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ACCY801 Business Accounting Report Assessment
In ACCY801 business accounting report assessment various aspects of Newcrest Mining Ltd has been analysed and evaluated related to its board composition, corporate governance recommendations, financial performance and stakeholder management. Newcrest Mining Ltd is operating its business in mining and gold extraction sector since last many years. They have diversified business operations under their organisation. Recommendations related to board composition, safety and sustainability, audit and risk committee has been provided in this report. Ernst & Young is the auditor of Newcrest Mining Ltd. Liquidity position of Newcrest Mining Ltd is quite well, Newcrest Mining Ltd needs to improve their net profit as they are lacking behind in terms of net profit margin. On the other hand Newcrest Mining Ltd has adequate efficiency in terms of business operations. They have four major investors or stakeholders that have contributed more than 80% of its issued share capital.
Newmont Australia Limited undertakes their operations through pipeline of Brownfield and Greenfield for the exploration of gold as their primary activity. Another business operation that Newmont Australia Limited undertakes is of research and development in exploration and extraction. Recent Newmont Australia Limited has achieved great success in its business area i.e. extraction of gold and other activities. Recent they had achieved 2423,000 ounces gold production and have all-in sustaining cost of AUD 941 per ounce.
Role of the external audit function
External audit function enables business organisation to conduct and manage audit of financial statement prepared for particular period. External audit function includes identification of frauds, any misrepresentation of facts and figures, and material misstatement in the financial statement of the company.
Analysis of financial statements in terms of following aspects
Liquidity: Their liquidity position is good as per current ratio i.e. 2.09 times which means they have 2.09 times current assets to pay its current obligations. On the other hand, as per quick ratio their liquidity position is not enough to repay its obligations from core assets i.e. excluding inventories and prepaid expenses (Campbell 2014).
Efficiency: Therefore this ratio shall be kept as low as possible and in case of Newcrest Mining Ltd, it is at adequate level. On the other hand, debtor’s turnover ratio indicates time period within which cash from debtors is collected or recovered by the business organisation (Peavler 2014).