BAO2203 Corporate Accounting
Assignment Semester 2, 2018
DUE DATE: Monday 10, September at 6PM (Week 8 Lecture)
Topic: Conceptual framework for financial reporting
The Conceptual Framework for Financial Reporting describes the objective of, and the concepts for, general purpose financial report. The International Accounting Standards Board (IASB)’s existing Conceptual Framework was developed by its predecessor body, the International Accounting Standards Committee, in 1989 (AASB, 2015). Although the existing Conceptual Framework has helped the IASB when developing International Financial Reporting Standards (IFRS):
· Some important areas are not covered;
· The guidance in some areas in unclear; and
· Some aspects of the existing Conceptual Framework are out of date.
Consequently, in 2004 the IASB and the FASB initiated a joint project to revise their Conceptual Framework. The project was suspended in 2010 and restarted in 2012 (AASB, 2015). The objective of the project is to improve financial reporting by providing a more complete, clear and updated set of concepts. One of the areas to be addressed is the financial performance (including the use of other comprehensive income) (AASB, 2015). IASB’s view is that income and expenses included in the statement of profit or loss are the primary source of information about an entity’s financial performance for the period, there is a rebuttable presumption that all income and all expenses will be included in that statement. However, they could be reported outside the statement of profit or loss and included in other comprehensive income (OCI) only if:
1. The income or expenses relate to assets or liabilities measured at current values; and
2. Excluding those items from the statement of profit or loss would enhance the relevant of the information in the statement of profit or loss for the period.
PART I (500 words)
Using the 2017 consolidated financial statements of the following companies:
1. Macmahon Holdings Ltd (http://www.macmahon.com.au/);
2. Mercantile Investment Company Ltd (http://www.mercantileinvestment.com.au); and
3. Maca Ltd (http://www.maca.net.au)
1. The companies’ reporting of comprehensive income;
2. The similarity and difference between the companies in relation to the disclosure of comprehensive income; and
3. Whether the disclosure of comprehensive income provides for better clarity of financial information.
PART II (1500 words)
After reading the attached documents, newspaper articles and research papers, answer the following questions:
1. Do you believe that “valuable information is often hidden by ‘boilerplate’ disclosures and that financial information is often poorly presented” as noted by IASB?
2. Do you believe that the current IFRS framework provides sufficient definition and clarity in relation to operating profit and earnings before interest and tax (EBIT)?
3. What is IASB’s current definition of profit or loss and other comprehensive income (OCI) and whether the definition, if one existed, meet the needs of stakeholders?
Note: there exists different views on these accounting issues. You will need to conduct your research using the above articles as starting point, and then supplement them with your own research. Check the marking scheme for further guidance.
Maximum word Length: 2000 words (marks will be deducted for assignments exceeding 2000 words excluding the reference list).
Marking: This assignment is worth 20% and will be scored out of 20 marks. The assignment is a group assignment and therefore scores will be applied to all members of the group without distinction.
Submission: You are required to submit two (2) copies of your assignment on the due date:
· An electronic copy on Turnitin via a link on VU Collaborate on Monday 10, September at 6pm for all campuses. Only one group member needs to submit the assignment.
· A hard copy to your lecturer before week 8 lecture. Footscray Park students to submit on Monday 10, September at 6pm. City Flinders students to submit on Tuesday 11, September at 2pm.
Penalty for late assignments: two (2) marks per day including weekend and no mark will be awarded after five (5) days.
· Group members must belong to the same tutorial group.
· It is YOUR responsibility to form groups, thus swapping contact details and arranging regular progress meetings is essential. Remember, once a group is formed, it is up to you and your group members to maintain group discipline. All group members are equally responsible for the submission of the assignment.
· Students must meet at least once every fortnight. Meeting records must be attached at the end of your report. Marks will be allocated for your meeting logs. A suggested meeting log is attached.
· This is a research assignment. As such, evidence of research is required. As a minimum, you must quote, as sources of reference, seven (7) articles or textbooks in your assignment.
· Where a group member is not cooperating or contributing to the group and the group has made all efforts to resolve the issue, the group must inform the tutor and unit coordinator/s immediately via email. Where a group does not report this matter immediately, it will not be entertained later on, especially before the due date of the assignment. The defaulting member will be given a warning and should the member continue to default, the group will continue without the defaulting member and the defaulting member will receive zero for the task.
Referencing and style:
· Assignment must be typed using Word document and double-spaced and Times New Roman with 12 font size.
· The required referencing style is Harvard (Please visit VU library for examples of Harvard Referencing Style at http://guides.library.vu.edu.au/Harvard). Essays not using the required referencing style or not showing in-text and end of text references will be returned unmarked.
· Only one member must submit their assignment through Turnitin and attach the Turnitin submission report with your assignment. Your assignment will not be marked without a Turnitin submission report.
· Submission of this assignment by due date (as advised by the local lecturer) is compulsory for successful completion of the subject. The identical electronic copy must be submitted through Turnitin by due date. The printed copy along with a Turnitin Similarity Report (less than 30% similarity required) can be submitted to your lecturer at the beginning of the lecture you normally attend.
· You cannot withdraw an assignment from Turnitin after the due date).
· Late submission without extension approval from the Unit Coordinators and local lecturers will be penalised two (2) out of 20 marks per day. Do not submit any assessable task by slipping it under the door of your lecturer’s or tutor’s office.
· No extension will be granted unless supported by appropriate documentation prior to the due date. An application for an extension must be in writing and must use the appropriate form.
Assessment Criteria and Assignment Structure
Assessment Structure (marks) Excellent Very Good Good Average Marginal Poor Very Poor
Part I (6 marks)
1. Questions 1 (2 marks)
2. Question 2 (2 marks)
3. Question 3 (2 marks)
Part II (14 marks)
1. Research question: report format; abstract, intro, literature review and conclusion.(10 marks)
2. English expression, coherence, grammar and spelling (2 marks)
3. Evidence of the group work-meeting logs (2 marks)
Assessment criteria to be applied on Assessments
Excellent: Work fulfilling the above criteria to an outstanding degree, in particular demonstrating excellence in sustained argument, critical thought and synthesis of material from diverse sources.
Very Good: Work demonstrating extensive knowledge and understanding of major content areas and issues; the ability to appropriately synthesise material from a range of sources; a well-developed capacity for critical analysis of key issues and concepts; the ability to present a defensible perspective on issues; evidence of wide reading in relevant areas of the discipline.
Good: Above average work demonstrating good knowledge and understanding of major content areas and issues; demonstration of some capacity for critical analysis; the ability to present a perspective on issues; evidence of reading in relevant areas of the discipline.
Average: Work of ‘average’ standard which demonstrates a average comprehension both of basic concepts and some issues, based on class work and some further reading in the area; some ability to compare key concepts and theoretical perspectives; average presentation, particularly in regard to structure, expression and referencing.
Marginal: Work which shows a basic understanding of key elements of the subject matter at a descriptive level, based mainly on attendance at lectures; satisfactory presentation with some deficiencies in structure, expression and referencing.
Poor: Work which shows little evidence of knowledge or understanding of the subject matter and is unsatisfactorily presented, particularly in regard to structure, expression and referencing.
Very poor: Work which shows no evidence of knowledge or understanding of the subject matter.