Question
Assume that you are a team of graduate accountants working for Pinnacle Pty Ltd, an independent consulting & accounting firm located at 87 Islington Street
Assume that you are a team of graduate accountants working for Pinnacle Pty Ltd, an independent consulting & accounting firm located at 87 Islington Street Sydney, NSW 2000. Among other things, your firm provides its clients with advice regarding accounting issues, including applying the Australian Accounting Standards in preparing Financial Reports. You must prepare a Statement of Advice (SoA) for Shine Ltd to address several accounting issues raised by Sonia Duncan on behalf of the company's directors. Sonia Duncan has raised these issues in a letter in the following two pages
Issue 1:
Assume that you are a graduate accountant working for Pinnacle Accountants & Co, a public accounting firm located at 87 Islington Street Sydney, NSW 2000. The manager of your firm, Mr. Peter Cliffe asked you to draft a statement of advice (see the format in page 5) in response to an email received from Sonia Duncan, the managing director of Shine Ltd in response to various key accounting issue. The following is the email sent from Sonia Duncan to Peter Cliffe.
Re: Accounting Issues: Year Ending 30 June 2024
From: Sonia Duncan
Sent: 15 July 2024
To: Peter Cliffe
Dear Peter,
Thank you for your phone call this morning. As agreed, I am emailing you regarding the two following accounting issues (listed below). As I do not have any accounting experience, please explain the principles and concepts for me in simple language. In order to assist our management team in the decision-making process, could you please make sure you reference any relevant sources relating to your advice, for example, AASBs, Corporations Act, and relevant websites?
Issue 1 Shine Ltd incurred the following development costs in the last two years:
\f$'000 Carrying amount of the factory at 30 June 2024 30,000 Value in use estimated at 30 June 2024 23,130 Value in use estimated at 30 June 2025 25,086Step by Step Solution
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