Word Limit: The business report should be a maximum of 2,000 words (excluding executive summary, references and any appendices)
Learning objectives assessed:
This assessment task is designed to test your achievement of learning objectives 1, 2, 3 and 4.
This is a group-based assessment task (groups of 2) and not an individual project
It is designed to assist you in demonstrating your knowledge of, and ability to critically assess a contemporary issue in financial reporting and disclosure. It also provides you with an opportunity to further enhance your research, judgement and written communication skills.
Issue to be investigated: Intangible Assets
Accounting for intangible assets continues to be a contentious standard-setting issue. Standard setting bodies around the world, including the Financial Accounting Standards Board (FASB) in the United States, the Australian Accounting Standards Board (AASB) and the International Accounting Standards Board (IASB), are holding discussions about what improvements (if any) should be made in the recognition and measurement of intangible assets. Such debate stems from criticisms that, due to a changing business environment where intangible assets are increasing in prevalence and magnitude, current accounting standards prevent a company from reporting its true value.
You have recently been appointed as a graduate accountant in a company listed on the Australian Securities Exchange Top 200 (ASX200) Woolworths, and are currently reporting to the Chief Financial Officer (CFO). The CFO of Woolworths has been asked to respond to a recently convened focus group of the AASB on what changes (if any) should be made to the recognition and measurement of intangible assets.
You are to research and comment on why accounting for intangible assets is a controversial issue and present your findings as follows:
A business report to update the CFO and the board of directors on whether and how current accounting requirements limit your company’s recognition of all intangible assets.
Your business report needs to be concise and informative. In preparing your report, you should investigate a range of issues as follows:
(i) Provide a description of those intangible assets that Woolworths currently recognises and, based on your understanding of Woolworths operations, those that the company is prevented from recognising based on current accounting requirements.
(ii) Critically evaluate the current accounting treatment of intangible assets. This will include identifying what changes, if any, you would make to current accounting standards. In doing so, consider what types of intangibles should be recognised, what criteria should be satisfied to warrant recognition, and what measurement base should be used; and
(iii) Provide a recommendation which your CFO can take to the focus group of the AASB. Support your position and discussion with reference to theories covered in this unit and academic journal articles.
*This assessment task must be done in pairs, i.e two students working together from the same tutorial. Within the first two tutorials, students will be required to form themselves into pairs and advise their tutor.
*In preparing your business report, you must refer to theories covered in this unit, academic journal articles and, where relevant, high quality newspaper and professional articles.
*A word count must be included. Students exceeding the word limit by more than 10% will incur a mark penalty.
*You must keep a copy of your submission until your marked assignment is returned.
A matrix outlining the assessment criteria and how your work will be assessed against these criteria will be provided on Moodle. This will assist you in completing the assessment task and to see the allocation of marks.
For more information on appropriate report writing, formatting and referencing, you should refer to the Q Manual at the following site:
Students must submit a properly referenced assignment. Students who submit an assignment without in-text referencing (and reference list) will have their assignment returned to them and receive zero marks. These students may choose to re-submit their assignment with appropriate referencing. However students will only be eligible to receive half of the total available marks (i.e a maximum of 10 out of a total possible 20 marks).
http://www.fasb.org/jsp/FASB/Document_C/DocumentPage?cid=1176168357653&acceptedDisclaimer=true (see Chapter 1)
http://au.wiley.com/WileyCDA/WileyTitle/productCd-1119191092.html (see Chapter 8 – available as an ebook via Monash library).