ACCT11059Assignment 1By Tegan Johnston

Part 1

Introduction & Chapter One reflection

I’ve read Chapter 1 by Martin Turner a few times now, I had to keep reading the first 3 pages over and over before I could move further forward through the book. Yesterday I had no idea on how I would write a review without summarising and repeating the information that was already written. That is because this is a new learning style for me. I have never had to do KCQ’s before and I am so used to being handed an assignment with set tasks that have a set layout and set questions, where the information that has been read is the answer to the question. So here goes my first at-tempt with KCQ’s, I have spent a lot more hours then I thought (4-41/2 hours) to complete this, more then 10 hours.

Page 1, Chapter 1, Sentence 1, Question 1: What is accounting? If I was asked this question be-fore enrolling in the course I would answer by saying, Accounting is taxation, book keeping, num-bers and running accounts (staff payable, bills ect) section of a business. After reading this book I have already learnt accounting is so much more it is the key element that keeps all business’s running whether that be a small business, a sole trader, a trustee, or a coprate business such as Westfield Farmers. There are so many different sections where accounting comes into play. With out accounting a business would not run smoothly. I run a small business as a sole trader and I didn't realise how much of a roll my accounting played with keeping the business in budget and making a profit. I personally do all of my accounting my-self this includes, budgets, taxation reports, profit and loss reports. Without these reports my busi-ness would run at a loss and if there were no spending reports I wouldn't be able to see how or why my business is running at a loss or profit.

Chapter 1 states “A firms accounts may help or hinder us in gaining insights into economic and business realities of a firm.” After coming to the realisation of how much of a role accounting can play in the business world I believe that a firms accounts may help us in gaining insights into economic and business realities of a firm. By showing us an insight into the economic and business realities of a firm it can give the owner or shareholders an idea of whether or not the business is going in a positive or negative di-rection financially, which in the end will have an impact on whether or not the business survives.

Chapter 1 gets into what accounting is about right from the start. I have a passion for business and Martin mentions that “Business is a fascinating and wonderful world to work and live in” I truly be-lieve that 100%. I love to study different business structures and gain an understanding of how dif-ferent business’s run. So far I have had a taste of retail, tourism, community services, construction industry (building roads), building a nanny referral agency and working in the beauty industry. All of these different industries have something in common and that is they will all rely on some sort of accounting organisation. They will all have business goals and structures, and they will all service the community.

The Proprietorship chapter in Chapter 1 was a lot to take in, I felt bombarded with information read-ing this section. The fact that there are real life comparisons such as referring to a coin that has 2 sides made it so much easier to understand. This section makes me excited to learn more about different aspects within accounting and how it can affect the different business aspects and ulti-

mately affect the whole world. I now want to go and learn an read about the global financial crisis in 2008 as I don’t actually remember any of it.

I love that Martin explained the 5 elements of accounting, the statement by Barry Long that starts off this section is a little confusing. “It is a little known fact that the truth cannot be memorised” I have no idea what this means. I guess everything that happens will have that “double sided” effect within our memories. For example I have a picture of myself and my sister with my great grandpar-ents and its one of the few and lasts memories I have with them. I think a lot of that memory is cre-ated from the pictures taken on the day and I guess within my memory little pieces of what truly happened have disappeared and altered. That is my take on this quote although I’m not to sure how this relates to accounting, because accounting is full of transactions and accurate bookkeep-ing and the “realities of business” as Martin mentioned at the start of the book.

The 5 different elements was bought to my attention and I feel as though I need to read a little bit more and watch some videos on the 5 elements to educate myself more. This way I can grasp a better understanding because of reading this section I am left a little confused.

One question through out this book that stood out to me was, “Can Accounting make it easier, or more difficult to engage with and understand what is really going on in a firm?” At the moment I have no idea on how to answer this question and this one of the many questions I will be taking away with me so through out this course I can refer back to it and hopefully answer it by the end.

Overall, I have really enjoyed reading Martin’s book, although the first couple of pages were boring (sorry Martin) and I had to put it away and come back to it a few times. Once getting past the intro-duction I found it so interesting and I am excited to kick start my learning journey again in a com-pletely new and unfamiliar way.

Part 2

My Blog:

https://theblogofanaccountingstudent.wordpress.com

Part 3

The company I was given was CARDNO PTY LTD

Cardno is a world wide company with their head office being in Brisbane, Australia.Cardno have offices in United States, Belgium, Canada, Colombia, Ecuador, Germany, Indonesia, Kenya, Myanmar, New Zealand, Nigeria, Papua New Guinea, Peru, Phillipines, Singapore, Timor-leste and the United Kingdom.

Cardno are an ASX listed professional infrastructure and environmental services company, spe-cialising in development and improvement of physical and social infrastructure for communities around the world.

Cardno was started in Brisbane in 1945 it was originally known at Cardno and Davies.

During the years of 1945 - 1997 Cardo had offices in Brisbane, Gold Coast, Sunshine Coast, Townsville and Papua New Guinea.

1997 - 2003 Cardno experienced major growth and two name changes, Cardno MBK and then re-branded to Cardno as we know them today. During this time Cardno had 180 employees and an annual turnover of AU$14 million.

Cardno have such a big history with so many business changes that I won’t be able to list them all but I will add a link to their history off section on their website: Cardno HistoryWhen I first received Cardno I had mixed views, step 3 seemed like such a huge task and there is so much detailed information on the Cardno website that I felt overwhelmed reading it. After finally sitting down to actually do step 3 I have realised that the information has come in handy. Cardno is such a huge company! I’ve found reading their website and financial reports really interesting (I wish I had of started sooner and not procrastinated).

Cardno is a strong company that is continuing to grow. Under the directors report under the section balance sheets it discussing the company’s net debt. At the end of June 2017 this was $15.3 mil-lion which is down from $49.6 million at June 2016 and down from $311.3 million at June 2015. Thats a reduction of $296 million in just 2 years. The company sold it’s specialty software business XP Solutions for US$49 million which helped decrease this debt.

Overall I’m excited to learn more about the company I was given Cardno and I think they are an extremely successful company and the fact they originated from 2 local engineers (They say local but they were employed by the United States Army at the Australian Base Command in Brisbane) .Cardno have gone from these 2 men and grown into a world wide business with more then 6000 employees.

If your interested in learning more about Cardno their brochure can be found here: Cardno online brochure Website: Cardno Home page

Cardno’s Financial Statements:https://theblogofanaccountingstudent.wordpress.com/2018/03/30/cardnos-fincial-statements/

KCQ's on Cardno's Financial ReportMy initial thought on Cardno's report was OMG its huge! and to be honest I haven't even read half of it.

After writing most of this blog I have decided to add in the introduction to the chairmen letter as it states the most important key bits of information for the report. So I apologise for any extra repeti-tion.

Chairman’s Letter

Dear Shareholder,

This time last year I set out that FY17 would be a rebasing year for Cardno and in essence a re-view year to recalibrate the business away from past financial performance and practice. In addi-tion I explained that alongside conducting a complete balance sheet review, Cardno needed to push decision-making back down to divisional management, rebuild the trust of its staff and invest in business development. I explained that there were a number of business and office consolida-tions that were required and that there was the need to review the balance sheet, both from a leverage perspective as well as a general review of the carrying value of assets.

I am pleased to report that your company has made significant progress in completing this restruc-ture. Cardno achieved an underlying profit of $19.9 million in FY17 and an underlying EBITDA from

continuing operations of $44.0 million. This performance was consistent with the guidance pro-vided at our AGM in October 2016.

The business returned to growth at both the fee revenue and EBITDA level for the first time since 2015. The balance sheet of Cardno is now one of the strongest in the industry, with effectively no (net) debt, appropriate provisioning on outstanding contracts and debtors and assets that reflect what the board believes is realisable value. The balance sheet review has led to considerable one off expenses that have gone through at the half year and full year.

I was so confused when I first looked at it because my statements weren't called balance sheet and income statement they were called financial position and financial performance. I actually had to search changes in equity in the search section to find my report which then led me to the table of contence. It was a bit of a der moment I don't know why I didn't think of just going straight to the ta-ble of contence in the first place.

The most important areas of the report would be the directors report and chairmens letter this ex-plains key areas of the report and an overview of the company's goals and what has and hasn't been achieved.

In the 2017 financial year Cardno had a business restructure which has improved their growth and profit, the EBITDA Growth - earnings before interest, taxes, depreciation, and amortisation (used as an indicator of the overall profitability of a business) was 3 times the EBITDA in the second half of FY2016. In the FY17 the directors have put trust back in to the branches managers to help with the business growth.

In the balance sheet review it says that there was a cost of $10.7million associated with closing or consolidating 32 offices if the business is doing so well I don't understand why they closed down so many offices. After reading this bit I remembered when I first googled Cardno it came up with a Bundaberg Office but then when I search Cardno's Offices there was no Bundaberg Office which led me to assume they closed down. Upon further google searches I have found a newsmail article with a head line of "Cardno Accountant jailed for $335K credit card theft" What a blow for the com-pany! no wonder trust was lost in the staff of Cardno this would have also created a loss in trust from many customers in the Bundaberg Region.

By looking at the statement of financial performance you can see that in FY17 the company spent $2,455,000 on employee expenses compared to in FY16 they spent $16,406,000 thats a huge dif-ference and I'm sure if I looked further in to the directors report of that the directors incomes proba-bly haven't taken a cut. I will be looking in to that after the assignment is finished at the moment I have spent way to much time reading and researching and not enough time blogging and complet-ing assignments. The company has also profited in FY17  by $8,579 compared to a loss in FY16 of $194,919,000.

I could probably ramble on a little more but I think this covers my main KCQ's on Cardno's Finacial Report.

Top 3 blogs and favourite blogTop 3 Blogs:Trying to find my top 3 blogs was actually really hard. Trying to find time to read other peoples blogs while trying to write my own was really daunting, there are so many good blogs that I didn’t actually want to read the good blogs I came across because I became jealous! But here are my top 3 blogs:Number 1: An Accounting JourneyNow I’m not going to lie I actually found Emily’s blog by looking at Chatflow’s top 3 so thanks for sharing Chatflow! Again Emily’s blog is so easy to read! she has uploaded quiet a few different

blogs on different aspects of the course and the introduction and initial thoughts on her company was so well written for a com-pany that she hadn’t heard of before. All I can say is Emily I’m glad I didn’t receive your company!

Number 2: ChatflowMy initial thought on Chatflow’s blog was its so easy to read, I continued to scroll down and seen how Chat Flow’s KCQ’s was set out and it’s like a lightbulb turned on for me! how simple and easy, up until this point I was still trying to get my head around the whole KCQ’s thing. I have no awesome random photo to share off Chatflows blog.Number 3: Ashleighlouisecqu Ashleigh’s blog is one of the first blogs I came across after she com-mented on one of blog posts and again her blog is so easy to read! (see a pattern with how I’ve picked my blogs yet?) All though Ashleigh hasn’t posted many blogs her assignment 1 draft is so detailed and I love that her actual blog is so simple but covers everything.

Now in addition to my top 3 list my favourite blog would be Rochelle Burney – It’s The Little Things. I love Rochelle’s blog its simple and easy to read. After read about Rochelle I feel like we have a lot in com-mon, on top of that she has a quote from Izaak Walton, a little off topic but My son is named Izaak and we wanted to spell it like Zak so after a quick google of the name Izaak Walton came up and we realised ok other Isaac’s are spelt that way (usually Isaac). After the quote something clicked and I decided on top of all Rochelle’s information on her company and the fact that she is a mum and running a small business I have decided Rochelle is my favourite blogger!

My Blog Posts:Please find a link to my blogs discussing my company Cardno:https://theblogofanaccountingstudent.wordpress.comhttps://theblogofanaccountingstudent.wordpress.com/2018/03/30/my-top-3-blogs/

Comments on other blogs:Aileen’s blog - https://wordpress.com/read/blogs/144194420/posts/17Ashleighlouise96 - https://wordpress.com/read/blogs/143766903/posts/3#comment-2Tessa’s Blog - https://tessasblog292213167.wordpress.com/2018/03/26/realising-the-realities-of-studying/comment-page-1/#comment-8An Accounting Journey - https://anaccountingjourney.wordpress.comChat Flow - https://chatflow386831018.wordpress.comRochelle Burney - https://rochelleburney.wordpress.com

Plus you will see comments on my own blogs from other people.

Step 4

Financial Statementshttps://theblogofanaccountingstudent.wordpress.com/2018/03/30/cardnos-fincial-statements/https://theblogofanaccountingstudent.wordpress.com/2018/03/28/step-4-financial-statements/