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Ths s an assgnment report prepared for the company for the year 2019 please loo at t f you want. reallly do....

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THE UNIVERSITY OF THE SOUTH PACIFIC FACULTY OF BUSINESS AND ECONOMICS SCHOOL OF ACCOUNTING AND FINANCE Semester I, 2020 AF101: INTRO. TO ACCOUNTING MAJOR ASSIGNMENT – COVER SHEET Due Date: Thursday, 23rd April Total Marks: ________/60 Note: Any discrepancy or error in marking should be brought to the notice of the lecturer/tutor immediately on the receipt of the marked manuscript.

PLEASE ENSURE YOU COMPLETE THIS SECTION BEFORE YOU ATTACH THE COVER SHEET TO YOUR ASSIGNMENT Mode of Study: FACE-TO-FACE

Students Names*:

1.Bhawesh Sidharth Singh 2.Mohammed Muzammil Jamil 3.Ashleen Shaleen Chand

Students ID Numbers*:

1.S11183289 2. 3.

*If in a group, please list down all students’ names and ID numbers.

Table of Contents

1.0 Introduction The South Pacific Stock Exchange is a stock exchange based in Suva, Fiji. As of 2020, the South Pacific Stock Exchange consists of twenty-one listed companies. This report focuses on the analysis of the financial reports of the Amalgamated Telecom Holdings Limited (ATH). Amalgamated Telecom Holdings Limited was formed as public company on 10th March 1998, which served as a medium that was used by the Fiji Government to invest in telecommunications sector. Today some major activities of the ATH group include the provision of business communications solutions and International telecommunications facilities to name a few. In the 2019 annual report, the chairman of Amalgamated Telecom Holdings Limited, mentioned that “Building on the results of this financial year will require hard work, especially with the new additions to the Group” (Kodagoda,2019). This analysis report is likely to provide an investor with an evaluation of the overall performance of the company aiding investors to explore the investment opportunities which they can pursue together with its benefits and drawbacks. In-depth analysis of the organisation’s financial performance and position is outlined in order to affect decision making.

2.0 Horizontal Analysis “An analysis of the change from year to year in individual statement items is called horizontal analysis” (Hogget, et al., 2015).

Amalgamated Telecom Holdings Limited and Subsidiary Companies Consolidated Statement of Profit or Loss and other Comprehensive Income Year Ended 31st March Horizontal Change During Year 2018 ($)

2019 ($) Revenue Direct Costs

Dollar Amount

Percent

523,950 (190,055)

460,416 (162,676)

333,895 17,666

297,740 20,053

65,534 14.23% (ꜛ) 27,379 16.83%(ꜛ) 36,155 12.14%(ꜛ) (2387) 11.89%(ꜜ)

(59,539) (5,681) (1,087)

(50,984) (3,135)

8,555 16.78%(ꜛ) 5,681 No effect (2048) 65.33%(ꜜ)

587 (57,746) (17,919) (88,606)

(2,638) (49,486) (15,900) (76,589)

(2051) 8,260 2,019 12,017

121,570

(258) 118,803

(258) No effect 2,767 2.33%(ꜛ)

Finance income Finance cost Net finance cost Profit from operations Share of profit from associate

2,505 (11,348) (8,843) 112,727 -

2,862 (8,596) (5,734) 113,069 462

(357) 2,752 3109 (342) (462)

Profit before income tax

112,727

113,531

(804) 0.71%(ꜜ)

Income tax expense

(27,988)

(23,744)

4,244 17.87%(ꜛ)

84,739

89,787

2,244

437

Gross Profit Other Income Depreciation of property, plant and equipment Depreciation of right use of assets Amortisation of intangible assets Impairment / (reversal of impairment) on trade and other and receivable, net Personnel Costs Marketing and promotion expenses Other operating expenses Impairment loss on telecommunications and capital equipment Operating profit

Profit for the year after tax Other comprehensive income Items that are or may be reclassified subsequently to profit or loss: Exchange difference on translation of foreign operations Other comprehensive income for the

77.75%(ꜜ) 16.70%(ꜛ) 12.70%(ꜛ) 15.69%(ꜛ)

12.47%(ꜜ) 32.01%(ꜛ) 54.22%(ꜛ) 0.30%(ꜜ) No effect

(5048) 5.62%(ꜜ)

year Total comprehensive income for the year

2,244 86,983

437 90,224

1,807 413.50%(ꜛ) (3,241) 3.60%(ꜜ)

(Source: (ATH Limited Annual Report 2019)) Amalgamated Telecom Holdings Limited’s income statement for two consecutive years 2018 and 2019 was used to carry out the Horizontal analysis. In the accounting period 2018-2019 it was seen that the expenses had a much greater increase than that of revenue which led to an overall decrease in the profit of ATH Limited by 3.60% at the end of the financial year. The direct costs had increased by 16.83% which is a concern for the business since the revenue increased by a lower proportion. Hence this led to a 12.14% increase in Gross Profit for the year. The majority of revenue is gained from data network and internet services provided. In a nutshell, Amalgamated Telecom Holdings Limited accounted for majority positive changes, however, the final comprehensive income for the year is favorable to the company but significantly decreases when compared to previous figures. Relevant stakeholders may review the analysis to decide on potential investments....