country
$20 Bonus + 25% OFF
Securing Higher Grades Costing Your Pocket? Book Your Assignment at The Lowest Price Now!

Accounting Policies Estimates BHP Billiton

tag 0 Download5 Pages / 1,222 Words tag Add in library Click this icon and make it bookmark in your library to refer it later. GOT IT

Question:

Discuss About The Accounting Policies Estimates Bhp Billiton?

 

Answer:

Introduction

This report reflects the key understanding on the financial reporting of BHP Billiton Company. In this report, it is reflected that each and every company prepare their financial reporting as per the IFRS rules and standards in which they have to make estimation in their financial statement.  In this report, BHP Billiton Company has been taken into consideration.

Present description of organization

It is an Australian company which has been selling gas and oil products to its clients. The main reporting issues and changes in BHP Billiton Company has arisen due to changes in estimation prepared in its financial statements. This report has shown the incidents of iron ore operations of Samarco Mineração S.A in Minas Gerais, Brazil in BHP Billiton Company (Ball, and Shivakumar, 2015).  

Accounting policies and GAAP rules followed by BHP Billiton Company

BHP Billiton Company has followed GAAP Rules and IFRS accounting standards in its reporting frameworks with a view to increase its overall efficiency (Aobdia, Lin and Petacchi, 2015).

  • BHP Billiton Company has charged written down value method to reflect true and fair view of its assets as per the IAS-16.
  • In addition to this, all the lease transactions has been recorded as per AASB16 rules and standards. BHP Billiton Company in its annual report has adopted provision of right of use assets in reporting of its underlying leased assets.
  • BHP Billiton Company has been filling its consolidated financial statement as per the AASB-105 in its reporting frameworks (Cairns, et al. 2011).
  • As per the IAS-136, BHP Billiton Company has been implemented impairment test and charged its impairment loss from its goodwill and other cash generating units.
  • AASB-117 has been followed by BHP Billiton Company to record its leased transactions and reporting of its estimation done (BHP Billiton Company, 2015).

Estimates prepared by BHP Billiton Company before incidents of iron ore operations of Samarco Mineração S.A in Minas Gerais, Brazil.  

The financial statement of BHP Billiton Company has been prepared with FRS 101 requires the use of critical accounting estimates. There are several future estimates that have been followed by BHP Billiton Company in its financial reporting frameworks such as income tax payment, valuation of assets, investment in subsidiaries, income tax expenses and foreign exchange transactions. However, it is observed that when BHP Billiton Company did not face the incidents of iron ore operations of Samarco Mineração S.A in Minas Gerais, Brazil then at that time company was having general estimations in its reporting frameworks. Ideally, it focused on preparing provision, foreign exchange transaction, income tax payment and subsidiaries company investment (Barth, 2013). The main estimation was done by company for reporting of its liabilities for wages and salary that includes non-monetary transaction set off 12 months from the reporting period. In addition to this, BHP Billiton Company did not follow proper CSR rules and regulations which resulted to failure to install eco system safety mechanism to reduce the negative impact of Samarco incident (Atkins, J. and Maroun, W., 2015).

Estimates prepared by BHP Billiton Company after incidents of iron ore operations of Samarco Mineração S.A in Minas Gerais, Brazil.  

After occurring of this event, the financial statement of BHP Billiton Company has been prepared by adopted preliminary agreements rules and regulations in its reporting frameworks. However, this incident has resulted to high value destruction in its annual turnover throughout the time. There are several new estimations has been adopted by BHP Billiton Company such as creation of contingent provision, preparing separate liability discharge account and increasing the CSR amount in its business functioning. However, as per the IAS-137, the impairment test implemented by company on periodic basis has charged all of its decreased value of assets from goodwill and remaining amount has been charged from its cash generating unit. In addition to this, hedge funds created by BHP Billiton Company has also increased by $ 1.3 billion in its estimations prepared as per the IFRS rules and standards. In addition to this, framework reporting of company has also been changed after entering into agreement with the Brazilian Authorities in determined approach. This level of change in its reporting frameworks (Bischof,  Brüggemann and Daske, 2014).

 

Red flag in accounting report of BHP Billiton Company

BHP Billiton Company has observed several red flags while charging the loss arise from Samarco incident. Company has charged this Samrco loss from its all cash generating units after implementing the impairment test as per the IAS-136. In addition to this, company has also prepared reserve and provisions to cover up its future contingent liabilities (BHP Billiton Company, 2017).  However, company has faced problems and issues in complying with the GAAP rules and IFRS standards. As per the GAAP Rules Company should re-evaluate its assets and liabilities only on periodical basis. On the other hand, company could implement impairment test as per needs and estimations prepared by company, if IFRS rules and regulations followed. BHP Billiton Company has identified these problems and issues in its reporting frameworks while reporting financial statement to financial reporting authorities. BHP Billiton Company did not follow CSR rules and issues in its reporting frameworks which resulted to destruction of proposed eco system to mitigate the negative impact of hazardous occurring (BHP Billiton Company, 2017).

There are several financial issues which company has faced in its reporting frameworks

BHP Billiton Company should have maintained reserve and provisions under the federal government agreement and frameworks in its reporting frameworks to mitigate the negative impact of hazardous happening in society.

Company should have charged its loss as capital expenditure to reduce the negative impact on its profit earning capacity and should have deposited all of its penalties and loss in the escrow account.

Company should have complied all the rules and regulation of preliminary agreement prepared by it with other authorities while complying with the reporting standards (Cairns, et al, 2011).

Conclusion

After evaluating the annual report of BHP Billiton Company before 2015 and after 2016, company has filled various red flags. BHP Billiton Company needs to established proper level of harmonization in its domestic and international business reporting frameworks in determined approach after complying with the rules and instruction given under the federal government rules and regulations.

 

References

Aobdia, D., Lin, C.J. and Petacchi, R., 2015. Capital market consequences of audit partner quality. The Accounting Review, 90(6), pp.2143-2176.

Atkins, J. and Maroun, W., 2015. Integrated reporting in South Africa in 2012: Perspectives from South African institutional investors. Meditari Accountancy Research, 23(2), pp.197-221.

Ball, R., Li, X. and Shivakumar, L., 2015. Contractibility and transparency of financial statement information prepared under IFRS: Evidence from debt contracts around IFRS adoption. Journal of Accounting Research, 53(5), pp.915-963.

Barth, M.E., 2013. Global comparability in financial reporting: What, why, how, and when?. China Journal of Accounting Studies, 1(1), pp.2-12.

BHP Billiton Company, 2015, Annual report, Retrieved on 30th September, 2017 from

BHP Billiton Company, 2017, Annual report, Retrieved on 30th September, 2017 from

Bischof, J., Brüggemann, U. and Daske, H., 2014. Fair value reclassifications of financial assets during the financial crisis.

Cairns, D., Massoudi, D., Taplin, R. and Tarca, A., 2011. IFRS fair value measurement and accounting policy choice in the United Kingdom and Australia. The British Accounting Review, 43(1), pp.1-21.

OR

Cite This Work

To export a reference to this article please select a referencing stye below:

My Assignment Help. (2018). Accounting Policies Estimates BHP Billiton. Retrieved from https://myassignmenthelp.com/free-samples/accounting-policies-estimates-bhp-billiton.

"Accounting Policies Estimates BHP Billiton." My Assignment Help, 2018, https://myassignmenthelp.com/free-samples/accounting-policies-estimates-bhp-billiton.

My Assignment Help (2018) Accounting Policies Estimates BHP Billiton [Online]. Available from: https://myassignmenthelp.com/free-samples/accounting-policies-estimates-bhp-billiton
[Accessed 27 May 2020].

My Assignment Help. 'Accounting Policies Estimates BHP Billiton' (My Assignment Help, 2018) <https://myassignmenthelp.com/free-samples/accounting-policies-estimates-bhp-billiton> accessed 27 May 2020.

My Assignment Help. Accounting Policies Estimates BHP Billiton [Internet]. My Assignment Help. 2018 [cited 27 May 2020]. Available from: https://myassignmenthelp.com/free-samples/accounting-policies-estimates-bhp-billiton.


MyAssignmenthelp.com has become one of the leading assignment help provider in New York City and Boston. We provide top class auditing assignment help. Not only auditing, but we also cover more than 100 subjects and our writers deal with all types of assignments with utmost expertise. To make writing process faster and accurate, we have segmented our assignment experts' teams as per their expertise on writing different types of assignments. We guaranteed that students who buy our assignment online get solutions worth their investment.

Latest Finance Samples

ACC00716 Finance

Download : 0 | Pages : 5
  • Course Code: ACC00716
  • University: Southern Cross University
  • Country: Australia

Answer: 1: Requirement a:   Requirement b:   Requirement c:   Requirement d:   Requirement e:   Requirement f:   2: The application of modern portfolio theory helps in explaining the concept of measures of interpretation of return and risks of investment. When it comes to perform the analysis of finance and investment by individual investors and company as a whole, one of the most influential theories ...

Read More arrow

HI5002: Finance For Business Research

Download : 0 | Pages : 9

Answer: Introduction: Woolworths Limited is regarded as one of the major Australian organization having extensive amount of retail interest across the regions of Australia and New Zealand. Woolworths Limited is regarded as the second largest company in Australia following the Perth Based retail company of conglomerate Wesfarmers. In addition to this, Woolworths Limited is regarded as the largest takeaway retailer of liquor in Australia with l...

Read More arrow Tags: Australia Brisbane Management Explain sociologically how social inequality (in terms of class and/or ethnicity) is constructed and James Coo 

ACST201 Financial Modelling

Download : 0 | Page : 1
  • Course Code: ACST201
  • University: Macquarie University
  • Country: Australia

Answer: Part A: Calcualtion of Implied annual nominal rate Annual Borrowing 100000 Number of payment 60 Monthly Payment 2000 Compounding Periods per year 12 Total Duration of Loan 5 Interest Rate 7%   Goal = Monthly Repayment to 2000   Annual Borrowing 100000 Number of payment 59 Compounding Periods per year 12 Interest Rate 7% Monthly Payment 200...

Read More arrow Tags: Australia Melbourne Finance Accounting University of Melbourne Management 

IC51002A Perspectives On Capital: Financial, Physical, Human And Social System

Download : 0 | Pages : 8
  • Course Code: IC51002A
  • University: Victoria University
  • Country: Australia

Ansqwer: Introduction: Social Capital is easily understandable as the web of the social relations which are distinguished by the norms of trust and the reciprocity. The basic core of the social capital is only the relations that humans maintain with people. The quality of the relations is understood with the help of social capital when people come together to resolve the issues they face commonly and in the end they gain mutual benefit from t...

Read More arrow

FELM4026 Financial And Economic Literacy For Managers

Download : 0 | Pages : 17

Answer: Introduction: The report has been prepared to evaluate the various concepts of business economics in UK market. For this analysis, various articles, economic report and the newspapers have been read so that a conclusion could be made about the business performance and the economic factors of the country.  Firstly, UK local high street store has been researched and it has been found that how the market is performing and one of the...

Read More arrow Tags: Australia Lewisham Management University of New South Wales Humanities 
Next
watch

Save Time & improve Grade

Just share Requriment and get customize Solution.

question
We will use e-mail only for:

arrow Communication regarding your orders

arrow To send you invoices, and other billing info

arrow To provide you with information of offers and other benefits

1,320,224

Orders

4.9/5

Overall Rating

5,075

Experts

Our Amazing Features

delivery

On Time Delivery

Our writers make sure that all orders are submitted, prior to the deadline.

work

Plagiarism Free Work

Using reliable plagiarism detection software, Turnitin.com.We only provide customized 100 percent original papers.

time

24 X 7 Live Help

Feel free to contact our assignment writing services any time via phone, email or live chat.

subject

Services For All Subjects

Our writers can provide you professional writing assistance on any subject at any level.

price

Best Price Guarantee

Our best price guarantee ensures that the features we offer cannot be matched by any of the competitors.

Our Experts

Assignment writing guide
student rating student rating student rating student rating student rating 5/5

440 Order Completed

99% Response Time

Jack Arens

MBA in HRM

London, United Kingdom

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

234 Order Completed

100% Response Time

Samantha Ji

PhD in Chemistry with Specialization in Organic

Singapore, Singapore

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 4/5

3076 Order Completed

99% Response Time

Emily Wei

Doctor of Philosophy (Ph.D) in Civil Engineering

Singapore, Singapore

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

798 Order Completed

97% Response Time

Benjamin Blakeman

MSc in Medical Technology

London, United Kingdom

Hire Me

FREE Tools

plagiarism

Plagiarism Checker

Get all your documents checked for plagiarism or duplicacy with us.

essay

Essay Typer

Get different kinds of essays typed in minutes with clicks.

edit

GPA Calculator

Calculate your semester grades and cumulative GPa with our GPA Calculator.

referencing

Chemical Equation Balancer

Balance any chemical equation in minutes just by entering the formula.

calculator

Word Counter & Page Calculator

Calculate the number of words and number of pages of all your academic documents.

Refer Just 5 Friends to Earn More than $2000

Check your estimated earning as per your ability

1

1

1

Your Approx Earning

Live Review

Our Mission Client Satisfaction

very good writings, good references and really good pronunciation. would do here again the other time. very recommended!!!

flag

User Id: 409717 - 27 May 2020

Australia

student rating student rating student rating student rating student rating

must be a stupid expert who finished my assignment, don\'t trust it when they say, how good they are. They are all lies!!! i paid 148 dollars for 1000 words, and got less than 50%.!

flag

User Id: 422981 - 27 May 2020

Australia

student rating student rating student rating student rating student rating

It was good and was satisfied with this. This is completed and was passed right away after the presentation. Thank you!

flag

User Id: 238261 - 27 May 2020

Australia

student rating student rating student rating student rating student rating

They did a good job but this time i was no happy that much because i feel i need to let them again and again then even they did't done proper what i need but anyway once happend otherwise other all are mine good and i clear too

flag

User Id: 247567 - 27 May 2020

Australia

student rating student rating student rating student rating student rating
callback request mobile
Have any Query?