The following Profit and Loss Statement was prepared by a graduate accountant for Formix Ltd. Forex Ltd is a long-standing company operating in the US with several subsidiaries. Discuss in detail which items in the statement do not comply with AASB101’s disclosure requirements and why.

 

Profit from operations Income from government bonds Dividends from subsidiaries Income tax expense Profit for year Retained profits at 1 July 2014 Profit and Loss Statement for the year ended 30 June 2015 Interim dividends paid-preference shares -ordinary shares Final dividends declared-preference shares ordinary shares Transfer to general reserve Retained profits at 30 June 2015 $ (6000) (100 000) (6000) (125000) Depreciation Debenture interest Employee benefits Impairment of receivables Audit and tax $300 000 40000 50000 $(237 000) (50000) Additional information relevant to the presentation of these financial statements, but not included as part of them, is as follows: (a) Profit from operations is after charging: 10000 20000 $ 500 000 12500 7500 520000 (250 000) 270 000 67 000 337000 (287 000) $ 50000 (b) Freehold land was revalued by directors at the end of the current year at $600 000, an increase of $100 000. Buildings on the land were valued at cost $400 000 less accumulated depreci- ation $180 000.