For The a2 Milk Company Ltd., comment on the following:

Knowledge and understanding of the accounting principles and standards for non-current assets, revenue, and liabilities.

i. Discuss why the selected company has prepared the General Purpose Financial Statements (GPFS). Your discussion should include a reference to the objective of a conceptual framework.

ii. State the basis of preparation of these statements.

iii. Refer to the following items from the statement of financial position/ Balance sheet of The a2 Milk Company Ltd:

➢ Property, Plant& Equipment (PPE)

➢ Intangible assets ➢ Right of use of asset

➢ Deferred tax assets

➢ Deferred tax liabilities

➢ Provisions

Review the information provided in notes to financial statements about each of the above items. In your written report identify the following for each of the above items:

▪ accounting standards used for reporting.

▪ measurement basis used.

▪ key judgments and estimates applied.

iv. Identify the selected company’s sources of revenue and the accounting standard applied for reporting revenue.

v. Explain the revenue recognition criteria applied to each of the revenue sources identified in point iv above and further assess whether it satisfies the recognition criteria as stated in the Conceptual Framework.

Preparation, presentation, and analysis of cash flow statement.

i. Outline the two different methods of preparing the statement of cash flows. Examine the selected company’s statement of cash flows and report on the method used.

ii. Assess how each section in the statement of cash flow of your selected company relates to the statement of financial position.

iii. Examine the selected company’s statement of cash flows and compare the cash from operating activities with operating profit after tax. Are they similar? If not, suggest why.

iv. What financing activities were undertaken by the selected company? Compare the borrowings from the previous year and suggest reasons for any major changes. Were there any payments made to shareholders?

v. Generate an opinion about the selected company’s cash position and its usefulness to shareholders, lenders, and creditors.

Developed recommendations in line with the evidence available in the annual report.

Analyze the measurement basis, key judgments, and estimates identified for Property Plant & Equipment (PPE) and Intangible assets. Discuss whether this provides relevant, reliable, and faithful representation to stakeholders. For this analysis, you may look at qualitative characteristics mentioned in the conceptual framework and look at an annual report of another company in a similar sector and compare the approach adopted with The a2 milk company.