Extra Information:

Company - Telstra

Cost of Sales - $9,137

Please answer all wuestions neatly and clearly full working

Hi, as the question stated this is a Case study so the information being using is supplied through Telstra's Finanacial Statement as of 2019 and 2020. Down Below i have attached their finanical statement (Income Statement, Statement of Comprehensive Income, Statement of Financial Position, Statement of Cash Flow and Statemebt kf Changes in Equity).

PLEASE USE COST OF SALES AS $9,137

2020 Financial Statement:

Financial Statement 2019

Marks 5 U Using the annual report allocated to you, answer the following questions: 1. For the financial year 2020: a. What was the total assets and liabilities of the company you are analysing? b. What was the total equity? c. What was the total comprehensive profit? If the company has subsidiaries, please give the consolidated figures. 2. Prepare a horizontal analysis of the company's balance sheet you are analysing making 2019 as the base year with regards to: a. Current Assets. b. Non-Current Assets. C. Current Liabilities. d. Non-Current Liabilities. 3. Comment on the trend of those ratios above and interpret the movement. 4. Prepare a vertical analysis of the company's consolidated income statements for the years 2019 and 2020 using the data from consolidated income statement and limit it to the line of Profit before taxation. Comment on the result. 5. Analyse and comment on the company's level of liquidity for 2020 which is measured by the following ratios: a. Current ratio b. Acid-Test ratio c. Accounts Receivable turnover d. Accounts Receivable collection period e. Inventory turnover f. Days of Inventory 6. Comment on the liquidity of the company in 2020. Use the finding of the above ratios compare it to benchmarking available in the internet as much as you can to comment on the performance of each ratio and the liquidity. 5 5 5 5 5 10 5 5 5 5 5 5 20 100 Income Statement For the year ended 30 June 2020 Telstra Group Year ended 30 June 2020 2019 $m $m Note Income Revenue (excluding finance income) Other income 2.2 2.2 23,710 2.451 26,161 25.259 2.548 27,807 Expenses Labour Goods and services purchased Net impairment losses on financial assets Other expenses 5.279 9.138 184 2.3 4.058 9.107 202 3,584 16,951 (305) 17.256 Share of net (loss)/profit from joint ventures and associated entities 5,234 19,835 12 19.823 6.2 2.3 2.2 2.3 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 Profit/(loss) for the year attributable to: Equity holders of Telstra Entity Non-controlling interests 8,905 5.338 3,567 274 1.045 771 2,796 957 1,839 7,984 4.282 3,702 238 868 630 3,072 923 2,149 2.4 Earnings per share (cents per share) Basic Diluted 1.819 20 1,839 cents 15.3 15.3 2.154 (5) 2,149 cents 18.1 18.1 2.5 2.5 The notes following the financial statements form part of the financial report. Telstra Financial Report 2020 Statement of Comprehensive Income For the year ended 30 June 2020 Telstra Group Year ended 30 June 2020 2019 Sm $m Note Profit/(loss) for the year attributable to: Equity holders of Telstra Entity Non-controlling interests 1,819 20 1,839 2.154 5) 2,149 5.3 82 25 (10) 3 3 income 16 (2 (43) 08 (22) & Items that will not be reclassified to the income statement Retained profits Actuarial loss on defined benefit plans attributable to equity holders of Telstra Entity Income taoc on actuarial loss on defined benefit plans Fair value of equity instruments reserve Gain from investments in equity instruments designated at fair value through other comprehensive Share of other comprehensive income of equity accounted entities Income tax on fair value movements for investments in equity instruments Atems that may be subsequently reclossified to the income statement Foreign currency translation reserve Translation differences of foreign operations attributable to equity holders of Telstra Entity Cash flow hedging reserve Changes in cash flow hedging reserve Share of other comprehensive income of equity accounted entities Income tax on movements in the cash flow hedging reserve Foreign currency basis spread reserve Changes in the value of the foreign currency basis spread income tax co movements in the foreign currency basis spread teserve 21 39 43 54 3 43 (16) (22) (16) 2 49 6 1,845 7 26 66 2.215 Total other comprehensive income Total comprehensive income for the year Total comprehensive income for the year attributable to: Equity holders of Telstra Entity Non-controlling interests The notes following the financial statements form part of the financial report 1.825 20 2.220 15 Statement of Financial Position As at 30 June 2020 Telstra Group As at 30 June 2020 2019 $m sm Note 493 5.121 5.390 35 39 82 35 147 2 265 120 7 457 121 7,300 3.10 6,534 1420 1354 24 29 35 6.2 28 897 21 780 1.232 35 1.200 25 21.836 3.3 3.2 3.000 7,412 2011 66 123 37.869 46 403 7.700 2.080 50 232 35.286 42,589 Current assets Cash and cash equivalents Trade and other receivables and contractants Deferred contract costs Inventories Derivative financial asets Current tax receivables Prepayments Assets classified as held for sale Total current assets Non-current assets Trade and other receivables and contract assets Deferred contract costs Inventories Investments - accounted for using the equity method Investments - Other Property, plant and equipment Right of use assets Intangible assets Derivative financial assets Deferred to Dafined benefit asset Total non-current assets Total assets Current liabilities Trade and other payables Employee benefits Other provisions Leasibilities Borrowing Derivative financial buities Current tax payables Contract liabilities and other revenue received in advance Liabilities classified as held for sale Total current liabilities Non-current liabilities Other payables Employee benefits Other provisions Loaseliabilities Borrowings Derivative financial abilities Deferred to be Dofined benefit liability Contract labilities and other revenue received in advance Total non-current liabilities Total liabilities Net assets 3.6 51 7.3 100 3.900 723 124 611 2.753 54 224 7,611 43 24 3.7 3.10 100 1657 79 9,553 10,094 3.6 5.1 73 3.3 4 127 143 68 158 158 13.066 15.031 283 320 24 3.7 1.805 8 1.202 19,162 29,256 15,147 1.271 18,506 28,059 14,530 Telstra Financial Report 2020 Statement of Financial Position (continued) As at 30 June 2020 Telstra Group As at 30 June 2020 2019 $m $m Note 42 4.2 Equity Share capital Reserves Retained profits Equity available to Telstra Entity shareholders Non-controlling interests Total equity 4,451 5 10.017 14,473 674 (58) 10,160 14,549 (19) 14,530 15,147 The notes following the financial statements form part of the financial report. Income Statement For the year ended 30 June 2019 Telstra Group Year ended 30 June 2019 2018 Restated Sm Sm Note Income Revenue (excluding finance income) Other income 22 22 25.259 2,548 27,807 25.848 2,993 28,841 Expenses Labour Goods and services purchased Net impairment losses on financial assets Other expenses 5.207 8.338 190 23 5.279 9.138 184 5.234 19,835 12 19,823 4,887 18.622 (22) 18,644 Share of net profit/(loss) from joint ventures and associated entities 6.2 23 10,197 4.470 5,727 218 22 23 7,984 4.282 3,702 238 868 630 3,072 923 2,149 806 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 Profit (loss) attributable to: Equity holders of Telstra Entity Non-controlling interests 588 24 5,139 1.582 3,557 2.154 15 2,149 cents 18.1 3,591 134 3,557 cents 30.2 30.2 Earnings per share (cents per share) Basic Diluted The notes following the financial statements form part of the financial report. 25 25 18.1 Telstra Financial Report 2010 Statement of Comprehensive Income For the year ended 30 June 2019 Telstra Group Year ended 30 June 2019 2018 Restated Sm Sm Note Profit/(loss) for the year attributable to: Equity holders of Telstra Entity Non-controlling interests 2.154 (5) 2,149 3.591 34 3,557 5.3 (TO) 3 112 (34) Items that will not be reclassified to the income statement Retained profits Actuarial lossgain on defined benefit plans attributable to equity holders of Telstra Entity Income tax on actuarial lossgain on defined benefit plans Fair value of equity Instruments reserve Gain loss) from investments in equity instruments designated at fair value through other comprehensive income Share of other comprehensive income of equity accounted entities Income tax on fair value movements for investments in equity instruments Foreign currency translation reserve Translation differences of foreign operations attributable to non-controlling interests 3 (16) 86 29 2 3 40 90 39 48 4 4.3 Items that may be subsequently reclassified to the income statement Foreign currency translation reserve Translation differences of foreign operations attributable to equity holders of Telstra Entity Share of foreign currency translation reserve of equity accounted entities Cash flow hedging reserve Movements in cash flow hedging reserve Income tax on movements in the cash flow hedging reserve Foreign currency basis spread reserve Changes in the value of the foreign currency basis spread Income tax on movements in the foreign currency basis spread reserve 3 (1) 1972 29 223 7 26 66 (31) 9 (38) 52 3,609 2.215 Total other comprehensive income Total comprehensive income for the year Total comprehensive income attributable to: Equity holders of Telstra Entity Non-controlling interest The notes following the financial statements form part of the financial report. 2.220 5 3.646 1371 Statement of Financial Position As at 30 June 2019 Telstra Group 30 June 2019 As at 30 June 1 July 2018 2017 Restated Restated Sm $m Note Sm 20 33 3 60 5392 5.58 ea 938 6.000 106 LE 21 75 170 7 412 3:1 7,303 7.290 8,047 790 730 1.180 8 971 993 20 35 129 25 31 32 22.100 2.922 292 21.350 8.312 1.623 7210 Se ** 24 53 Current assets Cash and chivalents Trade and other receivables and contract sets Deferred contract costs Inventories Derivative financial assets Current tax receivables Prepayments Assets clasified as held for sale Total current assets Non-current sets Trade and other receivables and contract assets Deferred contract costs Inventones Investments - accounted for using the equity method Investments - other Property, plant and equipment Intangible assets Derivative financial Deferred tax Defined benefit Total non-current assets Total assets Current abilities Trade and other payables Employee benefits Other provision Borowing Derivative financial Current payables Contract liabilities and other revenue received in advance Liabilities classified as held for sale Total current liabilities Non-current liabilities Other payable Employee benefits Other provision Bonowing Derivative financial abiti Deferred tax liabilities Defined benefit liability Contract lisbilities and other revenue received in advance Total non-current liabilities Total liabilities Net assets 54 250 35,433 42,723 35.286 33.950 42.000 25 51 30 160 3.944 36 10 399 52 103 16 79 9,553 1 133 1532 43 101 1.434 31 8.785 9,081 35 51 15 65 153 15 15310 70 100 134 14.800 15.001 530 43 24 5 1.52 1537 7 1881 19,319 28,104 14,619 1.443 . 1.617 18,774 27.855 14.151 18.505 28.059 14,530