Learning Outcome 4:
Develop information gathering (research) and communication strategies to enable the provision of professional advice to a client.
Research, and apply theoretical aspects of financial accounting and reporting to practical scenario(s) and communicate professional technical advice to a client, via a business letter and video presentation.
Work in teams (groups) of 3 members. You may discuss the selection of teams with your lecturer, who may decide to allocate you into teams or he/she may decide to form teams using a random process.
You must notify your lecturer of your teams by the Friday of week 6 and be prepared to be allocated into teams if the lecturer so decides.
Any work which has been copied or shared between groups or teams will result in a Fail grade for all students concerned. So please make sure that the answer to this team assignment is your own work and not copied from any source.
The assignment will need to be submitted electronically through the student portal – use the link under “Assessments” to submit both the video [Moodle] and letter of advice [Turnitin].
Answer the questions/case studies below, in a maximum of 2,500 words. Next, summarise your findings in a 9-12 minutes’ video presentation with each team member presenting for 3 minutes.
Note that marks are also allocated for professional presentation, grammar and spelling.
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Please check the marking sheet (included below) for each part to ensure that you have followed all the guidelines for presenting your work.
Please make sure you follow the guidelines noted in your subject outline especially those relating to presentation, late policy and academic integrity.
Case Study Background
Assume that you are a team of graduate accountants working for Kapland and Associates a public accounting firm situated at 396 Ann Street, Brisbane, QLD 4000. The manager of your firm, Ms Michele Jackson has asked you to draft a letter in response to an email received from a client – Mr Mark Wiseman, the Managing Director of HiTech Production Ltd, raising key accounting issues regarding his company – see the copy of the email on the next page.
The maximum length of the covering letter is 1 page. You should then address all the technical issues/discussion after the letter, each on separate pages as attachments , followed by a Reference List. The maximum word limit for all parts of the assignment should be 2,500 words.
• Part A: Technical component 15% - This mark covers the technical content of your advice and the explanation on each of the issues, the calculations and the sources used.
• Part B: Communication Skills – Letter Writing 5% - This mark covers the generic skills of business letter writing; layout, clear meaning, structure and organisation, appropriate tone and grammar, spelling and punctuation etc. throughout the whole assignment.
• Part C: Communication Skills – Presentation 10% - The group prepares a 9-12 minute video presentation that will keep the audience engaged; the presentation should be well-rehearsed and all group members have equally active roles to play; supplementary material, such as slides and visual aids must be of a professional standard.
ACCM4200 FAR1 – T3 2018 – Group Page 2 of 6
Re: Accounting Issues: Year Ending 31 December 2018
From: Mark Wiseman (firstname.lastname@example.org)
Sent: 5 November 2018
To: Michele Jackson (email@example.com)
Thank you for your phone call this morning, as agreed I am emailing you regarding the accounting issues we briefly discussed. By the way to assist the accounting team in our decision-making process could you please make sure you reference any relevant sources relating to your advice, for example, AASBs, Corporations Act, and other relevant articles or websites.
The directors of HiTech Production Ltd understand that is required to prepare financial reports under the Corporations Act. However, they believe that applying the requirements of AASB 136/IAS 36 Impairment of Assets would not provide a fair presentation because the resulting $80 000 impairment loss is only temporary.
Can you please advise the directors how this problem should be addressed in the financial statements in accordance with AASB 101/IAS 1.
HiTech Production Ltd provides professional advisory services to develop internal and external reporting systems to facilitate the integration of various forms of technical equipment into the business models of their clients. The contracts take up to 18 months, culminating in the delivery of a report to clients outlining the design of integrated information systems, as well as specifications and procedures for implementation.
Until recently, HiTech Production Ltd progressively recognised revenue from providing services in accordance with AASB 118/IAS 18 Revenue. It recognised revenue and expenses and hence, profit, based on the stage of completion of its contracts with customers.
The finance director of HiTech Production Ltd recently attended a presentation on the implementation of AASB 15/IFRS 15 Revenue from Contracts with Customers, where he discovered that the company would need to change the way it accounted for revenue. It would not be permitted to recognise revenue under AASB 15/IFRS 15 until the report is delivered to the customer on completion of the contract.
The estimated that the change in accounting policy would result in a 30% reduction in revenue and a 50% reduction in profit in the year of adoption of the new Standard. The directors thought this would be misleading to investors because the amount of work and cash inflows was expected to remain stable.
Please prepare a response to address this concern.
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A customer has filed a lawsuit against HiTech Production Ltd in December 2020 for costs and damages allegedly incurred as a result of the failure of one of company’s electrical products. The amount claimed was $5 million. HiTech Production Ltd’s lawyers have advised that the amount claimed is extortionate and that the company has a good chance of winning the case. However, the lawyers have also advised that if HiTech Production Ltd loses the case its expected costs and damages would be about $500??000.
How should HiTech Production Ltd disclose this event in its financial statements as at 31 December 2020?
Please respond by letter (not email) as I would like to present this to the Board. I look forward to hearing from you shortly.
Mr Mark Wiseman
Managing Director, HiTech Production Limited
Level 9, 54 William Street,
Brisbane QLD 4000
Hint: Remember that your firm plans to charge the client for your advice; as a check ask yourself if you would pay for the advice you have drafted!
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OTHER IMPORTANT INFORMATION
Any sources that you use need to be acknowledged in order to avoid plagiarism. Information on referencing can be found in the Guidelines for Referencing and Presentation at the Kaplan website using the following address: (https://elearning.kbs.edu.au/course/view.php?id=1481§ion=2).
In-Text Referencing and the Reference List:
Sources of information must be cited both in the body of the text (in-text referencing) and the end of the assignment (reference list). Failure to do so will result in penalties. Remember that when referencing an Annual Report, it is a corporate document that does not have a particular author but it will still require referencing any time you use information from it. Any other documents or books or other references you use will also require referencing.
Penalties Regarding Referencing:
No in-text referencing – deduct 1 mark
Some in-text referencing only – deduct 1 mark
No reference list – deduct 2 marks
Incomplete reference list – deduct 1 mark
Academic Integrity Policy
KBS values academic integrity. All students must understand the meaning and consequences of cheating, plagiarism and other academic offences under the Academic Integrity and Conduct Policy.
For details on academic integrity policies and penalties, the reassessment process, and the appeals process, please refer to http://www.kbs.edu.au/current-students/student-policies/.
ACCM4200 FAR1 – T3 2018 – Group Page 5 of 6
Student ID Number Student Name
Allocated Marks Comment
Issue 1 5
Issue 2 5
Issue 3 5
Business Letter 5
Total Mark 30
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