Key Questions

Key Questions

  1. "In FY 13 our share price rose by approximately 80%" and "Dividends also increased 10% from the previous year".

    I think this could be used as a good indicator of the strength and value of this company, do you agree?  Why or why not?

  2. "Directors believe that the presentation of non-AIFRS financial information is useful for readers of Annual Reports ..............equity valuation and research methodologies generally adopted in Australia".

    This statement was included in my company's Annual Report.  Does anyone know what non-AIFRS is and WHY is it important?

  3. Impairment of network infrastructure $4,995K; impairment of goodwill $2,814K: are listed as an expense.  What does impairment mean in this context?

  4. Derivative financial liability.  I have no idea of what this means.  Any ideas?

  5. "In specie distribution of shares"  and "Non specie distribution" are listed in Contributed Equity.  Again, never heard of this - can anyone shed some light?
Would love some help with these areas??!!

Megan

5 comments:

  1. Unknown18 March 2014 at 04:35

    Hi Megan,

    I did some research on KQ4 and found that derivative liabilities are financial instruments under contracts that have one or more underlying and one or more notional amounts. I am still struggling to understand what it means. Has it given you any insight?

    Thanks, Jess.

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  2. Rebecca Seron18 March 2014 at 04:56

    Hi Megan,
    To me, when something is impaired it is broken. So I assume that when goodwill is impaired it is less than it was to start with. So in the context of your accounts it would mean, I assume, that for some reason there is less goodwill than there was previously, or, in the case of network infrastructure, there is less than before, that cost could be that the infrastructure is now worth less than previously.
    Hope that helps
    Rebecca
    http://accountingwithbec.blogspot.com.au/

    ReplyDelete
  3. Sharon's Accounting Decision20 March 2014 at 21:54

    Hi Megan, we briefly discussed derivatives in the tutorial with Martin, to my understanding, derivative instruments are other operating comprehensive income, gains or losses, that go straight into equity, such as revalued assets or deferred tax impacts. There is so much more to learn!

    ReplyDelete
  4. Matt9221 March 2014 at 19:23

    Hi Megan,
    I had some similar KQ's so reading this has helped a lot thanks (and thanks to the ladies for their replies!).

    As for question two, AIFRS is the Australian equivalent to International Financial Reporting Standards so I would assume that non-AIFRS information is information that is not presented according to the AIFRS . Basically they have reformatted their statement to include other information that makes it not compliant with the AIFRS. I'm not sure whether it is important, I just think that they have included it as, like they say, it may be useful for readers or perhaps it makes it easier to understand.

    In specie distribution is a phrase describing the distribution of an asset in its present form, rather than selling it and distributing the cash. So I'm hazarding a guess that in specie distribution of shares means that Amcom have provided their shareholders with more shares instead of cash dividend. I'm assuming that non specie distribution is the opposite? not sure on that though.

    Cheers Matt

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  5. Megan McCormick21 March 2014 at 20:33

    Thanks so much Matt, Rebecca, Jess and Sharon! These are great explanations and make sense....helped heaps so thanks thanks thanks.

    ReplyDelete

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