Telstra Corporation Limited is an Australian telecommunications and media company that builds and provides land-based and mobile telecom services along with internet and pay television products. The company is Australia's largest \(3 \mathrm{G}\) and \(4 \mathrm{G}\) enabled mobile network covering 99.3 percent of the Australian population. Following are the financial statements for the 2012 year end, reported in Australian dollars.

Required

Forecast Telstra's fiscal year 2013 income statement, balance sheet, and statement of cash flows. Round forecasts to the nearest whole dollar. Identify all financial statement relations estimated and assumptions made. Estimate forecasted income statement and balance sheet relations to one decimal place. Assume that revenue will increase by \(3 \%\) in 2013. Calculate depreciation and amortisation expense as a percent of revenue. Assume no change for: other income, finance income and finance costs on the income statement. Assume no change for derivative financial assets, investments, current borrowings, derivative financial liabilities, share capital, reserves, and noncontrolling interests on the balance sheet. Assume that assets and liabilities classified as held for sale are eliminated in 2013. For fiscal 2013, capital expenditures are \(\$ 4,001\) million, and dividends are \(\$ 3,475\) million. Use the noncurrent borrowings as your plug account to balance the balance sheet. What do the forecasts imply about Telstra's financing needs for the upcoming year?

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TELSTRA CORPORATION LIMITED Income Statement ($ millions) Income Revenue (excluding finance income).. Other income.... Expenses Labour. Goods and services purchased. Other expenses Share of net (profit) from jointly controlled and associated entities.... Earnings before interest, income tax expense, depreciation and amortisation (EBITDA).. Depreciation and amortisation... Earnings before interest and income tax expense (EBIT) Finance income.. Finance costs.. Net finance costs Profit before income tax expense. Income tax expense. Profit for the year. 2012 $25,368 135 25,503 4,061 6,179 5,029 15,269 15,269 10,234 4,412 5,822 134 1,022 888 4,934 1,510 $ 3,424 2011 $25,093 211 25,304 3,924 6,183 5,047 15,154 (1) 15,153 10,151 4,459 5,692 127 1,262 1,135 4,557 1,307 $3,250