Accounting Statement Analysis Financial and Accounting Management

Question: Describe about the Accounting Statement Analysis for Financial and Accounting Management. Answer: Module 1 A post graduate course will take my studies and my knowledge to a much higher level. I have worked for two years as an intern, which has made me capable of understanding the aspects of the financial and accounting management. It has made my network and contacts stronger which will prove to be a great incentive for me and also for attracting more contacts in near future. Also, I have acquired skills and knowledge and by choosing this course, I will be improving the skills and knowledge which I am presently lacking. Also, by opting for this career I will be able to get an expertise in both the theoretical and practical experience of the financial and accounting management. This course is related to the integrated financial and accounting management and so the major policies, usage of the financial terms and major reporting styles which are not included in the earlier courses. The Australian standards and jurisdictions vary from the other countries and the national and international impacts of such standards will be understood by this course (Deegan 2012). So, overall I will be able to understand the regulations and standards of the accounting and financial management. Throughout, the entire course, the importance of equation of accounting is explained. The equation must be balanced and the ability to read and realize the financial statements is explained in the module. The significance of the ethics and maintenance of fair practices, transparent decision making and the ways to benefit the stakeholders and general public is learnt from the content. The failure in the ethical management can lead to various failures which can lead to the losing of the stakeholders. The ASX i.e. the Australian Stock Exchange establishes the standards for the corporate governance (Beekes et al. 2015). Also, the importance of sustainability and risk management is explained as the efficiency and effectiveness ensures the future of any organization. Thus, the overall content has helped me understand the importance of the risk management, association between the business practices and the capital introduced. Module 2 In this week, we have been taught about the financial statements such as the income statement, balance sheet and cash flow statement. The major challenge was to present the statements as per the required and applicable standards of accounting as per the Australian Standards. The standards are applied which require a number of considerations for the application and implementation in the financial statements. Firstly, I was unable to understand which standard would be the most effective and suitable; but with the advent of the course, I was able to grasp and analyze the requirement and implementation of the perfect standard as per the requirement of the statement. The major challenge also comprised of applying the correct method of depreciation. There are a number of methods to compute depreciation, which is straight line method, reducing balance method and units of production methods (Del Giudice et al. 2016). The nature of the assets of the organization which are depreciable was to be identified and analyzed. The method which would use the depreciation most effectively was required to be found. I was first unable to analyze the method which would be a perfect fit for the organization, but after the class there was a fine understanding of the topic and issue. The cash flows are the total analysis of the income inflow and outflow of the organization. The method was easily understood but the challenge faced was the identification of the applicable standard as per the Australian Standards. There are certain rules which were to be studied in order to implement such ideas in preparing the cash flow statement. The statement was to be compared with other organizations to maximize the maximum cash inflows and minimize the outflows (Kaplan and Atkinson 2015). Overall, in this week, the major challenge faced was during the learning of the applicable Australian standards for the financial standards, such as income statement, cash flow statement and balance sheet. To match the balance sheet of the organization, the effective implementation of all the other statements were to be in proper maintenance. Module 3 The first assignment consisted of questions in four parts which consisted of: A case study of a Company for knowing the independence in the committee performance and also the analysis of audit considerations undertaken. An evaluative study of the strengths and weaknesses in the structure of the Corporate Governance mechanism. The various figures were to be calculated for a consolidated financial statement. Lastly, a case study on the ethical considerations required for an organization. The major learning points for me were: The role of independent directors in a committee was identified and also the role of internal and external auditors in the company (Simon et al. 2014). The risk management considerations in a Company were analyzed on the part of both the internal and external auditors of the Company i.e. CSR Ltd. The formation of a committee is a must in every company which is discussed in the assessment and also formed the part of my learning. A non-executive member can take effective and major decisions for the committee which shows his independent nature. The applicability of the Corporate Governance Law is understood by the assessment. Adequate knowledge, skills and experience must be a foundation of a board member to ensure the implementation of the Corporate Governance (Tricker 2015). Self-assessment and reviews must form the part of the board members and I learned that if any mistake occurs, there can be a blunder in the whole organization. Through the assessment of the Consolidated Financial Statements, the percentages and various other required figures were calculated and analyzed (Income and Sheet 2012). I learned that the major valuable assets comprises of the non-current assets like equipments and properties. I even acquired the knowledge of applying of various inventory cost realization methods. Lastly, I learned that a company must have strong ethical values and its implementation should also be done in a perfect manner (Ferrell and Fraedrich 2015). One mistake and the entire company prove to be a deception. There must be strict controls over the corruption and the government must be provided with notices and advices on the maintenance of such fraud occurrences within the country. Module 4 This module, you learned about tools of financial statement analysis. When applied correctly, these tools will help you make informed financing decisions. The module content stressed the importance of always taking a contextual and comparative approach to the examination of financial figures within an organization. The financial statements are the most important statements which discusses and implements all the financial data of an organization. I learned that the statements must be prepared accordingly, as it has to be passed on to the important people which comprises of the stakeholders and the general public. The interpretation takes place after the identification of all the financial data which will be presented in the financial statements of the Company (Yeager et al. 2014). I have performed the analysis of the financial statements while moving through this course. In this course, I attained the knowledge that there are mainly three types of analyzing method of a company which are horizontal, vertical and ratio analysis. A completely different approach is required for performing the above three analysis methods and to understand the financial position of an organization (Homburg 2012). I learnt that the horizontal method of analyzing and interpreting data is actually the comparison of the changes over a number of periods, to jot down the changes which have crept in over such period. The vertical method compares the changes which take place over time and this method is used as complement to the horizontal one as they are similar to a great extent. The most variable and flexible analysis is the ratio analysis as they do not compare on a specific basis. The ratio analysis takes place as per the questions asked and required by the management and general public (Bodie et al. 2014). I have also learned about the way to maintain the working capital and the operating cash cycle of the organization. The main reason to manage the above is to have an eye over the movement of the cash which are invested in the activities and returned by the selling activities. Also, I have learned about the tools necessary to understand the management of currents assets and liabilities (McNeil 2015). The choices of funds creates a major impact on the financial performance of an organization and by the module, I have learned about the decision making process along with its benefits and drawbacks. Module 5 The second assignment consisted of questions in five parts which consisted of: Budgeting from the usage of the previous year consolidated financial statements. Decision making procedure by analyzing and interpreting the breakeven points, contribution margin and other such calculations required. The consolidated statement by calculation of various amounts like depreciation, recoverable amount, gross balance and other costs related to the organization. An income statement to derive the profits and other revenue operations performed. A Cash flow considering the consolidated income figures and data. The major learning points for me were: I learned that the previous year data can calculate an efficient budget statement for an organization. The trend can be identified and accordingly a budget can be prepared to get an effective financial statement (Cuganesan 2016). The comparison of the actual and budgeted can be analyzed to know the deficiency on the part of the management. Decision making through the computation of breakeven points, contribution margin per unit on an average and other profit decision making process can be a good attempt for an organization to maintain the balance of the companys procedures (Anderson et al. 2015). Further, I learned the depreciation methods to be applied and the procedure to collect the amount of recovery and other reportings required by an organization. I attained the knowledge of preparing the income statement and analyzing the total earnings from the operations undertaken by the organization. Lastly, by this assessment I learned the method to prepare the consolidated statement of cash flows by identifying the total inflows and outflows of an organization. The available cash balance was recognized which is necessary for knowing the profit of the company. Module 6 A good integrated report should consider certain critical factors which are of the environmental, social and governance nature. The factors are a way to assess the behavior of an organization and also by forecasting the future performances. The non financial factors can create a huge difference in an organization and hence should be critically analyzed before the application. I have known that the main purpose that the sustainability report serves is the exhibition of the organization progress and other major concerns (Sierra?Garca et al. 2015). Integrated reporting is considered as an emerging and insignificant practice in the terms of financial management but it has a potential and capability to identify the risks, perform decision making for both short and long term matters, throw light on the capability of the company . There are positive effects on a company but the transparency in the discussion of the internal matters like the strategies and policies in use can be a major threat for the organization (Eccles and Krzus et al. 2014). The important things learned by me are: Ethical values are an important part of organization and one small mistake can lead to an overall destruction of the company. The Australian Standards must be identified and analyzed well, before its application in the financial statements. Decision making process and preparation of the financial statements must be efficient in nature. The methods of analyzing data i.e. horizontal, vertical and ratio analysis. The importance of an independent member in the Board and also Corporate Governance and formation of a Committee. I have learned a lot throughout the course and will take the above for the execution in the real life. I feel that the analysis techniques and the method of integrated accounts must be learned in more depth as these are the trending topics in the modern world. I would definitely take the learning to grow and continue further for the betterment and enhancement of my own self. I will take the necessary steps to increase my learning by the techniques and process taught during the course. The practice and revision of the acquired knowledge and content will lead to an expertise which can be helpful in the future perspectives. References Anderson, D.R., Sweeney, D.J., Williams, T.A., Camm, J.D. and Cochran, J.J., 2015.An introduction to management science: quantitative approaches to decision making. Cengage learning. Beekes, W., Brown, P. and Zhang, Q., 2015. Corporate governance and the informativeness of disclosures in Australia: a re?examination.Accounting Finance,55(4), pp.931-963. Bodie, Z., Kane, A. and Marcus, A.J., 2014.Investments, 10e. McGraw-Hill Education. Cuganesan, S., 2016. The design of performance budgeting processes and managerial accountability relationships.Public Management Review, pp.1-18. Deegan, C. (2012).Australian financial accounting. McGraw-Hill Education Australia. Del Giudice, V., Manganelli, B. and De Paola, P., 2016, July. 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