Learning Outcome 4: Develop information gathering (research) and communication strategies to enable the provision of professional advice to a client. Objective: The objective of this assignment is to learn to effectively research a technical aspect of accounting and communicate professional advice to a client, via a business letter. Background to the case study: Assume that you are a graduate accountant working for Montana and Associates a public accounting firm situated at 696 George Street, Brisbane, QLD 4000. The manager of your firm, Ms Margaret Montana has asked you to draft a letter in response to an email received from a client – Mr Peter Pepper, the Managing Director of Pepper Limited, raising a key accounting issue regarding his company – see the copy of the email on the next page. The maximum length of the covering letter is 1 page. You should then address all the technical issues/discussion after the letter on separate pages as attachments, followed by a Reference List. The maximum word limit for all parts of the assignment should be 1250 words. Part A: Technical component 10% - This mark covers the technical content of your advice and the explanation on each of the issues, the calculations and the sources used. Part B: Communication Skills – Letter Writing 10% - This mark covers the generic skills of business letter writing; layout, clear meaning, structure and organisation, appropriate tone and grammar, spelling and punctuation etc. throughout the whole assignment. ACCM4200 FAR1 Assignment Information Page 2 of 3 The assignment is designed to test the following skills: 1. Your knowledge and your ability to research the issues and then apply the information appropriately using judgement to correctly identify the relevant standards and legislation that relate to the issues raised by the client. 2. Your written communication skills – business letter writing. Please note: Any work which has been copied or shared between students will result in a Fail grade for both students concerned. Therefore, please make sure that the answer to this individual assignment is your work and not copied or bought from any source. In completing this assignment make sure you follow the guidelines for assignments especially those relating to the presentation of written work, late assignment policy and academic integrity. Please check the marking rubric for each part to ensure that you have followed all the guidelines for presenting your work. Re: Accounting Issues: Year Ending 30 June 2018 From: Peter Pepper (
[email protected]) Sent: 5 July 2018 To: Margaret Montana (
[email protected]) Dear Margaret Thank you for your phone call this morning, as agreed I am emailing you regarding the accounting issues we briefly discussed. By the way to assist the accounting team in our decision-making process could you please make sure you reference any relevant sources relating to your advice, for example, AASBs, Corporations Act, and other relevant articles or websites. As you know, a new management accountant has been appointed to Pepper Ltd and he has implemented major changes in the calculation of depreciation. As a result, some parts of the factory have much larger depreciation charges. The change in reporting has angered some operations managers who believe that, as they take particular care with the maintenance of their machines, their machines should not attract large depreciation charges that reduce the profitability of their operations and reflect badly on their management skills. He has also indicated that more of our assets should be tested for impairment. The operations managers are also concerned about the impact of more charges against their divisions’ assets. Previously, impairment has only been carried out against assets carried under the cost model. For assets carried under the revaluation model, adjustments have been made using changes in fair value, resulting in revaluation gains or losses. The operations managers plan to meet with myself and the accountant and ask for change. ACCM4200 FAR1 Assignment Information Page 3 of 3 Can you please explain the following before I meet with the operations managers: The difference between depreciation, impairment and revaluation losses? What impact these charges will have on profitability? Why the changes are required for depreciation, impairment and revaluation? What disclosures are necessary for these changes? How we could otherwise report on performance without upsetting the managers? Please respond by letter (not email) as I would like to present this to the Board. I look forward to hearing from you shortly. Regards Peter Pepper Managing Director, Pepper Limited Level 5, 49 William Street, Brisbane QLD 4000 Hint: Remember that your firm plans to charge the client for your advice; as a check ask yourself if you would pay for the advice you have drafted!