagan. J (2015). "How prevalent are post-completion audits in australia. Accounting, Accountability & Performance". Accounting, Accountability & Performance.

Collins, J & Porras, J (1994) Built to Last: Successful Habits of Visionary Companies, London, and Century

Hilmer, F (1993), Strictly Boardroom: Improving Governance to Enhance Company Performance, Melbourne, the Business Library and The Sydney Institute

Karpin, D (1995), Enterprising Nation Renewing Australia's Managers to Meet the Challenges of the AsiaPacific Century, Canberra, Commonwealth of Australia

Power, Michael. 1999. The Audit Society: Rituals of Verification. Oxford: Oxford University Press

Shiller, R (2003). "From Efficient Markets Theory to Behavioral Finance". Journal of Economic Perspectives17(1): 83–104. doi:1257/089533003321164967

Remember, at the center of any academic work, lies clarity and evidence. Should you need further assistance, do look up to our Accounting and Finance Assignment Help

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