Buacc5934 : Financial Accounting : Assessment Answer

Answer: 

Paper 1: A case of Tailing Storage Facilities 

The basic question that the paper intends to answer is if mining can be done in a way that reduces its impact on the environment and at the same time protect the livelihood of the local community members. The author thinks of this as a key issue because a majority of the world’s mining related tragedies have occurred due to the tailings storage facilities. The arguments that the writer wants to give is demonstrated well with facts and figures. A thorough exploration of the three mines that is, Ok Tedi, McLaughlin and Mount Polley helps one to comprehend the concerns connected with TSF. The study helps one to find a reason why McLaughlin was a success and why the other two were a failure (Arnott, Lizama, & Song, 2017). Across the globe, we see that the reasons behind such disasters are purely political as opposed to technical. Such mishaps lead to social disasters, with far reaching impacts. Poor scrutiny of geotechnical elements substandard design model of tailings beach and dams, nonconformities with the Ministry approved designs, careless and incompetent supervision are some other examples. The essayist also articulates how scientific and innovative engineering practices can defeat the social and environmental impacts of mining (Alexander, 2016).

The case of tailing storage facilities” raises questions which are the need of the hour. Raising questions on the environmental impacts of mining is not new, but what is new here is the evidences and the reasoning that the writer provides. Unlike a lot of environmentalists, and columnists he has actually done his homework properly and does not just blabber. Though the author has approached few issues with aggression, I do not condemn it (Bizfluent, 2017). Such an approach is necessary for issues affecting humankind. The text is beneficial for all the strata of the society; students, researchers, government and its agencies, corporates, NGOs. The script is comprehensive and lucid. The evidences given in support are extensive and strong. These have been assigned numerical values, wherever possible. This makes the paper influential and irrefutable. However the inferences appear to be at an introductory stage. Mining industry has a long way to go before it becomes environmentally efficient.

Paper 2: A study of a Multinational Gas Company

The paper aims to talk about the disclosures that a company or organization is required to make in the event of an environmental incident. To achieve the anticipated goal, the author has taken the help of two case studies; one form Bangladesh. The case particularly includes the evaluation of two blowouts at a gas field owned by Niko Resources Limited. The author intended to know whether or not entities make such disclosure out of public pressure or as part of their accountability (Deegan & Shelly, 2014). A thorough study of the paper makes the readers conclude that the disclosures made by Niko Resources Limited, was merely out of public pressure. The company knew well that not addressing the issue would have a direct bearing on their survival. As a result, no quantitative information was provided with the annual report. Contingent liability was disclosed only to the to the extent that they did not defy the legislations.

The question that this paper raises is the need of the hour. With Globalization, a lot of MNCs are opening up places of business in developing countries. Therefore, their accountability and answerability incidents in those nations needs to be established. The question is relevant and is novice (Choy, 2018). This paper is the first that emphasizes on the action of international entities towards such incidents in local communities is characterized by reading, evaluating and reviewing the articles in the. The annual report and the standalone social responsibility report has also been properly read. Further, to enable the analysis of their behaviour, these disclosures were further divided into financial and non-financial disclosures. The approach is keenly observant and critical. The matter has been written in minute details. The tables that are given as an art of the paper do not require additional explanations (Dumay & Baard, 2017). The given conclusion is restricted because of the fact that a single multinational has been studied. There are other entities as well that has made similar disclosures, but their motive behind making such disclosures could definitely be varied and it cannot be communalized.

Paper 3: Corporate Social Responsibilities: Alternative Perspectives about the Need to Legislate

This paper on “Corporate Social Responsibilities: Alternative Perspectives about the Need to Legislate” raises its voice on corporate accountability, rather, corporate social responsibility. It explores whether corporate social responsibility shall be developed and determined by the vibrant and diverse market forces, or by statutory and regulatory bodies. In order to facilitate a conclusion, the article includes and travels across the opinions of different people, organizations and communities (Visinescu, Jones, & Sidorova, 2017). These opinions are about the introduction of a new, distinct and supplementary statute. It also talks about the existing legislations so that the readers get an understanding of what is existent and what needs to be achieved.

As anticipated, different groups or sectors answered contrarily to it. Every division advocated the alternative that they thought was favourable to their own interest. The business community was in support of an approach which does not involve any regulatory body or institution. The individuals and the social organizations, on the other hand were of the opinion that it should be strictly regulated (Schoenberger, 2016). The significance of the topic becomes clear from the amount of replies that were received by the Parliamentary Joint Committee on Corporations and Financial Services on the Inquiry. These responses came from a diverse group of people comprising of corporates, professional bodies, non-government organizations, employee groups, government organizations and individuals. From a sum total of 130 responses, 36 submissions came from individual respondents, who feel the need of investor protection legislations. The social and environmental organizations followed closely with 30 submissions.

Viewing from the technical aspect, the report is well documented. The author has used a research based style of writing. The responses have been given tabular representation that gives a quick view to the readers for easy understanding. The scrutiny of the responses with terms of references is very logical. It leaves no space for misconception and possibility of unrealistic conclusion is ruled out (Goldmann, 2016). The text matter has been divided into sections like research method, results, consistency and summary, each section catering to different aspects. The only thing where the paper could have done better is the conclusion part. Nevertheless, the script would be advantageous to students of the field and people who want to have the beginner’s knowledge on the concept of corporate responsibility.

Paper 4: A test Of Legitimacy Theory 

The purpose of this particular paper is to divert attention towards the use and implementation of the legitimacy theory while preparing the annual disclosures in the financial statements. It interprets the connection between the event that gives birth to the environmental threat and the decision taken by the company to handle the legitimacy. The paper establishes that disclosures in annual report is the most common method of controlling and communicating the strategic reaction with the stakeholders (Deegan, Rankin, & Tobin, 2002). Therefore organizations tend to divulge their social and environmental data in the annual report. This is done voluntarily to keep the stakeholders well informed. The value for environmental data is so big that corporate entities have also began to prepare standalone report that solely caters to this environmental disclosures. After going through different perspectives, it is evident that the need for disclosures depends on the magnitude of the matter. Where incidents require prompt action and a broad exposure, annual reports should not be the chosen mode of disclosures. In such cases, other unpopular mode of communication like media release and advertisements should be opted for (Farmer, 2018).

Evaluating critically, the paper has tried to raise a new topic. Given the speed of economic development and growth, the relevance of this theory is seeing a sharp increase. The link of legitimacy theory with other social theory like stakeholder theory, accountability theory and political economic theory is insightful. The writer has given figures to explain the play area of the expectations of the society and the actions of the corporates. Words of different authors have been quoted to impart perspectives. Sample tactics suggests a real response to hypothetical events (Gooley, 2016). The inputs about this research has not been collected extensively. It was gathered only by interviewing six senior managers. However, the small number of interviews were in depth. It involved a lot of open and close ended questions. The distinguishing feature of this paper is data analysis. It was conducted in two stages. The first stage concentrated on the quantitative factors whereas the second stage stressed on qualitative aspects. The comprehensive approach of data analysis imparts reliability to the report and makes it informative. Assigning ranks to disclosure approaches makes the concept clear. The inferences drawn are not final as a lot of other areas and theories pop up, requiring more research.

Discussion on Sustainability Report of BHP Billiton

A thorough study of the sustainability report of BHP leads to the conclusion that the report has been prepared as per the specification of the Global Reporting Initiative Standards comprehensive-level reporting (Delone & Mclean, 2004).  BHP follows a comprehensive approach, i.e. the assets, liabilities, operations and achievements of the entire group have been reported together. The content of the report has been prepared after assessing the materiality levels. This assessment is done on a yearly basis. The evaluation is done after analysing the issues that generates risk and by identifying the potential of the strengths to face these risks. The entire phenomenon of materiality assessment has at its fulcrum the task of engaging with all the stakeholders.

When we talk about companies that put safety and human rights first, BHP tops the chart. Their responsibility towards the environment is high. The group also focuses on the health and safety of its workforce. To ensure that the group attains the goal of sustainability, appropriate committees have been formed for example the Sustainability Committee, Risk and Audit Committee, Remuneration Committee (Linden & Freeman, 2017). Members of these committees belong to different expertise areas and have practical experience. In intricate issues that affect the sustainability, the company goes for expert advice form external sources so that a fool proof decision can be made. Aims for the next four years have also been mentioned in the sustainability report.

Looking from the technicality and ornamental aspect, the report does well. To give the users of the report an idea about the achievements, performance indicators are highlighted. These are communicated in a brief and easy term, and there is no room for doubts. The three pillars that comprise sustainability are social, economic and environmental factors. BHP’s performance should therefore be measured on these three factors (Raiborn, Butler, & Martin, 2016).

Social: BHP spends 1 percent of their profits before taxation for projects initiated for the local community. For the purpose, the entity made an investment of 80.1 million US dollars in the year 2017. The probable hazards and factory related exposures have gone down. This went down by 76 percent from their agreed levels, in the year 2012. This accomplishment is highly praiseworthy because it has been achieved in a short span. Year after year, there’s an improvement in Total recordable injury frequency (TRIF). BHP cares for the local culture and to show support it makes a lot of investments.

Environmental: BHP’s operations have led to reduction in the emission of greenhouse gases. Approximately, in a yea, 975,000 tonnes of carbon dioxide has been avoided. Resultantly, productivity has improved and economic gains have been achieved.  The company has also made use of sonar technology. BHP has also taken a mission of rehabilitation of 40,000 hectares of degraded land (Heminway, 2017).

Economic: For the year 2017, BHP has paid 4.7 million US dollars in the form of taxes and royalties. This has contributed to economic development and had made it powerful.

BHP’s Sustainability report is brilliant, in the sense that it provides all the material information to the users of the report.

References:

Alexander, F. (2016). The Changing Face of Accountability. The Journal of Higher Education, 71(4), 411-431.

Arnott, D., Lizama, F., & Song, Y. (2017). Patterns of business intelligence systems use in organizations. Decision Support Systems, 97, 58-68.

Bizfluent. (2017). Advantages & Disadvantages of Internal Control. Retrieved december 07, 2017, from https://bizfluent.com/info-8064250-advantages-disadvantages-internal-control.html

Choy, Y. K. (2018). Cost-benefit Analysis, Values, Wellbeing and Ethics: An Indigenous Worldview Analysis. Ecological Economics, 145. Retrieved from https://doi.org/10.1016/j.ecolecon.2017.08.005

Deegan, C., & Shelly, M. (2014). Corporate Social Responsibilities: Alternative Perspectives About the Need to Legislate. Springer, 121(1), 499-526. doi:DOI 10.1007/s10551-013-1730-2

Deegan, C., Rankin, M., & Tobin, J. (2002). An examination of the corporate social and environmental disclosures of BHP from 1983-1997 : A test of legitimacy theory. Accounting, Auditing & Accountability Journal, 15(3), 312-343.

Delone, W., & Mclean, E. (2004). Measuring e-Commerce Success: Applying the DeLone & McLean Information Systems Success Model. International Journal of Electronic Commerce, 9(1).

Dumay, J., & Baard, V. (2017). An introduction to interventionist research in accounting. The Routledge Companion to Qualitative Accounting Research Methods, 265. Retrieved from https://books.google.co.in/books?hl=en&lr=&id=PzQlDwAAQBAJ&oi=fnd&pg=PA265&dq=Dumay,+J.,+%26+Baard,+V.+(2017).+An+introduction+to+interventionist+research+in+accounting.+The+Routledge+Companion+to+Qualitative+Accounting+Research+Methods,+265.&ots=ta1isTHB

Farmer, Y. (2018). Ethical Decision Making and Reputation Management in Public Relations. Journal of Media Ethics, 33(1), 1-12.

Goldmann, K. (2016). Financial Liquidity and Profitability Management in Practice of Polish Business. Financial Environment and Business Development, 4(3), 103-112.

Gooley, J. (2016). Principles of Australian Contract Law. Australia: Lexis Nexis.

Heminway, J. (2017). Shareholder Wealth Maximization as a Function of Statutes, Decisional Law, and Organic Documents. SSRN, 1-35.

Linden, B., & Freeman, R. (2017). Profit and Other Values: Thick Evaluation in Decision Making. Business Ethics Quarterly, 27(3), 353-379. Retrieved from https://doi.org/10.1017/beq.2017.1

Raiborn, C., Butler, J., & Martin, K. (2016). The internal audit function: A prerequisite for Good Governance. Journal of Corporate Accounting and Finance, 28(2), 10-21.

Schoenberger, E. (2016). Environmentally sustainable mining: The case of tailings storage facilities. Elsevier, 119-128. doi:https://dx.doi.org/10.1016/j.resourpol.2016.04.009

Visinescu, L., Jones, M., & Sidorova, A. (2017). Improving Decision Quality: The Role of Business Intelligence. Journal of Computer Information Systems, 57(1), 58-66.