Step 2 (9 marks)
My company’s annual reports
ICS Global annual report 2012: http://icsglobal.com.au/annual_report_pdf/ICSGlobal-AnnualReport-300612.pdf
ICS Global annual report 2013: http://icsglobal.com.au/annual_report_pdf/287%20130828%20ICSGlobal%20Ltd.%20Annual%20Report%20for%20the%20Year%20Ended%2030th%20June%202013.pdf
ICS Global annual report 2014: http://icsglobal.com.au/annual_report_pdf/ICS%20Annual%20Report%202014.pdf
An understanding of my company
ICS Global is an ASX (Australian Stock
Exchange) listed technology investment company. This company was established in
1999 and operates in Australia and the UK, primarily operating business in the
UK. ICS is focused on growing the Medical Billing and Collections as a market
leader. The Medical Billing and Collections (MBC) has been providing billing
services to Medical Consultants and Specialists for over 20 years in the UK.
ICS, as an investment company seeks new investment opportunities to guarantee
that long value is delivered shareholders. (ICS Global, http://icsglobal.com.au)
By reading my company’s last financial
report, the company appears to be doing very well. The 2014 financial
year saw an increase in net profit and cash. The board was particularly pleased
with the 78% growth in 2014 earnings from continuing operations from $554,575
from 2013 ($312,351). The company also achieved ongoing capital efficiencies in
the business. ICS is continuing to improve its financial position and is well
placed to continue to support its UK business and to continue to consider other
opportunities for investment and acquisition. Throughout the year of 2014, a
further $285,562 was invested in the MBC platform from free cash flow to
support new software and fit out for the new premises. So wow, this business is
doing well alright! In regards to if I am happy with the company I got given, I
would have preferred to receive a company I had prior knowledge of, perhaps
something in retail rather then an investment company. This is because I still struggled with knowing exactly what the company
does and what their day to day basis consists of. Looking at
the example of ASS #1, Anna Towan’s company ‘Ryan Air’, would have been a very
interesting company to look into as they seem to have very
inconsistent figures throughout the years. In saying that however, ICS Global
must be doing something very well, as they only increase in profits every year.
When reading about my company and its annual report, I wasn’t sure what I was
looking for. The first thing I did was have a look at whether or
not the report stated whether the business has done well in the year or not.
ICS did in fact perform better than last financial year in a number of
different events. Although there is a lot to read of my company in
regards to their financial reports, I feel as if the company is yearly becoming
a better and more profitable business.
In researching more
into my company, I found this one video on YouTube that I found very funny. In
the cartoon, everyone is sitting at a meeting table having a meeting where the
speaker is talking about 'boring financial stuff', everyone is bored and the
title of the video is "ICS Global sales meeting recap day 1". Clearly
someone at this meeting thought it was so boring that they uploaded that video
onto YouTube. I must admit, I thought it was hilarious because to some people,
these things really can be boring. However, this was the only ICS Global
related item on the internet I could find; besides the website itself.
KCQ’s
Areas
of ICS Global that are most important or critical to me
- Final 2014 dividend maintained at 0.1 cents per share. I think that’s a crazy amount of money per share. 0.1 cents per share!
- The company purchased 572,834 shares during the 2014 year
- Th e last four years showed an increase in revenue, profit from continuing operations, net assets and net cash
- The business however, had more expenses in 2014 then in 2013
- I’d like to know how ICS Global is doing so well and improving every year?
Having
difficulty understanding
- I have difficulty understanding some terminology that is presented in the financial report for example, ‘issued capital’ is talked about a lot so I’d like to know what this means
- By having done statement of changes in equity, balance sheet and income statement in my spreadsheet, now I’d like to know what the cash flow is all about
- What is the difference between non- current and current assets and liabilities?
- What does consolidated mean?
Key
challenges the firm could be facing
Although, my company is doing very well
there could be some potential risks. Firstly, there is market risk. As the company
uses a lot of transactions used in a foreign currency, there is exposure to
foreign currency risk through foreign exchange rate fluctuations. There is also
credit risk which refers to a risk that a counterparty will default on its
contractual obligations resulting in financial loss to the company. However,
ICS does not have any material credit risk exposure to any single debtor or
group of debtors under financial instruments entered into by the company. A big
risk that any company should look out for is liquidity. The company manages
liquidity risk by maintaining adequate cash reserves and available borrowing
facilities by continuously monitoring actual and forecast cash flows and
matching the maturity profiles of financial assets and liabilities.
How
successful it appears to be in meeting these challenges and its strategy
As we can see from the above paragraph, ICS
Global could have many potential risks that could potentially bring the
downfall of the company. They have many strategies that have been discussed
above that are put in place to cease any risks from occurring. Overall, ICS
Global is a very professional company that knows what they are doing and how to
manage themselves.
Discussions with peers
In regards to sharing my blog, I had a few
comments stating that they enjoyed the layout of my blog and I also looked at a
few different blogs. Everyone had a wonderful and unique layout to their blogs
which I found interesting as no blog was the same. I introduced myself and left
a comment on a lot of blogs. In regards to sharing information on my company, I
found that a lot of people enjoyed the company they got given. At first, they
didn’t have any connection or likeliness towards their company, but as they
gained more information and learned about it, they realized that they actually
did have a lot in common with their company. A lot of companies were doing very
well I found. Through discussing on facebook, face to face and through email, a
few people I talked too said that their company doubled in equity by the last
year which is very good. Although my company didn’t double in figures, there
was still that gradual increase. However a lot of other companies said that
they were in a downturn in business as they were experiencing significant
decreases in work opportunities. There were increases in revenue in certain
accounts that didn’t make up for big losses in other accounts. I think end all,
I learnt that companies will always vary in financial results. Although there
can be similarities in some aspects of the business, there will always be
differences in other aspects.
My top three blogs
In no particular
order... there were three blogs that I found very interesting and well
presented.
1. Madison Briskey -
http://madisonbriskey.blogspot.com.au
The presentation of
her blog was out of this world and very eye catching. It had a logical set out
and had bright colours as a theme to make it more interesting. In her three
posts, she gave a lot of detailed information on her company and included
pictures and imagery as well. That makes everything so much more fun when there’s
not only writing! She introduced herself so we could all get to know her and I
think she has done a great job with her blog so far.
2. Georgia Fordyce
- https://geefordyce.wordpress.com/
I enjoyed reading
through Georgia's blog because she got straight to the point and didn't babble
about unrelated topics. It's a skill that a lot of people in this day, do not
have. She had a quick intro about herself and a quick intro about her company.
She finds her company very relatable to herself and has included links to
charities that her company associates with etc. I think Georgia has done a
great job with her blog and her research in regards to her company.
3. Jordan Noonan -
https://jordanmnoonan.wordpress.com
I absolutely adored
the presentation and layout of Jordan's blog. It had a very classy and stylish
theme to it. She clearly has done a lot of research in regards to her company
as well. Jordan gave us a good insight into her thoughts of the company on how
at first, she didn't have a connection but after doing some further
research she found a way that the company speaks out to her in ways that she
thought they couldn't have. I won't say anymore as you need to check out her
blog to find this out ;)
Step 3 (5 marks)
Step 4 (5 marks)
Chapter One:
KCQS
- · What does accounting really mean?
- · We will soon see later on in this course whether or not accounting helps us in seeing what is actually going on in a firm
- · Will we be doing some practical work involving the journal entries and ledgers?
- · Businesses are everywhere and most businesses if not all, need to keep accounts
- · A small business with one owner is a sole trader that has no separate legal status apart from its owner, a partnership is two or more owners of a business and a company is their own separate legal entity
- · Double-entry accounting is a way of recording the transactions and other economic events of a firm
- · Over the years, we have stopped using physical books to do book keeping and started to use computers and their software such as MYOB or Excel.
- · A journal includes the daily transactions of a firm such as sales and purchases etc in which they occur each day
- · A ledger contains these same transactions but in its individual accounts
- · These accounts include assets, liabilities, equity, revenue and expenses
- · How does the journal and ledger look like in format?
- · What is proprietorship?
- · Accounting equation is Equity = assets – liabilities
What do I
find confusing?
The main thing I
found confusing in this chapter was the accounting equation. The terminology
itself is still something for me to really wrap my mind around such as liabilities
and equity. I had to re read the paragraph a few times to understand it but I
still feel like my knowledge of these terms are still not at its best. I will
have to do some further reading. Math
and accounting were never my strong spots in high school so seeing an equation
and accounting terminology all mashed into one was overwhelming. I think the
one thing I have trouble understanding is how this equation will fit into the
journal or ledgers of the business but I guess I will soon be able to learn
this and put it into practice. Another aspect I found confusing at first was
how the debit and credit works. My knowledge of this would be that when you
purchase something or pay something for the business, it would be in the debit
column. Or when you gain money or so on, it would be in the credit column. I
learnt that it was now reversed and that we use positive numbers for debits and
negative numbers for credits. This concept I still find a bit confusing but I
am hoping to improve my knowledge by further reading.
What do I
find difficult to understand or believe?
I find it crazy
to believe that double-entry accounting was around long before the 15th
century. With today’s technology and how quick and easy it is to create a table
and type in some figures, it is a ridiculous thought on how they did it back
then without technology.
What do I
find boring?
I honestly found
the first page of the chapter quite boring. As it went on I found that the main
aim of the course was stated a few times. I understand that the topic and
course objectives need to be drilled into our minds. This is so at the end of
the course we can go back and say yes, ‘I know the answer to that first
question’ but I just found it a bit to repetitive. I also found when the all
the different businesses were listed, it just went on and on and I found that
very boring and to be honest, I just skipped that entire paragraph as it was
also very repetitive and boring.
What do I
find exciting or surprising?
What I found surprising
was the reason behind QWERTY. I never even realized the first few keys of the
keyboard spelt our QWERTY! I also have no learned the reason why the letters on
the keyboard are so far apart. This is also very surprising as I never would
have expected typewriters to have a part in it.
Chapter Three
KCQS
- · There are four general purpose financial statements that include balance sheet, income statement, statement of changes in equity and cash flow statement
- · Every firm’s financial statement has foot notes which include more information on its financial status
- · Every business is constantly moving
- · Recalling information is like going to a party and meeting someone for the first time. I really liked this analogy
- · Revenue and expenses are the two temporary elements of accounting
- · As long as the business does not run out of cash, no matter how much the losses are, the business can still continue to trade
- · Why were the Greeks so intelligent at creating ideas regarding mathematics and accounting?
- · 2:1 current ratio means twice as many current assets as current liabilities
- · Equity = present value of expected future dividends
What do I
find confusing?
I find the
concept of the ratios a bit confusing. I understand how ratios work I just
couldn’t visually picture it in my mind how the ratios will play in accounting.
Another concept I found confusing was the dividends. My interpretation of a
dividend is when a company’s earnings is shared to shareholder, however when it
came to the equation d= C – I + F, I became totally lost. I am presuming the
equation is supposed to help explain the relationship between cash flows and
dividends, but if anything, it made my understanding of it more difficult. I
find it difficult to express why I don’t get it, I just don’t get it the whole
concept in all honesty. This was the same with the accounting equation in
chapter one. I never have liked equations and I just find it difficult to
understand.
What do I
find difficult to understand or believe?
I find it hard
to believe that Euclid’s Elements is
the world’s second widely translated and circulated book, which is second to
the bible. Who would have thought that a book full of numbers and theorems
would be second? That just blows my mind and now I want to be able to have a
flick through it.
What do I
find boring?
Although I am
not the most excited person when it comes to reading about accounting, I did
not find the chapter boring at all. The way that the author has designed the
chapter is very interesting and relative. It’s not just a plain chapter on
definitions and what they mean etc, but instead showing examples and trying to
relate to the audience in everyday life.
What do I
find exciting or surprising?
Going on what I
stated just above, I like the analogy of how the author related accounting to
meeting someone for the first time at a party, and then throughout the chapter
he continued to talk about this analogy. I also found it very exciting to read
about the history of financial statements and how much the Greek’s had a part
in it.
