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HI5020 Corporate Accounting Assessment item 2 — Assignment Due date: 11.59pm Friday Week 10 Weighting: 20% Assessment task Select a public limited company listed on the Australian Securities Exchange...

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HI5020 Corporate Accounting
Assessment item 2 — Assignment
Due date: 11.59pm Friday Week 10
Weighting: 20%
Assessment task
Select a public limited company listed on the Australian Securities Exchange (ASX). Go to the
website of 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 firm’s annual reports and save to your computer your firm’s latest
annual reports consecutively for last three years. For example, these may be dated 30 June 2016
or 31 March 2017. Do not use your firm’s interim financial statements or their concise financial
statements. Please read the financial statements (balance sheet, income statement, statement of
changes in owner’s equity, cash flow statement) very carefully. Also please read the relevant
footnotes of your firm’s financial statements carefully and include information from these
footnotes in your answer.
You need to do the following tasks:
CASH FLOWS STATEMENT
(i) From your firm’s financial statement, list each item of reported in the CASH FLOWS
STATEMENT and write your understanding of each item. Discuss any changes in each
item of CASH FLOWS STATEMENT for your firm over the past year articulating the
easons for the change.
(ii) Provide a comparative analysis of your company’s three
oad categories of cash flows
(operating activities, investing activities, financing activities) and make a comparative
evaluation for three years.
OTHER COMPREHENSIVE INCOME STATEMENT
(iii) What items have been reported in the other comprehensive income statement
(iv) Explain your understanding of each item reported in the other comprehensive income
statement
(v) Why these items have not been reported in Income Statement/Profit and Loss Statement

ACCOUNTING FOR CROPORATE INCOME TAX
(vi) What is your firm’s tax expense in its latest financial statements?

(vii) Is this figure the same as the company tax rate times your firm’s accounting
income? Explain why this is, or is not, the case for your firm.
(viii) Comment on defe
ed tax assets/liabilities that is reported in the balance sheet
articulating the possible reasons why they have been recorded.
(ix) Is there any cu
ent tax assets or income tax payable recorded by your company? Why
is the income tax payable not the same as income tax expense?
(x) Is the income tax expense shown in the income statement same as the income tax paid
shown in the cash flow statement? If not why is the difference?
(xi) What do you find interesting, confusing, surprising or difficult to understand about the
treatment of tax in your firm’s financial statements? What new insights, if any, have
you gained about how companies account for income tax as a result of examining
your firm’s tax expense in its accounts?
Please remember some aspects of your firm’s treatment of its tax –can be a very complicated
area, particularly for some firms.
PRESENTATION
You will have to do a presentation in the class where your lecturer will question you from
different angles of the assignment and you will have to satisfy the lecturer that you were
sufficiently and appropriately involved in preparing the assignment. The presentation will take
place in the last hour of the class of week 11 and week 12. It is the discretion of the lecturer to
ask any student to do the presentation or to award marks to a student without asking to do the
presentation. But every student need to be prepared for the presentation and well conversant
about everything that has been written in the submitted assignment.
Assessment marking criteria
(i) Doing the assignment on three years annual report for your company and doing
appropriate comparison
(ii) Insightful description of each item of your firm’s cash flows statement –
indicating a degree of understanding of what each item is
(iii)Insightful explanation of changes in each item of the cash flows statement
(iv) Insightful explanation of each item of Other Comprehensive Income Statement
(v) Clear description of your firm’s income tax expense
(vi) Insightful explanation of whether, and if so why, your firms’ income tax
expense differs from the corporate tax rate times the accounting income
(vii) Explanation of why the income tax expense shown in the income statement is
different from income tax shown in the cash flow statement
(viii) Understanding of defe
ed tax assets and defe
ed tax liabilities and
why they have changed over the previous year.
(ix) Convincing evidence (if needed, class by presentation) that the student was
sufficiently and appropriately involved in preparing the assignment.
Answered Same Day May 09, 2020 HI5001

Solution

Aarti J answered on May 15 2020
141 Votes
Wesfarmers – Financial Analysis
Course Name
Course Date
Student’s Name
Wesfarmers – Financial Analysis
Introduction
Wesfarmers operates in different segments and has different segments. The company has diverse operations which includes department stores, liquor, supermarkets, hotels and convenience stores; coal mining, home improvement and office supplies; chemicals, energy and fertilizers; and industrial and safety products. The company operates by different segments which includes: Kmart, Office works, Coles, Industrial and safety and chemicals and other companies.
In this report we have analysed different aspects of the company from its financial perspectives. It includes the analysis of the cash flows statements, the comprehensive income statement and the corporate income taxes.
Cash flow statement
Cash flow statement is the statement which helps in analysing the cash inflows and the outflows of the company. The company reports in cash flow statements by using direct method. Some of the major items that are reported in the cash flow statement of the company includes:
Cash flow from operating activities:
Receipts from customers: These are the revenues that has been received from the customers. The cash flow from the receipts in 2017 was reported to be 74042 million as compared to 71157 million. These are the cash inflows from the revenues and the sales of the company. Comparing it from the last year we can see that the receipts from the customers has improved over the years which can be the result of the increase in sales of the company. (Annual Report, 2017)
Payment to the suppliers and employees: These are the payments that the company has done to its suppliers for purchasing the inventory and the salary payment to the employees. The payment to the suppliers and the customers were reported to be $68713 million as compared to $68671 million stating that the company purchased more inventory and paid more salary as the company is expanding its operations. (Annual Report, 2017)
Other cash outflows from operating activities includes the net movement in finance advances, bo
owing costs i.e. interest payments and the income taxes paid.
The interest payments or the bo
owing costs of the company was reported to be $234 million as compared to $288 million in the year 2016, the cash outflow from the bo
owing costs have decreased because of the decrease in the debt proportion of the company.
The company also had the cash inflows in the operating activities from dividends received and the interest received.
The company’s dividend received was reported to be $48 million in 2017 as compared to $74 million in 2016 and the interest received also decreased in 2017 as the company has reduced its investments.
Cash flow from investing activities:
The cash flow from investing activities is the result of the cash inflow and outflow from different investing activities like purchase and sale of fixed assets and business associates.
The major cash outflow in the investing activities was due to the purchases of property, plant and equipment which amounted to $1681 million. The company’s inflows was through the proceeds from the sale of property, plant and equipment and the net investment in the associates and joint a
angements. (Annual Report, 2017)
The payments for the property, plant and equipment for the year 2017 was reported to $1681 million as compared to $1899 million, the company has reduced its investments in the assets during the year.
The proceeds from the sale of property, plant and equipment in the year 2017 was reported to be 653 million as compared to 563 million in the year 2016.
In the year 2017, the company has sold off its business and associates for $947 million and the company also reduced its investment in the subsidiary in 2017 as compared to the previous year.
Cash flow from financing activities:
The cash flow from financing activities reports all the cash inflows and outflows that have been incu
ed because of the bo
owings, issue of shares and stocks and the payment of dividends. The company has major cash outflows through the financing activities.
The major...
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