Solution
Robert answered on
Dec 31 2021
LAVEESH CHAKOORY V15268
Page 1 of 15
BLUESCOPE STEEL
The purpose of this report is to analyze an annual report of a company which is listed on
the Australian Securities Exchange and to research on the nature of its disclosure
documents and how they practicing accounting standards.
I have chosen to analyze the 2011 annual report of BlueScope Steel Ltd. BlueScope
Steel is a leading supplier of premium metallic coated and painted steel building
products, and one of the world's largest manufacturers of pre-engineered steel
uildings. It is a company limited by shares incorporated in Australia whose shares are
publicly traded on the Australian Securities Exchange. The registered office of the
company is located on Level11, 120 Collins Street, Melbourne Victoria. The modern
BlueScope Steel Limited has evolved from the coming together of three pioneer
companies in the Australian steel industry (The Broken Hill Proprietary Company
Limited, John Lysate (Australia) Pty Ltd and Australian Iron & Steel Limited). BlueScope
Steel Limited (formerly known as BHP Steel) was listed on the Australian Stock
Exchange on 15 July 2002. Since the public listing, BlueScope Steel has expanded
further in to Asia with the development of new plants in China, Indonesia, Thailand and
Vietnam. At present, the business operates in 17 countries around the world with about
18,000 employees. The company adopted its new name of BlueScope Steel in
November 2003.
Firstly I’ll develop a list of disclosures in the report and will identify whether they are
mandatory or voluntary. Also there will be an analysis of how the company complies
with its related AASBs (Australian Accounting Standard Broad).
LAVEESH CHAKOORY V15268
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Section 295 of the Corporations Act 2011states a number of mandatory disclosure
equirements as to be included in the annual report.
According to Corporations Act 2001, Contents of a annual financial report are:-
(1) The financial report for a financial year consists of:
The financial statements for the year
Statement of Financial Position
Total Assets
The company has its presence in many countries . We represent the consolidated figure
for all operations as presented in the statement of financial position. The statement of
financial position is otherwise known as Balance Sheet. While looking at the financial
position, we can observe that there is a decrease in total assets from year 2011 (
$7793.00M) to 2012 ( $6733.50 M). In the total assets , it consists of two types of
assets like cu
ent assets and non-cu
ent assets. We understand that the cu
ent
assets are created for short term purpose by deploying funds from cu
ent liabilities.
We observe that there is a drastic reduction inventories from year 2011($1974.4 M) to
2012 ( $1337.40 M). This leaves an impression that, during the year 2011, the company
has observed the demand for steel in the global market had gone down , hence the
eduction in stock and the debtors level. The debtors for the company for the year 2011
and the year 2012 follow the similar pattern as it is in case of stocks. There are
eceivables and stocks which are not part of business receivables or stocks. The
company has invested in associate and a joint venture partnership. The total decrease
in investments from year 2011 to 2012 in associates and Joint venture partnerships is
$24.9 M.
In Property ,Plant and Equipment, during the year 2012, the company has reversed
impairments previously recognized for plant and equipment at the metallic coating and
painting facility in Suzhou, China. Previously booked impairment losses have been
eversed to the extent of $67.8M following the material improvement in financial
http:
www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s9.html#financial_report
http:
www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s9.html#financial_yea
http:
www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s9.html#financial_statements
LAVEESH CHAKOORY V15268
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performance and positive outlook of the business in the “The Coated & Building
Products Asia segment”.We also observe there is a significant amount of reduction in
the amount of non-cu
ent assets in the financial position . The defe
ed tax increases
and intangible assets decrease from year 2011 to the year 2012.
Liabilities
The payables have been decreased by close to 10% from year 2011 ($1156.6 M) to
($1049.1 M). This gives an indication that the company tries to pay its creditors little
early. Similarly the other items can be observed. Every item of cu
ent liability during the
year 2012 has been reduced from the year 2011, which indicates that the conservative
approach the company has taken in the year 2012. The provision as on the 2012
$416.2 M as compared to $399.3 M in the year 2011. The increased provision in the
year 2012 is because of the The total restructuring provision includes $84.8M (cu
ent
$61.8M, $23.0M non-cu
ent) for incu
ed and estimated future costs arising from the
closure of the No. 6 Blast furnace at Port Kembla and other equipment to reflect the
educed iron making capacity, as announced to the market on 22 August 2011.The
emaining restructuring provisions relate to the Coated and Buildings North America and
Australia Distribution & Solutions segments. In the year 2012, there was a drastic
change in the bo
owings made by the company. The company had made credit
standby a
angements in the form of facilities like bank overdrafts and bank loan
facilities. As on balance date the company had only used bank overdrafts for $1.90 M
(Out of $34.9 M) and $111.50 M out of $1461.30 M.We observe that the bo
owings has
drastically reduced by 57.78% in the year 2012 as compared to year 2011 and it gives
indications that the company was meeting its day to day business requirement out of its
own sources.
The net assets as on 2012 and 2011 are $3378.8 M and $4396. 1 M respectively. The
entire assets have been funded by equity. We have presented the movement of the
total assets on a half year basis.
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(Source : http:
www.bloomberg.com/quote/BSL:AU
alance-sheet)
Statement of Comprehensive Income
The revenue from continuing operations has reduced by 5% in the year as compared to
the year 2011. Because of the decrease in price, the company stood loosing in finished
goods and work in progress valuation. The employee benefits plan was less controlled
in the year 2012 and there were reduced cost in impairment in non-cu
ent assets. The
company has tightened its expenditures in all angles. But the restructuring cost has
taken a severe heat in the year 2012 to $403.60 The net loss for the year 2012 is
$1027.9 M and for the year 2011 is $1040.4 M. The earning per share has come down
from -$48.8 in the year 2011 to -$39.0 in the year 2012, which is a good news for
investors. We have presented the income levels for the company on a yearly basis.
(Source : http:
www.bloomberg.com/quote/BSL:AU/income-statement)
http:
www.bloomberg.com/quote/BSL:AU
alance-sheet
http:
www.bloomberg.com/quote/BSL:AU/income-statement
LAVEESH CHAKOORY V15268
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Statement of Changes in Equity
The total equity balance as on 1st July , 2011 is $4396.10 M. This is a
ived at by adding
the negative reserves of $324.80 M and positive retained earnings and non-controlling
interest. Hence adjusting the total contributed equity with negative reserves , negative
etained earnings and non- controlling interest leads to the equity value at the end of the
June 2012 comes to $3778.80 M.
Statement of Cash flows
In the statement of cash flows, the company has segregated the entire cash flow in
three segments like cash flow from operating activities, cash flow investing activities and
cash flow from financing...