Corporate Accounting
Assignment ( 35 Marks )
Objectives
This assessment item relates to the course learning outcome 4: Analyse various aspects of disclosure and performance from a companys annual report.
Step 1 :15 Marks
In the file Find Your Company you will find the listed company you have been given for this course. Complete this assignment for the company you have been given. Please be careful to use the listed company you have been given. Your assignment will not be marked if you use a different company to the one you have been given; and you will be asked to resubmit your assignment using the right company.
Go to the website of your company, by clicking on the URL next to your company in the list of companies in the file Find Your Company. Then go to the Investor Relations section of the website. This section may be called, Investors, Shareholder Information or similar name.
In this section, go to your firms annual reports and save to your computer your firms latest annual report. For example, these may be dated 30 June 2012 or 31 March 2012. Do not use your firms interim financial statements or their concise financial statements.
Within your firms latest annual report, find its balance sheet.
Tip: Your firms balance sheet may be called a range of different names, such as Consolidated Statement of Financial Position.
From your firms balance sheet, list each item of equity and write your understanding of each item. Make sure you read carefully any footnotes for each item of equity and also look at your firms Statement of Changes in Equity. Also discuss any changes in each item of equity for your firm over the past year.
Were you able to help each other understand the aspects of each others equity in your firms balance sheets? Why or why not? What remaining questions do you have about your firms equity? What insights have you gained?
Submit the following for Step 1:
1. Your firms latest annual report (either as a pdf or as a link to the specific page on your firms website that has your firms latest annual report).
2. A list of each item of equity of your firm (name and amounts for the past two years) and your description (in your own words) of what each item is.
3. A description of your discussions about the items of equity.Did these discussions help you understand each item of your firms equity: if so, why; if not, why not? … were you able to help othersunderstand each item in theirfirms equity: if so, why; if not, why not?
Step 3:20 Marks
What is your firms tax expense in its latest financial statements? Is this figure the same as the company tax rate times your firms accounting income? Explain why this is, or is not, the case for your firm.
Tip: Company tax rates are: Australia (30%), New Zealand (2012: 28%; 2011 & 2010: 30%) and UK (2012 & 2011: 26%; 2010: 28%).
What do you think accrual accounting is? How is the concept of accrual accounting relevant to tax-effect accounting?
Does your company use tax-effect accounting? Why or why not?
Is your companys tax expense in their income statement the actual tax they paid to the Government that year? Why or why not? What does the tax expense item in your firms income statement mean to you?
Does your firm have tax assets or tax liabilities? If so, what are their amounts in your firms financial statements? What do these amounts represent? What do your firms tax assets or tax liabilities mean to you?
Please ensure you read the relevant footnotes of your firms financial statements carefully and include information from these footnotes in your answer.
What do you find interesting, confusing, surprising or difficult to understand about the treatment of tax in your firms financial statements? What new insights, if any, have you gained about how companies account for income tax as a result of examining your firms tax expense in its accounts?
How to do well in your assignment
Please adopt a personal style, using the words I and me. It is not necessary to adopt a formal, academic style of writing for this assignment. I am interested in you communicating clearly your understanding and developing questions about the material in the assignment.
This assessment is an individual assignment and is to be submitted online. Please submit your Assignment on Moodle as a Word document (along with a pdf or link to your firms latest Annual Report).
When preparing your assignment, please refer to the assessment criteria listed below as well as to any further advice I may post on the course website.
Assignment Criteria
Step 1
Submitted correct annual report for your company
1
Insightful description of each item of your firms equity indicating a degree of understanding of what each item is
7
Describe your understanding of each item of your firms equity, and supported your emerging insights and questions about how companies account for equity
6
Well communicated and clear presentation
1
Total
15
Step 2
Clear description of your firms income tax expense
1
Insightful explanation of whether, and if so why, your firms income tax expense differs from the corporate tax rate times accounting income
1
Accrual accounting what it is
1
Accrual accounting relevance to tax effect accounting
1
Why or why not your company uses tax-effect accounting
1
Tax expense vs actual tax paid
3
What the item tax expense means to you
3
Tax assets/liabilities identify and meaning
3
Describe how your discussions with other students in the course (and also possibly with staff, work colleagues, friends and family) helped your understanding of your companys income tax, and supported your emerging insights and questions about how companies account for income tax
5
Well communicated and clear presentation
1
Total
20
Grand Total
35