6391 - COMPANY ACCOUNTING Semester 2, 2017
Due 22 October 2017 at 23.55
This is a group assignment and must be undertaken by groups of a minimum of two and maximum of four students. No consideration will be made when marking the assignments for groups which contain fewer than three students. You must provide the names and student IDs of your group members to the lecturer by email before the week 5 lecture.
One aim of this assignment is to provide opportunities for students to develop their cross-cultural communication skills. Therefore, students are to form multicultural groups to do the assignment. No group can have more than 50 percent of its members from the same background. For example, in a group of 4, no more than two members can come from the same background. If you are unsure about the composition of your group, talk to the unit convenor. Please note that for the purposes of this assignment all students from Bangladesh, India and Pakistan are treated as coming from the same background. Similarly, all Chinese born outside of Australia will be treated as coming from the same group. Details on managing groups are provided on the "Study Help" website, which can be accessed via Moodle. I expect to be informed very quickly by the group if a student is not contributing appropriately, for example, not attending group meetings, or not meeting deadlines for deliverables.
Each student is also required to submit a reflective journal worth 20% of the marks for the assignment. The journal will focus on your cross-cultural communication experiences within the group. The reflective journal is to be submitted individually and will remain confidential. Students who do not submit the reflective journal will only receive a mark for the group component. Students who do not form a group will not be able to submit this journal. The same applies to students who are in mono-cultural groups. Therefore the maximum these students can score in the assignment is 80 out of 100.
All students in a given group will receive the same mark for the research and technical component. Students will receive an individual mark for the reflective journal. However, if I have evidence, before the assignment is submitted, indicating that a student did not contribute fairly to the group effort, I will consult the group members to gain some insight into how much the offending student has contributed. If they form the opinion that the student has only contributed 20% of what he or she should have contributed, the student will receive 20% of the marks of the other team members for the research and technical part of the assignment.
Collusion and copying among students who are not members of the same group is not permitted. Students detected colluding with or copying from other students who are not members of their group will be dealt with under University rules. Students who assist other students to copy or collude will also be dealt with under University rules.
Instructions on how to submit the assignment and additional details of the requirements will be posted on Moodle.
Please see section 5b of the Unit Outline for late penalties. Students who do not submit the assignment within the designated period, do not have a legitimate reason and cannot provide relevant evidence (see 5b below), will be given a fail grade of NC (did not complete all assessment items). Students who have a legitimate reason for not submitting an assignment and produce acceptable evidence will be required to complete a separate assessment item covering the same learning outcomes
Feedback will be made through specific comments on the marked assignment and general comments made to the class.
Students will not be able to ask for a deferred deadline on the assignment because their computer blew up, crashed, or was attacked by a virus etc. You must make multiple backups of your work in progress. I strongly suggest you email copies of your workings to yourself.
GROUP COMPONENT (80%)
The overarching objective of GPFR is decision usefulness, supported by relevance, reliability and comparability. The desire to achieve comparability and (by implication) consistency over time is the reason to have reporting standards (Schipper 2003). There has however, been widespread and longstanding criticism that accounting rules fail to disclose information, or present it in ways that users are unable to incorporate in their decision-making processes (Mackintosh, 2006; Pozen, 2007).
The IASB met in May 2016 to discuss a number of issues, including IAS 12 Income Taxes. In an Education session to discuss the analysis of IAS12 prepared by IAS Staff https://www.iasplus.com/en/meeting-notes/iasb/2016/may/income-taxes it was noted that:
“income taxes were very complex and existing disclosure might be insufficient to explain what drives the amount of income taxes reported. The staff identified the following specific issues: tax disclosures; discounting current tax and deferred tax; and other issues including intra-period tax allocation and interim financial statements.” (Deloitte IASPlus, May 2016, p1)
Some IASB Board members noted that investors usually “do not analyse income tax information” and that users would “have to have a deep knowledge of tax laws to understand the information.” IASB Staff also noted that:
“investors in general ignored tax disclosures because: (i) disclosures are perceived as being too aggregated; (ii) tax reconciliations do not provide sufficient information about tax incentives and/or arrangement/negotiations with governments; (iii) they do not provide information about the key drivers that affect the effective tax rate; and (iv) do not provide information about the sustainability of current tax law situation and about the total picture of tax loss carry-forwards.” (Deloitte IASPlus, May 2016, p1)
Focusing on decision usefulness, critically evaluate AASB 112 (the Australian equivalent of IAS 12). You need to determine whether the recording of DTAs and DTLs misleads users and whether the disclosures relating to income taxes mitigates or adds to the confusion. Your response should include a review of the current literature relating to accounting for income taxes. You should also refer to Statements of Accounting Concepts, the Framework, other relevant accounting standard(s) and IFRIC.
In addition to your literature review, you are required to evaluate whether the current accounting treatment and disclosures relating to income taxes assists or hinders users. You need to analyse the financial statements of two companies listed on the Australian Stock Exchange for the financial years ended 2015 and 2016 (i.e. 2 years). You need to:
- o Consider the impact DTA and DTLs may have on users’ ability to gain an understanding of the companies’ performances and financial position; and
- Provide relevant ratio analyses that compares the financial statements with and without deferred taxes.
- The research and technical component of the assignment is to be typed.
- Your group report should be approximately 2000 words, plus any attachments/appendices.
- In addition, an executive summary of no more than one page should be submitted.
- The assignment is to be appropriately referenced using the Harvard method.
- A copy of the publication “Writing a Good Essay” is available from the University website.
Assignments are to be submitted:
- Electronically in the “Assignment Drop Box” via the Company Accounting LearnOnline Moodle site. The Document should be named with all group member’s student ID numbers in increasing order e.g. u3121356u3121375u3146715u3169578.doc Only one member of each group should submit the assignment.
- A Hardcopy is also to be placed in my mail box (Box 307) on level C in Building 11. The assignment hardcopy should be stapled in the top left corner. Please do not submit assignments in binders or plastic sleeves
Allocation of Marks (80%)
Assignment marks will be allocated as follows:
Depth and quality of research 15 marks
Clarity and cogency of exposition 20 marks
Demonstrated skills in analysing and interpreting relevant information 20 marks
Structure of report 5 marks
Spelling, syntax and punctuation 5 marks
Referencing 5 marks
Executive summary 10 marks
INDIVIDUAL REFLECTIVE JOURNAL (20%)
Each student is required to submit a reflective journal of no more than four typed pages. The journal will focus on your cross-cultural communication experiences within the group. The reflective journal is to be submitted individually and will remain confidential. Your reflections should focus on the group process and those factors which enabled or inhibited effective inter-cultural communication within the group. You need to reflect on what positive things happened and what made them positive. You also need to reflect on the causes of any conflicts and discuss why they occurred and what you and other members of the group did to resolve them. Also reflect on the group dynamics, leadership, participation, etc. Your reflections must be your own, not that of the group. As part of the process, you should keep a diary and reflect on what occurred whenever the group met or worked together. Note however, that the diary is not part of your reflective journal. (Be careful that you don’t give me a list of when you met and what you discussed. This is not the topic of the reflective journal.)
Please note that I am not interested in the academic literature. I am only interested in your reflections on the inter-cultural communication and group process and what worked and what did not work.
- The reflective journal is to be typed in a diary format
- An entry should be made each time the group meets, when you work on the assignment, or when you reflect on your work, group process, etc
- Electronically in the “Assignment Drop Box” via the Company Accounting LearnOnline Moodle site. The file should only contain your student ID
- A Hardcopy is also to be placed in my mail box (Box 307) on level C in Building 11. If the diary is loose-leaf, it should be stapled in the top left corner. Please do not submit in plastic sleeves
Allocation of Marks (20%)
Your reflective journal will be marked (4 marks each) against the following criteria:
- The group process
- Factors which enabled or inhibited effective inter-cultural communication within the group
- What positive things happened and what made them positive
- Reflect on the causes of any conflicts and discuss why they occurred and what you and other members of the group did to resolve them
- Reflect on the group dynamics, leadership, participation, etc
Deloitte IASPlus (2016) https://www.iasplus.com/en/meeting-notes/iasb/2016/may/income-taxes
Mackintosh, N.B. (2006). Accounting-truth, lies, or "bullshit"? A philosophical investigation: Commentary, the FASB and accounting for economic reality. Accounting and the Public Interest 6.
Pozen, R. (2007). Discussion Paper for Consideration by the SEC Advisory Committee on Improvements to Financial Reporting. Security Exchange Commission.
Schipper, K. (2003). Principles-based accounting standards. Accounting Horizons, 17, 61-72