Acct7104 Seminar 2 s2 2016 Pdf6

ACCT7104
Semester 2, 2016
Presented on: 2 & 4 August 2016
Administration
ACCT7104
CORPORATE ACCOUNTING
Blank Page
Seminar 2:
Basics of Consolidation, Feedback & The Assignment
To be discussed in Seminar
ACCT7104 Seminar 2 Semester 2 2016
Reading and Study Questions
Relevant Accounting Standards
Reading:
Arthur et al Chapters 1 & 2 (overview)
(selective reading required)
Particularly: Ch 2.2.2 Consolidation Worksheet
Ch 2.2.3 Consolidation Adjustments
Plus numerous examples in book
Set work:
Arthur et al: review Seminar 1 questions
Additional questions (if any):
Herb Limited & Revision Questions
plus: On-line BlackBoard MCQs
plus: carefully review in class exercises
(Broncos & Basil)
3
Accounting Standards:
AASB 3
Business Combinations
AASB 10 Consolidated Financial Statements
AASB 12 Disclosure of Interests in Other Entities
AASB 13 Fair Value Measurement
AASB 112 Income Taxes
AASB 116 Property, Plant & Equipment
AASB 127 Consolidated & Separate Financial Statements
(not all AASBs relevant to the project are listed)
4
Seminar Objectives
Seminar 2 Objectives (continued)
Seminar 2:
Basic Consolidation, Feedback & The Assignment
Seminar 2:
Basic Consolidation, Feedback & The Assignment
1. Basics of Consolidation
1.1
1.2
1.3
1.4
Revision of Seminar 1
Identification of specific consolidation adjustment journals
Consolidation worksheets
Full Example & In Class Exercise
3. Financial Statement Project

(FSP)(The Assignment)
3.1 Explanation of assignment
3.2 Individual & group elements
3.3 Timetable
3.4 Arranging Groups
2. Feedback
2.1 What is feedback?
2.2 Contrast formative & summative feedback
2.3 Who provides what feedback in this course?
4. Broncos Case Study Part 2

(continued from Seminar 1)
Seminar 2
ACCT7104
Semester 2, 2016
1.1 What is a simple Group?
Seminar 2 Objective 1
For this introductory topic, a simple Group will be:
1. Basics of Consolidation
1. One Company will buy one (1) Company to form a Group
of a Parent with one (1) subsidiary;
1.1 Revision of Seminar 1

1.2 Identification of specific
consolidation adjustment journals
1.3 Consolidation worksheets
1.4 Full Example
2. The purchase will be in cash only;

3. Goodwill will result in the Group;
4. The parent will control 100% of the subsidiary;
5. The parent will buy the controlling equity interest in the
subsidiary on the 1st day of the financial year; and

6. The date of reporting for financial accounts will be the
last day of the year in which the subsidiary was bought

(that is, one years trading only)
8
1.1 Consolidation Procedures (reminder)
1.1 A Simple Group AB Group Limited
B86 of AASB 10 Consolidation Procedures

Consolidated financial statements:
AB Group Limited
(a) Combine like items of assets, liabilities, equity, income, expenses
and cash flows of the parent with those of its subsidiaries.

(b) Offset (eliminate) the carrying amount of the parents investment in
each subsidiary and the parents portion of equity of each subsidiary

(AASB 3 explains how to account for any related goodwill).
(c) Eliminate in full intragroup assets and liabilities, equity, income,
expenses and cash flows relating to transactions between entities of
the group (profits or losses resulting from intragroup transactions that
are recognised in assets, such as inventory and fixed assets, are
eliminated in full). Intragroup losses may indicate an impairment that
requires recognition in the consolidated financial statements. AASB
112 Income Taxes applies to temporary differences that arise from the
elimination of profits and losses resulting from intragroup
transactions.
Control
100%
B Ltd
A Ltd
10
1.1 Fair Value & Intra-group Transactions
1.1 Group Financial Accounts

WHAT THE GROUP HAS
Less
Plus
A Ltd
CONSOLIDATED
ADJUSTMENTS
B Ltd
WHAT THE
GROUP WANTS
Equals
Group
Adjustments
SEPARATE BOOKS OF ACCOUNTS
Group
GROUP ACCOUNTS
Be clear about the difference between Separate & Group Accounts

Separate accounts are ongoing and the basis for the consolidation
Group accounts are only for the current year (refer to worksheet)
11
Seminar 2
Fair Value
When dealing with Group accounts, always at Fair Value
Need to revalue Group members accounts if recorded at cost
in separate books of account
Use of Revaluation Surplus in Group accounts
Triggers Deferred Tax Adjustment (liability) as values increased
Group trading with itself
On acquisition, Group cannot invest in itself
1.Intra-group sale of inventory
2.Sales/Revenues
3.Unrealised Intercompany Profits (triggers Deferred Tax Adjustment)
4.Dividends
12
ACCT7104
Semester 2, 2016
1.1 Investment in Subsidiary
1.2 Consolidation Adjusting Journals
Elimination Adjustment required to deal with:
Are you able to explain why consolidation adjusting

journals have been prepared, both generically &
specifically?
A. Items recorded in separate books,

that must be eliminated in Group accounts
1. Subsidiarys pre-acquisition equity
2. Investment in subsidiary
This is part of the assessable content for the

Mid-semester examination
Please Note
You will NOT be asked to prepare any consolidation
adjusting journals in the Mid-semester Examination
But you may need to be able to explain their purpose
B. Items recorded in Group accounts

1. Fair Value Adjustment (created in & needs elimination
from Group accounts
2. Goodwill (needs creation in Group accounts)
Preparation of journals will be comprehensively tested in

the Final Examination
13
14
1.2 Examples of Consolidation Adjusting Journals

Journal 1
DR LAND
CR REVALUATION SURPLUS
23,000
Compiled of:
DR ISSUED CAPITAL
10,000
DR RETAINED EARNINGS
12,000
DR REVALUATION SURPLUS
700
DR GOODWILL
300
CR INVESTMENT IN SUBSIDIARY
16
23,000
300
300
700
300
1.2 Examples of Consolidation adjusting journals

Journal 3
DR SALES REVENUE
CR PURCHASES (COGS)*
Journal 2
DR ISSUED CAPITAL
10,000
DR RETAINED EARNINGS
12,000
700
DR GOODWILL
300
CR INVESTMENT IN SUBSIDIARY
1,000
Combined
DR LAND
1,000
CR REVALUATION SURPLUS
CR DEFERRED TAX LIABILITY
15
1,000
CR DEFERRED TAX LIABILITY

Journal 4
DR DIVIDEND REVENUE
CR RETAINED EARNINGS
(DIVIDEND DECLARED)
1,500
1,500
DR CY PROFIT (COGS)*
CR INVENTORY
400
DR DEFERRED TAX ASSET

CR INCOME TAX EXPENSE*
120
120
Seminar 2
750
750
Declared means declared not paid

Payable & receivable in separate books
needs elimination in Group
400
DR DIVIDEND PAYABLE
CR DIVIDEND RECEIVABLE
(*Remember: Current Year Profit after Tax is already included in

Closing Retained Earnings in year end accounts)
17
18
750
750
ACCT7104
Semester 2, 2016

Example only
DR DIVIDEND REVENUE
CR RETAINED EARNINGS
(DIVIDEND PAID)
Where are we?
750
Investigated the components of a simple Group

750
Gained overview knowledge of consolidating

adjustments
Paid means declared and paid

Payable & receivable not in separate books
no elimination needed in Group
DR DIVIDEND PAYABLE
CR DIVIDEND RECEIVABLE
19
Now need to consider how to most efficiently

combine all this data to obtain Group Accounts
0
0
20
1.3 The Consolidation Process
1.3 Group Financial Accounts

WHAT THE GROUP HAS
Consolidation involves aggregating the financial

statements of the entities that comprise the group
Not just a simple addition we need to merge the
subsidiarys separate books of accounts with the
separate books of accounts of the parent so
eliminations must be done
Less
Plus
A Ltd
CONSOLIDATED
ADJUSTMENTS
B Ltd
WHAT THE
GROUP WANTS
Equals
Group
Adjustments
SEPARATE BOOKS OF ACCOUNTS
Group
GROUP ACCOUNTS
The consolidation worksheet facilitates the process

22
21
1.3 The Consolidation Worksheet
1.3 Sample Consolidation Worksheet
The separate financial statements of the parent and
subsidiaries are set out in the worksheet (spreadsheet).
Consolidation worksheet 1 July 20X9

Financial statements
$000
$000
Dulce
Pontes
Ltd
Ltd
Shareholders equity
Issued capital
7,800
2,400
General reserve
3,500
1,900
Retained earnings
2,000
1,100
--------------Total shareholders equity
13,300
5,400
Liabilities
Loans
5,200
2,800
--------------Total liabilities and equity
18,500
8,200
=====
====
Assets
Cash
6001
300
Inventory
4,300
3,100
Property, plant and equipment
7,900
4,800
Investment in Pontes Ltd
5,700
Goodwill
--------------Total assets
18,500
8,200
=====
====
Line items are added to recognise additional items that
arise in the group statements revaluation surplus,

goodwill, etc. (Part (a) B86 AASB10 combine)
Consolidation adjustments are made only in the Group
accounts (never in the separate books of accounts) to

eliminate & adjust intra-group items.
(Parts (b) & (c) AASB10 B86 offset & eliminate)
Line items (excepting totals) are added to derive the totals
for the group.
Consolidation adjustments
1 July 20X9
Debit
Ref.
Credit
Result
$000
Group
---------
--------=====
--------=====
The group items are added to give group totals.

23
Seminar 2
24
ACCT7104
Semester 2, 2016
1.3 The Consolidation Worksheet
1.3 Identification of CAJs
Consolidation Worksheet At XX XXXXXX 20XX

Parent
Sub
Eliminations
Dr
25
Current assets
Investment in
100% Sub at cost
Cr
Consolidation Worksheet At XX XXXXXX 20XX
Group
Parent
Sub
Eliminations
Dr
x
----
Current assets
Investment in
100% Sub at cost
Cr
Group
x
----
Other assets
Other assets
Total assets
Total assets
Current liabilities
Current liabilities
Net assets
Net assets
Issued capital
Issued capital
Retained profits
Retained profits
Owners equity
Owners equity
26
x
x
x
1.3 Example: Simple Consolidation Worksheet
1.3 Example 2: Consolidation Worksheet
You may be asked to explain what a specific journal

means in the worksheet
For instance, on previous sheet, journal (a) has been
identified
But what is its purpose?
Extract journal
DR Issued Capital
X
DR Retained Earnings
X
CR Investment in Subsidiary
X
In Class Case Study

Basil Limited Group
Extraction, Interpretation & Analysis of Consolidation Adjusting
Journals from a completed Consolidated Worksheet
Required:
1. Extract the separate consolidation adjusting journals from the
consolidation worksheet provided;
2. Provide a possible scenario as to why each journal is required;
3. Interpret and explain the circumstances surrounding each
transaction; and
4. What do the journals tell you generically about the acquisition?
An elimination adjustment, without revaluation

27
28
Example: Simple Consolidation

Separate Books of Accounts at 31 December 2014
1.4 Example: Simple Consolidation Worksheet

Liesch Ltd acquired the entire issued share capital of
Green Ltd for $23,000 cash on 1 January 2014, thus
gaining control.
Liesch Ltd Group is now preparing the Group
consolidated accounts at year end 31 December 2014,
and has prepared:
1.The final separate books of accounts of Liesch Ltd &
Green Ltd (see next slide); and
2.All necessary consolidation adjusting journals required
to complete the Group accounts (from previous slides,
Journals #s 1 4).
Land
Green Ltd
20,000
13,000
PPE
14,000
7,000
Inventory
10,000
8,000
Deferred Tax Asset
Goodwill
Investment in Subsidiary
23,000
Other assets
5,000
9,000
Total assets
72,000
37,000
Deferred Tax Liability
Current liabilities
22,000
12,000
Net assets
50,000
25,000
Issued capital
20,000
10,000
Retained profits
30,000
15,000
Revaluation Surplus
29
Liesch Ltd
Owners equity
50,000
25,000
30
Seminar 2
ACCT7104
Semester 2, 2016

Consolidation adjusting journals for
year ended 31 December 2014
Dr
$
Jnl
(1)
(2)
(3)
(4)
Cr
Land
Revaluation Surplus
1,000
Issued Capital
Retained Earnings
Revaluation Surplus
Goodwill
10,000
12,000
700
300
Sales Revenue
Purchases (COGS)
Current Year Profit (GOGS)
Inventory
Deferred Tax Asset
Income Tax Expense
1,500
Required:
23,000
Complete the consolidated worksheet for

Liesch Ltd Group as at 31 December 2014.
1,500
400
400
Explain the logic of how each of the Group

figures in the consolidated worksheet were
calculated.
120
120
Dividend Revenue
Retained Earnings (Dividend Declared)
Dividend Payable
Dividend Receivable
31
$
700
300
750
750
750
750
32
Consolidation Worksheet At 31 December 2014
Liesch
Green
Adjustments
Dr
Group
Liesch
Green
Adjustments
Cr
Dr
Land
Land
20,000
13,000
PPE
PPE
14,000
7,000
Inventory
Inventory
10,000
8,000
Goodwill
Deferred Tax Asset
Deferred Tax Asset
Goodwill
Other assets
23,000
Other assets
5,000
9,000
Total assets
Total assets
72,000
37,000
Current liabilities
Current liabilities
22,000
12,000
Net assets
Net assets
50,000
25,000
Issued capital
Issued capital
20,000
10,000
Retained profits
Retained profits
30,000
15,000
Revaluation Surplus
Revaluation Surplus
50,000
34
25,000
Liesch
Green
Adjustments
Dr
Land
20,000
13,000
1,000
Group
Liesch
Green
Adjustments
Cr
Dr
(1)
Land
20,000
13,000
PPE
14,000
7,000
PPE
14,000
7,000
Inventory
10,000
8,000
Inventory
10,000
8,000
Deferred Tax Asset
Deferred Tax Asset
Goodwill
Goodwill
23,000
23,000
Other assets
5,000
9,000
Other assets
5,000
9,000
Total assets
72,000
37,000
Total assets
72,000
37,000
22,000
12,000

Current liabilities
(1)
300
Current liabilities
22,000
12,000
25,000
(1)
300
(2)
50,000
25,000
Net assets
50,000
Issued capital
20,000
10,000
Issued capital
20,000
10,000
10,000
Retained profits
30,000
15,000
Retained profits
30,000
15,000
12,000
Owners equity
50,000
(1)
700
Revaluation Surplus
25,000
Seminar 2
Owners equity
36
50,000
700
Group
Cr
1,000
Net assets
Revaluation Surplus
Group
Cr
Owners equity
Owners equity
33
35
(2)
23,000
(1)
300
(2)
(2)
(2)/(1)
700
25,000
ACCT7104
Semester 2, 2016

Liesch
Green
Dr
Land
20,000
13,000
PPE
14,000
7,000
Inventory
10,000
8,000
(1)
(3)
20,000
13,000
PPE
14,000
7,000
Inventory
10,000
8,000
120
(3)
300
(2)
120
(3)
Goodwill
Goodwill
300
(2)
23,000
Other assets
5,000
9,000
Total assets
72,000
37,000
23,000
300
Current liabilities
22,000
12,000
Net assets
50,000
25,000
Issued capital
20,000
10,000
10,000
(2)
Retained profits
30,000
15,000
12,000
400
1,500
(2)
(3)/(3)
(3)/(3)
120
1,500
700
(2)/(1)
700
Revaluation Surplus
Owners equity
50,000
(1)
(3)
400
(2)
23,000
Other assets
5,000
9,000
(4)
750
Total assets
72,000
37,000
(1)
300
Current liabilities
22,000
12,000
Net assets
50,000
25,000
Issued capital
20,000
Retained profits
30,000
Revaluation Surplus
38
25,000
1,000
23,000

(1)
Group
Cr
Land
Deferred Tax Asset
400
(2)
Adjustments
Dr
Cr
1,000
Green
Group
Deferred Tax Asset
37
Liesch
Adjustments
Owners equity
750
(4)
10,000
10,000
(2)
15,000
12,000
400
1,500
750
(2)
(3)/(3)
(3)/(3)
(4)/(4)
120
1,500
750
700
(2)/(1)
700
50,000
25,000

Liesch
Green
Adjustments
Dr
Land
20,000
13,000
PPE
14,000
7,000
Inventory
10,000
8,000
(1)
21,000
(3)
400
120
(3)
300
(2)
23,000
(2)
23,000
Other assets
5,000
9,000
(4)
750
13,250
Total assets
72,000
37,000
Current liabilities
22,000
12,000
Net assets
50,000
25,000
120
(1)
750
300
Sub-totals do not get added across
300
(4)
It is only individual line items that get added across
33,250
This applies to balance sheet as well as profit and loss items
52,720
20,000
10,000
10,000
(2)
30,000
15,000
12,000
400
1,500
750
(2)
(3)/(3)
(3)/(3)
(4)/(4)
120
1,500
750
32,720
700
(2)/(1)
700
50,000
Total Drs and Crs of the CAJs must be equal
86,270
Retained profits
Owners equity
Net assets must still equal equity owners/shareholders equity
300
Issued capital
Revaluation Surplus
Consolidation Worksheet
Internal Cross Checks
17,600
Goodwill
34,000
Deferred Tax Asset
39
1,000
Group
Cr
Pay particular attention to the adding across
20,000
Example: Liabilities commence as Cr balance
If Dr liability in CAJ, then it will reduce the liability
25,000
52,720
If Cr liability in CAJ, then it will increase the group liability etc
Beware of Dr & Cr combinations when adding

40

Liesch
Green
Adjustments
Dr
Land
20,000
13,000
1,000
(1)
PPE
14,000
7,000
Inventory
10,000
8,000
120
(3)
300
(2)
Deferred Tax Asset

Goodwill
Group
Accounts
34,000
21,000
(3)
400
(2)
23,000
Other assets
5,000
9,000
(4)
750
13,250
Total assets
72,000
37,000
22,000
12,000
Net assets
50,000
25,000
Issued capital
20,000
10,000
10,000
(2)
Retained profits
30,000
15,000
12,000
400
1,500
750
(2)
(3)/(3)
(3)/(3)
(4)/(4)
700
(2)/(1)
41 Owners equity
50,000
300
31,270
86,270
Current liabilities
Revaluation Surplus
LIESCH LIMITED GROUP

Consolidated Statement of Financial Position at 31 December 2014
$
Non-current assets
55 000
Current assets
31 270
120
55,000
17,600
23,000
Cr
(1)
750
300
(4)
300
33,250
33,550
Total assets
Total liabilities
Net assets
86 270
33 550
52 720
Issued capital
Retained profits
Owners equity
20 000
32 720
52 720
52,720
20,000
20.000
120
1,500
750
32,720
37,720
700
25,000
52,720
42
Seminar 2
ACCT7104
Semester 2, 2016
Range of Mid-semester Examination Requirements
Control/Significant Influence
Ability to explain difference (more than one line)
Application to provided situation
2. Feedback
2.1 What is feedback?
2.2 Contrast formative & summative feedback
2.3 Who provides what feedback in this course?
Consolidation Adjustment Journals

No preparation of journals
Interpretation of journals (more than one line)
Create a question scenario from a set of journals
Consolidation Worksheets
Completion of Worksheet (format provided)
Interpretation of Results (more than one line)
43
Note well: consolidation adjustment journals will be

far more exhaustively tested in the Final Examination
44
2.1 Feedback can I have some more, please?
2.1 Feedback
Frequent student observation that feedback insufficient
Popular misconceptions about feedback:

Feedback only comes from teachers
Feedback is only Examination & Assessment Grade
Comments made are not worth reading as concern past work
Feedback rather than Feed Forward
No changes can occur because of feedback
Feedback only interpreted with dialogue (personal contact)
Teaching staff not interested to discuss
Too vague, no words at all, not directive enough
45
46
2.1 Feedback what isnt it?
2.1 Feedback what is it?

a process in which information about the past or the present influences
the same phenomenon in the present or future. As part of a chain of

cause-and-effect that forms a circuit or loop, the event is said to "feed
back" into itself.
Examples:
Providing students with solutions to set questions
Receiving marks on assessments with no commentary
"information about the gap between the actual level and the reference
level of a system parameter which is used to alter the gap in some way",
emphasising that the information by itself is not feedback unless
translated into action. Ramaprasad (1983)
Complaining to your peers about insufficient feedback
'feedback' exists between two parts when each affects the other...
Ashby (1956)
47
Seminar 2
48
ACCT7104
Semester 2, 2016
2.2 Formative vs Summative Feedback
(White & Weight, 2000)
Whats Been Lacking? Formative Feedback
Formative feedback (not for marks)

Potentially modifies a students thinking or behaviour for the purpose
of learning
Since formative feedback influences thought and behaviour, it is more
motivational
During this process students are asked to continue doing what they
have been doing, ask questions, participate, stay on topic, and/or
modify their thinking or approach (when and if necessary)
Increases student knowledge, skills, and understanding in some
content area or general skill (for example, problem solving)

Different functions (Black and Wiliam (1998)):
Directive feedback tells the student what needs to be fixed or
revised.
Facilitative feedback, which provides comments and suggestions
to help guide students in their own revision and conceptualization.
Summative feedback (for marks)

assesses how well a student accomplishes a task or achieves a
result for the purpose of grading
49
2.3 Feedback Mechanisms
Commonality of Feedback
Learner-Teacher
Learner-Content
Learner-Learner
Leaner-Interface
Who provides feedback and how?

Learner-Teacher
Learner-Content
Learner-Learner
Leaner-Interface
Hillman, D. C. A., Willis, D .J. & C.N. Gunawardena (1994). Learner-Interface Interaction
in Distance Education: An Extension of Contemporary Models and Strategies for
Practitioners. The American Journal of Distance Education. 8(2), 30-42.
LEARNER
Each student must actively construct their own knowledge & skills
That is, self-regulate their studies to achieve their aims
More student centred than teacher centred
Teachers open the doors, but students choose whether to enter
Feedback is a critical element of how students develop learning
And feedback is not only from teachers!
Frequent reference will be made to various types of feedback
through course
NB learner-learner includes self-study & feedback
51
50
52
Where in this course will feedback come from?
Good Feedback Practice (Nicol & McFarlane-Dick, 2006)

Good feedback practice is anything that might strengthen the
students capacity to self-regulate their own performance:
1. Helps clarify what good performance is
2. Facilitates the development of self-assessment in learning
3. Delivers high quality information to students about learning
4. Encourages teacher and peer dialogues about learning
5. Encourages positive motivation and self-esteem
6. Provides opportunities to close the gap between current and
required performance
7. Provides information to teachers than can be used to shape
teaching
Learner-Teacher
Seminar, consultations, workshops, discussion board, quizzes, emails
Both-way feedback you must feedback to teacher of issues & problems
Learner-Content
Revision material, Seminar notes, set questions & solutions, workshops, prescribed
text, recommended reading, research, preparation before contact, technology
requirements
Learner-Learner
MCQs, study group/buddy, comparative progress, discussion board
(Facebook/Weibo)
Leaner-Interface
Discussion board, blog, emails, technology
53
Seminar 2
54
ACCT7104
Semester 2, 2016
Feedback & Self-Regulation

Read
Seminar
slides
Attend
Seminar
Read text,
do study
questions
Attend
Workshops
Whats the bottom line?

Its your course!
Its you that have to pass the assessments, not me!
Its up to you how much effort you make = what grade you get
You have to self-regulate your learning
The teaching staff cannot do that for you,
but they are available when you ask
You set your own standards
Review &
practise
Discussion Board, MCQs, e-mail, consultation, peer groups, study groups, yourself!!!!
Bottom Line:
Have I prepared enough? Do I understand? Can I do this in exam?
Have I achieved my goals in this course? Have I taken sufficient
responsibility for my learning in a timely & efficient manner?
Endless cycle, where knowledge at the end of one week is required to be carried forward
and modified in following weeks
An action learning cycle
55
56
Assignment
3. Financial Statement Project

3.1 Explanation of assignment
3.2 Individual & group elements
3.3 Timetable
57
58
Assignment Overview
Assignment Overview - Changes
The Project requires students to work BOTH individually
Topic has been changed this semester
and in a Group, contrasting and comparing certain

information contained in published Annual Reports and
researching certain Accounting Standards.
Total Marks increased to 25% course

Hurdle Rate introduced
All elements of the assignment must be properly
25% of the total course marks, and are allocated as
follows:
Report Individual
Report Group
Group video/blog
Peer assessment
attempted if any marks are to be awarded at all
10%
5%
7%
3%
Hurdle Rate Examples

Individual 9/10, Group not attempted = 0 marks overall
Individual 9/10, Group Report 4/5, Blogs & Video 6/7, but no Peer
Review submitted = 0 marks overall
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Seminar 2
10
ACCT7104
Semester 2, 2016
Assignment Overview
Assignment Group Formation
In conduct and presentation, the Project will

emphasise:
Strictly Four (4) members (NB not 1,2,3 or 5 members)

Names advised to Course Co-ordinator
Professionalism;
(via Group Registration Form)
Respect;
Confirmed by Course Co-ordinator
Acceptable Ambiguity;
Initial compulsory Blog completed
Feedback; and
All above by 4.00 pm on Friday, 12 August 2016
Self-regulation.
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Assignment Individual
1. Select ASX company from List provided

I.
II.
III.
Operating Segments/Potential Goodwill disclosure

Follow selection criteria
Biggest/best known groups are not always best
LIST OF GROUP COMPANIES TO SELECT FROM:

Class 1
Decmil Group Limited (DCG)
Computershare Limited (CPU)
2. Answer specific consolidated statements questions
Include in report (not included in wordcount) as Appendix
3. Operating segments
I.
II.
Class 2
Seven Group Holdings Limited (SVW)
Telstra Corporation Limited (TLS)
Amcor Limited (AMC)
Slater & Gordon Limited (SGH)
Critical analysis of compliance with AASB

Summarise approach and evaluate level of compliance
4. Goodwill
I.
Research & succinctly address aspects required
II.
Critically analyse the specific acquisition stated re disclosures
III. Critically evaluate the suitability of the methodology used
Class 3
Fairfax Media Limited (FXJ)
Steadfast Group Limited (SDF)
1,000 1,200 word report in specified format

Due 12.00 noon on Friday, 16 September 2016
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PLEASE NOTE WELL
1. Operating Segments
ASIC still unhappy with how companies disclose
Not meet core principles of AASB8
Each Group of four (4) members must have:

1. Four (4) different companies must be selected;
2. At least one (1) Class 1 Group, one (1) Class 2 Group
and one (1) Class 3 Group; and
3. The 4th Group can be from any of the classes
Required
Independently research relevant AASB(s) and summarise
generically what treatment your company has used in its

2015 annual financial statements (supported by AASB)
Example
DCG (Class 1); TLS & SGH (Class 2); & FXJ (Class 3)
Critically analyse and evaluate in detail the level of
compliance that your selected company has achieved in

regard to the relevant AASB requirements on operating
segments
The Groups should decide amongst themselves which

Group member is best suited for each type of Class
65
Seminar 2
66
11
ACCT7104
Semester 2, 2016
1. Operating Segments (continued)
2. Potential Goodwill
Each Group selected has made some form of acquisition
You may not assume that compliance occurs simply
of another entity which has been disclosed in the 2015

financial statements
because there is not a qualified audit report.

You will need to conclude on a level of compliance
The specific acquisition to be reviewed has been indicated
achieved.
in the detailed instructions
You will need to propose why any apparent non-
Each acquisition produces the potential for goodwill to be
compliance has been allowed by the auditors.
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created, which is the main focus of your research
68
2. Potential Goodwill (continued)
Word Limit
1,000 1,200 words
Required
Normally +/- 10%, but range there already
Within the body of the report, you will need to:
Research and define goodwill, critically analysing different

business acquisition scenarios that could influence the reporting,
disclosure and expectations of potential goodwill;
Explain circumstances where different accounting treatments for
goodwill may be appropriate;
Critically analyse the goodwill disclosures made regarding the
specific acquisition detailed for your chosen Group, then critically
evaluate the suitability of this methodology for the type of entity and
industry being reviewed, as well as compliance to the accounting
Standards.
If less, not enough work

If more, not met key requirement of being succinct
What will a CEO read in real life?

Excludes Appendix A responses
Should still be professionally presented
Excludes reference list and in-body references
What about Tables or Appendices
Tables count but can be very word efficient
Though not cast in stone, in this report, if it is important enough
to be shown, it should be in the body, not as Appendices

Markers reserve the right to stop reading after reasonable length
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Assignment - Group
1. Prepare Report (1,000 words) in specified format:

1. Compare & contrast four (4) individual companies
2. Critically analyse & evaluate against detailed requirements
3. Highlight how industry/entity differences influence your analysis
External References
Must be four (4) in each assignment
What does not qualify:

Wikipedia or equivalent
Seminar notes/quoting Woollard
Your companys financial statements
AASBs
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2. Video presentation (UQ Kaltura)

1. Eight (8) minutes, all members identified & presenting
2. Professional, but not bells & whistles
3. Blog
1. Eight (8) substantial blogs (at least 2 from each members)
2. Not including Group Formation blog required (see above), nor
self-assessment blog
What does qualify (inter alia):

Professional accountants views
Text books
Professional journals
Academic journals
Relevant press cuttings
External internet data
Seminar 2
4. Peer Evaluation
Individually completed and confidentially submitted
All above due 12.00 noon on Friday, 21 October 2016

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12
ACCT7104
Semester 2, 2016
Assignment - Marking
Assignment - Submissions
100 marks (represents 25% total assessment)

All elements below must be fully completed:
Both the individual & group reports only need to be

submitted electronically as below:
1. Individual Report (40 marks/10%)
1. As a one piece PDF document (no cover for
individual report Group covers sheet signed by all

members for the Group Report);
Marked by Teaching Staff
2. Group Report (20 marks/5%)

Self-assessed, moderated by Teaching Staff (if needed)
2. To Turnitin Submission Folder in Assessment
within BlackBoard; and
3. Video presentation & Blog (28 marks/7%)
Marked by Teaching Staff, reflecting individual effort
3. Named and identified as detailed
4. Peer Evaluation (12 marks/3%)

Self-assessed, moderated by Teaching Staff (if needed)
Professionalism will be assessed in each element

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Assignment - Details
Assignment Key Dates
Inter alia, extracted from requirements:

Defined Format
Week
Date
Event
12 August
Addressee
Word length
Single sided
Double spaced
Times New Roman 11 font
asap
12
21 October
Formation/advice of Project Group
16 September Project Individual Report due

Project Individual Report feedback
Submission requirements
Project Group Report due (+ others)
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Assignment
Assignment-Terminology
Detailed information already on BlackBoard

Including:
1. Assessment Detailed Instructions
2. Group Registration Form
3. Qualitative Marking Rubrics
4. Peer Evaluation Form
5. Instructions re uploading documents/UQ Kaltura
6. UQBS Report Writing Guide
7. UQ Library You Tube video
8. CPA guidance to Financial Reports
Read #1
Read #2
Read #3
Critical Analysis
Compare & Contrast
Critical Evaluation
ASK QUESTIONS EARLY

PLAN & TIME YOUR WORK CAREFULLY
77
YOU WILL NEED TO EARN YOUR MARKS

Seminar 2
Support
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13
ACCT7104
Semester 2, 2016
Critical Analysis
Critical Evaluation
Elements identified:
"the intellectually disciplined process of actively and skilfully

conceptualising, applying, analysing, synthesising and/or evaluating
information gathered from, or generalised by, observation, experience,
reflection, reasoning or communication, as a guide to belief or action [or
argument]"
(Scriven & Paul, 2001, p.1).
Give your verdict as to what extent a statement or findings within a
piece of research are true, or to what extent you agree with them.
Provide evidence taken from a wide range of sources which both
agree with and contradict an argument.

Come to a final conclusion, basing your decision on what you judge to
be the most important factors and justify how you have made your
choice.
Break an issue into its constituent parts. Look in depth at each part
using supporting arguments and evidence for and against as well as
how these interrelate to one another.
University of Leicester
http://www2.le.ac.uk/offices/ld/resources/writing/writingresources/essay-terms
University of Leicester
http://www2.le.ac.uk/offices/ld/resources/writing/writing-resources/essay-terms
Discussions
1. Wall colours
2. Best country to live in
3. Ukrainian Crisis
Examples of Critical Analysis

https://www.uq.edu.au/student-services/examples-critical-analysis
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See hand-out
In Class Case Study

Thats all for today, see you next week!
Broncos Case Study

(Part 2, continued from Seminar 1)
Identify types of Consolidation Adjusting Journals

Posting Journals to Consolidation Worksheet
Interpreting worksheet
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Seminar 2
14

Acct7104 Seminar 2 s2 2016 Pdf6

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ACCT7104

Presented on: 2 & 4 August 2016

ACCT7104 Seminar 2 Semester 2 2016

Reading and Study Questions

Relevant Accounting Standards

ACCT7104 Seminar 2 Semester 2 2016

ACCT7104 Seminar 2 Semester 2 2016

Seminar 2 Objectives (continued)

3. Financial Statement Project

4. Broncos Case Study Part 2

ACCT7104 Seminar 2 Semester 2 2016

Presented on: 2 & 4 August 2016

1.1 What is a simple Group?

For this introductory topic, a simple Group will be:

1. One Company will buy one (1) Company to form a Group

of a Parent with one (1) subsidiary;

1.1 Revision of Seminar 1

2. The purchase will be in cash only;

subsidiary on the 1st day of the financial year; and

last day of the year in which the subsidiary was bought

ACCT7104 Seminar 2 Semester 2 2016

1.1 Consolidation Procedures (reminder)

1.1 A Simple Group AB Group Limited

B86 of AASB 10 Consolidation Procedures

(a) Combine like items of assets, liabilities, equity, income, expenses

and cash flows of the parent with those of its subsidiaries.

each subsidiary and the parents portion of equity of each subsidiary

ACCT7104 Seminar 2 Semester 2 2016

1.1 Fair Value & Intra-group Transactions

1.1 Group Financial Accounts

SEPARATE BOOKS OF ACCOUNTS

Be clear about the difference between Separate & Group Accounts

ACCT7104 Seminar 2 Semester 2 2016

ACCT7104 Seminar 2 Semester 2 2016

ACCT7104 Seminar 2 Semester 2 2016

Presented on: 2 & 4 August 2016

1.1 Investment in Subsidiary

1.2 Consolidation Adjusting Journals

Elimination Adjustment required to deal with:

Are you able to explain why consolidation adjusting

A. Items recorded in separate books,

This is part of the assessable content for the

B. Items recorded in Group accounts

Preparation of journals will be comprehensively tested in

ACCT7104 Seminar 2 Semester 2 2016

1.2 Examples of Consolidation Adjusting Journals

ACCT7104 Seminar 2 Semester 2 2016

ACCT7104 Seminar 2 Semester 2 2016

1.2 Examples of Consolidation adjusting journals

1.2 Examples of Consolidation adjusting journals

1.2 Examples of Consolidation adjusting journals

DR DEFERRED TAX ASSET

ACCT7104 Seminar 2 Semester 2 2016

Declared means declared not paid

(*Remember: Current Year Profit after Tax is already included in

ACCT7104 Seminar 2 Semester 2 2016

ACCT7104 Seminar 2 Semester 2 2016

Presented on: 2 & 4 August 2016

1.2 Examples of Consolidation adjusting journals

Where are we?

Investigated the components of a simple Group

Gained overview knowledge of consolidating

Paid means declared and paid