here is 2015 AGL energy annual report link:https://www.agl.com.au/-/media/AGL/About-AGL/Documents/Investor-Centre/150826_AnnualReport_1466512.pdf?la=en

ACCT2189/2213 Accounting in organisations and Society Assignment - Melbourne semester 2 2016 This assessment is to be submitted via Blackboard REQUIRED: This assessment needs to be submitted via Blackboard, no submissions will be taken in class or via any other means. A non-submission will result in a grade of zero (0). All answers need to be recorded in Blackboard. The questions following give an indication as to the mode of answer that is to be given in blackboard. You will only be able to enter blackboard once, so ensure you have your answers prepared before you open the assignment portal. Requirements You are required to access the website for AGL Energy Ltd (www.agl.com.au) and then answer the following questions. You will need to locate the Investor Centre sections plus the annual report. Within the annual report, pay particular attention to the information provided in the financial statements as you will find a lot of useful information in them that may help with some of the questions. Use the formula sheet provided to prepare your ratio solutions, this ensures that you can maximise your results. Ratios taken from other sources may use different numerators or denominators. The Due Date is Friday September 30th at 5.30pm The submission portal in Blackboard will be opened from Thursday 29th September 2016 at 7.00am and will close on Friday 30th September 2016 at 5.30pm. Accounting Assignment Semester 2 2016 Page Question 1 ( marks) (Multiple choice answer) The concept of triple bottom line reporting refers to the reporting on a. Corporate Governance, environmental and social performance b. Environmental, economic and social performance c. Employee, supplier and customer relations d. Profits, employees safety and economic performance Question 2 ( marks) (Multiple choice answer) Corporate Governance is growing in focus for companies in Australia. Using your knowledge select the best definition of corporate governance. Corporate governance refers to: a. The adherence to the laws set down by the Commonwealth of Australia b. The direction, control and management of an entity c. Issues with the rights and responsibilities of the company's management and its interactions with customers and external parties d. The decision making responsibilities of all the employees that are associated with the company Question 3 ( marks) (Multiple choice answer) Who is ultimately responsible for the Corporate Governance of the Company? a. The shareholders b. The employees c. The board of Directors d. The Chief Executive Officer (CEO) Question 4 ( marks) (Multiple Choice) Sustainability is a focus of many Australian companies. Sustainability can be defined as: - A development that is continual that uses renewable resources and excludes the use of scarce resources - Only using renewable resources in the development of new products - Using resources that meets the needs of the present without hindering future generations use of resources - Using resources that meet the needs of the present without thinking about the ability of future generations to meet their needs Accounting Assignment Semester 2 2016 Page Question 5 (1 marks) (Multiple Answers) Within the AGL Energy Annual Report there is an area on their sustainability business strategy. In this section there are a number of key aspects of the Australian energy market and policy reforms that AGL Energy is supporting. Select from the list below all the policy reform areas that AGL Energy are supporting in their business. - Improved energy production and distribution - General international trade agreements - Increased subsidies for fossil fuel use and production - Climate change policies and electricity market design - Implement an Emissions Trading Scheme - Energy affordability and vulnerable customers - Develop Nuclear energy - New energy technologies TURNING YOUR ATTENTION TO THE ANNUAL REPORT: In the AGL Energy website there is an area for investors (Investor Centre). Access the 2015 Annual report from here, there is no need to print it just down load Question 6a (Multiple Answers) (2 mark) The annual report contains a number of reports with only some of these being 'financial reports'. Name all of the financial reports shown for this company in the 2015 annual report. (Multiple fill in the blanks) Ensure your spelling is correct (you must use the same names as in the annual report) Accounting Assignment Semester 2 2016 Page Question 6b ( marks) The amounts shown in the financial reports are rounded. Identify how the amounts in the financial report for this company are rounded. (Multiple choice answer) a. Nearest dollar b. Nearest thousand c. Nearest million d. Nearest billion Question 6c (1 mark) Briefly explain why you believe the amounts shown in the financial reports are rounded in this way. (Multiple answer) Select 2 from the list below: - ASIC class order 98/100 allows the company to round amounts in this way. - The numbers are easier to read if they are rounded this way. - The report looks neater and the columns are not as wide. - Report is internal so doesn't need to be detailed. Exact detail is not necessarily required, for management decision making. - Rounding increases the speed at which the report can be prepared. It is not important for everything to balance. - Exact detail is not necessarily required, for investment decision making. Report is external so doesn't need to be detailed. - Details like dollars and cents aren't used by investment decision makers, they are more concerned with the Auditors report and directors report, to be interested in monetary performance. - External reporting is not for decision making and therefore does not need the detail of internal reports. Accounting Assignment Semester 2 2016 Page Question 7 (1 + 1 + 1 + 1 + 1 + 1 + 1 + 1 + 1 = 9 marks) Using the consolidated figures for AGL Energy Ltd calculate the following ratios for the years 2014 and 2015. .(Please use Consolidated Statement information). (Multiple fill in the blanks) Ratios are to be shown to two decimal places. Ratios 2015 2014 Profitability Analysis Profit Margin Return on Assets (ROA) Cash flow to sales ratio Asset Efficiency Asset Turnover Capital Structure Debt ratio Market Performance Earnings per share Dividend per share Working capital Debtors Days Liquidity Question 8 (1 + 1 + 1 + 1 = 4 marks) You have been provided with the following information about a hypothetical publically listed company, CoEnergy Ltd, in the same communications industry as AGL Energy Ltd: CoEnergy Ltd Ratios 2015 2014 Profitability Analysis Profit Margin 12.1% 11.0% Return on Assets (ROA) 9.81% 8.25% Cash flow to sales ratio 12.58% 14.96% Asset Efficiency Asset Turnover 0.80 times 0.82 times Capital Structure Debt ratio 40.02% 46.98% Market Performance Earnings per share 37.0 36.5 Dividend per share 64.5 64.0 Working capital Debtors Days 35.05 40.6 Liquidity 1.50 1.55 Question 8 continues Accounting Assignment Semester 2 2016 Page Using the information above and the calculations in question 7, that is the ratios you are required to make the following comparisons: (a) Looking at the Asset efficiency of both companies, which business has a better Asset turnover? (Multiple Choice) AGL Energy Ltd (b) CoEnergy Ltd Looking at the Profitability of both companies, which business has a better Profitability? (Multiple Choice) AGL Energy Ltd (c) CoEnergy Ltd Looking at the Capital structure of both companies, which business has a lower debt position? (Multiple Choice) AGL Energy Ltd (d) CoEnergy Ltd Looking at the Market performance of both companies, which business is performing better? (Multiple Choice) AGL Energy Ltd CoEnergy Ltd Question 9 (1 mark) (Multiple Choice) Using the information above and the calculations in question 7,: Look at the working capital section of your analysis for AGL Energy Ltd. The trend for Debtors days would indicate that; a. Debtors are paying their accounts faster b. Debtors are taking longer to pay their accounts c. Debtors are buying less on credit d. Sales on credit are increasing Question 10 (1 mark) (Multiple Choice) There are ways to encourage payments of invoices by accounts receivables, one is to offer discounts. Discount terms of 2/10 net 30 means a. Pay 10% today and the rest in 30 days b. Pay 2% in 10 days and the rest in 30 c. 2% discount if paid in full within 10 days d. 10% discounts if paid in full within two days Question 11 (1 marks) (Multiple Choice) Accounting Assignment Semester 2 2016 Page There are many benefits and costs to offering credit to customers. Select all the costs of offering credit to customers - Increased sales - Attracting new customers - Attracting impulse purchases - Opportunity costs - Bad debts - Slow payers - Reducing the cost of making a sale - Better profits - Reduced interaction with the customers. Question 12 ( marks) (Multiple Choice) When an entity does not have enough cash to meet its financial obligations as they fall due the entity is said to be a. Liquid b. Insolvent c. Dissolved d. Wound up Question 13 (1 mark) (Multiple Answer) There are many costs in business around cash. Select all the costs of not having enough cash in the business. - Opportunity cost - Bad reputation - Loss of business - More expensive borrowings - Embarrassment - Ensuring physical security over the money - Missed timings of cash flows - Closing of store outlets Accounting Assignment Semester 2 2016 Page : Question 14 (4 marks) Assume you are considering becoming an investor for AGL Energy Ltd or CoEnergy Ltd, that is, you will only be investing in one of them. Explain which company you would prefer to put all your money into and why you have chosen this company. Analyse the profitability of AGL Energy Ltd and CoEnergy Ltd . You may consider both financial and non-financial information in making this decision. (Multiple answers) Select 4 from the list below. - Profitability is more favourable for CoEnergy - Profitability is more favourable for AGL Energy. - Cash flow is improving for CoEnergy indicating growth - Cash flow is improving for AGL Energy indicating growth - Return on Assets is better for CoEnergy indication an efficient use of assets - Return on Assets is better for AGL Energy indication an efficient use of assets - The debt structure of CoEnergy is preferable indicating a more stable business - The debt structure of AGL Energy is preferable indicating a more stable business - The earnings per share for CoEnergy indicates a better situation for investors - The earnings per share for AGL Energy indicates a better situation for investors - The dividend per share for CoEnergy is preferable indicating a better return - The dividend per share for AGL Energy is preferable indicating a better return - CoEnergy's working capital is better due to favourable debtor days - AGL Energy's working capital is better due to favourable debtor days - Asset turnover is improving for CoEnergy indicating that better use of assets - Asset turnover is improving for AGL Energy due to an increase in sales - AGL Energy share price is higher indicating more demand for their shares - CoEnergy shares are cheaper so therefore I can purchase more ASSIGNMENT TOTAL - 30 Marks toward your final results Accounting Assignment Semester 2 2016 Page Ratio formulas for AGL Energy Ltd assignment 2016 Profitability Analysis Profit Margin (EBIT/Sales Revenue) x 100 = x% Return on Assets (ROA) (EBIT/Average total assets) x 100 = x% Cash flow to sales ratio (Net Cash flow from operating activities/Sales revenue) x 100 = x% Asset Analysis Asset Turnover Sales revenue/Average total assets Capital Structure Debt ratio Total Liabilities / Total assets Market Performance Earnings per share (Profit available to ordinary shareholders)/(Weighted average number of shares) = x cents per share Dividend per share Dividend Paid/Weighted number of ordinary shares Working capital Debtors Days (Average Receivables/Sales revenue) x 365 Liquidity Current assets/Current liabilities Accounting Assignment Semester 2 2016 Page