Questions-
Analyze the 2011 annual report of Rakon Ltd and answer the following questions.
1. Briefly describe the main operations (activities) of the Rakon Ltd and Subsidiaries group of companies?
2. According to accounting theory, for who is the annual report prepared. Provide specific referenced information here from the New Zealand Framework on why financial statements are prepared.
3. Rakon Ltd and Subsidiaries is a group of companies. Use the financial report to identify two other companies in the group.
4. a) Using group dollar figures for the 2011 year present the accounting equation ($ Assets = $ Liabilities + $ Equity)
b) Explain why the accounting equation always holds true.
5. a) Research and identify the international accounting standard (IAS or IFRS) for inventories and explain the measurement rule that applies in this standard.
b) Has Rakon Ltd group used this measurement rule (Reference required).
6. What is meant by the accounting concept of depreciation?
7. What is amortisation? Has the group applied the concept of amortization within the financial statements? Provide details and reference your source (annual report).
8. Describe the accounting policies the group has chosen to account for current assets "Trade and other Receivables". Reference your source.
9. a) What is the 2011total value of property plant and equipment?
b) What method of depreciation is used for property plant and equipment?
c) Why will the group have chosen this particular method of depreciation?
10. a) According to accounting theory(standards), what is meant by the term contingent liability?
b) Does the group have any contingent liabilities? Provide details.
11. Details of all expenses are not listed in the group Statement of Comprehensive income. Explain why this is and where other information can be found on expenses.
12. Does the group have a positive or negative cash flow for the 2011 year? Explain your answer using the totals of the three main cash flow activities.
13. Group operating revenues have changed between 2010 and 2011. Identify these changes and explain why revenues may have changed.
14. a) What is the group surplus or deficit (after tax) for the 2011 year? State whether it is a deficit or surplus.
b) Explain the reasons for the change from 2010 to 2011.
15. a) What is meant by solvency test? When and how is it applied?
b) Will the solvency test have been applied to the group in the 2011 calendar year? Explain with details.
16. a)What is meant by the accounting term "consolidation"?
b) Explain briefly how it will apply to this group of companies.
17. Rakon Ltd provides information on segmental reporting. What is the purpose segmented information? Is it a requirement of New Zealand accounting to provide this information? Research and explain.
Additional information-
These questions belong to Basic Accounting and it discuss about reviewing the annual report of Rakon Ltd and its subsidiaries for the year 2011. Questions about the annual report have been answered in detail in the solution.
Word limit-3500.