Accounting: Business Reporting for Decision Making 7th Edition by Jacqueline Birt Solution manual
Chapter 1: Introduction to accounting and business decision making
Apply your knowledge
a. Provide an example of the different types of activities that would be performed by a management and a financial accountant for a large public company listed on the ASX. (5 marks)
b. What are some of the advantages of business planning? (5 marks)
c. Sustainability accounting is a very important and huge growth area of accounting. Discuss the different stakeholders (and their information needs) that would be interested in sustainability reports. (10 marks)
d. Integrated reporting is a type of reporting that has been adopted in countries such as South Africa. What do you think are the advantages and disadvantages to the company of providing such disclosures? (10 marks)
e. What are the three elements of a business plan? Consider the situation of two sisters contemplating a new business hiring surfboards and providing surf lessons on the Sunshine Coast. Explain how the business plan would assist the sisters in planning their business venture. (10 marks)
a. Provide an example of the different types of activities that would be performed by a management and a financial accountant for a large public company listed on the ASX.
The management accountant would perform activities such as capital budgeting for future store fit-outs, preparation of budgets and cost–volume–profit analysis for a new business venture (e.g. diversifying product range to include books).
The financial accountant would perform activities such as preparation of financial reports (i.e. statement of profit or loss, statement of financial position and the statement of cash flows) in accordance with generally accepted accounting principles, which are represented by accounting standards including those issued by both the AASB and the IASB and the Corporations Act.
b. What are some of the advantages of business planning?
Business planning provides a clear, formal statement of direction and purpose. It allows management and employees of the entity to work towards a set of clearly defined goals in the daily operations of the business. It also assists the business entity in evaluating the business.
c. Sustainability accounting is a very important and huge growth area of accounting. Discuss the different stakeholders (and their information needs) that would be interested in sustainability reports.
Apply your knowledge
a. Provide an example of the different types of activities that would be performed by a management and a financial accountant for a large public company listed on the ASX. (5 marks)
b. What are some of the advantages of business planning? (5 marks)
c. Sustainability accounting is a very important and huge growth area of accounting. Discuss the different stakeholders (and their information needs) that would be interested in sustainability reports. (10 marks)
d. Integrated reporting is a type of reporting that has been adopted in countries such as South Africa. What do you think are the advantages and disadvantages to the company of providing such disclosures? (10 marks)
e. What are the three elements of a business plan? Consider the situation of two sisters contemplating a new business hiring surfboards and providing surf lessons on the Sunshine Coast. Explain how the business plan would assist the sisters in planning their business venture. (10 marks)
a. Provide an example of the different types of activities that would be performed by a management and a financial accountant for a large public company listed on the ASX.
The management accountant would perform activities such as capital budgeting for future store fit-outs, preparation of budgets and cost–volume–profit analysis for a new business venture (e.g. diversifying product range to include books).
The financial accountant would perform activities such as preparation of financial reports (i.e. statement of profit or loss, statement of financial position and the statement of cash flows) in accordance with generally accepted accounting principles, which are represented by accounting standards including those issued by both the AASB and the IASB and the Corporations Act.
b. What are some of the advantages of business planning?
Business planning provides a clear, formal statement of direction and purpose. It allows management and employees of the entity to work towards a set of clearly defined goals in the daily operations of the business. It also assists the business entity in evaluating the business.
c. Sustainability accounting is a very important and huge growth area of accounting. Discuss the different stakeholders (and their information needs) that would be interested in sustainability reports.
| Stakeholder | Information needs | |
| 1. | Management | Sustainability reporting can improve stakeholder relations, create market opportunities, increase control over environmental disclosure, satisfy a mandatory or signatory reporting need, gain the confidence of investors, insurers and financial institutions, trigger internal improvement in environmental performance and gain external recognition or awards. Meeting environmental targets can increase remuneration for management. |
| 2. | Investors | The disclosures can provide information to investors to determine the future of an entity and to assess future cash flows for dividends and the possibility of capital growth of investment. |
| 3. | Employees | Employees can use the information to ascertain job security and future promotional opportunities. |
| 4. | Suppliers | Suppliers of the entity can use the information to determine an entity’s ability to repay debt associated with purchases. |
| 5. | General public | Interested in comparing companies to determine their sustainability practices. |