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Question: Discuss About The Presentation Financial Statements Retrieved? Answer: Introducation The main objective of this memo is to address the key problems which has occurred during formulating the statement of financial position and also validate the key parts which are need to be deliberated in accordance with AASB 101 of Presentation of financial statements wherever required. Before starting the preparation of financial statements it is important to identify the type of organisation. In this case, Jennifer has prepared the statement of financial position of Dom Ltd. After taken into consideration all the areas of this statement, it has been scrutinised that the financial report has not been prepared in accordance with Australian Accounting standard that is AASB 101. The main requirement of making the financial statements is to show true and fair view about the companys financial stability which is useful to the stakeholders of the company. Predominantly, the statements describe the companys assets, equity, costs, revenues, liabilities, cash flows and other things. The assets, liabilities and equity of the company deliver information of the specific date particularly at the end of the reporting period (AASB101, 2015). However, in this case the financial statement of accounting period ended on 30 June 2017 was not presented in accordance with AASB 101. It should be flagrantly presented as follows: The Organisation name whether the financial statements consist of single entity or group of entities Accounting period Accounting currency (AASB101, 2015). According to AASB 101, it is very important to display line items on the face of the statement together with headlines and sub-totals in order to reflect the true and fair view about the companys financial condition to the stakeholders. For Instance, in the case of Dom Ltd, Land Cash at bank Trade debtors Property, Plant and Equipment Goodwill Intangible Assets Other Assets The total of Assets bank Loans Trade Creditor Thus, in accordance with the financial statements of Dom Ltd it clearly depicts that users of the financial statements are not able to recognize and differentiate the line items and users are also not able to make judgements. Therefore, it is advisable to separate the line items with proper headings and sub-headings showing current assets, non-current assets, current liabilities, non-current liabilities in their statements. Such as Inventories, cash and cash equivalents, trade receivables are required to show under current assets whereas land, Intangible assets, plant and equipment are required to show under non-current assets. Similarly, short-term bank loans, trade payables, provisions are required to show under current liabilities whereas long-term financial liabilities, long-term bank loans are required to show under non-current liabilities. All the above classification should be sub-totalled and presented as per the AASB 101. Hence on the basis of given statement of financial po sition of Dom Ltd it depicts that users are not able to recognize the financial condition and also cannot make judgements. There are three main items shown in the statement of financial position are as follows: Assets Assets are defined as resources which are owned by the company for which future economic benefits are expected to flow to the company. For instance, in the case of Dom Ltd there is an investment property which is an asset and it is related to the land and short-term loans and therefore as per AASB 101 it should be bifurcated into non-current assets and current liabilities. In addition to this, the assets are always calculated as per going concern assumption and should be displayed at the specific date of the reporting period. Liabilities Liabilities are future obligations of a company as a result of past events are termed as Liabilities. There are two types of liabilities such as current liabilities and non-current liabilities and these are bifurcated according to the obligation due dates. For instance, in the case of Dom Ltd there is trade and other payables some portion of which are repayable within a year and some payables are more than a year. As seen that total trade and other payables are come under liabilities head but according to AASB 101 it shall be bifurcated between current liabilities and non-current liabilities. Equity Amount of funds invested by the shareholders in the company are called as Equity. The equity portion should also consider retained profits if any. For instance, in the case of Dom Ltd it is observed that ordinary share capital is given under liabilities head which is wrong and it should be covered under Shareholders Equity head as per AASB 101. Therefore, it is highly advisable as a chief accountant of the Wesley Ltd to refer all the aspects in preparing financial statements which are covered under AASB 101 and follow AASB 101 which are helpful in decision making for the stakeholders. Dom Ltd Statement of financial position as at 30 June 2017 Particulars $ $ ASSETS Current Assets Cash at bank 4000 Trade Debtors 160000 Other Assets 10000 Raw material inventory 40000 Total Current Assets 214000 Non-Current Assets Property, Plant and Equipment 610000 Land 114000 Other Assets 36000 Intangible Assets 94000 Total Non-Current Assets 854000 TOTAL ASSETS 1068000 LIABILITIES Current Liabilities Bank Loans 28000 other Loans 34000 Trade creditors 40000 Allowance for inventories 4000 Financial Liabilities 100000 Current Tax Payable 8000 Provision for warranty 40000 Total Current Liabilities 254000 Non-Current Liabilities Trade creditors 70000 Financial Liabilities 500000 Total Non-Current Liabilities 570000 TOTAL LIABILITIES 824000 NET ASSETS 244000 EQUITY Share capital 200000 Retained Earnings, 1 July 2016 20000 Reserves 24000 TOTAL EQUITY 244000 References AASB101. (2015). Presentation of financial statements. retrieved on 20 September 2017 from file:///C:/Users/Tanvi%20Jain/Downloads/1707771_548068821_AASB10107-15.