Assessment Task

Majan International LLC is a well-known IT organization with a strong workforce of dedicated employees. However, the Managing Director has recently identified that many of his staff members have a poor understanding of financial statements and difficulty in interpreting financial information as their education has not exposed them to such information. You have been asked to answer the following tasks in preparation for the coursework that you will perform internally for the company. You need to prepare a report addressed to Mr. Sameer. The structure of the report should be as follows:

I. Introduction

a. Briefly explain the role of accounting.

b. Discuss the accounting process and role of Financial Accounting.

II. Discussion

a. Discuss the accounting conventions and concepts relating to consistency and materiality.

b. Explain what the statement of comprehensive income (Income Statement) and statement of financial position (Balance Sheet) represent about Majan International LLC.

c. Briefly discuss what is contained in Income Statement and Balance Sheet of Majan International LLC. Give examples.

d. Prepare the pro-forma templates for each statement.

e. Discuss the two methods of depreciation available to Majan International LLC.

f. Briefly explain the differences between the two methods.

III. Recommendation

a. Explain the purpose and need of Financial Statement Analysis.

b. Analyse the financial performance of Majan International LLC using Liquidity and Profitability ratios based from the pro-forma statements prepared.