Accounting. Blackmores Limited

Only available on StudyMode
  • Download(s) : 98
  • Published : August 6, 2012
Open Document
Text Preview
Question 1
The principal operating activities of Blackmores Limited is to develop and market nature, innovative, quality branded health products including vitamins, herbal, mineral and nutritional supplement (Blackmores Annual Report 2011, page 37).

Question 2
As shown in the annual report, the chairman is Mr. Marcus C Blackmore AM (Blackmores Annual Report 2011, page 35).

The number of shares the chairman held in the company at the end of their 2011 financial year is 4,479,278 (Blackmores Annual Report 2011, page 36).

Question 3
The financial reports in Blackmores’ 2011 annual report are as follows: •Consolidated Income Statement (Blackmores Annual Report 2011, page 51). •Consolidated Statement of Comprehensive Income (Blackmores Annual Report 2011, page 52). •Consolidated Statement of Financial Position (Blackmores Annual Report 2011, page 53). •Consolidated Statement of Changes In Equity (Blackmores Annual Report 2011, page 54). •Consolidated Statement of Cash Flows (Blackmores Annual Report 2011, page 55).

Question 4
The note that deals with Significant Accounting Policies is note 3.5 (Blackmores Annual Report 2011, page 92).

The method of depreciation the company uses is straight-line method (Blackmores Annual Report 2011, page 62).

Question 5
The term, ‘Corporate Governance’ is used to describe the system in which companies are directed and controlled (Atrill,P, Melaney, E, Harvey,D, Jenner,M 2008, Accounting: an Introduction, 4th edn, Pearson Education Australia, Frenchs Forest, NSW, page 42).

The eight principles of corporate governance that Blackmores adheres to are as follows: 1.Lay solid foundations for management and oversight
2.Structure the Board to add value
3.Promote ethical and responsible decision-making
4.Safeguard integrity in financial reporting
5.Make timely and balanced disclosure
6.Respect the rights of shareholders
7.Recognize and manage risk
8.Remunerate fairly and responsibly
(Blackmores Annual Report 2011, page 30, 31).

Question 6
The purpose of the external auditor’s report is to give a true and fair view of the consolidated entity’s financial position and of its performance for the year ended on that date and as well as to comply with Australian Accounting Standards and the Corporations Regulations 2001 and the consolidated financial statements also comply with International Financial Reporting Standards as disclosed in Note 3 (Blackmores Annual Report 2011, page 49).

The audit firm engaged by Blackmores in 2011 is Deloitte (Blackmores Annual Report 2011, page 47).

Question 7
The total amount of revenue and other income in 2011 is $236,592,000 (Blackmores Annual Report 2011, page 51).

The two revenue items are ‘Sales’ and ‘Royalties’ (Blackmores Annual Report 2011, page 51).

The ‘other income’ comprised of Gain on disposals of property, plant and equipment, Government grants received for market development and Net foreign exchange gains (Blackmores Annual Report 2011, page 68).

Question 8
The amount of cash receipts from customers in 2011 is $247,828,000 (Blackmores Annual Report 2011, page 55).

This amount differ from the 2011 sales figures due to customers may have used prepayments and thus leads to a higher cash receipts and sales (Blackmores Annual Report 2011, page 55).

PART B - ANALYSIS OF FINANCIAL INFORMATION

Question 1
Workings:
Ratio(s)20102011
Current Ratio (no. of times)Current Assets
Current Liabilities

= 80,485,000
34,457,000
= 2.3Current Assets
Current Liabilities

= 78,521,000
33,221,000
= 2.4

Acid test Ratio (no. of times)Current Assets (excluding inventory & prepayments) / Current liabilities

= 80,485,000 – 22,555,000
34,457,000
= 1.7
Current Assets (excluding inventory & prepayments) /
Current liabilities

=78,521,000 – 23,749,000
33,221,000...
tracking img