Job interviews ...

http://www.theguardian.com/careers/careers-blog/2015/may/28/how-to-avoid-the-top-five-most-common-job-interview-mistakes

Meet the Business Leader ...

Thanks to Amanda for these photos!  Link below.

https://drive.google.com/a/macrob.vic.edu.au/folderview?id=0B5dd0fsvG7cgSmdhOENaU3VvRHc&usp=sharing_eid

One day?

http://www.forbes.com/power-women/

Profit but unfavourable cash ... is this possible?

Part A.
Thank you to Vishy and Anamika for agreeing to participate in this role play which explains how a business can report a profit in a reporting period yet, at the same time, experience an unfavourable change in its cash position.  Link below.

Link to video:
https://drive.google.com/drive/u/0/#folders/0B3lBZTLHkqJsfmhBclVfUGpJVnhNSHVTWFJWS21rOWdhLWFTS09oUm9UejFtQ2tfYkJUOVU
Link to script:
https://docs.google.com/document/d/1W0o2eHMVJ1H767hgqvSd93s_eL5pv4-pRYYQhSixmN4/edit
Link to solution:
https://drive.google.com/drive/u/0/#folders/0B3lBZTLHkqJsMWl2WklTWEFVOWs/0B3lBZTLHkqJsSkdJNHhlMV9OOWM/0B3lBZTLHkqJseE5uU0dfYnlfZVk/0B3lBZTLHkqJsfmhBclVfUGpJVnhNSHVTWFJWS21rOWdhLWFTS09oUm9UejFtQ2tfYkJUOVU

Favourable cash but poor profit performance ...

Part B.
Once again, thank you to Vishy and Anamkia for this role play.  In Part B, they explain how it is possible for a business to report a favourable change in the cash position yet experience a poor profit performance.  See links below.

Link to video:
https://drive.google.com/drive/u/0/#folders/0B3lBZTLHkqJsfmhBclVfUGpJVnhNSHVTWFJWS21rOWdhLWFTS09oUm9UejFtQ2tfYkJUOVU
Link to script:
https://docs.google.com/document/d/1x9zmArpzQfEK4W76lVJCjlW4Csz6J8hoUPC2eZ7TYxY/edit
Link to solution:
https://drive.google.com/drive/u/0/#folders/0B3lBZTLHkqJsMWl2WklTWEFVOWs/0B3lBZTLHkqJsSkdJNHhlMV9OOWM/0B3lBZTLHkqJseE5uU0dfYnlfZVk/0B3lBZTLHkqJsfmhBclVfUGpJVnhNSHVTWFJWS21rOWdhLWFTS09oUm9UejFtQ2tfYkJUOVU

Visitor this Thursday lunchtime ...

Dear team
This Thursday lunchtime, L2, Kim Fung from the Class of 2014 is coming to speak to you about Cadetships at BDO.  She is one!  This is a great opportunity to get some quality information from an ex-MacRobian.  She is taking time out to assist you!  Bring your lunch and your questions.

BDAs ... FastFacts

• Stock loss
• Stock gain
• Prepaid expenses
• Depreciation
• Accrued expenses

The following file is a summary of Balance Day Adjustments (BDAs).  Useful.

https://drive.google.com/drive/u/0/#folders/0B3lBZTLHkqJsMWl2WklTWEFVOWs/0B3lBZTLHkqJsSkdJNHhlMV9OOWM/0B3lBZTLHkqJseE5uU0dfYnlfZVk/0B3lBZTLHkqJsTGZDdHI2V3NoT2s/0B3lBZTLHkqJsfjBXckZyb1FYUDA0UmJOaWQzNlNoeEtrNnJ5QUtsYWlES3JiS1psSjFvTmM

Learning depreciation ...

Accounting Cadetships ...

Next Tuesday, 26th May, lunchtime, L2, representatives from Earnst and Young are coming to talk to you about Accounting Cadetships.

Check out their website:  http://www.ey.com/AU/en/home

Preparing for SAC3

SAC3 is 100% on Outcome 2.
Date:  Tuesday 9th June.
(This means the Red Class have to come to school early ... so we can start SAC at 8.00 am ... sorry!)
Thus it covers chapters 10, 11 & 12.
Start preparing now.  How?

• Nanos Outcome 2 (1 to 17) ... I  have sent you the file.  Also on NEO.
• Red Book test #2.
• Quia quizzes on stock loss/stock gains, prepaid expenses, depreciation and accrued expenses.
• Past SACs.  See NEO Practice SAC folder.  Start at 2014 and work backwards.
• Other stuff I will give you.
• 

Big Picture ...

Don't forget the big picture with balance day adjustments - BDAs. It is all about measurement.  Measurement of revenue and expenses for the reporting period to provide stakeholders with the most relevant profit.  Measurement at the end of the reporting period to provide stakeholders with the most relevant information of assets and equities.  Yes, all BDAs impact on both the Income Statement and Balance Sheet (never the CFS).

Stock loss:
Debit:  Stock Loss.  Credit:  Stock Control
No impact on the Cash Flow Statement.
Increases expenses and decreases gross and net profit in Income Statement.
Decreased stock control and owner's equity in the Balance Sheet.
Stock gain:
Debit:  Stock Control.  Credit:  Stock Gain
No impact on the Cash Flow Statement.
Increases revenue and gross and net profit in Income Statement.
Increases stock control and owner's equity in the Balance Sheet.
Prepaid expenses:
Debit:  Expense.  Credit:  Prepaid Expense
No impact on the Cash Flow Statement.
Increases expenses and decreases net profit in Income Statement.
Decreases prepaid expense (CA) and owner's equity in the Balance Sheet.
Depreciation of NCAs
Debit:  Depreciation NCA.  Credit:  Accumulated Depreciation NCA
No impact on the Cash Flow Statement.
Increases expenses and decreases net profit in Income Statement.
Decreases NCAs and owner's equity in the Balance Sheet.
Accrued Expenses
Debit:  Expense, eg Wages.  Credit:  Accrued expense, eg, Accrued Wages
No impact on the Cash Flow Statement.
Increases expenses and decreases net profit in Income Statement.
Increases CL and deceases owner's equity in the Balance Sheet.

Budget 2015/2016 ...

Businesses have to pay tax on their net profit.  This type of tax is not covered in VCE Accounting so you do not need to understand the details.  However, because you are business/commerce students, you may be interested.  This week, the Treasurer, Joe Hockey, announced that businesses can "write-off" non current assets up to a vaule of $20 000 in the year of purchase.  No need to depreciate the asset over its useful life.  The asset becomes an expense!  This would not fit the VCE Study Design.  The impact is to reduce net profit by say $20 000 which means less tax (the tax that is not covered by the VCE) is paid by the business.  Businesses like this.  They will purchase more assets and stimuate economic activity which could cause more empployment and income multiplier effects.
The following article is useful:

http://www.abc.net.au/news/2015-05-13/budget-2015-small-business-tax-break-explained/6466066

BDO Cadetship Program ...

For year 12s in 2015 and year 11s in 2016.
A ex-MacRobian from the Class of 2014 received a Cadetship to BDO.  To be successful in this program, you do not have to be the best accounting student.  They are looking for students that they feel will add value to their organisation and would be a good team person.  Does that sound like you?  What have you got to lose?  Talk to me about it if you are interested.  This is the first time they have gone directly to MacRob looking for candidates.  I wonder why?

Dear David,

I have been passed your name as I understand you are the best contact for connecting with students of The Mac.Robertson Girls’ High School in relation to their careers.

BDO is one of the leading global accounting firms, employing over 1200 employees across Australia alone. Our service offering covers audit, tax and advisory services, partnering with a diverse range of clients. We are interested in reaching out to current Year 12 students who might be interested in pursuing a career in Accounting / Professional services.

We are looking for bright, enthusiastic and motivated students who would join us next year on a full time basis whilst studying part time at university. They would need to be enrolled to complete a single major degree in accounting, commerce or business (accounting major). The individual would be with us in this capacity for 2 years before returning to university to complete their degree full time.

Once their tertiary studies are completed, they would walk into a position here at BDO bypassing both the graduate application process (which is extremely competitive) and the graduate level entirely.

Attached is a brochure which outlines more information on our Cadet program and also further information on BDO as an employer. We would appreciate if you could share this with the relevant faculty and students.
https://drive.google.com/drive/#folders/0B3lBZTLHkqJsN1lLMWp2SjBVUWc

Applications for our 2016 Cadet intake are open from the 18th of May until the 14th of June and can be lodged at www.bdo.com.au/careers/students/melbourne

If you or any of your students have any questions or would like to know more, please feel free to give me a call on 9603 1745.

Looking forward to hearing from your students in the coming weeks!

Alex

ALEX WESTWOOD

People & Culture Coordinator
HR
Direct: +61 3 9603 1745

alex.westwood@bdo.com.au

Asset or expense?

Non current assets of $20 000 become expenses!
Tonight, the Treasurer announced the 2015/2016 Commonwealth Budget.  One new policy was to allow small businesses (sales of less than $2 000 000 per year) to treat as expenses, non current assets up to $20 000.  This means that, for example, a business could purchase a vehicle for $20 000 and report it as an expense, not an asset, and thus reduce their taxable profit by $20 000. This would be good the business's cash flow at the end of the financial year and encourage more purchases of equipment, machinery etc in the economy which would stimulate economic activity.  The vehicle would be used for many years but would not be depreciated over its useful life as all of it would be fully expensed in the year of purchase.  This is not relevant to VCE!!!  An expense is meant to be used-up or consumed in the reporting period.  Expenses do not have a future benefit ... assets do.  But this change in policy converts a non current asset, up to $20 000, to an expense even though it will provide future benefits.  There is a difference between the real world and VCE Accounting!

Theft in supermarkets ...

When Steve and Ian visited one day (the ex owners of a Supermarket) I decided to tape a conversation with them.  When I told them you (Accounting students) would be listening they took it seriously.  This podcast covers theft and other issues relevant to a Supermarket such as KPIs.   Worth listening to.  Link below.

http://bottomline.podomatic.com/entry/2010-06-23T15_21_41-07_00

Budgeting ...

On Tuesday this week, Joe Hockey, Treasurer and minister in charge of the ATO, will deliver the Commonwealth Budget for 2015/2016.  In simple terms, this is an estimate of the Commonwealth's cash inflows and cash outflows for the next 12 months.  Later in Unit 4, we do a unit on budgeting by businesses.  Same concept ... smaller scale.

Unfair behaviour by suppliers ...

Former Premier Kennett is the arbitrator in disputes between Coles and some of its suppliers.   Link below.

http://www.abc.net.au/news/2015-05-11/kennett-coles-refunds-millions/6455990

Balance Day Adjustments (BDAs)

BDAs

• Stock losses/stock gains
• Prepaid expenses
• Depreciation of NCAs
• Accrued expenses

Finally, the last part of Unit 3 ... and very important.  Examiners love to use this stuff to rank students so ... our job is to frustrate them.  Aim to master this section of the course and you will reap rewards for the rest of the year.  We start by using the 8 page booklet (with 8 exercises) that aim to give you the big picture.  It can be intimidating ... but hang in there. We do a couple together, then drill down to the detail by working on booklets 12.1 (stock loss/gain), 12.2 (prepaid expenses), 12.3 (depreciation) and 12.4 (accrued expenses). We return now and again to that 8 page booklet to refresh the big picture.  Can you do all 8 exercises by the end of May?  When you have done exercise 8 ... email me ... and I will congratulate you.  If you decide that 4 of those exercises is enough ... well ... well ... I don't believe that will happen with the Accounting Class of 2015! The signs are good that this group can have a very good year.  The next 4 weeks are super important.  Make a commitment to yourself to challenge yourself.  Don't be afraid to make a few mistakes along the way.  That is OK.  That is a normal part of the learning process.  Move from the comfort zone to the stretch zone.  Are you up to it?  Of course you are.

TED!

Chapter 11 deals with the classification of the Cash Flow Statement and Income Statement.  If you can remember, it was Chapter 5 that dealt with classification of the Balance Sheet.

Good news.  You have been doing these reports since day 1 of the year.  So you are already comfortable with preparing them.  Chapter 11 just adds a bit of extension to the classification, especially with the Cash Flow Statement for those who did not do unit 2.
The templates are in the booklet and below ... learn them ... eventually.  You will revisit them in Chapter 12 and the Nano SACs. (did you print out that file!).

Cash V Profit, part 1

This is pre chapter 12 stuff.

There is a dot point on the study design that asks students, you, to understand the difference between cash and profit.  The best way to consider this is to compare and contrast two reports:  the Cash Flow Statement (CFS) and the Income Statement (IS).

Main point
These two reports report on different concepts.  The CFS reports on cash inflows and cash outflows. The IS reports on revenue earned less expenses incurred to calculate accrual profit. Consequently, it is unlikely that the change in cash reported in the CFS will be the same as the net profit or loss reported in the IS.  

Specific examples
That point above, is a good general point to make BUT most questions on this topic require specific examples.  So here are some.  More will follow after we have done chapter 12.

Think about a CFS.  What cash inflows could be reported in the CFS which would NOT be reported as revenue in the IS?

• GST collections
• ATO refund
• Debtor receipts
• Capital injection of cash
• Loan borrowings

Now think about the cash outflows which could be reported in the CFS which would NOT be reported as expenses in the IS?

• GST payments
• ATO settlement
• Creditor payments
• Purchase of non current assets
• Purchase of stock
• Drawings
• Loan repayments

Think about an IS.  Which revenue items could be reported in the IS which would NOT be reported in the CFS?

• Credit sales
• Discount revenue

Which expense items could be reported in the IS which would NOT be reported in the CFS?

• Cost of sales
• Discount expense
• Advertising (stock)
• Bad debts

SAC 2