Subject Code & Title :- ACC1100 Accounting
Assessment Type :- Assignment 1
Assignment value :- 20%
The Assignment will involve a case study. You will be assigned to one case involving a fictitious company and will write a business report where you analyse the facts and provide recommendations to the Chief Executive Officer (CEO) of the business on the problems raised.
ACC1100 Accounting Assignment
The business report should be formatted to have a cover page and content page. In the body of the report you should include an introduction, analysis conclusion and recommendations. Include the extract from the Annual report financial statements in the Appendix. A reference list will be required. Please also view the recorded presentation on the assignment which will clarify further what we expect in each part of the report. Further, a Senior Learning adviser will visit during Week 5 lecture to provide guidance on Business Reports.
The assignment satisfies W23 Course learning objective (CLO) 2: Access analyse and critically evaluate relevant information to solve challenging business problems systematically [AQF7 S1, S3, A1].
This unit covers accounting which is a service activity to organisations. Accounting’s main purpose is to provide information to various users, be it internal users such as managers of the organisation itself or to external users such as investors, creditors regulators consumers employees and various parties interested in the organisational performance and the organisation’s impact on society at large.
In the past there have been many financial scandals involving financial statement frauds and mis management of companies leading to the eventual collapse of these companies. The violation of accounting assumptions/ concepts and professional ethics has led to non-credible accounting information presented to users of financial reports.
The credibility of accounting information is critical for decision making if the information is to be relied upon. The regulatory frame work and professional codes of conduct as well as the accounting standards guided by assumptions and accounting concepts have been promulgated to ensure that accounting and accountants deliver useful information.
Businesses who are being reported on, also, must uphold ethical business practices in compliance to ethical business norms and regulation. To this end Corporate governance frame works including Ethical codes of conduct for employees in an organisation have been formulated by the relevant Stock exchanges and business organisations, themselves.
The assignment cases therefore relate to different situations/problems encountered by the accountants or managers of businesses. On completion of the assignment students should be able to:
• Identify and assess the relevant available frameworks, accounting, and ethical conceptual framework/ standards for solving the situations/problems presented in the cases.
• Interpret and apply logically the identified framework/ standard to analyse each situation/problem, outlining clearly how this is done.
• Consider the situation/problem in the broader context of business governance and regulation not only from the accounting perspective.
• Provide professional recommendations on the accounting treatment and other initiatives in respect to the particular situation.
• Be able to extract information from financial statements and report on the relevant accounting policies adopted and figures disclosed by two (2) listed companies on the Australian Stock Exchange.
Sources of information for the assignment may come from:
• Company and other entity annual/ sustainability reports and website
• Financial press, including professional journals, magazines, newspapers
• Business magazines
• Textbooks
• Australian Accounting Standards Board- framework including Statements of Accounting Concepts and Accounting Standards
• Australian Stock Exchange.
• The Accounting Professional & Ethical Standards Board
Assignment instructions
1.You will be working individually.
2.Your instructor will assign you to report on one case. The list for your class will be posted under the Assignment link. If you have enrolled late do contact your instructor directly to be assigned a case.See Appendix A- pages 4 to 6 for the case assigned. The instructions are contained in Appendix B – pages 7 to 8 and the same instructions apply for every case.
3.Regulatory framework Professional ethics and the accounting conceptual framework are covered very briefly in Lectures 1 & 2 (Refer to Chapters 1 & 13 of recommended text Carlon et. al. 7e for details). You will be required to do further research on your own as not all the relevant subtopics (for example, inventory non current asset) would have been covered before the assignment due date. See also further resources document which contains 3 links.
4.A marking rubric will be posted under the assignment link. This will provide clear guidance on how the assignment will be graded.
5.All references (minimum of 3 references) must conform with APA 7th referencing style.The library provides assistance and organises workshops on referencing.
6.Report Format:
• Cover sheet: Do not use standard ECU cover sheet
• Use a blank sheet. Show case assigned, Instructor name and your name, as in your enrollment with last name in capital letters, followed by the first name.
• The document will be named thus: student last name followed by the first name then Case number e.g., WOOD, Simon_Case X
• Table of Contents
• Body of report: Use subheadings
• Words: minimum 1,000 words, maximum 1,200 words, excluding references and appendices.
• Line spacing: 1.5 lines, Font: Arial 12
• Reference list (See instruction 5.)
• Appendix: Use table format.
7. A learning adviser will visit your class during Lecture 5 to clarify business report writing.One of the sessions will be recorded and posted under the Assessment> A1: Assignment link
8. Submit under Assessment link> A1: Assignment by due date Friday 8 April 10 pm.Extension of due date is subject to ECU rules – see additional assessment information link. Please write to your instructors one week before the due date with your legitimate reasons should you require any extension to the due date.
• Post to the Assessment> A1: Assignment> Turnitin link for similarity index. You must try to write the assignment in your own words. You can post multiple times to the Turnitin link. The last submission by due date will be marked.
Appendix A: Cases- These are fictional cases.
Do only one case as assigned by your instructor.
If you have enrolled late, do contact your instructor directly to be assigned a case.
ACC1100 Accounting Assignment
Case 1
Toy works Ltd is a manufacturing company that produces electronic toys. The company’s shareholders are awaiting the announcement of Toyworkz’s earnings for the financial year, which ends on 30 September. Market analysts have predicted the current year’s earnings growth to be 10%. The accountant of Toy workz expects earnings to be only 8% and knows this will cause the price of the shares to drop. Executive rewards are tied to company performance and the tight labour market has seen retrenchment of workers in the recent few years. The manager suggests the following ideas to try to increase reported earnings by the end of the financial year:
a. delaying the recording of product returns in September to October.
b. waiting until the new financial year to update the current Xero accounting software to Oracle accounting software.
c. recognising deposits received in advance for orders that will be shipped in October/ November as revenue when cash is received in September by changing the dates on the shipping documents to September.
d. Recording costs on researching alternative cheaper raw materials, as an intangible asset.
e. switching from diminishing balance to straight-line depreciation to reduce depreciation expenses in the current year for equipment purchased in the current year.
f. The toys are hand-painted, and it was reported by a journalist that Toyworkz’s second tier supplier is using child labour to hand-paint the toys. The manager is concerned about the negative publicity of using child labour and would like to replace the second- tier supplier but this action will take time.
Case 2
Outback meats has produced an innovative product over the last three years which has been well received in the Middle east. Instead of selling lamb bellies to pet food manufacturers, it has developed a new product Lacon for export to the Middle east. Outback reported a minimum 12% growth in annual earnings for each of the past three years. During the current year, because of border restrictions due to COVID the earnings growth is expected to be less than 9% this year. One month before the 31 December financial year-end of the current year, the manager of the Lacon product line notes that the following actions could address the low earnings growth.
ACC1100 Accounting Assignment
a. deferring December’s routine monthly maintenance on packaging equipment to the next financial year.
b. extending the close of the current financial year beyond 31 December so that some sales orders received in January are included in the current year sales, although the orders will be delivered in February in the next year.
c. Outback purchased equipment which was transported to the factory in Perth. The company paid the fine incurred by the driver who parked the truck illegally to get a coffee as well as the extra cost to replace a part which fell off the truck as it was negligently secured to the truck by the driver. The bookkeeper was instructed to include the fine and cost of part replacement to cost of Equipment asset.
d. giving salespeople a double bonus to exceed the last quarter sales targets.
e. deferring the current period’s reported advertising costs by having Outback meats’ outside advertising agency delay the billing of December advertisements until January or by having the external advertising agency alter invoices to conceal the December date.
f. The accountant was told to increase the cost of the lamb inventory on the balance sheet to show its higher market price (net realisable value).
ACC1100 Accounting Assignment
Case 3
Global Net Ltd is an internet service provider in Australia which employs staff located overseas to man its call centres. Competition in this industry is intense and Global is about to issue more shares in the following two years. The executive bonuses are tied to Global Net’s earnings performance. To boost its profits in the prospectus to be prepared for the share issue, the following ideas have been actioned for the current year ( ending 30 June):
a. Make deep cuts in pricing through to the end of the year to generate additional revenues as Global expects to attract new customers.
b. Record executive year-end bonus compensation accrued for the current year when it is paid in the next year, after the June fiscal year-end.
c. Move the call centres to cheaper and older rental premises which is of inferior building quality.
d. Slash training costs by offering employment to new casual staff who will have to pay for the training courses certifying their attainment of skills required to qualify as permanent staff.
e. Sell off equipment before year-end. The sale would result in one-time gains that would boost the company’s profits. The owned equipment could be replaced with leased equipment at a lower cost in the current year.
f. Record the service revenue received in cash in the current year on plans effective from 1 July of the next year as revenue for the current year.
Appendix B: Instructions for all cases
Required:
Assume that you are a trainee accountant, recently employed by the company write a report to the Chief Executive Officer containing:
1) Front matter: Cover page, Table of contents
2) Body of the Report
ACC1100 Accounting Assignment
• Introduction:
o Briefly state the business involved- remember that this is a fictitious company, and the information is contained in the case.
o Identify possible motivations for the action/ideas/suggestions
o Identify relevant frameworks, standards you will use to analyse and solve each item (a) to (f).
ACC1100 Accounting Assignment
• Analysis of items:
o Have a subheading for each of the problems labelled (a) to (f)
o Under each, specify the consequence of the suggestion on the financial statements. If there is no financial impact, please state so.
o Discuss the specifics of framework/ standard/ code to be applied. Show logically how you apply the framework to the item.
o Conclude whether the suggestion is acceptable and why or why not?
o Suggest the appropriate response, e.g., accounting treatment and advice.
Tip: In your write-up please do not repeat the description of each item just the item notation (a) to (f), otherwise, this will increase your similarity index.
• Following the discussion of all items, you may like to include a general conclusion:
Broad consequence to the business and offer recommendations on general action to undertake to strengthen corporate governance.
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