This task requires you to prepare a report to evaluate information provided in the
annual report of a chosen company listed on the Australian Stock Exchange (ASX). Your
comments or evaluation should comply with the requirements of relevant Australian
accounting standards (AASBs). The report should address the points outlined below:
1) Provisions, Contingent Liabilities and Contingent Assets: you should refer to the
requirements of AASB 137 Provisions, Contingent Liabilities and Contingent Assets as the
guidelines of your report.
â€¢ Discuss the recognition of provisions and contingent liabilities or contingent assets in
the chosen company. (1 mark)
â€¢ Discuss the measurement of provisions and contingent liabilities or contingent assets.
â€¢ Identify the differences between contingent liability and provision? (1 mark)
â€¢ Provide at least one example of a contingent liability and provision reported in the
annual report of the chosen company and discuss. (2 marks)
â€¢ Discuss whether information presented in the annual report regarding provisions,
contingent liabilities and contingent assets are sufficient to investors. (1 mark)
2) Income Taxes: You should refer to the requirements of AASB 112 Income Taxes as the
guidelines of your report.
â€¢ Comment on the recognition of current tax liabilities (assets) and tax expenses
(income) reported in the annual report of the chosen company. (1 mark)
â€¢ Determine the recognition of deferred tax assets (DTAs) and deferred tax liabilities
(DTLs) and explain the factors that led to DTAs and DTLs in the chosen company.
â€¢ Discuss the measurement of current tax liabilities and assets, DTAs and DTLs in the
annual report, and comment on whether it aligns with the requirements of AASB 112.
â€¢ Are DTAs and DTLs offset against each other in the annual report? (1 mark)
â€¢ In your opinion, are there any DTA(s) and DTL(s) that are not recognised in the
annual report of the chosen company? (1 mark)
3) Shareholdersâ€™ Funds/Equity: Comment on the recognition and disclosure of share capital in
the chosen company according to the requirements of AASB 101 Presentation of Financial
â€¢ List the components of Shareholderâ€™s Funds/Equity presented in the annual report of
the chosen company, providing details of changes during the financial year. (2 marks)
â€¢ Determine whether the company has reclassified any financial instrument as an
equity instrument during the observed financial year. Explain why it is import to
classify funds appropriately as either debt or equity. (1 mark)
â€¢ Comment on any items that are recorded against equity rather than as part of profit
and loss. (2 marks)
â€¢ Does the company provide sufficient information to assess its performance? (1 mark)
4) 2 marks will be awarded for effective communication and referencing.
The report should include an executive summary, a body of contents covering points listed
above, and a reference list. The word limit of this report is 1,800 words (excluding executive
summary, references and appendix). The references should be done using Harvard Style or
ARA Style. The reference list should provide all materials supporting the report. Sections
extracted from the annual report or AASB to support your report should be included in the
appendix. Remember to attach a link/copy of the financial report/statement with your
assignment. Also, provide specific page numbers of the annual report and paragraph numbers
of AASBs as in-text reference in your assignment. If you choose to ignore this instruction,
then you will lose marks.
Each student should choose a company that is listed on the Australian Stock Exchange (ASX)
and find an annual report for the 2014/2015 or 2013/2014 financial year. Remember to use a
complete annual report, not a concise financial report or a half-year financial report.
To ensure your choice of a company does not duplicate one already chosen by other student,
they will be allocated on a first come, first served basis. You may reserve a company by
adding a post on â€˜Discussion Boardâ€™ under â€˜Reserve a company hereâ€™. Write the name and
code of the chosen company in the description line of your post. If you add the company
name in the message and NOT in the description line, then the reservation is void because it
will not be readily visible to others.