Understanding Financial Statements Value: Identifies the key assets, liabilities, equity classes, incomes and expenses which impact the firm’s reported position and performance

Understanding Financial Statements Value

All listed companies are required to prepare annual reports and lodge these with the ASX. While this is a legal requirement, managers can use information prepared by accountants on a regular basis to make a range of operational, strategic and management decisions. Additionally investors, employees, creditors and other stakeholders use the information provided in annual reports. Collectively, financial statement users use a range of interpretive techniques to make assessments and draw conclusions about a company. This assignment provides you with an opportunity to review and analyse the financial statements of a firm chosen from an approved list of ASX listed firms which will be made available through Interact.

Referring to the most recent annual report of the firm you have selected from the approved list, prepare a 10-15 minute narrated presentation for prospective investors which:

1. Provides a brief overview of the nature of the firm. This introduction should discuss the firm’s products/brands, history, size and the locations of the firm’s operations (10 Marks).

2. Discusses how the firm’s balance sheet, income statement and cash flow statement could be used to support the decisions of a range of specific stakeholders of the firm (15 Marks).

3. Identifies the key assets, liabilities, equity classes, incomes and expenses which impact the firm’s reported position and performance (10 Marks).

4. Outlines how the measurement of the firm’s key assets is influenced by underlying accounting conventions and by managerial judgement (10 Marks).

5. Conducts an analysis of the financial performance and position of your firm. This analysis should be supported by an in-depth analysis of relevant ratios which help to understand the firm’s profitability, liquidity, solvency and efficiency (at least 2 ratios for each should be discussed). This analysis should include comparisons through time to identify trends and comparisons to at least one other firm. You are encouraged to make use of relevant charts, tables and/or figures prepared in Excel to summarise your findings. Relevant ratio data can be accessed through the D&B Hoovers database – you are not required to calculate the ratios on your own (40 Marks).

The narrated presentation will be in the form of an in class group presentation. More information will be provided on interact and in class at the commencement of the semester. It is your responsibility to ensure that your presentation is easily accessible to the marker. One presentation per group will be required to be uploaded through TURNITIN. Alternatively, a link to the file could be provided.

A two-page written summary of your findings should also be provided with your narrated presentation. This summary should be uploaded through TURNITIN.

References must be clearly acknowledged in accordance with the APA style (marks available for communication skills: (15 Marks).

Rationale

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This assessment task will assess the following learning outcome/s:

· be able to critique basic accounting and financial management ideas that underlie and limit the usefulness of accounting and finance information.

· be able to explain the nature of, and apply, the measurement of assets, equities, revenues, expenses and income.

· be able to critically evaluate and analyse some of the interpretative techniques used in accounting and financial management.

· be able to integrate skills in information technology, communication and the use of quantitative techniques for management decision making.

This assessment task is designed to enable you to apply your understanding of key financial accounting concepts and financial statement analysis techniques to real life companies. The task is designed to assess your understanding of Topic 2 (An Overview of Financial Statements), Topic 3 (Financial Statement Analysis), and Topic 4 (Understanding and Managing Working Capital).

Marking criteria and standards

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Criteria High Distinction (HD) 85% to 100% Distinction (DI) 75% to 84% Credit (CR) 65% to 74% Pass (PS) 50% to 64%
Overview of case firm Overview is comprehensive, covering all key features of the firm. Fully referenced. Overview is comprehensive, covering most of the key features of the firm. Fully referenced. Overview is moderately comprehensive, identifying the major facets of the firm. Fully referenced. Overview is adequate, identifying major facets of firm with minimal depth. Fully referenced.
Discussion of relevance of the financial statements of case firm Discussion is comprehensive, identifying how financial statements are relevant to the decisions of a range of potential stakeholder groups. Reasoning is supported by valid arguments and examples. Fully referenced. Discussion is comprehensive, identifying the relevance of financial statements to key stakeholder groups at some depth and with some examples provided. Fully referenced. Discussion is moderately comprehensive, identifying the relevance of financial statements to key stakeholder groups at some depth. Fully referenced. Discussion is adequate, identifying the relevance of most financial statements to some stakeholder groups with minimal depth. Fully referenced.
Identification of key financial statement items of case firm and discussion of how the measurement of the firm’s key assets is influenced by accounting conventions and concepts and managerial judgement. Discussion is comprehensive, identifying the relevance of all key financial statement line items and provides an in-depth analysis of how these items are influenced by accounting standards and managerial judgement. Fully referenced. Discussion is comprehensive, identifying the relevance of all key financial statement line items and provides an analysis of how some of these items are influenced by accounting standards and managerial judgement. Fully referenced. Discussion is moderately comprehensive, identifying the relevance of most key financial statement line items and provides some examples of how these items are influenced by accounting standards and managerial judgement. Fully referenced. Discussion is adequate, identifying the relevance of some key financial statement line items and provides some examples of how these items are influenced by accounting standards and managerial judgement. Fully referenced.
Analysis of the financial position and performance of case firm. Always correctly applies a range of finance and accounting techniques to review and benchmark the firm’s position and performance. In depth and accurate conclusions are drawn on firm’s position and performance. An outstanding level of critical evaluation is provided. Fully referenced. Always correctly applies a range of finance and accounting techniques to review and benchmark the firm’s position and performance. In depth and accurate conclusions are drawn on firm’s position and performance. Thorough critical evaluation is provided. Fully referenced. Mostly applies a range of finance and accounting techniques correctly to review and benchmark the firm’s position and performance. Moderately detailed and mostly accurate conclusions are drawn on firm’s position and performance. Displays satisfactory critical evaluation. Fully referenced. Mostly applies a range of finance and accounting techniques correctly to review and benchmark the firm’s position and performance. Reasonably detailed and mostly accurate conclusions are drawn on firm’s position and performance. Fully referenced.
Integration of skills in IT, communications and the use of quantitative techniques for management decision making. IT skills used to perform all required quantitative analysis. Calculations demonstrate an outstanding understanding of how to apply relevant IT skills. IT skills used to perform all required quantitative analysis. Calculations demonstrate a thorough understanding of how to apply relevant IT skills. IT skills used to perform all required quantitative analysis. Calculations demonstrate some understanding of how to apply relevant IT skills. IT skills used to perform some of the required quantitative analysis. Calculations demonstrate some understanding of how to apply relevant IT skills.
Communication skills Engagement activities were embedded in speech (e.g. rhetorical questions, pauses for emphasis). Persuasive and interesting intonation.

Excellent written expression and very clear articulation of ideas and concepts. Superior grammar and spelling skills. References presented show evidence of significant research and are used accurately.

Speech was clear and intonation in voice modulated and interesting.

Consistently clear and concise expression of ideas. No spelling errors and only minor grammatical errors. References presented show evidence of significant research and are used accurately.

Voice was clear and intonation was good.

A satisfactory standard of expression. Expression of concepts is clear and concise. Very few spelling and/or grammar errors. Several references are presented and used accurately.

Voice was clear and intonation was good.

Some inconsistency in sentence structure. Clarity of expression could be enhanced by some revision. Some spelling errors and/or poor grammar. Several references are presented and used accurately.

Presentation

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The narrated presentation will be in the form of a group in class presentation, with details to be provided on interact and in class at the commencement of the semester. It is your responsibility to ensure that your presentation is easily accessible to the marker. The presentation file can be uploaded through EASTS. Alternatively, a link to the file could be provided.

The two page summary must be submitted as a Word document. The two page summary must be prepared using 12 point font and single line spacing. Please ensure that your name and student number are included as a footer.

Requirements

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