Amcom's Assets, Liabilities & Equity

Assets

1. Goodwill  -  $34,472,000
   
   Goodwill is a non-current asset.  This account has increased from $23,126,000 in 2011 to $34,472,000 in 2012 which indicates Amcom has purchase another entity in that year.  In a dollars sense goodwill basically is the difference between purchase price and assets but in a reality sense it is the intangible value of that company - why you would pay more than what the assets etc are worth - maybe a company's reputation reputation, industry placement etc??
   
2. Trade and other receivables  -  $15,983,000
   
   This is a current asset as is it is predicted to be received in the short term future usually 30 days.  Amcom has pretty much the same trades and receivables as the prior year which indicates stable activity. They written off $272,000 which is a small amount in the big picture (2%). The remaining amount has been reviewed and decided by management to be fully collectible.
   
3. Plant, property & equipment  -  $123,209,000
   
   This non current asset has increased in the last year by over $14,360,000 opposed to only $6,000,000 for 2011.  The biggest increase in assets was in the area of network infrastructure which is associated with the Cloud & Cisco partnership.

Liabilities

1. Derivative Financial Liability
   Current - $47,000,000
   Non Current - $70,000,000
   
   These are obligations the firms has with an agreement of a interest rate swap being the BBSW rate (Bank Billed Swap rate) +1.5%.  This is basically to lock in a fixed amount and control variation to amounts paid due to fluctuating interest rates.
   
2. Deferred Revenue  -  $13,934,000
   
   The is a great example of Accrual Accounting.  The deferred revenue noted above is revenue which has been received but not yet earned.  A possible example of this may be a customer has paid for 12 months of IT assistance of which only 6 months has been provided.  Therefore 6 months essentially has not yet 'earned' and is therefore an obligation (ie liability) for Amcon to provide this service.
   
3. Borrowings
   
   Current - $639,000:  This is a short term loan which is forecast to be paid back within a year, not a substantial amount.
   Non Current - $36,516,000:  $4,480,000 is for the upgrade to network infrastructure for the Cisco partnership. The other substantial portion of this liability, $31,500,000 is drawings on bank borrowings due to expire on 31/12/16.

Equity

1. Retained profits  -  $13,493,000
   Essentially a bucket of funds retained as equity and not distributed to shareholders as dividends.
   
2. Contributed equity - $107,873,000
   This is quite self explanatory being capital invested by equity shareholders.
   
3. Reserves - $720,000
   This is a tool used to recognised the shares transferred to employees/executives as part of their remuneration.

Megan