Project 1

 Undertake your own research to obtain an organisation’s annual report. You can use one
from an organisation with which you are familiar or one which is freely available on the
internet or from ASIC. Alternately, your trainer/ assessor might provide you with one.

Answer these questions (150 to 180 words for each answer):

1. To who is this report disseminated and how does this take place?
The Annual report of the company is intended to provide to the shareholders and other
interested people information about the company's activities and financial performance.
The reports fulfil the basic function of informing the company's stakeholders of financial
health and management. Current and potential investors, as well as other people
interested in the finances of a company, use the annual report to assess the financial
health of the organization.
Investors, shareholders, banks, and executives of the company use the annual report of
the company for the decision making

2. Why might these recipients need or want the information contained in the annual report?
The primary purpose of financial statements is to aid current and prospective
shareholders and other providers of capital in their resource allocation decisions
The statement of comprehensive income provides a complete picture of company
performance by reporting the total monetary measure of all events that have changed
the value of an owner’s interest in the company, other than those events with owners
when acting in their capacity as owners.
The statement of financial position shows the monetary measure of all the resources
controlled by a company and all the obligations due by the company at one point in time
classified as current or non-current or in order of liquidity. The statement of changes in
equity reports all changes to equity during the financial period. The cash flow statement
shows the historical cash inflows and outflows for the financial period from operating,
investing and financing activities. The content of the four statements is supported by
notes. Also internal control report and auditor report
3. What information is contained in the report? Describe the contents and explain what it
disclosed about the organisation’s financial activities during the year.
The report includes data about the assets and liabilities and how they change during the
year (2017) and in comparison with the last financial year (2016), in this statement it’s
important to take into consideration the as current asset the cash, trade receivables,
inventories and non-current assets property, plant and equipment, intangible and as
liabilities borrowings, current tax payable, provisions and more
 Also about the incomes and expenses (Profit or loss statement) in which is represented
aspects like revenue from the sale of goods and services, Cost of sales administration
expenses, financing costs, Income tax expense, branch expenses and others.
The statement disclosed about the organisation’s financial activities during the year that
most of the assets and non-assets are concentrated in the inventories and Property, plant
and equipment respectively.

4. Is there any evidence that those within the organisation used consolidation or conversion
procedures to analyse the financial data which was available?
The evidence to determine that the company used a consolidation procedure to analyse
the financial data is that the company is a group of different business so it’s very
important to have a system that allows a good analysis of all the data of the whole
company.
In the financial procedure we find property, plant and equipment that is breakdown in
the notes, doing a deep analysis of that asset all Carrying amount at end of period of 2018
increased (development properties, freehold land, warehouse, retail and other
properties, leasehold improvements, plant and equipment), what gives the group a
positive panorama because increases the assets of the company as the liabilities decreses.
5. Has the organisation disclosed any asset or liability valuations? If so what do they
indicate?
Current liabilities are obligations the firm must pay within a year, such as payments owing
to suppliers. Non-current liabilities, meanwhile, represent what the company owes in a
year or more time, and it represents a bank and bondholder debt.

In the statement we can determine that there has been a decrease when talking about
debt and when debt levels are falling, it’s a good sign and we can notice in different
accounts like borrowings that changed from 2,777 in 2017 to 2,199 in 2018 and other
financial liabilities 116 in 2017 to 61 in 2018.
The quick bratio determines whter the company has enough cash and liquid assets to
cover its short-term debt obligations. For this company its:
𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑎𝑠𝑠𝑡𝑠−𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑖𝑒𝑠
𝑄𝑢𝑖𝑐𝑘 𝑅𝑎𝑡𝑖𝑜 = 𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠
= (7,181-4,233)/(9,196)= 0.3205. As it’s less
than 1 it means the company doesn’t have enough cash and liquid assets to cover its
short-term debt obligations.Also the total of assets increased from 2017 to 2017 in 515.

6. Is there any indication of any discrepancies, unusual features of queries about the
financial data? Describe.
The data is shown as usual, there’s not notorious discrepancies or unusual features of
queries about the financial data
7. Does it appear that the organisation claimed all available benefits and allowances?
Explain.
The available benefits and allowances may include different aspects like:
• Depreciation: Woolworths group comply with all the requirements of the depreciation
of all the assets, in order to
 • Donations: As the report says “Woolworths Group is committed to contributing the
equivalent of at least 1% of our pre-tax profits on a three-year rolling average every year
to community causes. We donate cash, in-kind or team member time to various charities
across Australia and New Zealand”
• Sales tax deductions: Tax deductions are reflecte4d in different statements like the
profit and loss, and gives the value of the NPAT. Also in the provisions of the taxes that
the company have.
• Interest payments: Net interest paid of $184 million decreased $50 million due to lower
net debt.

8. Did the organisation record details of its income and expenditure? Is evidence provided?
Provide details.
The company have different consolidated statements in which it shows in general the
incomes and expenditures like the Consolidated Statement of Profit or Loss, Consolidated
Statement of Other Comprehensive Income, Consolidated Statement of Financial
Position, Consolidated Statement of Cash Flows.
But also Woolworth’s group break down all the statements mentioned above showing
with more detail the income and expenditure.
Australian food makes $37,379 of $61,510 of the total sales. On the other hand Big W had
sales for $3,566 but it represents a loss of $110. Other incomes apart sales are classified
as Income tax effect, Movement in the fair value of investments in equity securities,
Movement in the fair value of cash flow hedges and others.
9. Examine the financial summaries for information about the financial status of the
organisation. Did the organisation show a profit?
In 2018 the company shows a profit of 1,795, the reports shows that the business with
more sales is New Zealand Food, following by Big W, it’s important to highlight that the
Cost of goods sold are the 70% of the sales in total which decrease in an important way
the profits.
Profit for the period: year 2018: 1,795 - year 2017: 1,593 = 202

Variation=202/1,593= 0.12680477

Conclusion: The profit increase 12, 68% in comparison with the last financial year.

9. What sorts of recommendations are made and what suggestions are made regarding
business activities for the upcoming year? Are they constructive?
To have better results its vital to decrease the costs in order to increase the profits, there are
different ways to do it like the improvement of productivity, higher productivity achieves higher
production with the same cost, or the same production with lower cost and this means the
best use of each of the resources.
 Also the improvement of quality. The higher the quality of the product or service, the greater
the satisfaction, the greater the loyalty and stability of the customers, the more sales and the
greater the possibility of increasing the price.

Another way to decrease the cost is investing in technology in order to optimize process.
Reduce inventories, inventory takes up space, prolongs the waiting time for production,
generates transport and storage needs, and absorbs financial assets.

10. Is the report and any recommendations clear and logical?

The report is extensive and it have different point to zoom at. As it’s a really big company
they have all the procedures organized which allow them to have clear and logical analysis
and data of all the reports.
11. Has the organisation complied with its statutory requirements? Explain.
Woolworth’s group operations are subject to a range of laws and regulatory requirements
regarding competition, employment, health and safety, product and consumer regulation,
privacy, anti-bribery and corruption, anti-money laundering, liquor, gaming and the
environment. As the report says remaining compliant with the wide and diverse range of
regulatory requirements applicable to the businesses is recognised as an important
requirement to maintaining the ability to operate sustainably and successfully.

The organization have an overarching Compliance Framework in place encompassing a

range of policies, procedures and business operational compliance plans to help manage
our legal and regulatory compliance. It’s important to highlight that the Code of Conduct
and training programs promote awareness of our core legal, regulatory and internal policy
requirements. As a retailer of alcoholic beverages, the company its aware of their obligations
and have programs in place in relation to responsible drinking and the responsible service,
ranging, sale and marketing of alcohol.

12. Compare the two reports and comment on whether or not the projections from the first
report were accurate.
It’s important to have into consideration that the Petrol business was reported as a
discontinued operation from 2017 that explain the blanks on the reports of 2018.
The projections were accurate as a result we find news like “Woolworths recorded the
strongest growth in sales in years as the supermarket chain posted a 12.5% lift in full year
profit to $1.72 billion”

13. Were the recommended changes/ improvements made? How did they impact on the next
year’s report (if at all)?

REFERENCES
https://www.woolworthsgroup.com.au/icms_docs/195396_annual-report-2018.pdf

https://www.woolworthsgroup.com.au/icms_docs/188795_annual-report-2017.pdf

https://www.woolworthsgroup.com.au/content/Document/Woolworths%20Group%20201
8%20Full-Year%20-%20Five%20Year%20Summary%20PDF.pdf