Prepare necessary adjusting journal entries for the above

Question

Question 1: Wild and van Staden (2013, p. 6) argue that stand-alone reports relevant to social and environmental activities are non-integrated. Therefore, they are not capable to evaluate business performance, strategy and potential for value creation for different types of stakeholders (cited in Bernardi, 2015). Integrated reporting evolves due to response to this criticism (Bernardi, 2015).

Required: Critically discuss the above statement and briefly explain the role of integrated reporting by identifying the problems associated with tradition financial reporting. Choose a company listed on the ASX and identify whether the company prepare integrated reporting or not?

References:

Bernardi, C. 2015. The transparency of environmental, social and governance disclosures, integrated reporting, and the accuracy of analyst forecasts, Working paper.

Wild, S. and van Staden, C. 2013. Integrated Reporting: initial analysis of early reporters - An institutional theory approach', paper presented at the 7th Asia Pacific Interdisciplinary Research in Accounting Conference, 26-28 July, Kobe, Japan.

Note 1: Word limit for Question 1 is 1,000.

Note 2: Professional marks will be awarded for format, clarity and expression.

Note 3: The presentation of Question 1 should include Introduction, Discussion, Conclusion and List of references.

Note 4: You will be able to obtain electronic copies of articles by visiting La Trobe University Library website.

Question 2: At the end of its financial year, Roxy Ltd. took the following information from its accounting books of record.

Trial Balance as at 30 June, 2017

	Debit AUD $	Credit AUD $
Land	10,200,000
Buildings	40,000,000
Vehicle	2,500,000
Accumulated depreciation- buildings		4,000,000
Accumulated depreciation- vehicles		500,000
Investments	35,000,000
Cash at Bank	1,000,000
Accounts receivables	4,495,000
Inventory	21,500,000
Share capital		67,000,000
Calls in advance		2,000,000
Retained earnings***		2,600,000
Mortgage payable on land and buildings		20,000,000
Bank overdraft		7,500,000
Accounts payable		2,000,000
Sales revenue		24,000,000
Interest on investments		1,000,000
Rent revenue		750,000
Cost of sales	11,000,000
Selling Commission expense	100,000
Delivery expense	200,000
Salaries: Travellers	450,000
Salaries: Administration	2,000,000
Directors fees	200,000
Audit fees	90,000
Interest on mortgage	1,000,000
Damage due to fire	150,000
General expenses	1,465,000
	$131,350,000	$131,350,000

Note: Retained earnings is after deducting last year's final dividend of $2,500,000 and an interim dividends for this year of $1,500,000.

Additional Information -

i. Depreciation on vehicles at the rate of 10% p.a. and on buildings at the rate of 5% p.a. for the whole year.

ii. The allowance for doubtful debts at 30 June 2017 is estimated to be $160,000.

iii. Unrecorded and unpaid travellers' salaries amount to $100,000.

vi. Prepaid general expenses amount to $15,000

v. Income tax provided for totals $3,504,000

vi. A final dividend is recommended for a total of $2,500,000

vii. $1,000,000 is to be transferred to a general reserve

viii. Land is revalued to its fair value of $11,000,000

ix. Roxy Ltd pays income tax at the rate of 30%.

x. On 21^st June 2017, Roxy Ltd was notified of an impending legal suit for $17,000 against the company for breach of contract. The case was settled 15^th July 2017

xi. The share capital consists of 67,000,000 ordinary shares of $1 each

xii. On 20 September 2017, Roxy Ltd issued 100,000 fully paid shares to acquire the net assets of ABC Pty Ltd at price of $2.5 per share.

xiii. On 28 July 2017 the Commonwealth government enacts legislation altering the company income tax rate from 39 per cent to 42 per cent for all income tax returns from 1 July 2017

Required:

1) Prepare necessary adjusting journal entries for the above events.

2) Prepare a Statement of Comprehensive Income, a Statement of Financial Position and a Statement of Changes in Equity for ROXY Ltd for the year ended 30^th June 2017 in accordance with the requirements of AASB 101.

3) Prepare at least fifteen (15) notes to the financial statements according to the relevant accounting standards.