报告模板Word格式.docx

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TELSTRACORPORATIONLTD

DueDate/Presentation:

Friday28October2005

Ideclaredthatalltheworkaredonebymyown.

GROUPMEMBERS

TABLEOFCONTENTS

EXECUTIVESUMMARY

ThisreportrepresentsanaccountinganalysisforTelstraCorporationLtd’s（TLS）basedonits2005AnnualReport.

TLSisAustralia’sleadingtelecommunicationsandinformationservicescompany.ItoffersafullrangeofservicesandcompetesinalltelecommunicationsmarketsthroughoutAustralia,providingmorethan10.3millionAustralianfixedlineandmorethan6.5millionmobileservices.

ThereportbeginsbysummarizingTLS’mainbusinessactivitiesincludinglandlineandmobilephoneservicesaswellasTLS’strategiestoimproveitsmarketpositionwithinAustralia.

ThereportthengoesontoidentifythekeyaccountingpoliciesrelevanttoTLS’successandtheaccountingstandardsandruleswhichapply.Fromthepoliciesandstandardsnoted,itisapparentthatTLSmanagementhaslimitedornoflexibilityinselectingthekeyaccountingpoliciesgiventhesizeofthecompanyanditslistingontheAustralianStockExchange.

ItalsoappearsthatTLS’incentiveinselectingthestrategiesbehinditskeyaccountingpoliciesistomaintaincomplianceandregulationwithintheparametersoflegislationandthegoverningbodies.

ItwasalsofoundthatthequalityofTLS’financialdisclosureisofahighstandardandthatnumberswhichappearedquestionablewhenviewingthefinancialreportswereinfactdisclosedundertherelevantfootnoteswithintheannualreport.

RecentfinancialpresshasreportedthatwhilstTLScontinuestogenerateanetprofit,revenueshavebeendecreasingandTLSmayhavetoreevaluateitscurrentbusinessstrategiesandpositionshoulditwishtoremainastrongholdintheAustraliantelecommunicationsmarket.

1.SummaryofCompanyActivitiesandStrategies

MainActivities

TLS’mainactivitiesincludetheprovisionof:

∙BasicaccessservicestomosthomesandbusinessesinAustralia;

∙Landlinephoneservicesbothlocalandlongdistance;

∙Mobiletelecommunications,dataandinternetservices;

∙Managementofbusinesscustomers'

ITand/ortelecommunicationsservices;

∙Wholesaleservicestoothercarriersandcarriageserviceproviders;

∙Advertising,directoriesandinformationservices（e.g.theWhitePages）;

and

∙DistributionservicesforFOXTEL'

scabletelevisionsubscriptions.

TLSStrategies

TLS’strategiestofurtheritsmarketleadershipinclude:

∙Migrationofcustomerdemandfromtraditionalproductsandservices,totheemergingproductsandservicese.g.broadbandinternetservices;

∙Identifyingcostefficienciestoprotectoperatingmarginsandimproveproductivity;

∙Continualimprovementofcustomerservicelevels;

∙Privatisationof100%ofthecompany;

∙Alignmentofinvestmentwithrevenuegrowthdrivers.

2.BackgroundInformation

TLS’currentpolicyistoprepareitsfinancialstatementstosatisfybothAustralianGenerallyAcceptedAccountingPrinciples,（AGAAP）andUSGenerallyAcceptedAccountingPrincipals（USGAAP）.WherethereisnoconflictbetweenAGAAPandUSGAAP,TLSincorporatesthemoredetailedrequirementsinbothfinancialstatements.TLSwilladopttheAustralianequivalentsofInternationalFinancialReportingStandardstofuturefinancialreports（effective1/07/2005）.

KeyAccountingPoliciesRelevanttoTelstra’sSuccess:

OverleafarethekeyaccountingpoliciesrelevanttoTLS’success.Therelevantaccountingstandardsandrulesarenotedingreen.

RevenueRecognition

AASB118–referstothetreatmentofrevenuefromordinaryactivitiese.g.Thesaleofgoodsandrenderingofservices

TheunderlyingaccountingprinciplesofrevenuerecognitionarethesameunderAGAAPandUSGAAP.AsUSGAAPprovidesmoredetailedguidanceastothetimingofrevenuerecognition,TLShasappliedthistobothAGAAPandUSGAAPfinancialstatements.

ThekeypointsofTLS’revenuerecognitionare:

∙Revenueearnedonthecompletionofcallsisrecorded;

∙Installationandconnectionfeerevenuesandrelatedincrementalcostsaredeferredandrecognisedovertheaverageestimatedcustomercontractlife;

∙Anycostsabovetherevenuedeferredarerecognisedimmediately.

∙Revenuefromsaleofgoodsisrecordedondeliveryofthegoodssold.

∙Networkaccessrevenueisrecordedonanaccrualbasisovertherentalperiod.

∙Constructionrevenueisrecordedonapercentageofcontractcompletionbasis.

∙Revenuefromonlinedirectoriesisrecognisedoverthelifeoftheserviceagreements（~1year）.Printdirectoriesarerecognisedondelivery.Voicedirectoriesarerecognisedatthetimeofprovidingtheservicetocustomers;

∙Revenuereceivedinadvanceisinitiallyrecordedasaliabilityandthentransferredtoearnedrevenueinlinewiththerevenuepoliciesdescribed.

Receivables

AASB118（18）revenueisrecognisedonlywhenitisprobablythattheeconomicbenefitsassociatedwiththetransactionwillflowtotheentity.（Deeganpg547）

Tradedebtorsarerecordedatamountstobereceived.Aprovisionfordoubtfuldebtsisraisedbasedonareviewofoutstandingamountsatthebalancedate.Baddebtsspecificallyprovidedforinpreviousyearsarerecordedagainsttheprovisionfordoubtfuldebts.Inallothercases,thebaddebtsarewrittenoffasanexpensedirectlyinthestatementoffinancialperformance.Receivablesfromrelatedpartiesarerecognisedandcarriedatthenominalamountdue.

Inventories

AASB102,paragraph9.Inventoriesaretobemeasuredatthelowerofcostandnetrealisablevalueonanitembyitembasis.（Deeganpg230）.

Inventoriesarevaluedatthelowerofcostandnetrealisablevalue.TLSallocatescosttothemajorityofinventoryitemsonhandatbalancedateusingtheweightedaveragecostbasis.Fortheremainingquantitiesonhand,actualcostisused.

ConstructionContracts

AASB111–providesguidanceondeterminingreportedvalueofpartlycompletedconstructionprojectsandondecidingwhentheassociatedrevenuesandexpensesshouldberecognised.（Deeganpage557）

Constructioncontractsarerecordedinprogressatcostlessprogressbillingswhereprofitsareyettoberecognised.Whereasignificantlossisestimatedtobemadeoncompletion,aprovisionforforeseeablelossesisbroughttoaccountandrecordedagainstthegrossamountofconstructionworkinprogress.

Profitisrecognisedwhenthestageofcontractcompletioncanbereliedon;

coststodatecanbeidentifiedandtotalcontractrevenueistobereceivedandcoststobecompletedcanbereliablyestimated.

PropertyPlantandEquipment（PP&

E）

AASB116.PP&

Eistobeinitiallymeasuredatcostandincludethepurchaseprice,anycostsneedtobringtheassettothelocationandconditionnecessaryforoperationandanycostsassociatedwithdismantlingtheitem.ThisstandardcoversdepreciationforPP&

Eanddefinesitasthesystematicallocationofthedepreciableamountofanassetoveritsusefullife.

AcquisitionofPP&

Earerecordedatcost.Valuationsofalllandandbuildingsareobtainedonceevery3years.Allproperty,plantandequipmentareheldatcost.

PP&

Eistobedepreciatedonastraightlinebasisoveritsestimatedservicelife.

3.ManagementFlexibilityinSelectingKeyAccountingPolicies

Telstramanagementhaslimitedornoflexibilityinselectingthekeyaccountingpolicies.ThisisbecauseTLSdoesnotmeetthesmallcompanyrequirementsunders296oftheAustralianCorporationsAct,2001i.e.:

agrossoperatingprofitbelow$10million;

Grossassetsbelow$5million;

andLessthan50employees.

ThereforethecompanydirectorsarerequiredtoensurethatTLS’financialstatementsforthefinancialyeararemadeoutinaccordancewiththerelevantaccountingstandards.

ThedirectorsofTLS,asstatedinthenotestotheTelstrafinancialstatements（2005）mustensurethatthereportsarepreparedinaccordancewiththenecessaryrequirementsunder:

TheAustralianCorporationsAct2001;

AustralianAccountingStandardsBoard;

UrgentIssuesGroup;

andAGAAP.

Infutureperiods,TLSmustadopttheInternationalFinancialReportingStandards.

4.EvaluationofEmployedAccountingStrategies

TLShaspresenteditsfinancialsasperUSGAAPandAGAAP.Theaccountingstrategiesemployedbymanagementinrespecttoeachkeyaccountingpolicyareinlinewiththeprescribedstandards.

RevenueRecognition

TLSmanagementhasadoptedtheaccountingpoliciesasdefinedundertherelevantaccountingstandardAASB118andappliedthemsothattheyareappropriateforusewithinthetelecommunicationsmarket.

Billsofexchangeandcommercialpaperswithamaturitydategreaterthanthreemonthsarevaluedatamortizedcostwithinterestrevenuerecognizedonaneffectiveyieldtomaturitybasis.Receivablesfromrelatedpartiesarerecognizedandcarriedatthenormalamountdue.Interestistakenasincomeonanaccrualbasis.

Inventory

Theweightedaveragecostmethodisusedforthecostallocationforamajorityoftheinventoryitemsonhand.Fortheremainingquantitiesonhand,accrualcostisused.

TLSmanagementhasadoptedtheaccountingstandardAASB111andapplieditwithoutalterationtothereportingofitsconstructioncontracts.

RevaluationofProperty,Plant&

Equipment

TLSobtainsvaluationofallthelandandbuildingsitholdsonceeverythreeyearsor,morefrequentlyifnecessaryinaccordancewiththerequirementsofAASB1040.ItisTLS’policytoapplythecostbasisofrecordingpropertyplantandequipment.