Newcrest mining annual report 2017

3D OIL LIMITED

You need to look at the annual report of your company and answer these questions:

1. Has the company complied with the measurement requirements of the conceptual framework?

2. Have they complied with the fundamental qualitative characteristics?

3. Have they complied with the enhancing qualitative characteristics?

4. Are the users of financial reports (investors/potential investors/lenders/other creditors) able to use the report to make decisions.

5. The conceptual framework says users only need a basic knowledge of accounting - do they need more than this to analyse your company.

6. Have they met the requirements for general purpose financial reporting.

You need to use screen prints from the annual report to support your arguments as well as academic arguments etc.

Remember this is a report and must have all the usual requirements. Don't forget

Academic research
Referencing
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Use Paragraphs.

Executive Summary
The organization that has been selected for this report, is an Australian Top 100 ASX organization which is known as Newcrest Mining. This is one of the largest gold mining companies which has operations in four countries. The report consists of investigations on Newcrest Mining with respect to the calculated structures in accounting. Moreover, the report also comprises of various financial related segments that will help in better comprehension of financial articulation of the organisation to give diverse recommendations and conclusions.

Table of Contents Executive Summary 2 Introduction 3 Analysis 3 General Purpose Financial Accounting 3 Target audience of the General Purpose Financial 3 The recognition criteria for the elements of financial statements 4 Fundamental qualitative characteristics of Financial Reporting 5 The enhancing qualitative characteristics of Financial Reporting 6 Recommendation 9 Conclusion 9 References 10

Introduction
Newcrest Mining has been focusing on the attainment of long-term value creation, where the company emphasise on maintaining low costs, increasing the reserves, and making the use of capital in an efficient manner. The company is focused on delivering superior returns from developing, finding, and operating the mines of the company. In this report, a conceptual framework is being evaluated to anticipate that if this organization is meeting the requirements of the conceptual framework or not.

Analysis
General Purpose Financial Accounting
An organization has a variety of different stakeholders who have differential levels of interests in the organization. With this, they would prefer to make use of a variety of different information that is supplied by an organization to undertake different decisions (Cascino, 2014). General Purpose Financial Accounting objectives guide the development of financial reports which are intended to meet the information needs that is common to the users who would be unable to command the development of the reports which are tailored in a manner to satisfy the needs of the stakeholders for the information. The 2017, annual report has been downloaded from the company’s website, and it has been seen that the report matches with the general purpose of financial accounting whereby the report provides the required level of information which is to be used by the external users for decision making (Dumontier, 2002). Moreover, the report has been prepared while adhering to the Australian Accounting Standards (AAS) which ensures the overall accountability of the details provided in the annual report which could be used by public (Newcrest, 2017). Apart from this, any of the information which is important, has been also disclosed which is relevant to the assessment of the company and its resources.

Target audience of the General Purpose Financial
The financial reports are generally prepared in the way of facilitating the target audience to obtain the required level of information and using it for undertaking different decisions. The primary target audience for the general purpose financial reports include the clients, the suppliers, government, management, etc. who will use the information presented in the reports to make decisions (Unegbu, 2014). The General Purpose Financial Reports of Newcrest Mining are available publicly on their website and can be viewed/downloaded anytime without any charge. The report clearly depicts the different heads of information segmented in the report, so that each user who needs the required information, can access that information within no time. Furthermore, in case of any other information, or any discrepancy in the information can be communicated to the concerned people as the contact details of the important people have been provided in the report (Hitz, 2007). Following are some of the major types of information that have been provided in the report, and matches with the requirements of General Purpose Financial Reports (Newcrest, 2017):

· Performance

· Financial Position

· Compliance

· Financing and Investing

The users can adequately use this annual report of the company to gather the required information for their needs.

The recognition criteria for the elements of financial statements
Recognition can be referred to as a process on incorporating an item in the income statement or the balance sheet, which meets the definition of an element that satisfies the recognition criteria (Botosan, 2006). This criteria is as follows:

An item which meets the definition of the element must be recognized, if:

· It is likely that the item will flow from or to the entity;

· The item has a value which can be measured with reliability.

From the report, it is evident that the company fulfils the recognition criteria for all of the element of the financial statements. All of the elements of the income statement as well as the balance sheet, have been effectively recognized. The company has the revenue recognition policy in-tact and also recognizes the other significant items, specifically providing information about the base for their recognition (AASB, 2017). Apart from that, the company provides notes to the financial statements providing the criteria for recognition of the items such as changes in Foreign currency, Dividend, income, taxes, etc. Moreover, the company has made certain assumptions and estimates and in consideration to that, the company has provided enough information to explain the criteria upon which the changes in the reported reserves, plant and equipment, provision for rehabilitation obligation, recognition of deferred tax asset and the depreciation have been taken into account by the company (Newcrest, 2017).

Fundamental qualitative characteristics of Financial Reporting
The fundamental qualitative characteristics of financial reporting are:

Relevance: the information that is being presented, should be relevant to the needs of the users, which would in turn help to influence the economic decisions of the users. This is likely to involve reporting specifically the relevant information or the information which, if omitted or misreported, would influence the economic decisions of the users (EY, 2010). The information provided in the annual report of Newcrest mining is relevant and is provided in appropriate detail so that it can be used effectively by the users of the financial reports. Each and every relevant item has a description attached with it for better understanding of the users (Christiaens, 2003).

Faithful Representation: the information that is provided in the reports, should be free from any biasness or material error, and should not be misleading. Hence, the information must faithfully represent the transactions as well as the other events, while reflecting the underlying substances of the events and represent the estimates as well as uncertainties with proper disclosure (Rodríguez, 2016). Newcrest Mining provides the information of each and every item in detail within its annual report. Furthermore, the company has further given a detailed account of the items which needs further explanation (Ruhl & Smith, 2013). The information in the report, is not misleading and has been audited by the assigned auditor.

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(Source: Independent Auditor Report – Newcrest Mining Annual Report 2017)

The enhancing qualitative characteristics of Financial Reporting
Comparability: The information that is provided in the financial reports should be comparable to the financial information that is presented in another period of accounting, so that the trends in performance as well as financial position of the reporting entity can be identified (Richardson, 2017). Considering the financial report of Newcrest Mining, then it is evident that the report is comparable whereby the company has exhibited the figures of 2017 in the annual report have also been compared with that of 2016 (May, 2006).

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(Source: Statement of Cash Flow, Newcrest Mining Annual Report 2017)

Understandability: The information that is provided in the financial reports must be understandable readily to the users who will be using the financial statements, which means that the information provided in the statements should be presented clearly and with the required additional information within the footnotes so that it will assist in clarification (Kythreotis, 2015). The information that has been provided in the Newcrest Mining Annual report is presented clearly with the required documentation and additional notes which facilitates clarification to the users. All the additional notes have been provided below the consolidated financial reports under the head “notes to financial statements” (López, 2004).

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(Source: Notes to the consolidated financial statements – Newcrest Mining Annual Report 2017)

Timeliness: The information that is provided to the users should be provided within a timescale that will be suitable for the purpose of decision making. In simple words, the reporting process should not be delayed and must be available to the users in a timely manner. Newcrest Mining has been providing the required information in its annual report which is available on the company’s website Quarterly, Half Yearly and Annually (Kettl, 2006).

Recommendation
In order to beat the issue related to not having a legitimate articulation in regards to the liabilities in money related explanations of the organization the organization needs to centre around the essential rules that are given inside the reasonable system in accounting. In addition, the organization needs to centre around the planning of the money related explanations and furthermore the figuring to give a positive effect on the clients of the budgetary reports of organization, for example, the diverse speculators. Without a legitimate financial record the financial specialists will endeavour to additionally keep away from or will put relatively fewer in the offers of Newcrest Mining. Consequently, to maintain a strategic distance from such unfriendly impacts the expert examiners that are relegated for the recommendations and the diverse feeling on the money related explanations should have a reasonable aspect towards the changed counts and the income proclamations alongside the money that was contributed. Consequently, the comprehension of the blemishes in the figuring and its effect can influence the whole introduction of the income articulation too.

Conclusion
The conceptual framework of accounting has been used in this report to evaluate that if the practices that are being followed in Newcrest Mining matches with the requirements of the conceptual framework or not. After evaluation, it has been seen that the Newcrest Mining is effectively meeting the requirements and efficiently facilitating the objectives of the framework.

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