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Topic: This assignment covers the in-depth theoretical concepts with some practical accounting task application based on the topics from the subject. Task Details: This assignment requires a...

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Topic: This assignment covers the in-depth theoretical concepts with some practical accounting task application based on the topics from the subject. Task Details: This assignment requires a consideration of accounting theory concepts with critical analysis with application to General Purpose Financial Reporting by corporations. Students are required to prepare a comprehensive report directed to an Australian ASX Top 100 listed corporation detailing a critical analysis of the effectiveness of the corporation to meet the obligations of the conceptual framework of accounting.
Answered Same Day Aug 23, 2020 ACC700 Deakin University

Solution

Nikita answered on Sep 06 2020
136 Votes
Accounting
Accounting    
Woolworths Group Limited
Table of Contents Page No.
Introduction………………………………………………………………………..3
Framework for the preparation and the presentation of the financial statement…….3
Ratio Analysis……………………………………………………………………..4-7
Accounting Policies……………………………………………………………..…7-8
Conclusion…………………………………………………………………………..9
References…………………………………………………………………………..10
Introduction
Woolworths Group limited runs retail stores. New Zealand Food, Australian Food, BIG W, Hotels, Endeavour Drinks and other segments it is operated. The Food segment of Australia is engaged in the food products procurement and resale in Australia to Customers. The Company has 1008 Metro stores and Woolworths supermarkets. The food segment of Newzealand is engaged in the procurement and foods and drinks resale to customers in New Zealand.181 Countdown Supermarket is operated by the segment, and also involves in the operations of wholesale. The Drink segment of Endeavour procures and resells the products of liquor to consumers in Australia.1,545 liquor stores is operated under Dan Murphy’s and
ands of BWS, and Summer gate stores, as well as Langton’s, Cellar masters and winemarket.com.au online platforms. The segment of BIG W procures and resells general merchandise products which are in discount in Australia to customers.183 BIG W stores are operated by the segment. The segment of Hotel offers the services of leisure and hospitality, including accommodation, food and drinks, gaming, dining in Australia.323 hotels is operated, including dining, gaming, accommodations, bars and operations of venue hire (Woolworths, 2018). The segment which is other is also involved in the business of property leasing. A strategic alliance is there with the Woolworth Group limited with Catlex across convenience, redemption, wholesale food, fuel supply and loyalty. The Company was funded in the year 1924 and in Bella, Vista Australia it is based.
Framework for the preparation and the presentation of the financial statements
The framework is issued by the Australian Accounting Standards Board for the preparation and presentation of financial statements. The framework purpose is for assisting the AASB in the future Australian accounting standards development and in the review of Australian Accounting standards that are existing, including evaluating the International Accounting standard Board pronouncements which is proposed. The AASB is assisted in promoting regulations harmonization, standards of accounting and procedures related to the financial statements preparation by providing the reducing basis for the number of alternative accounting treatment as allowed by the Australian Accounting Standards.
Ratio Analysis
A form of financial statement analysis is ratio analysis which is used for obtaining an indication which is quick of the financial performance of the firm in several important areas. The ratios are classified as Debt management ratios, Asset management ratios, solvency ratios, Market value ratios and profitability ratios. The ratios computation facilitates the firm’s comparison which differs in size. Ratios can be used for comparing the financial performance of the firm with industry averages (Tracy, 2012).
Solvency Ratios
It is one of the ratios which is used to measure the company ability to meet its debt that are long-term. The solvency ratio quantifies the company’s size after income-tax, not counting the depreciation expenses of non-cash, as contrasted to the obligations of the firm debt. It provides the company with the assessment to continue congregating its obligations of debt.
Cu
ent ratio: This ratio helps in making comparison of the cu
ent assets to the cu
ent liabilities and it is used commonly as short-term solvency quantifications.
Cu
ent Ratio = Cu
ent Assets/Cu
ent Liabilities
Figures in $ (Millions)
Cu
ent Ratio (2018) = 7181/9196 = 0.78
Cu
ent Ratio (2017) = 7121/8952 = 0.79
The Company cu
ent ratio has decreased from 0.79 to 0.78 which is a bad indicator for the company. The Company is recommended to increase the Cu
ent ratio to 2:1 as it will improve the solvency position of the company. Higher cu
ent ratio is more favorable than the lower cu
ent ratio.
Quick Ratio: It is also known as acid-test ratio, which shows the cash ratio and other organisation liquid resources in comparison to the cu
ent...
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