Requirements: 1. You are to choose a company from the list provided. 2. Prepare a report about on your chosen company. – A2 Milk Company Ltd 3. Locate the latest annual report for your chosen company...

Financial Analysis – A2 milk company
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FINANCIAL ANALYSIS A2 MILK COMPANY    8
Introduction
A2 milk is an Australian and New Zealand based milk company. The company was founded by Dr. Co
an McLachlan where he emphasized on natural benefits of the products which contains A2 protein type and emphasize on giving healthy life to the target customers. The company develops high quality dairy based nutritional products and has diversified itself by providing nutrition and healthy life to the target consumers. The company closely work with the farmers to select the certified cows who produce milk with A2 protein and not A1 protein. The company has a wide product range which includes fresh milk, infant formula, milk powder and other dairy products. (Annual report, 2017)
Conceptual Framework
The conceptual framework of the accounting is an important part as it is considered as the baseline for the accounting reporting. The major objective of the financial reporting is to provide all the adequate financial information about the reporting company, which can be useful for the cu
ent and the future investors, creditors, lenders, stakeholders particularly in making the relevant decision for investment and other perspectives. The information is used in making different decisions in respect to the particular organisation.
“The objective of general purpose financial reporting is to provide financial information about the reporting entity that is useful in making decisions about providing resources to the entity through equity investments and loans or other forms of credit” (IASB 2010b, par OB2).
The framework primarily focuses on safeguarding the interest of the stakeholders and the investors and help them to know the true picture of the organization. The information about the financial statement of the company is provided by the income statements and the other facts of the company’s financial position.
Accounting for Plant, property and equipment
The plant, property and equipment is reported on the basis of the cost. The cost of the asset includes the acquisition cost, ca
ying cost, installation cost and all the costs required to put the asset to use. The assets are recorded at cost less the depreciation. The plant, property and equipment are the are the assets which has the life of more than 1 year and are used to help in the operations of the company. The company reports all its assets at the stated cost less the accumulated depreciation or impairment. The stated costs includes all the costs that are directly required to acquire the assets. The depreciation of the assets are calculated on the basis of straight line method of depreciation. The depreciation is calculated using the useful estimated life of the assets.
Plant and equipment 10–15 years, Furniture and fittings 5–10 years, Office and computer equipment 2–10 years and Leasehold improvements 2–10 years.
The ca
ying value of the asset is derecognized once the asset is disposed off or does not it does not hold any economic benefit of the company.
Accounting for impairment of assets
Impairment is done in accordance to NZ IAS 36. The company performs annual impairment of assets of the goodwill and other intangible assets which helps in determining the ca
ying value of the asset. The value of impairment used by the company includes the cash flow assumptions as well as discount rates which is used to value the intangible assets of the company. The costs of intangible assets and the other assets like goodwill is capitalized considering the economic benefit that the company expects for the future. The trademark is considered to have infinite life and is the asset which is impaired. The goodwill of the company is recognized on the basis of the business acquisitions, it represents the value above the acquisition value and is measured at the cost. The company tests the impairment of goodwill on the basis of the cash generating units that are expected in different countries of operations. (Annual report, 2017)
The company implies impairment only on the assets which...