ACC203 ASSIGNMENT 2
Question 1- Corporate Governance
1) Agency theory is the separate legal status of the corporation means that is in charge of
the corporation is separate from the equity investment. The implication for what
boards to do is to boards remaining independent of administration so that it can
implement the power on behalf of the company’s owner. This is differ by the
implications for what boards should do like in resource dependence theory, board
subsist on the way to supply contact toward assets, information, control plus extra
significant input which can assist corporation to run their background. It is agency
theory because the real meaning of the governance dilemma lies in the separate legal
status of the corporation. The implication for board structure is that the skill,
knowledge plus capability related toward the place of executive seized through every
executive within organization on the time of the yearly statement.
2) Yes, the directors of listed companies should be independent. The skill, knowledge
plus capability related toward the place of executive seized by every executive within
organization on the time of the yearly statement be integrated into the director’s
report. Director of the corporation be consider to subsist self-governing while they be
self-governing administration plus at no cost to any company otherwise extra
association that can significantly hold up among- otherwise can logically be there
apparent toward significantly hold up among –the implement of their unregulated and
self-governing option. A mainstream of board do not have self-governing director.
The mainstreams of board have director. The top level management takes Corporate
Governance Councils suggestion to facilitate many of the top management must
consists of sovereign director. The top management believe that every senior manager
be capable toward plus do carry worth as well as self-governing judgement to every
one appropriate issue declining in extent of job of administrator plus the corporation
like a entire payback since extended status skill of executive in relation to operation
plus company dealings of the company. There are measures within position, decided
by top level management to allow executives to carry on with their duties to request
independent qualified suggestion at the cost of the corporation. `
Question 2-Property, Plant and Equipment
30/06/2017 Accumulated depreciation 20000
Factory 20000
(write down assets to its carrying amount)
Factory 20000
Gain on revaluation of factory-OCI 12000
Gain on revaluation of factory-P&L 8000
(revaluation of assets to fair value)
Income tax expense-OCI 4200
Deferred tax liability 4200
(Tax effect of revaluation increment)
Gain on revaluation of factory-OCI 12000
Income tax expense 4500
Assets revaluation surplus 7500
(To record accumulation of net revaluation gain in equity)
Accumulated depreciation 15000
Motor vehicle 15000
(Removal of existing accumulated depreciation prior to revaluation)
Loss on revaluation-OCI 13000
Motor vehicle 13000
(Devaluation of motor vehicle to fair value)
Deferred tax liability 4350
Income tax expense-OCI 4350
(To record tax expense of devaluation loss)
Assets revaluation surplus 8450
Income tax expense-OCI 4550
Loss on devaluation-OCI 13000
(Removal of net revaluation gain from equity)
30/06/2018 Accumulated depreciation 250000
Factory 250000
(Removal of existing accumulated depreciation prior to revaluation)
Loss on revaluation-OCI 12000
Loss on revaluation-P&L 33000
Factory 45000
(To record devaluation of factory to fair value)
Deferred tax liability 4200
Income tax expense 4200
(Tax effect loss on devaluation of factory)
Reference
Hogget, J. (2012) Company Accounting. 9Ed. Australia: John Wiley& Sons Ltd.
Name: sheenal Naicker
ID: 20190043
