Financial Reporting DCC plc Essay - 825 Words

Financial Reporting DCC plc (Essay Sample) Content: Financial Reporting DCC PlcStudents NameInstitutionInstructors Name:Course NameFinancial Reporting DCC plcDCC is an international sales, distribution, marketing and business support group that is organized and managed across five divisions. The five divisions of the company include, Energy, Sercom, Healthcare, Environmental and Food and Beverage and are focused on specific market sectors with numerous employees globally. The company objective is to continue building a business which is growth-oriented, sustainable and cash generating. In addition, the company aims to obtain significant revenues on capital employed way more than its cost of capital. DCC is headquartered in Dublin, Ireland and is listed under Support Services on the London Stock Exchange. DCC energy which is one of the divisions of DCC plc is the largest distributor of oil in Britain and Sweden and a leading distributor of oil in Denmark, Ireland and Austria (DCC plc, 2013). The company is also one of t he leading sales and marketing businesses in Britain for fuel branded cards. The company has a strong balance sheet and its financial performance is robust despite a continuing weak economic environment with earnings per share at their highest point ever and an annual earnings growth of 26% on a constant currency basis. In addition, the groups revenue has increased from the previous year by 19.4%, operating profits increasing by 21.3%, operating cash flow increasing to 324.5 million, free cash flow increasing to 198 million and an incremental of 277.7 million placed on acquisitions and net capital expenditure. DCC plc is a successful business with a well proven business model and a long term track record with a significant contribution to the economy (DCC plc, 2013). The Group in relation to exceptional items has adopted an income statement format which seeks to highlight important items within the Groups annual reports. Such items may include restructuring costs, acquisition and re lated costs, net loss on disposal of subsidiaries, litigation costs and settlements, impairment of assets, loss on disposal of investments, profit or loss on disposal or termination of operations, adjustments to deferred and contingent acquisition consideration( arising on business combinations from 1 April 2010), and other operational exceptional items. Judgment is used by the Group in assessing the particular items, which by virtue of their scale and nature, should be presented in the income statement and disclosed in the related notes as exceptional items. The accounting policies applied in the preparation of financial statements for the group are applicable to all subsidiaries, joint ventures and associates for all periods presented in the consolidated financial statements. The financial statements preparation in line with IFRS needs the use of particular important projections of accounting and management to execute judgement in the process of applying the companys accounting po licies. The accounting policies adopted by the company are the Amendment to the IFRS 7 Disclosures-Transfer of financial assets. This amendment talks about disclosures needed to assist the financial statements users to ascertain the exposure to risk associated with the transfer of financial assets and the effect of those risks on an entitys financial position. The amendment to the IFRS 7 Disclosures-Transfer of financial assets did not have any significant influence on the Groups financial statements. Secondly, is the Amendment to IAS 12 Restoration of underlying assets? The amendment supplies an approach which is practical for quantifying postponed tax liabilities and...