Explore the accounting policies

Introduction / Learning objectives:
This task accounts for 15% of the final mark for ACF5950 (provided the final exam hurdle is
passed). The objective of this task is to gain familiarity with, and experience in, the use of
financial statements.
You will be assigned a pair of Australian Stock Exchange (ASX) listed companies as the case
for this assignment. Your pair of companies will be notified to you via the Grades section of
Moodle. As this is an individual assignment, each student will receive a different pair of
The aim is to explore the accounting policies applied by one or both of the companies in the
preparation of their financial statements and identify an instance you find particularly
interesting. Examples of accounting policies include those relating to:


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 Revenue recognition
 PP&E valuation: cost/impairment or market value model
 Depreciation
 Valuation of intangible assets
 If your company is in the mining industry, then the application of the AASB 6
Exploration & Evaluation of Mineral Resources accounting standard
 If your company is in the agricultural sector, then the application of the AASB 141
Agriculture accounting standard
 Etc.
The reason you find something interesting is personal, i.e. it does not matter no-one else finds
it interesting, it is enough that you do! After reflecting upon aspects of the financial statements,
some reasons why you might find an instance of the use of an accounting policy particularly
interesting are:
 You are curious about the apparent consistency/inconsistency of the accounting policy
with the new Conceptual Framework (e.g. in relation to definition and recognition
criteria of assets, income, etc);
 You query the relevance or reliability of the information that results from the
application of the policy
 you are interested that the companies chose different policies and wonder about the
effect of the difference on the comparability of the statements, or perceived quality of
the company’s reported earnings
 you discovered something that surprised you, or contradicted something you believed.
1. State the name(s) of the company (or companies) and briefly describe the nature of their
2. State the accounting policy you find interesting in the context of the
3. Paste a screenshot(s) from the Notes to the Accounts that describes the accounting
policy. Make sure the screen shot(s) contains the details that relate to why you find the
application of the policy interesting.
4. interpret the accounting policy and explain the meaning of it in your own words;
5. explain what you think is interesting about the application of the policy in the context
of your company/companies.

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