Carraro Group – An Amazing Turnaround!

Hi everyone,

Hope you enjoyed the warmest July winter in years!

After years of losses post the Global Financial Crisis, what an amazing turnaround of fortunes for the Carraro Group! Innovative products, new technologies, production efficiencies and hiving-off non-core businesses.

I welcome your feedback on Carraro Group’s Trial Balance and my Income statement drawn from the bank transaction statement.

Cheers,
Rahul

Rahul Ass_1 Step 3-6

Carraro AR2017

Rahul June Bank & Income Statement v1

Carraro Group Trial Balance Spreadsheet (Step 5)

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DPEL Financials – The Picture Emerges

Hi Everybody,

I hope you are enjoying your weekend and the lovely weather!

Having restated DPEL’s financials and its financial ratios, the business and economic realities have finally emerged:

• RNOA increased from about 9% in 2014 to about 17% in 2016, scaling back to about 10% in 2017.

• Considering a cost of capital of 10%, DPEL recorded a significant Economic Profit of about $30 million and $48 million in 2015 and 2016 respectively.

• Profit margins increased from about 7% in 2014 to about 13% and 19% in 2015 and 2016 respectively, before retreating to about 11% in 2017.

• ATO has been generally stable in the range 0.9 to 1.3

In summary, DPEL had its best operating performance years during 2015 and 2016, as evidenced in its RNOA, Economic Profit and Profit Margins.

I would really appreciate if you could provide me some feedback, more specifically in the areas of a) Accuracy of ratios, b) How these ratios are similar / different from your firm, c) Economic profit commentary

I would be delighted to reciprocate with feedback and look forward to hearing from you.

Cheers,
RahulDPEL Financials 2Rahul Ass_2 Step 7Rahul Ass_2 Step 8 and 9

DPEL Restated Financials – Aha!

Restating the financials of DPEL seemed quite a tedious activity, with all the copying, pasting and reclassifying of all the financial metrics so that the Operating and Financial activities are separated. It seemed like painting a picture on a blank canvas – once completed, the full business and economic reality of DPEL emerges. Specifically, I could now see the trend of key operating metrics, Return on Net Assets (RNOA), Economic Profit, Profit Margin and Asset Turnover Ratio (ATO) for the period 2014 – 2017. This presents a great picture of the operational performance of DPEL as below:

• RNOA increased from about 9% in 2014 to about 17% in 2016, scaling back to about 10% in 2017.

• Considering a cost of capital of 10%, DPEL recorded a significant Economic Profit of about $30 million and $48 million in 2015 and 2016 respectively.

• Profit margins increased from about 7% in 2014 to about 13% and 19% in 2015 and 2016 respectively, before retreating to about 11% in 2017.

• ATO has been generally stable in the range 0.9 to 1.3

In summary, DPEL had its best operating performance years during 2015 and 2016, as evidenced in its RNOA, Economic Profit and Profit Margins. Aha!

Restated Financials Draft – Feedback

Hi everybody,

I have uploaded the restated financials for Dominos Pizza Enterprises Ltd and would really value your feedback in general.

More specifically, I would seek your input on the 3 transactions under Other Comprehensive Income relating to Gains/losses from cash flow hedges and net investment hedge and Defined Benefit Obligation and whether these relate to Operational or Financial activities? There were no notes relating to these transactions.

DPEL Financials 1

I look forward to hearing from you.

Cheers
Rahul

Striking the Balance!

Hello Everybody,

I found working with Domino’s Pizza Enterprises Ltd’s annual reports quite fascinating, a great experience and in fact “I got the hots for what’s in the box with the dots!” Developing the key concepts was quite thought provoking. Interestingly, the concepts threw up many questions on how companies would “strike a balance” between investing activities, managing revenues, expenses and working capital, rewarding shareholders, ensuring full disclosure of bad news, managing employee benefit expense line yet having happy productive employees and the list was simply endless…

And while the experience of reading so many pages and creating the excel financial statement was somewhat painful – no pain, no gain!

Cheers, I will see you around.

Rahul

My First Lecture at Accounting at CQU!

It was 2 minutes to 9 am on the first day of Term and I rushed in to my first Accounting lecture on Level One, scared stiff not knowing what to expect – it had to be the only place I should have been at, considering I was enrolled in Bachelor of Accounting!
Lois Kemprich had struck up a hectic pace for Day One, talking through PeerWise covering multiple choice questions like Non-Current Assets in the first half-hour. I wondered if Non-Current Assets was being covered so early, what advanced topic would we get to by the end of the first month? Despite that, I found myself answering a few questions in an otherwise quiet class. Phew!
At the first hour break I realised I was attending a Year 2 course I had no business to be sitting in! With some Accounting background from school, things were not going to be so bad at CQU Accounting after all! It was time for an Ice Tea break!