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Accounting Market Analysis

Essay by   •  January 14, 2013  •  Research Paper  •  1,293 Words (6 Pages)  •  1,611 Views

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1.0 EXECUTIVE SUMMARY

Our team has compiled a report for our Investment Advice Section of the Strategic Planning Department for management basing our analysis of ASX Listed Company of JB HI-FI Limited. As required 4 key areas where investigated to see whether JB HI- FI reporting sector have remained in compliance with the Accounting Standards by the Australian Financial Reporting Standards Boards and other Legal Regulations and Laws.

This report is collaborating on the provided accounting data of JB HI-FI's current annual financial reports. The areas we chose to investigate are of changes in equity, cash flow, intangible assets and tax effect of this company.

JB HI-FI have been established since 1974 initially operating as a single store, providing a great selection range of HI-FI technologies and recorded music, then was sold in 1983 and then reimbursed as a larger developing company opening a massive number of stores Australia-wide commencing from 1999. And they how now extended their services to provide a massive range at best prices marketing a substantial niche of customers, offering world leading brands of products including HI-FI, speakers CDs, DVDs, games, computer programs, laptops, phones, television, cameras, car sound, GPS navigation devices and so much more at lowest prices.

2.0 STATEMENT OF EQUITY

The statement of changes in equity must contain all information about items and activities that affected the net assets, but were not put into the profit and loss. This statement covers two years worth of information. This statement shows the equity at the beginning and at the end. JB HI-FI statement does follow the relevant standards of changes in equity bounds within AASB 101.

Para 107 of AASB 101, states that;

JB HI-FI has provided a note to the statement, demonstrating the issue of shares to their employees and other stakeholders, as well as showing the buy back. The notes also include the amount of dividend paid to shareholders. This data shown is in compliance with what the accounting standards asks for. JB HI-FI has in addition set out distribution of dividends, separately from share issue. Profit and or losses that were made during the financial year made on those shares were also featured in the notes. As can be seen from section 29a of the financial reports notes, it states that as at "30 June 2011, employees and executives have over 3,195,434 ordinary shares" in total with various expiry dates. Duties are fulfilled in accordance with this standard. Furthermore, how much dividends were paid per share was also presented in the notes. Since JB Hi-FI have gone through processing all recordings of certain transactions and events of the current financial year within the annual report, they have shown that as an entity to have met the requirements of the AASB.

The statement JB HI-FI produced begins with the profit for the year, of both years that it has included in the statement. It then lists as per the standard the comprehensive income with a sub total. To fulfill the final para 106, the equity statement needed to include information about ownership. For the financial year ending 30 June 2011 JB HI-FI conducted some share buy backs, where these were included in the report to show the transactions with owners of the company, as anyone who is a shareholder is considered an owner of the company. Although it may seem as if there is a loss of control from these owners that is not the case.

In provisions of AASB 101, the paragraphs relevant to the statement of equity were clear and easy to understand. The standards works to guide, like a systematic reference for all reporting and disclosing entities to necessitate on how to perform in compliance with the set accounting standards, rules and

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