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Assessment 1

Steps 3,4,5,7&8

Financial Statement Analysis

ACCT13017

Due, 2020

Heidi McCormick

10076872

Heidi McCormick10076872 of 22

Step 3

My firm is Apollo Tourism & Leisure Ltd. They are the campervans you will see

travelling around the country. I was very excited to receive this company as we have

actually booked a six-berth camper for our holiday in New Zealand in June so I feel

lucky that I get to discover where my hard earned money will be going.

I was shocked to see that that the total revenue for 2019 was over $365M. My

previous knowledge of the company only came from seeing them driving around

Australia and having hired one several times while driving around the beautiful

country side of New Zealand. I was surprised to see that they operated out of Europe

and North America with North America having more rentals than Australia.

The profit and loss statement has an expense called external acquisition costs. I

have never heard of this cost before and in 2017 it was $1,664,000 increasing from

$0 in 2016 then to slowly decrease through to $158,000 in 2019. This has confused

me as there is nothing in the notes to explain where this cost comes from. I can only

assume that in 2017 they started purchasing a lot of assets which dramatically

increased their costs. I am having difficulty understanding where I could look to find

out more information on this expense. I thought of looking if there were dramatic

changes in property plant and equipment in case they had made large purchases in

2017. There was an increase but it left me with more questions as the increase was

a dramatic. From $129,625,000 in 2016 to $381,973,000 in 2019 for property, plant

and equipment, so my first assumption of external acquisition costs being that they

purchased a lot of assets in 2017 and less in the following year was incorrect,

otherwise the assets would have increased and decreased in a similar fashion to

coincide with the expense.

An important area as well as a challenge for the firm is the increased amount of

trades and other payables in the statement of financial position. This amount has

more than tripled over the last four years to $33,298,000 in 2019. The notes on this

liability state that these amounts are usually paid within 30 days but I could not find

where there is proof of this or exactly what percentage is not paid within 30 days. As

a company I can imagine they would not want to have a bad relationship with their

suppliers by not paying their debts on time. If they are paying within 30 days, then I


guess they are successful in meeting that challenge to then keep the suppliers

happy to be able to continue business.

Something that I find confusing is for the 2019 year they have changed the financial

statements and revenue section. Sales of service and sales of goods are no longer

an item and revenue from contracts with customers and rental income is now in its

place as a new accounting policy. It states that the new policy is for when the control

of the goods and services is transferred to the customer at an amount that reflects

the consideration to which the consolidated entity expects to be entitled in exchange

for transferring goods or services to a customer. In my understanding this is just a

reflection of the movement of sales for the company.

Another key challenge for the first is soft sales of their second hand vehicles world-

wide. This has been offset by a higher than expected increase in rental demand.

Although I feel that the soft sales markets need to be taken seriously and could be

critical as when every part of the business is succeeding then there is no need for

another area of the business to have to exceed to be able to make up for the areas

that are not doing well. I believe the strategy Apollo has taken on is to retain these

vehicles that did not sell for the following season which then reduced the purchasing

requirements, that would have needed to take place if these vehicles were sold. It is

stated that they were able to achieve this strategy due to the flexibility of their

business model.

News articles, blogs and videos

Some negative reports on TripAdvisor. Not painting the company in good light.

https://www.tripadvisor.com.au/ShowTopic-g255055-i120-k6488689-

Apollo_motorhomes_BEWARE-Australia.html

Video of some of the fleet and what you can see in a motorhome/van

https://www.youtube.com/channel/UCjCTa6toRAO-xLs26TDJ1nA

A great video with a how to guide on a few motor home models

https://www.youtube.com/watch?v=G5mlZ-o4ZBM

Some specials Apollo has on offer


https://www.youtube.com/watch?v=G5mlZ-o4ZBM

https://www.youtube.com/channel/UCjCTa6toRAO-xLs26TDJ1nA

https://www.tripadvisor.com.au/ShowTopic-g255055-i120-k6488689-Apollo_motorhomes_BEWARE-Australia.html

https://www.tripadvisor.com.au/ShowTopic-g255055-i120-k6488689-Apollo_motorhomes_BEWARE-Australia.html

https://old.apollocamper.com/specials.aspx

Three favourite Blogs

These have been posted to the forum as specified in requirements:

Kiah Frahm’s Blog

https://kiahfrahm.wixsite.com/blog

When opening Kiah’s blog, I had to have a laugh. The first words that popped up

where “The Reckoning”. I think we all feel like that at some stage during the term. I

really enjoyed the view ability of her page and that she added a personal photo so I

could get more of an idea who I was communicating with. Also, the way she set out

her KCQs with headings such as the chapters. This made an easy read. I also felt

like she didn’t overdo this step. She was able to add some good aspects of

confusion and agreement. An overall enjoyable read. I did leave a comment and

have discussion on Kiah’s blog but was unable to paste a snip as proof. She is using

something other than WordPress and it is not allowing me to see comments.

The evidence of Kiah’s personal photo on her blog:


https://kiahfrahm.wixsite.com/blog

https://old.apollocamper.com/specials.aspx

Tia McGrath

https://tiasblogweb.wordpress.com/

I enjoyed reading through Tia’s blog as it was easy to navigate. I was also blown

away with the depth in which she wrote her KCQs. I do not know how she managed

to complete such as long draft as six pages in Step 6 within the suggested timeframe

as I had completed much less and went over the suggested four hours. I was a really

good read and I can’t wait to see what Tia brings for the rest of the assignment.

My evidence and comment on Tia’s blog so far:


https://tiasblogweb.wordpress.com/

Jemma Ahmann

https://jemmyahmann28.wordpress.com/

Jemma had another different idea on KCQ’s and I felt was more personal and added

more emotion into her understand of the readings. I like how she linked this being a

capstone unit to the importance of the significant link it has with being able to

understand a firm. Jemma also wrote a lot of personal information on her blog which

really helped to get to know her and where she has come from. She also included a

photo of herself which is nice to see whom I am talking to.

Evidence of Jemma’s Blog and my comment:


https://jemmyahmann28.wordpress.com/

Conversations had about differences and similarities with others financial statements


Have not received a reply from Marc at time of submission.


Finally, after looking through other people’s firms and financial statements, I was

surprised to not see any great differences. I think mostly, my company is trying to be

a bit too fancy with their annual statement which makes it a little harder to follow and

read. If they were to simplify it more with less pictures and graphs in the beginning,

then the information would be more easily accessed.

Studiosity

I have used this service several times before and almost every time I have been

surprised with how much I missed while proof reading. Some of the people at

studiosity are amazing and pick up on every little thing. I have learnt so much about

my grammar and sentence structure. I know that I have improved on my writing

because of the studiosity team. The feedback this time was defiantly useful,

especially where I should be using more punctuation. I will continue to use this

service and share my thought with others.


Step 5

Trying to find my finance income was hard. I knew it had to be there but where? I

spent many hours searching through each year’s statements as well as some

research to try and narrow down what finance income could be in case I was missing

something. It was a very frustrating process. I asked for advice on the facebook page

which helped as well as Martin replying to an email. I eventually came to an answer

and I am really hoping it is correct as I spent a lot of time getting to the end result. I

was also able to ehlp out one of the other students as she was having a similar

issue. Evidence is below.


I also needed help once finishing my restating. I was careful to not have missed any

lines and was following Maria’s video step by step. I asked on facebook for help as

my figures were not balancing and I was lost as I had been following the steps so


slowly and intently. I had learnt a lot from this as I wasted a lot of time which didn’t

need to be. I had accidentally double entered some figures. If I have not just checked

ever line was entered but also checked the figures, then I would have picked this up.

It was kindly pointed out by one of the other students. As for the amounts not

balancing. I hadn’t watched through to the end of the video. If I had watched another

30 seconds I would have seen that Maria had actually made a mistake in the

calculating which she explained at the end. I had also made this same mistake and

would have figured it out if I had just watched the end of the video and not expected

Maria to be 100% correct. My lesson learnt is that anyone can make a mistake. Even

the lecturers and to have more confidence in myself to just spend some time to have

a look and see where something may have gone wrong. Below are the

conversations from facebook.


One thing I did learn, and I do not know how I didn’t pick this up before is that my

company was only floated on the share market in November of 2016. I found this

really interesting but couldn’t find much information as to why they decided to take


this step. I read in some online articles that they made some big promises of profits

in the coming years which would have been very enticing for the investors.

I defiantly found this task easier than when I first completed it 3 years ago as my first

unit in my degree. I was so stressed out completing it last time as I had never heard

of most accounting terms let alone using excel. It was all so new to me. I still spent

many hours completing this spreadsheet but it was so much less stressful and I was

actually able to take some of the information on board and hopefully retain it for the

future.


STEP 7

Step 7 is the ratio analysis and has been completed within the spreadsheet. This

took me much longer than the estimated 4 hours. I had some communications with

Kiah Frahm’s about the difference between our ratios. I wanted to try and complete

this step without looking at the exempla’s as I thought that might help me to

understand each ratio better and what it was trying to say. I did end up looking at the

exempla’s as there was only so much that I could complete as I found this step quite

tedious and technical as I still struggle with some of the terminologies and what they

mean.


STEP 8

Feedback From: Heidi McCormick

Feedback To: Kiah Frahm .

My Comments

Step 1

KCQs

I could not see a Step 1 on the blog but after asking Kiah for help, she directed me towards where it could be found. I assumed the link was only for spreadsheets. I enjoyed the read and liked how it had heading for each paragraph. You covered what you found exciting, fun and surprising as well as adding your own personal experiences. Good job

Step 2

KCQs

Another great read. I suggest to re-write or put some punctuation in the sentence “I imagine if you could personify a company into a warrior that resists tumultuous times and battles through the ever changing ups and downs of the intimidating investor market.” It is a complex sentence to read. You mentioned what makes you exited and adding personal links to your writing which was good to read. I would like to have seen what you found boring or confusing as well.

Step 3 The initial information about your company is very thorough. I enjoyed how you wrote about their secret recipe for success and the steps included. I would suggest to bold these numbers and this heading to make it more readable and also add a space between the paragraphs as your blog makes it seem a bit crammed up. I would also suggest to add a paragraph about anything that you may have difficulty in understanding.

There are no links to comments on other people’s blogs at this stage. I’m sure that is something you are still working on. Also I cannot see where you have submitted to studiocity. I highly recommend completing this step as they are a great forum to work with, I have used them often.

Background information on company

Comments/KCQs

Comments on other’s blogs

Step 4 I like how you have added the links to their financial reports in your documents section. This make it easier to access for review rather than clicking backwards and forwards. You have included a good list in the notes section to help understand your figures. I like how you have added the actual notes numbers in the column to make it easier to reference if need be. It is very well set out and readable. I have so suggestions on how to make it look better as you have done a fantastic job.

Input company’s financial statements


Step 5

Restated Income statement

Restated Balance sheet

Commentary & discussion with others

You managed to get your CI to balance. Well done. Everything looks good, your links are in correctly. My only criticism is there are a couple of lines where you have only the figures in bold, look at “Change in fair value of financial asset” as an example. Fixing this minor error with help with readability. You also have an asterix next to the tax benefit but there is no asterix in the notes to see what it is there for. Not sure if this is just something missed or if the asterix was there for another reason.

Step 6

KCQs

I like the depth you added to this step by referring some parts in the chapter to what is currently happening the wold due to the virus. My only criticism is there are a couple of random words in bold. I’m not sure why as they are not key words. Not sure if it’s just a glitch with your blog.

Step 7

Calculation of ratios

You have done a good job with your ratio’s and you have linked back to the other tabs correctly. My suggestions for all of the questions if you should state as ratio’s or percentages. The Total Asset Turnover Ratio as a ratio not a percentage although there is an argument for either. I believe it depends on what you are wanting to know from performing the ratio. I would suggest to add some notes in the right side column with some explanations at the bottom to help markers and those giving feed back to understand what you were thinking when arriving at some figures. As an example, what does the short term borrowing rate mean or why is it that percentage.

Overall ASS#1 I think you have done a fantastic job and I struggled to find anything to criticise. Well done, you should be proud of your efforts. IT shows you have spent many hours completing your work.


Feedback To: Melanie Watt .

My Comments

Step 1

KCQs

Your step 1 is basic and to the point. You included what you understood and what you were excited about. I didn’t see much about what was confusing to you but this could be because you understand what we are learning at this stage.


Step 2

KCQs

You picked up on some confusing points in this step which was good to see. You also added some personal links which showed your trying to understand some of the concepts. There are some double and triple spacing throughout which would help the presentation once fixed. Otherwise well done.

Step 3 I enjoyed reading the background information of Oldfields. I was shocked that they are such a well-known company, yet I don’t ever remember hearing about them. The dot points in your KCQ’s made it easy to read and understand. Really enjoyed your description of “revaluation of deferred senior loan note derivative component” this is a big mouthful and didn’t really relate to anything so I’m happy you were able to find an answer. I can tell you really did try your best at understanding your company.

I could not see any proof on comments on others blogs or communication with others, I know you have been as you have commented on my blog. I suggest to do a cut and paste into your assignment of your communications to help the marker see how interactive you have been in this area. The links to your videos was good to see.

I also cannot see where you have submitted your step to studiocity. I’m guessing this is till something you are working on. If not I highly recommend this as they are a fantastic team and really help on many levels.


Comments/KCQs


Step 4 I can see you took a different approach with you statements to others I have seen and used tabulation to help separate items. You also used underling, bold and italics for your totals, that really made them stand out. I would suggest to delete the space under Gross profit or separate it by underline as it looks un finished and also delete the spaces at the end of your balance sheet to give it a more complete look/ Otherwise you have done well


Step 5




I like how you added the yellow highlighting. I first thought it was an error but it shows what figures are more important. It looks like you have linked all of your figures back to the financial statements tab which is great. I would suggest to just tidy up your formatting a little with your colouring.

Your commentary of what you found confusing and frustrating was well thought out. It was good to see that you struggled as I did. Well done for coming out the other end.

I could not see where you have had commentary and discussion with other but that may still com coming.

Step 6 Loved the Dr Phil comment. I am who I am because of watching this


KCQs man. He is a master, although I feel he has lost his way a little and has become a bit judgmental. It was a good link to the writing of this chapter. You are missing an ‘ at the end of your statement in the second paragraph. It is great to see that you have learnt well from watching Maria’s video. It would have been good to add more of what you found, boring, exciting or surprising but I believe you concentrated on what was happening within the assignment which shows you are focussed.

Step 7


Your ratios seem to be very complete. We have several ratio formats different such as your total asset turnover is a percentage whereas mine is a ratio amount. I honestly think that some of these don’t really matter as it just depends on what information you are wanting to gain from performing the ratio equation which I believe we will be able to explain in assignment 2. I suggest to add some footnotes in to explain why you completed some of the ratios. Otherwise I think you have done a great job.

Overall ASS#1 Overall I believe Melanie has completed a well-rounded assignment. She seems to be very similar to me, stating that she has minimal experience. This task it very daunting for us who have not been in the accounting industry. I believe She has done an exceptional job.


Feedback To: .

My Comments

Step 1

KCQs

Step 2

KCQs

Step 3


Comments/KCQs



Step 4


Step 5




Step 6

KCQs

Step 7


Overall ASS#1


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