Discuss About The Company Strong Internal Control Measures?
The two Australian Company that have been selected are-Telstra is an international company that provides digital telecommunication services to the people. It compromises of mobile, internet and other cloud computing services. The company has the highest market share with the level of growth improving every quarter. It is one of the leading companies in the telecommunication sector.TGP Telecom is the second largest Australia Company in this sector that provides digital communication services to the people. The company has a large number of subsidiaries and it expanding internationally to support it in its quest for success (Das 2017).
The two Malaysian Companies that I have selected are Sino Hua-An International Berhad, is a Malaysian listed company that sells international metallurgical coke and related products in the Malaysia. The Company is the chief supplier of iron ore. The other company is Titijaya Land Berhad that is one of the top property developers in the country that provides top services in this sector. The financial records of all the four companies have been extracted and analysed to comment on the financial position of these countries. Requisite analysis has been done to provide a clear picture of the present liquidity position. It will help the investors in taking important decisions with regard to these companies (Maynard 2017). The analysis is done hereunder-
On the basis of the above ratio analysis we can say that
In case of Telstra we see that return on assets, return on equity all have reduced that shows that the company is not performing well. The gross profit ratio, the current ratio and the liquidity ratios are much better than TGP that shows that the company having strong internal control measures. Also the company is taking advantage of its trading on equity and hence it is also the master leader in the Australian economy. The ratios show that the company is making good use of its equity position making the most of its share in the market. Even if the return on shares is not that good, the company is performing very well given to its strong liquidity position that is reflected in its current and liquidity ratios (Venezia 2017).
In case of TGP Telecom Company, the return on capital and return on assets is stable that shows that the company is earning profits and the shareholders return is good as the return on equity is increasing. The gross profit margin and the net profit margin ratios are almost stable this shows that the company is improving. The current ratio and the quick ratios have decreased that shows that the overall liquidity position of the company have worsened and the liquidity position is not favourable. But on the investor perspective the company is giving good records hence the company needs to employ more internal control measures to make its overall position strong, along with the investors return (Muller, Ward & Moodley 2017).
In case of Sino Hua-An International Berhad, we see that the return on assets is negative but over the years, the ratio is improving but still they are in negative which shows the company is not profitable in the respect of the investors. The gross profit ratio, we see has also been negative but in the current year it has become positive so that shows that the company is earning the required amount of profit. The liquidity position of the company is good giving to its current ratio and the liquidity ratio. The long term liquidity ratio is not applicable which shows that there is no debt in the company (Fay & Negangard 2017).
In case of Titijaya Land Berhad, we see that the return on shares and return on assets is decreasing over the years it shows that the company is not performing well and is not favourable for the investors of the company. The asset turnover ratio is also decreasing, which shows that company is not doing well. The company is taking huge debts but still on the basis of the above ratios it can be said the own assets are more than the debts (Werner 2017).
On the basis of the above analysis we can say that the Australian companies are performing more better than the mlayasian companies.
Das, PK 2017, 'Financing Pattern and Utilization of Fixed Assets - A Study', Asian Journal of Social Science Studies, vol 2, no. 2, pp. 10-17.
Fay, R & Negangard, EM 2017, 'Manual journal entry testing : Data analytics and the risk of fraud', Journal of Accounting Education, vol 38, pp. 37-49.
Maynard, J 2017, Financial accounting reporting and analysis, 2nd edn, Oxford University Press, United Kingdom.
Muller, C, Ward, M & Moodley, T 2017, 'The relationship between the management of payables and the return to investors', Journal South African Journal of Accounting Research, vol 31, no. 1, pp. 35-43.
Venezia, I 2017, Behavioral Finance: 'Where Do Investors'' Biases Come From?', WORLD SCIENTIFIC, Singapore.
Werner, M 2017, 'Financial process mining - Accounting data structure dependent control flow inference', International Journal of Accounting Information Systems, vol 25, pp. 57-80.