3. Assessment Details
3.1 Details of Each Assessment Item
The assessments for this subject are described below. The description includes the type of assessment, its purpose, weighting, due date and submission requirements, the topic of the assessment, details of the task and detailed marking criteria, including a marking rubric for essays, reports and presentations.
KOI expects students to submit their own original work in both assignments and exams, or the original work of their group in the case of group assignments. Material in assignments which comes from the work of others must be appropriately acknowledged.
Assessment Type: Written Report — individual assessment
Purpose: This assessment is designed to reinforce the subject content and develop students' skills and application of knowledge of the subject content to business situations. This assessment relates to learning outcomes a, b and c.
Topic: This assignment covers contemporary theoretical concepts with practical accounting task application based on the topics from the subject.
Task Details: This assignment requires students to access the Conceptual Framework of Accounting and select the conceptual framework tab. Students are then required to access paragraph 2.4 fundamental qualitative characteristics.
1- Prepare a summary of the requirements for general-purpose financial reports with respect to these fundamental qualitative characteristics. 2- Select an ASX corporation and review general purpose financial report material with respect to the reporting of risk by the corporation 3- Review the general-purpose financial reports, additional company media releases, internet, and other sources in relation to the reporting of risk by the corporation. 4- Prepare a comprehensive report directed to this research. The report extracted from the general-purpose financial report and additional material relevant to the analysis.
Presentation: Report — 1,500 word report. The word count excludes the cover sheet, contents page, references, appendices, and illustrations (e.g. diagrams, graphs and tables). Students need to stay within the assigned word limits, and indicate the word count on the cover page of the assignment. The report should be typed double spaced, using Times New Roman font size of either 10 point or 12 point. Every page should be clearly numbered.
The assignment should include the following parts:
o A title / cover page, which indicates basic information such as Subject title, Subject code, Trimester number, Assignment title, group members' full names and KOI student numbers, word count and name of the tutor; o Executive Summary; o Table of Contents; o Main contents — Introduction, analysis using suitable headings and subheadings, Conclusions and Recommendations, Appendices (if any); References (using Harvard — Anglia style); and/or o Attachments.
The report is a summary of the requirement for a general-purpose financial report concerning fundamental qualitative characteristics. The report provides an understanding of issues that should be considered in the preparation and presentation of a financial statement based on the concepts of accounting and accounting principles. The report describes and provides a review of the general-purpose financial report.
Requirements for general-purpose financial reports:
The set of financial statements such as balance sheet, statement of profit and loss, cash flow statement, and change in shareholders' equity are known as general-purpose financial reports. The general-purpose financial reports consist of information that can be used by a group of people for a broad range of activities. The general-purpose financial reports are required to present the financial performance and position of the organization to the people outside the organization. The general-purpose financial reporting is used to communicate the information of stakeholders and investors therefore there is a requirement to have certain qualitative characteristics in the general-purpose financial reporting that increase the relevancy and reliability of the statement of accounts (Drake, Hales, & Rees, 2019).
As per the conceptual accounting framework, the major qualitative characteristics of financial reporting are understandability, faithful representation, comparability, timeliness, relevance, etc. The financial statements are used by the outsiders for decision making whether to invest in the company or not and assess the financial position of the company therefore the information provided in the financial reporting should be correct and relevant along with understandable to the users.
Qualitative characteristics of general purpose financial reporting:
The quality of financial reporting is important as the statements are used by the user to assess the financial performance of the company. Therefore following qualitative characteristics are required while preparing and presenting the GPFR (Drake, Hales, & Rees, 2019).
The main characteristics of the GPFR are the understandability as the users using the financial statement for the decision making and assess the financial performance of the company. If the financial statement is not understandable, the GPFR does not fulfill the requirement and objective therefore it should be easy to understand for the users. For example, The information provided in the GPFR by the companies should be explained in plain language and understandable. The understandability is enhanced when the information is classified, characterized, and presented clearly and concisely.
The comparability is the quality that enables the users to identify the similarities and differences in the major account balance and also assess the major change in the accounts of the company such as profits, liquidity, assets balances, and liabilities. The comparability helps to understand the relationship between two or more items of information and also helps to assess whether the company is following the consistent accounting policies and concept in GPFR (Zubilevych, & Poznyakovska, 2017).
The information provided in the GPFR is relevant for the users as it is capable of making a difference in achieving the objective of GPFR. The information provided in financial reporting is related to the company's economic condition and related to transactions that take place in the company and help in the assessment of accountability or decision making (Islam, & Sadekin, 2020).
The timeliness is also a quality of the GPFR as the information available to the users before it loses its capacity to be used for accountability and decision-making process. The availability of relevant information on time improves or enhances the usefulness of information that is reported in the GPFR.
Reporting of risk by ANZ banking group:
For the review of the general-purpose financial report material concerning the reporting of risk, the public listed company taken is the ANZ banking group. The ANZ banking group is the 3rd largest bank in Australia and the largest bank in New Zealand. The ANZ banking group provides the banking facilities such as deposits, saving accounts, providing loan facilities, investment advice, and other banking services to retail and corporate customers in Australia and New Zealand. The annual report taken for the analysis is related to the year 2020 and the information provided in the general purpose financial reporting is important for the users as the banking sector impacts the economy of the country widely as the investment of peoples are highly involved in the banking group. The risks in the banking sectors are high as the liquidity risk, capital adequacy risk, operational risk, technical risk, etc. which are required to report in the financial statement (SOYINKA¹, Fagbayimu, Adegoroye, & Ogunmola, 2017).
Review of the general-purpose financial reporting of ANZ bank:
As per the financial reporting of the company, the company has taken effective measures for the recovery from such critical situations as the financial crises due to the COVID-19 impact which impacts the major economic sector of various industries. As the banking group is impacted and affected by various industries and government policies, the management of ANZ bank has taken necessary actions for the same. The management has maintained the required liquid portfolio for meetings the immediate liquid fund needs.
Based on the financial statements it is found that the company has a bear decrease in the cash profit by 42% in the year 2020 and the returns to shareholders are decreased by 36.9% as compared to the previous year. The financial reporting for the year 2020 shows that the company has made a major change in the accounting policies and disclosure which impacts the profitability and financial position of the company (Rensburg, & Botha, 2014).
Based on the media release related to the ANZ banking group, the bank has decreased the interest rates on various loans such as business loans, and home loans to boost growth and economic recovery. The bank has taken this step as the current year is the most challenging year for many Australians and the banks continue to support the customers now and as the economy starts to recover. The media release is the method to assess the other non-financial factors of the company which are not reported in the GPFR and the information that impact the GPFR such as the decrease in the interest rate reduced the interest income of the bank while it helps the bank to boost the economy which helps the bank in long-run business.
Internet and online information:
In the current scenario, online information is the best source to gather the information, the information can be access through online news, websites, sites of the stock exchange, etc. As the banking group also takes initiative in technical sections as the net banking and mobile banking facilities increase to help the customers 24/7 hours which help the bank in increase the business and more disclosure of information.
The website is the best source of gather information as the annual reports and financial data are available on the website in the form of interim financial records, annual reports, declarations of change in capital structure, and other important financial data which helps the users to assess the information and take necessary actions accordingly. The website also includes information related to government policies and their impact on the banking group as the bank is the center of the economy of the country (Van der Laan Smith, Adhikari, & Tondkar, 2015).
From the above report, it can conclude that the GPFR is important for the assessment of financial information of the company and they must have certain characteristics to maintain the quality of information. There is a certain risk involved in the ANZ banking group due to high economic changes as disclosed in the annual report. The reporting information can be gathered through various sources such as media, online sites, the website of the company, stock exchange, etc. which is used by the users for timely decision-making.