Royal Dutch Shell

Case study on the Annual report of Royal Dutch Shell

Teacher: Professor Eno L. Inanga
Student: Boy Theunissen
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Assignment:
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Study carefully the 2008 Summary Consolidated Financial Statements of Royal Dutch Shell plc. Comment critically on each of the following sections of the Financial Statement in comparison with the preceding year, 2007.

Introduction

Every year a company has to make a annual review, just like Royal Dutch Shell and let it audit by a external auditor. In this review is stated how Shell’s financial position is at the moment, and in relationship to the previous years. In the case of Royal Dutch Shell this is 2006, 2007 and 2008. When we look at the actual situation of Royal Dutch Shell we must watch out with our conclusions because it is a snap-shot. When for example Shell gets paid from a debtor this could let to a major change to the liquidity of Shell.
Not every aspect of the annual report is analyzed, the main focus is on the most important changes of the Statement of Income, Earnings per Share, Balance sheet, Summary of the Consolidated Changes of Statement in Equity and the Summary of the Consolidated Changes in Statement of Cash flow.
What is obvious stated is that Shell has subsidiaries, but how much is not stated. These subsidiaries influence the annual report of Shell, but are not always clearly explained. In the Summary Business Review there is almost no information about these subsidiaries stated.
When we look at the Independent Auditors Statement (2008) from PWC (the auditor from Shell), the next 2 sentences express clearly for who the Shell’s Annual Review is made:
‘This statement, including the opinion, has been prepared for and only for the Company’s members as a body in accordance with section 251 of the Companies Act 1985 and for no other purpose’. ‘We do not, in giving this opinion, accept or assume... [continues]

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