Coca-Cola

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TABLE OF CONTENTS

Executive Summary
1. Company Background
1. Coca Cola Amatil Brief Activities in Australia
2. Company’s brief financials
3. Company’s Strategy & Growth Drivers
2. Company’s Key Accounting Policies
1. Foreign currency translations (AASB 1012)
2. Inventories (AASB 1019)
3. Revenue (AASB 1004)
4. Changes in Accounting Policies (AASB 1001)
3. Flexibility in the Selection of Company’s Key Accounting Policies 4. Accounting strategy
5. Quality of Disclosures
6. Questionable accounting figures
7. Possibility to UNDO Distortions in the Accounting Numbers 8. CCA’s financial press
9. Conclusion
10. References
11. Appendices
1. Appendix 3: Flexibility in the selection of company’s key policies 2. Appendix 4: Specific recognition criteria
3. Appendix 5: Evaluation of the quality if the disclosures made in the accounts 1. Appendix 5a: Change in the composition of equity
2. Appendix 5b: Transition to AIFRS
3. Appendix 5c:Use of Estimates
4. Appendix 6: Changes of investment in bottler’s agreement 5. Appendix 7: Possibility to UNDO Distortions in the Accounting Numbers 1. Appendix 7.1: Investment in bottler’s agreement

2. Appendix 7.2: Modification of investments in Bottler’s Agreements 6. Appendix 8: Coca Cola Financial Press
1. Appendix 8a: Press Article 1
2. Appendix 8b: Press Article 2
3. Appendix 8c: Press Article 3

1. Company’s Brief History
The Company was incorporated in England in 1904 as British Tobacco Co. (Australia) Ltd and formed to acquire a number of tobacco manufacturers, including W.D. and H.O. Wills Ltd, British-Australasian Tobacco Company Pty Ltd, the States Tobacco Company Pty Ltd and Kronheimer Ltd.

1.1 Coca Cola Amatil Brief Activities in Australia
Coca-Cola Amatil is the principal Coca-Cola licensee in Australia and independently manufactures its own soft drinks and mineral waters. Coca-Cola was introduced to Australia in 1937 and by early 1938 the first manufacturing plant began operating in Sydney. Business began slowly, but the arrival of American troops to Australia in 1942 had significant impact on both sales and market acceptance. Licenses were granted to various bottlers in the 1940's and 1950's. CCA entered the Australian beverage industry in 1964 and by 1990 had acquired all the Australian Coca-Cola bottling licensed territories in Australia, except for those in part of the Northern Territory. Company’s is also holding more than 10 key brands, At present the company is having 14 Plants, 37 Production Lines, 14 Major Warehouses, 75 Cross Dock Locations, 390 Stock Keeping Units (approx.) & 3408 Employees.

1.2 Company’s brief financials
1) Revenue: 2125.1 Million, 2) Volume: 322 million unit cases, 3) Revenue per Unit Case: 6.60 $, 4) EBIT: 455.5 million, 5) EBIT margin: 14.3%, 6) Market Cap: 5423 million, 7) EPS & DPS is 43.1 & 31.5 respectively, 8) PE Ratio: 16.91, 9) Sales revenue grew 15.6% to $3.99bn, 10) Return on capital employed was 17.5%, down 4.1 percentage points due principally to the first time inclusion of SPCA, 11) Net operating cash flow was $435.2m compared to $381m last year, 12) The final dividend declared was 17.5 cents fully franked, which brought the total dividend to 31.5 cents, up 12.5% over 2004.

1.3 Company’s Strategy & Growth Drivers
Coca-Cola Amatil is becoming a broader-based beverage company by being the supplier of choice for both carbonated and non-carbonated beverages. To achieve its financial targets CCA is focused on the following five pillars of future per capita consumption growth are 1) Product and Package Innovation, 2) Cold Drink Equipment Placement, 3) Outlet Expansion, 4) Non-Carbonated Beverages Expansion, 5) Customer Service Improvement

2. Company’s Key Accounting Policies
2.1 Foreign currency translations (AASB 1012) Transactions in overseas currencies are converted to Australian currency at the rate of...
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