FNSACC504 Prepare Financial Reports for Corporate Entities

Published : 06-Oct,2021 | Views : 10

Question:

For this assessment, students are to prepare updated financial records for the acquisition of RDL Ltd by TMH Ltd (Information found in Appendix 1). Students are to complete the Balance sheet ending 30 June 2013 for TMH Ltd which doesn’t include merger details. Students must then use the information provided to complete the Balance sheet for the new parent company following the merger,

Students are to prepare an updated balance sheet following the acquisition of RDL Ltd. by TMH Ltd. Students must:

Undertake face to face or phone consultation with your instructor, who will role-play the part of management of TMH Ltd. to define any procedures you must follow as well as set timeframes and deadlines.
Complete the worksheet provided in Appendix 1.
Complete the year ending 30 June 2013 Balance sheet for TMH using the information provided.
Systematically review, code and classify data as required and check for accuracy following policies set by your instructor and complying with AASB standards.
Undertake conversion & consolidation procedures to compile the data (Using the merger method) and make comments as to appropriateness and ensure they meet AASB standards
Calculate the amount of income tax for TMH for the year ending 30 June 2013. Take into consideration assessable and non-assessable items. Including performing the following tasks:
- Calculate the amount of income tax expense for the year, using the derivative method that complies with Accounting Standard AASB1026/AAS28
- State the Profit before income tax
- State the Accounting Profit
- State the Profit after income tax.

For this part, students are required to work in small groups of 2-4 to undertake the following research assignment. Students must research into business legal requirements as well as financial and taxation requirements in regards to business reporting requirements and business mergers / acquisitions. This report should include:

Discuss the differences in calculation of income tax based on the PAYG system and the Income Tax Assessment Act
Discuss what constitute taxable transactions, and what legislation governs this
Provide information regarding the impact the AASB has on reporting requirements to businesses
Discuss the legal implications that affect businesses – research into different State and Federal legislation and comment on each

For this assignment, students are required to discuss why it is necessary to have the legislation and accounting standards discussed in Part 1. Students should concentrate on the following:

Who is being protected by the legislative / standards
What do these laws / standards promote
What do these laws / standards prevent
How do these laws / standards promote ethical accounting.

Answer:

Particulars	2016
Sales	7,59,220
Cost of Goods Sold	-3,86,790
Gross Profit	3,72,430
Other Revenue	3,030
Total Revenue	3,75,460
General & Administrative Expenses	-2,63,800
Selling & Marketing Expenses	-2,810
Net Profit before Tax	1,08,850
Income Tax Expenses	-35,920
Gain on Revaluation of Land & Building	50,000
Net Comprehensive Income	1,22,930
Receipts from Cash Sales	86,000
Receipts from Customers	6,68,440
Commission Income Received	2,830
Cash Purchase of Inventory	-34,500
Payment to Suppliers	-3,44,380
Salaries & Wages Paid	-1,97,560
Superannuation	-7,900
Motor Vehicle Expenses	-14,700
General Expenses	-18,300
Advertising Expenses	-500
Call on Deposit	-2,00,000
Income Tax Paid	-21,300
Net Operating Cash Flow	-81,870
Proceedings from Sale of Building	40,000
Purchase of Motor Vehicle	-25,000
Proceedings from Sale of Plant	10,000
Net Investing Cash Flow	25,000
Issue of Share Capital	1,00,000
Issue of Debentures	1,00,000
Dividend of Previous Year Paid	-30,000
Interim Dividend Paid	-20,000
Net Financing Cash Flow	1,50,000
TOTAL EQUITY CAPITAL	34810