Introduction To Financial Accounting

Question: Discuss about the Introduction To Financial Accounting. Answer: Introduction: A report under which companies board of directors under the compliance of law state about the company in relation to its financial, accounting and social responsibility (Investing.com, 2016). David Jones is a retail industry founded in 1838 by David Jones; it is headquartered in New Zealand, Australia (Jones, 2013) (Jones, 2011). Director Decleration Its Uses: Director declaration is a statement to be provided by directors of an organization stating the organizations current and future plan. This is done with due compliance of Corporations act. It is useful to bring transparency in the organization for the stakeholders. It can be complemented by the directors remuneration and company accounts. The director report is disclosed as public, as it is an important source of statement. It is the duty of directors to present the report once in a while as prescribed by the law. Directors Statements In Relation To Financial Statements Of David Jones: The directors opinions regarding financial statement of David Jones in 2013 are as follows: The financial statements, notes to accounts, and additional disclosure of the entity are as per the rules and regulations formed by corporations act 2001. The financial statement gives a true and fair picture of the business and its performance. The statements also comply with the Australian accounting standards and corporate regulations 2001, and international financial reporting standards. There are some provisions and accounts made for the debt repayment as they become due and payable. On 12th August, 2013, the company entered into an agreement with dick smith electronics pty ltd to operate in electronics market. For this agreement David Jones has made a provision in its financial statement of $9.1 million (Jones, 2013). Woolworths ltd has acquired David Jones limited to strengthen its departmental store to better able to compete with its competitors. It was agreed to by Woolworths ltd to acquire David Jones ltd at A$2.15 billion ($2 billion). The acquisition of David Jones held on 1st august, 2014. The financial statements were impacted by the acquisition, as it makes some changes in the capital structure, balance sheet and liquidity and risk factors. Apart from that the acquisition also affected the return on equity, and return on capital employed (Bloomberg, 2016). Operating Performance: In case of operating performance of the company, after the acquisition, the sales growth of David Jones sales increased by 12%, whereas Woolworths ltd has increased its growth by 38.5%. Operating profit has increased by 0.7%, therefore earning per share growth also increased by 2.1%. This was a positive effect on market share in both the companies Woolworth and David Jones in South Africa and Australia respectively (Woolworths limited, 2016). Gross profit: Gross profit increased by 14%. However this got distributed to reduce the affect of expenses which were increased by 16.3% as compared to previous year. The combination of David Jones to Woolworth ltd has a positive effect on the business. Dividend: The final dividend declared by the company to its shareholders was 7% that is $37,450,000. References: Jones,D,. 2013, DavidJonesLimited2013AnnualReport.pdf, viewed on 3rd January, 2016 Jones,D,.2011, Annual report 2011: David Jones, viewed on 3rd January, 2016, retrieved by https://www.aspecthuntley.com.au/asxdata/20111028/pdf/01234424.pdf Bloomberg, 2016, Woolworths $2 billion David Jones deal bolsters department model, viewed on 3rd January, 2016, retrieved by https://www.bloomberg.com/news/articles/2014-04-08/david-jones-agrees-to-south-africa-s-woolworths-2-billion-bid Woolworths limited,. 2016, Woolworths limited 2016 annual report.pdf, viewed on 3rd January, 2016 Investing.com, 2016, David Jones ltd, viewed on 3rd January, 2016, retrieved by https://www.investing.com/equities/d-jones-ltd-income-statement Jones,D,. 2016, Executive Committee, viewed on 3rd January, 2016, retrieved by https://www.davidjones.com.au/About-David-Jones/Executive-Management