Analysis Annual Report Medibank Australia -Myassignmenthelp.Com

Question: Discuss About The Analysis Annual Report Medibank Australia? Answer: Introduction This report provides an analysis of the accounting items, accounting policies, and importance of the accounting items for the company and the society. For this purpose, an annual report of Medibank Australia for the financial year 2016 has been selected. From the annual report, two accounting items have been selected and then an analysis into the accounting policies in relation to these accounting items has been conducted. Two Accounting Items and their Accounting Policies Two accounting items such as trade receivables and Property, plant and equipment have been selected from the annual report of Medibank Australia (Annual report of Medibank, 2016). The information extracted from the notes to accounts reveals that Metibank prepares its financial statements based on the financial reporting framework prescribed by the Australian Accounting Standard Board. In relation to trade receivables, it has been observed that the trade and other receivables of the bank comprise non-interest bearing accounts. The bank recognizes the trade and other receivables at the fair value on the initial recognition; however, subsequent recognition is made at the amortized cost which is computed applying effective interest method. The allowances for the impairment in the value of receivables is made and reduced from the amortized cost. The trade receivables falling due for receipt within 12 months are accounted for as current asset and that falling due after 12 months are accoun ted for as non-current assets (Annual report of Medibank, 2016). The property, plant and equipment comprises of assets such as land and building, plant and machinery, leasehold assets, and assets under construction (Annual report of Medibank, 2016). The accounting policy in regards to land and building prescribes that land and building is to be valued at fair value and that fair is to be reviewed at least after 3 years for revision. The building is depreciated applying the straight line method over the useful life. Further, the gains or losses on the disposal of an item of land and building are book in the statement of comprehensive income. Further, the items of property, plant and equipment are applied for impairment test so that the carrying amount does not exceed to the recoverable amount of the assets (Annual report of Medibank, 2016). Importance of the Selected Items The trade and other receivables of Medibank are $313.1 million forming part of the current assets of the bank. The bank holds total current assets of $2,812.50 million. This implies that the trade and other receivables of the bank are 11.15% of the total current assets. It indicates that the trade and other receivables of the bank are not much significant. The property, plant and equipment forming part of the non-current assets of the bank are worth $93.3 million. The total value of the non-current assets is $453.7 million. The value of property, plant and equipment is 20.56% of the total non-current assets (Annual report of Medibank, 2016). Thus, looking at the value of the property, plant and equipment, it seems that these items are not significant but considering the use of these items in the smooth running of the business, it could be inferred that these are of high importance for the bank (Shim and Siegel, 2007).; Social Impact of the Selected Items The social impact of trade and other receivables is more important than any other accounting item of an entity. The trade receivables are the customers who usages the products and services of the entity. The company strives to fulfill all the requirement of its customer to flourish and grow in the market. Further, the use of properties by the corporate also has impact on the society. The increase in the corporatization will decrease the space of accommodation for the social lives (Cronin and Dearing, 2017). Reflection on the Annual Report The annual report provides information about performance of the company during the financial year. The annual report of Medibank contains different sections such as directors report, financial report, corporate governance report, and business summary. At the starting pages, the report provides a snapshot of the financial performance over the period of five years (Annual report of Medibank, 2016). Further, the report provides a glimpse of References section adequately reflects the contribution made by the company for the social and environmental developments. The financial report section provides detailed information on the financial performance and position of the bank along with explanatory notes and auditors report. The annual report of Medibank seems appropriate; however, improvements could be made in the presentation of the information (Stittle, 2003). Conclusion From the discussion carried out in this report, it could be inferred that the annual report of a company is an important document for not only the investors but all the stakeholders. The information provided in the notes accompanying the accounts is crucial for the purposes of analysis of financial performance. References Annual report of Medibank. 2016. Annual report of Medibank for the year 2016. [Online]. Available at: https://www.medibank.com.au/content/dam/medibank/About-Us/reporting-centre-2016/Annual%20report/Medibank_Annual_Report_2016.pdf [Accessed at: 18 September 2017]. Cronin, economics. and Dearing, T.C. 2017. Managing for Social Impact: Innovations in Responsible Enterprise. Management. Shim, J.K. and Siegel, J.G. 2007. Handbook of Financial Analysis, Forecasting, and Modeling. CCH. Stittle, J. 2003. Annual Reports: Delivering Your Corporate Message to Stakeholders. Gower Publishing, Ltd.