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Corporate Accounting & Economics - Assignment

Part A Corporate Accounting:

Objectives

The educational objective of this task is to develop student capabilities to read, interpret and analyse financial statements; to apply international accounting standards; to prepare a report on corporate financial performance; and to make judgments on applying appropriate accounting standards to different business situations. Your report should demonstrate ability to access online corporate information and analysis of accounting information. This assignment will involve the use of corporate annual reports, analysis of the relevant information provided within the reports, compare and contrast the information with the requirement of relevant accounting standards and finally reporting your observations and conclusion.

Task

1. Choose the latest annual report for any one of the following companies
You shall be allocated latest annual report of one of the following companies listed on the Australian Stock Exchange. Your are required to answer following assignment questions for the company selected in a report format and also compare the findings of your company ( wherever necessary) with another competing company from the same industry selected by your assignment.

1. Harvey Norman Holdings Limited (Consumer Discretionary)

• All annual reports are available on the website of this company.
• Choosing a company other than those mentioned above is not permitted.
• All accounting standards are available on online database or these standards can also be accessed on AASB web site (www.aasb.gov.au).

2. Draft a report incorporating the following points in relation to your selected company (not exceeding 3,500 words).

Company- Introduction, Business & operating activities, Finances and Financial performance
• Describe the core business of the company. Provide full details of its different activities and or business segments.
• Discuss the industry that the chosen company operates in. For example, is it a growing or declining industry; which are the main competitors of the company and what are they doing, etc. Ensure you discuss the implications of these factors.
• How the company is funded vis-à-vis internal or external sources? Critically analyse the financial structure of the company?
• Describe key elements of Financial Performance reported by the company in the annual report.
• Has this company reported any event that occurred after the reporting date? Describe the event.
• Were there any changes in accounting policies disclosed in the annual report? If yes, describe those changes.

Assets - PPE and Intangibles
• What is the carrying amount of each class of Property, Plant, and Equipment, at reporting date, of yourcompany?
• Describe the accounting policies relating to Property, Plant, and Equipment adopted by your company.
• Identify the intangible assets reported by the company. Discuss their composition and relevance to the company's business.
• Describe the accounting policies relating to Intangible Assets adopted by your company.
• Are any items of Property, Plant, and Equipment, and/or Intangible Assets of your company impaired? If so, identify which assets are impaired, and the amount of accumulated impairment losses.

Research component (suggested 1,500 words of total limit of 3,500 words)
• If your selected company publishes any corporate social responsibility report or sustainability report, then discuss some of their key initiatives regarding their social responsibility and sustainability
• Conduct search for any media stories, blogs or other commentary about your company's initiatives. For example, do they place profit before people? Do they have any credible projects? Use your analytical skills to critically analyse these issues in relations to initiatives of selected company
• Why do you think corporate social responsibility and sustainability have become so important in the modern corporate world? Use any sources (books, journal articles, Parliament debates, Royal Commissions, media, blogs, etc.) and critically argue the case.
• How has Covid19 impacted operations of chosen company, its revenue and staffing. This information may not be available in annual report, but online search will show if there was drop in sales, if there was job losses and so on.
• Note: It is important to refer to relevant accounting standards in your report to score high marks in this assignment.

Part B: Economics:

You are required to answer all questions.
This is an individual piece of assessment. Make sure your submission is an original submission, this means it must be the creation of the person submitting it.

You are required to explain your reasoning and use diagrams where appropriate.

Question 1:
Using a production possibilities frontier (PPF) diagram, determine how does the PPF change in response to the following events:
a) A relaxation of policies allowing more foreign direct investment into the country
b) Increasing the minimum wage level
c) A decrease in expenditure on research and development
d) An increase in the retirement age
e) Government policies supporting the provision of services, without affecting manufacturing.

Question 2;

Identify what sort of effect the following events have:
a) A concerted reduction in the total production level in oil markets
b) Government policies supporting agricultural production
c) The implementation of subsidies to manufacturing of cars in Australia
d) The implementation of a Carbon tax in the resources exploitation sector. A Carbon tax is charged according to the level of emissions of greenhouse gases in an economy.
e) The implementation of a new loan program to university students in the education sector
You are required to explain whether the event acts on the demand or supply side, and whether the event leads to a quantity or price change,or leads to a shift in demand and/or supply. Make sure to explain what sort of assumptions you are making on the elasticities of demand and supply.

Question 3:
Compare the impact of a recession that reduces consumer income by 5 percent on the consumption of durable goods and house rentals. Suppose that the income elasticity of demand for durable goods is 1.5 and the income elasticity of demand for house rentals is 0.3. Based on your response, make a policy argument to support through government funding either businesses or house rentals.

Question 4:
Using a supply and demand analysis show first the labour market in equilibrium, and then show
a) the effect of a reduction in the demand for labour as a consequence of a pandemic.
b) The effect of a government subsidy to producers to restore the employment of labour.
Provide a diagram with clear axis details. Make sure to explain what sort of assumptions you are making on the elasticities of demand and supply