Assessment task
Select two public limited companies listed on the Australian Securities Exchange (ASX) that are in the same industry. Go to the website of your selected companies. Then go to the Investor Relations section of the website. This section may be called, -Investors-, -Shareholder Information- or similar name.
In this section, go to your companies' annual reports and save to your computer your firms' latest annual reports consecutively for last three years. Do not use your companies' interim financial statements or their concise financial statements. Please read the financial statements (balance sheet, income statement, statement of changes in owner's equity, cash flow statement) very. carefiilly. Also please read the relevant footnotes of your companies' financial statements carefully and include information from these footnotes in your answer.
You need to do the following tasks:
ACCOUNTING FOR CROPORATE INCOME TAX (15 Marks)
(x) What are the tax expenses shown in the latest financial statements of the two companies that you have selected?
(xi) Calculate the effective tax rate for both companies that you have selected.
Effective tax rate is calculated as (income expense / earnings before tax).
Which one of the companies has the higher effective tax rate?
WO Comment on deferred tax assets/liabilities that is reported in the balance sheet articulating the possible reasons why they have been recorded.
(xiii) Was there any increase or decrease in the deferred tax assets or in the deferred tsss liability reporte,c1 by each of your selected companies?
(xiv) Please calculate the cash tax amount for both companies using the book tax amount, changes in the deferred tax assets and deferred tax liability (please do your own research for your better understanding of these concepts and the method of calculating the cash tax amount the book tax amount.)
(xv) Calculate the cash tax rate for both companies. Which company has higher cash tax rate? (Please do your own research to familiarise yourself with how to calculate cash tax rate).
(xvi) Why is the cash tax rate different from the book tax rate?
Please remember some aspects of your companies' treatment of tax can be a very complicated area, particularly (55 55555 companies. For a better understanding of the concepts included in the assignment that has not been introduced in the class, please do your own research.
PRESENTATION
You might have to do a presentation in the class where your lecturer will question you from different angles of the assignment and you will have to satisfy the lecturer that you were sufficiently and appropriately involved in preparing the assigtunent. The presentation will take place in the last hour of the classes of vveek 11 and week 12. It is the discretion of the lecturer either to ask any student to do the presentation or to award marks to a student without asking to do the presentation. However, every student needs to be prepared for the presentation and well conversant about everything that has been written in the submitted assignment.