The document discusses accounting standards and regulations in India regarding the preparation and presentation of consolidated financial statements. It outlines the objectives of consolidated financial statements which include providing financial information about a group's economic activities and resources. It also describes key requirements for consolidated financial statements such as elimination of intragroup transactions and uniform accounting policies.
Solution Manual Advanced Accounting Chapter 15 9th Edition by BakerSaskia Ahmad
Solution Manual, Advanced Accounting, Thomas E. King, Cynthia Jeffrey, Richard E. Baker, Valdean C. Lembke, Theodore Christensen, David Cottrell, Richard Baker, Advanced Financial Accounting, Advanced Financial Accounting by Baker Chapter 18, Advanced Financial Accounting by Baker Chapter 18 9th Edition, 9th Edition,
Solution Manual Advanced Accounting Chapter 15 9th Edition by BakerSaskia Ahmad
Solution Manual, Advanced Accounting, Thomas E. King, Cynthia Jeffrey, Richard E. Baker, Valdean C. Lembke, Theodore Christensen, David Cottrell, Richard Baker, Advanced Financial Accounting, Advanced Financial Accounting by Baker Chapter 18, Advanced Financial Accounting by Baker Chapter 18 9th Edition, 9th Edition,
Prepared by CA Sandesh Mundra - An exhaustive presentation on Consolidation of Accounts covering the Standards - AS 21, AS23 and AS 27 with indepth analysis of the finer aspects involved.
INTRODUCTIONAnnual Report Analysis Projectis designed to get y.docxBHANU281672
INTRODUCTION
Annual Report Analysis Project
is designed to get you familiar with a real company’s financial statements and disclosures. The purpose of the project is for student to be able to identify the MANDATORY AND VOLUNTARY disclosure of financial information rules.
REQUIREMENT
Form into a group of 2 students.
Choose
two companies in the same business and industry
that are listed on Tadawul stock market.
Go to
www.tadawul.com.sa
then click on
equities,
then click on
listed companies web link
. The list of companies with their official website is listed on the page.
Go to the company’s website to get each company’s
annual report for 2015 (the latest annual report)
All of the financial and company information that you need will be in the company’s Annual Report. Submit
soft copy of the annual reports
together with your written report.
Answer all of the questions to the best of your ability, using all of the accounting skills that you have accumulated in ACCT 110, 211, 314, AND 321 to answer the questions
You must submit your final report about your findings.
BACKGROUND INFORMATION
In Saudi Arabia, company need to follow the listing rules set by Capital market authority on financial information disclosure requirement. CMA listing rules article 42 details the disclosure of financial information and article 43 details the content of directors report (
www.cma.org.sa
).
PART A
Go to CMA website to find information about mandatory and voluntary disclosure of financial information that is requires by CMA of all the company listed on TADAWUL. Be specific on the disclosure requirement. Write a report on mandatory and voluntary disclosure.
PART B
Article 43 stated that annual report should include a review of operations and all of relevant factors affecting the company’s business which an investor requires to assess the assets, liabilities and financial position. The report should include:
1.
a description of the principal activities of the issuer and its subsidiaries. Be specific on
which page of the annual report
the information is recorded.
2.
a description of the issuer’s significant plans and decisions (including any restructuring, business expansion or discontinuance of operations of the issuer), the future prospects of the issuer’s business and any risks facing the issuer. Be specific on
which page of the annual report
the information is recorded.
3.
a summary, in the form of a table or a chart, of the assets and liabilities of the issuer and of the issuer’s business results for the
last five financial years
or from incorporation, whichever is shorter;
4.
a
geographical analysis
of the issuer’s gross revenues and its subsidiaries;
5.
an
explanation for any material differences
in the operating results of the previous year or any announced forecast made by the issuer;
6.
an explanation for any departure (not follow) from the accounting standards issued by SOCPA;
7.
Detail explanation about
...
Key Takeaways:
- Accounting records and systems of control
- Financial statements and consolidated financial statements
- Companies exempted from preparation of financial statements
Annual update deliver by Paul Rhodes to the IFRS staff group at Crowe Soberman LLP.
Topics covered were estimation and judgment calls for functional currency; strategic investments; business combinations; impairments and going concern
2. To standardize accounting methods and
procedures.
To lay down principles for preparation and
presentation.
To establish benchmark for evaluating the
quality of financial statements prepared by
the enterprise.
To ensure the users of financial statements
get creditable financial information.
To attain international levels in the related
areas
3. Accounting Standards and The Companies Act,
1956
Section 211 sub sections (3 A), (3 B) and (3 C)
inserted by the Companies Amendment Act,
1999 w.e.f. 31.10.1998:
(3A) every P & L Account and Balance Sheet shall
comply with accounting standards,
(3 B) deviations, if any, to be disclosed with
reasons and financial effect of deviation,
(3 C) "accounting standards" means standards of
accounting recommended by ICAI or as may be
prescribed by Central Govt. in consultation with
National Advisory Committee on Accounting
Standards.
4. Section 217 sub section (2AA) inserted by the Companies
Amendment Act, 2000 w.e.f. 13.12.2000:
(2AA) The Board's report shall also include a Directors'
Responsibility Statement indicating therein (1) that in
preparation of annual accounts, the applicable accounting
standards had been followed along with proper
explanation relating to material departure.
Section 227 sub section (3)(d) inserted by the Finance Act,
1999 w.e.f. 31.10.1998:
(3)(d) the auditor's report shall also state whether, in his
opinion, the P & L Account and the Balance Sheet comply
with accounting standards referred in section 211 (3C),
(4) where answer to (3)(d) is negative or with qualification,
it shall also state the reasons thereof.
5. AS-1 DISCLOSURE OF ACCOUNTING POLICIES
AS-2 VALUATION OF INVENTORIES
AS-3 CASH FLOW STATEMENTS
AS-4 CONTINGECIES AND EVENTS OCCURING
AFTER THE BALANCE SHEET DATE
AS-5 NET PROFIT OR LOSS FOR THE PERIOD,
PRIOR PERIOD ITEMS AND CHANGES IN
ACCOUNTING POLICIES
6. AS-6 DEPRECIATION ACCOUNTING
AS-7 ACCOUNTING FOR CONSTRUCTION
CONTRACTS
AS-8 ACCOUNTING FOR RESEARCH AND
DEVELOPMENT
AS-9 REVENUE RECOGNITION
AS-10 ACCOUNTING FOR FIXED ASSETS
7. AS-11 ACCOUNTING FOR THE EFFECTS OF
CHANGES IN FOREIGN EXCHANGE RATES
AS-12 ACCOUNTING FOR GOVERNMENT
GRANTS
AS-13 ACCOUNTING FOR INVESTMENTS
AS-14 ACCOUNTING FOR AMALGAMATIONS
AS-15 ACCOUNTING FOR RETIREMENT
BENEFITS IN THE FINANCIAL STATEMENTS OF
EMPLOYERS
AS-16 BORROWING COSTS
8. AS - 17 SEGMENT REPORTING
AS - 18 RELATED PARTY DISCLOSURES
AS - 19 LEASES
AS - 20 EARNING PER SHARE
AS - 21 CONSOLIDATED FINANCIAL
STATEMENTS
AS - 22 ACCOUNTING FOR TAXES ON INCOME
9. AS - 23 ACCOUNTING FOR INVESTMENTS IN
ASSOCIATES IN CONSOLIDATED FINANCIAL
STATEMENTS
AS - 24 DISCONTINUING OPERATIONS
AS - 25 INTERIM FINANCIAL REPORTING
AS - 26 INTANGIBLE ASSETS
AS - 27 FINANCIAL REPORTING OF INTERESTS
IN JOINT VENTURE
10. AS – 28 IMPAIRMENT OF ASSETS
AS – 29 PROVISIONS, CONTINGENT LIABILITIES
AND CONTINGENT ASSETS
AS – 30 FINANCIAL
INSTRUMENTS:RECOGNITION AND
MEASUREMENT
AS – 31 FINANCIAL
INSTRUMENTS:PRESENTATION
AS – 32 FINANCIAL INSTRUMENTS:DISCLOSURES
11. Objective
Statements are presented by a parent
(holding enterprise ) -
to provide financial information about the
economic activities of its group
to show economic resources controlled, the
obligations of and results achieved by the
group.
Accounting Standard lays down principles and
procedures for preparation and presentation
of consolidated financial statements
12. Should be applied in the preparation and
presentation of consolidated financial statements for
a group of enterprises under the control of a parent.
Should also be applied in accounting for investments
in subsidiaries in a separate financial statements of a
parent.
Does not deal with methods of accounting for
amalgamations, accounting for investments in
associates and joint ventures
13. A parent which presents consolidated statements
should :
Present these statements in addition to its
separate financial statements.
Consolidate all subsidiaries, domestic as well as
foreign.
A subsidiary should be excluded when control is
temporary or when it operates under severe long
term restriction.
Disclose the reason for not including the
subsidiary
14. A subsidiary is an enterprises that is controlled
by another enterprise known as the parent.
A group is a parent and its subsidiaries.
Control means the ownership of more than half
of the voting power of an enterprise or control of
the composition of BOD so as to obtain economic
benefits from its activities
Consolidated Financial Statements are the
financial statements of a group presented as
those of a single enterprise.
15. To be combined on line to line basis.
Cost to the parent of its investment in each
subsidiary and the parent's portion of equity of
each subsidiary to be eliminated,
The excess or deficiency to be treated as
Goodwill / Capital Reserve
Intra group balances, intra group transactions
and resulting unrealized profits and losses to be
eliminated in full (unrealized losses should not
be eliminated if cost cannot be recovered)
16. The financial statements should be drawn up to the
same reporting date. If not practicable, difference
should not be more than six months.
Minority interest in net income of the consolidated
subsidiary to be adjusted against the group income
Minority interest in net assets to be presented
separately from liabilities and the equity of the
parent's shareholders.
If minority's share of loss exceeds the minority
interest in the equity of the subsidiary, such excess is
to be adjusted against majority interest.
17. Subsequently, in case of profits in future, all
such profits are allocated to the majority
interest, unless previous losses absorbed by
the majority are recovered.
Parent's share of profits in subsidiary, should
be adjusted for Preference Dividend, whether
declared or not on Preference Shares of
subsidiary held outside the group.
18. On disposal of subsidiary, the difference
between proceeds from disposal and carrying
amount of net assets is treated as profit /
loss on disposal in consolidated financial
statements.
Investment to be recorded as per AS-13 in
individual financial statement of parent from
the date it ceases to be a subsidiary
19. List of all subsidiaries including name, country of
incorporation, proportion of ownership interest and
voting power held.
Nature of relationship between the parent and a
subsidiary, if the parent does not own more than half
of the voting power of the subsidiary.
Effect of the acquisition or disposal of subsidiaries on
the financial position at the reporting date.
Name of the subsidiaries of which reporting dates are
different from that of parent's and the difference in
reporting dates.
20. If it is not practicable to use uniform accounting
policies, the fact together with the proportion of
such items in consolidated financial statements
to which different accounting policies apply
should be disclosed.
If a member uses different accounting policies,
for reasons other than those stated above,
appropriate adjustments should be made in
consolidated financial statements.