Obtain an annual report for the year ending 2012 of an Australian listed company where a MODIFIED or an EMPHASIS OF MATTER opinion was given due to going concern issues.
The company we have chosen is “Aircruising Australia Limited”. The company is Australian owned, based in Sydney and was established in 1983. The company operates under “Bill Peach Journeys”. The company provides a service to its customers. They aim to give people the opportunity to have air cruise experiences in Australia and worldwide. They provide travel through private aircrafts, cruises and private trains. They also organise personalised tours, accommodation and fine dining throughout the travel.
The term going concern refers to the assumption that the company…show more content… A qualified opinion is given when the auditor concludes that the financial report contains a material (significant) misstatement. The material misstatement is in regards to the valuation of the “Bellinger River Tourist Park” in July 2011. This is a tourist park which is owned by the entity.
The directors have not recognised an impairment charge against goodwill. The firm made the decision not to charge the resulting impairment of goodwill on the difference between the recoverable amount and the carrying value and record the impairment loss and associated accumulated Impairment loss in the Financial Statements. The tourist park was independently valued. As per AASB 136, the impairment loss to goodwill and accumulated impairment losses should both have increased by the same amount, but this was not done, due to a number of reasons provided by the Directors in Note 11 Disclosure to the Financial Statements 2012. The same chain of events occurred a year earlier in 2011 and the Disclosure Notes to the Financial Statements reflected the decisions made by the Directors, yielding the same Audit Opinion – a qualified report on the basis of a breach of AASB 136 (Impairment of Intangibles).
| 2012($) | 2011($) | Carrying Value | 3,109,496 | 2,985,204 | Independent Valuation | 1,850,000 | 1,850,000 | VIU | ? | ? | Impairment Loss | 1,259,496 | 1,135,204 |