“I embarked on the task of calculating [my firm’s] ratios with an enthusiasm I hadn’t previously known was possible prior to taking ACCT11059. Calculations and equations have always been a difficult area for me to grasp. However, as this unit has progressed so has my confidence and enjoyment of undertaking such mathematical tasks. Reflecting on my accounting journey thus far, I initially felt stunned in week one to be challenged in my approach to learning. But Martin’s outline of the 6 different approaches to learning I feel has been made evident through my newfound ability and confidence in an area that has always been one I have struggled with … I feel the way I think, understand and view the world around me has significantly changed. I have morphed as an individual and embarked on a much deeper level of learning that I didn’t know was possible. So here I am, a previously inadequate person in respect to numbers, calculations and anything math related, to an individual excited at the prospect of performing ratios and seeing what information I can derive from numerical values.”
Thank you to everyone who has submitted your ASS#2 Steps 7-10. Quite a few people are pleased to have finished their last assignment and have felt like dancing for a few minutes before, perhaps, preparing for exams in other units.
So far, we have marked about one-quarter of everyone’s assignments; and we plan to have everyone’s mark and feedback available on Moodle within the next week. The average mark so far is about 21/29.
Here is some general feedback on ASS#2 Steps 7-10.
Step 7 was generally very well done.
Most people identified three products or services for their firm very well, although some people did struggle to do this. Also, most people were able to estimate or guess selling prices, variable costs and contribution margins for each of their firm’s products or services, and to comment on the contribution margins; and also to identify resource constraints and comment on these constraints.
Also, some people commented on how using contribution margins could help us to focus on what is relevant to decisions, although it was also important to consider qualitative factors (such as the need to keep a broad enough product range to ensure access to distribution channels). Also some people referred to the fact that contribution margins are only as good as the numbers put into their calculation; and that these numbers may turn out to not reflect what actually happens in the future (for example, selling prices and variable costs in the future may end up being different to what occurred in the past).
“…this assignment was definitely… an interesting task. There were a few tears and emotions when it came to completing it but in the end I got there. This assignment has calculated and analysed ratios, analysed the economic profit and what drives it, developed a capital investment decision and calculated the payback period, NPV and IRR of my firm … I learnt many aspects of accounting throughout this assignment and I now feel comfortable and confident in calculating various accounting ratios.”
“At the start of this unit, I was new to Excel. I have used Word documents in other subjects but never used Excel before. Along the study path of the unit, I was getting comfortable and familiar in using Excel and working on the spreadsheets. For this assignment, I faced quite lot of difficulties in using spreadsheets, particularly linking them. When I watched the video on how to link data in Excel, I gained confidence for using Excel. After doing practice, I can say that I know how to apply formulas and link data in Excel spreadsheets. I discussed this step (linking data) with a number of students in the class. Everybody is facing the same issue and almost all students in my class are new to Excel. I spent a number of hours … with other students to try to work out the linking process.”
Step 8 was generally quite well handled. Most people were able to calculate the ratios for their firm. Also, most people were able to link the cells in the spreadsheet to cells in the financial statements and restated financial statements worksheets in their spreadsheet.
The first groups of ratios were based on numbers in your firm’s financial statements. The last group of ratios were based on your firm’s restated financial statements. Some people mixed this up a bit when calculating their firm’s ratios.
One of the topics discussed on the discussion forums was whether to include total liabilities or only interest paying debt when calculating your firm’s debt/equity ratio. Quite a few people decided to use total liabilities. I suggest you only include interest paying debt (such as borrowings) when calculating debt/equity ratios. The reason for this is that we are often interested in how much debt (with legal obligations to pay interest regularly) we have compared with equity (where we have the choice whether to pay dividends in any given year). However, there are a range of opinions about this among practitioners in our financial markets, so it is fine to calculate debt/equity ratios using either total liabilities or interest-paying debt.
Quite a few people showed their dividends per share and net borrowing cost as negative numbers. We usually show them as positive numbers.
When calculating earnings per share, a few people had trouble identifying the number of shares their company had on issue. You can generally find the number of shares a company has issued in the Equity footnote in your firm’s balance sheet.
Also, to find your firm’s share price, you can generally find this on Google. For example, by googling ‘Ryman Healthcare share price’.
A company’s share price is a fact. Facts are so easy to find now. You can generally Google facts. There are a number of important skills to be able to search for facts. Finding your company’ share price gave you the chance to see how good you are at finding simple facts.
But what you can’t Google are judgements. And as quite a few people found in their Step 8, there are all sorts of judgements required to be made, not just in interpreting our firms’ ratios, but also in calculating them in the first place. For example, some people realised that ratios such as Return on Net Operating Assets (RNOA) could be quite different depending on whether we use opening, closing or average Net Operating Assets when calculating the ratio.
Quite a lot of the marks for Step 8 were given for the quality of your commentary on your ratios and your economic profit.
“I must admit, by conducting extensive research into [my firm] for ASS#1, I was instantly able to view how these events affected the ratios utilised.”
Some people simply stated the definition of each ratio and commented on what their ratio was, whether it had changed over the past three years, and how it might have compared with the ratios of other firms. Doing this was OK, but to get a good mark for your commentary you needed to communicate what the ratios told you about your firm itself: its operations and activities.
Some people (though not all) found things coming together for them quite a bit as they completed their Step 8 … and reflected on what their firm’s ratios might tell them about what is really going on in their firm.
ASS#2 Steps 7-10 was the final stage in a series of inter-connected assignments. And remember, each stage of the assignments was a realistic learning task designed to support us to look more carefully, item-by-item, at the financial statements of our (and other’s) firms, and to learn more about them. And most particularly, to experience that financial statements and accounting are perhaps not as scary and out of reach for us as we may have thought they were before we started the unit.
Step 9 was also generally well done.
Almost everyone was able to generate two capital investment options for their firm and to generate/’guess’ future expected cash flows for each option. A few people struggled with the idea of including a residual value as part of the cash flows in the last year of their future expected cash flows for each option.
Also, many gave a recommendation and provided an insightful discussion about their recommendation. A number of people, however, forgot to include a brief commentary on this in their assignment.
Many people provided some thoughtful feedback to other people in our unit. Many people commented about how useful they had found both giving and receiving feedback to be; and that giving feedback really helped them to do a better assignment as they realised they needed to strengthen aspects of their own assignment as they gave feedback to others about their assignment:
“For Assignment 2, there has been a definite shift in the way feedback is given and also received. Compared to Assignment 1, I (and my fellow students) would read through an assignment and offer encouragement, very mindful of only providing positives as I lacked the confidence if I was completing it correctly. I find now though, my peers are not afraid to point out errors in my work and are happy to offer guidance on my interpretations and offer opinions on where I may be lacking. I know, with absolute certainty, the feedback I have received from peers has gained me extra marks.
As outlined (and discussions linked) in Step 8, I have been fortunate to engage in many conversations with fellow students that assisted me to have a much greater understanding of the topic. In relation to the feedback I have received for these final stages, I have found it has assisted me in fine tuning my assessment to ensure I have met the necessary criteria. I found it constructive and used them as a checklist when conducting final reviews. I found the feedback I received was an excellent mix of constructive and reassurance. With the time and effort invested, it was genuinely appreciated.
Just as a side note – I never fully understood the piecemeal way these assignments were required to be submitted until I considered that in other units we never get the opportunity to see what other students have submitted. It has opened my eyes to my own style and approach to not only this unit but University as a whole. Without the necessary step of providing feedback to others, I would never have known. So thank you 😊”
Adjusting to uni
Quite a few people in our unit have been adjusting to studying at university this term; and many have been experiencing the benefits of active, real learning and finding their thinking and intellectual capacities being refreshed and developing:
“This unit, while driving me crazy at times (damn you Chapter 4), has provided me with the most amazing feelings, understandings and gratitude. I feel proud of myself (and my peers) for pushing each other to strive for the best results possible and I feel a sense of calm over my everyday life even through the turmoil.
This unit has opened up so many mind blowing experiences and has woken up the parts in my brain that went to sleep many years ago due to going through the same monotonous motions in my ungrateful job. I feel alive again and so eager to keep using the skills and information I learnt through this unit and keep pushing to make my workplace a better place to be.”
And it is comments like these (and the experiences of people) that are the reason I, Maria Lois, Peter and Mitch, and the marking team, do what we do; as we seek to support your learning in a way that is flexible and personal, and part of your total life.
Learning about learning
And others have been posting some comments and reactions about coming to the end of our unit; including how quite a few people have found they enjoyed learning in our unit, including interacting with others online:
“So I have spent the past few minutes taking a stroll through memory lane on my blog, distracting myself from the fact that my assignment is ready to submit but I can’t quite bring myself to push that great green submit button. It looks so intimidating right at this point, I am not quite ready for this unit to be over.
Who would have thought at the beginning of this unit … that the unit I had anxiety over because of this online communication and interaction with others would be a unit which became not a chore, not study, but I guess you could say a hobby, something I enjoyed, and looked forward to. I have enjoyed talking with like minded individuals and I hope that I continue to use my new found learning and communication skills in not only my future studies but my entire life.”
Well, our unit is called Accounting, Learning and Online Communication. 🙂
Fear of numbers
Quite a lot of people have been able to face their ‘fear of numbers’ and realise that numbers and maths are not that scary afterall. And that perhaps it is more about confidence than anything else:
“I have a confession…
I absolutely loved step 8’s calculation of ratios!
…I am quite proficient in writing, but numbers… yeah not so much.
After completing the spreadsheet in step 3, numbers, calculations and equations moved from being a nemesis of mine into the friend zone. I think I finally realised it wasn’t that I lack the ability to understand math and equations but maybe I just lacked the confidence…”
Developing our skills and abilities with online communication, to effectively learn with and from each other from all around Australia, has been a highlight for many people in our unit this term:
“…the sharing and connecting with others has been a wonderful aid in furthering my knowledge.”
Many people experienced the benefits and value of learning with and from each other, cooperatively and effectively, as we together learnt about accounting:
“The online communication and discussions that occurred throughout the entire unit itself was both helpful in increasing my knowledge but most importantly supportive. Having such open communication in an environment where others were experiencing the same difficulties and uncertainties enabled a more constructive learning environment to be created. This inclusive community I believe was a critical component in my learning process overall that allowed me to not only ask questions to increase my knowledge, but also assist others which in turn put my newfound understanding of concepts and tasks to use. I greatly enjoyed the “online communication” component of the unit and am hopeful to undertake further units with the same communicative focus as ACCT11059.”
As you receive your mark for ASS#2 Steps 7-10, remember that all marks are provisional. All marks in our unit will be reviewed by the Accounting Assessment Committee and the university’s Education Committee before grades are finalised. So all marks are subject to review. Your final grade for our unit will be provided to you on Friday 3 November 2017.
Also, you will have noticed a big red button ‘Have your say’ has appeared on the top left-hand side of Moodle.
Thank you to those who have completed your student survey. So far, about one-quarter of people in our unit have completed your survey. We look forward to hearing what you have to say. The university (and I) expect everyone (and at least 50% of people) in our unit will complete your student survey. So if you have not already done so, please go onto Moodle and ‘have your say’.
For some people in our unit, this term has been a little bit like catching a train to work in Perth on a Monday morning and singing Over the Rainbow. How has your learning journey been this term? And which passengers in the video do you identify with? And how has it been for you at the end of our trip?
And for those studying the Bachelor of Accounting (or majoring in Accounting in another degree), you may be studying ACCT11081 Introductory Financial Accounting with us next term. Well, the fun is only just starting to begin; as we build on what we have learnt. As we get more serious about accounting, we can ‘let go and enjoy the ride’. So much more fun in store. Party time? Now this is the ‘way to travel’:
And the big kahuna? The capstone unit at the end of our Bachelor of Accounting: ACCT13017 Financial Statement Analysis. Well, things really get serious, as we discover that, like dance, accounting connects us all:
All the best for the rest of your studies this term, as many people prepare for exams in other units you are studying.
It has been great having each of you in our unit; and I trust everyone has gained something of value as we have learned together about accounting this term; and had the chance to reflect on whether accounting can help, or perhaps hinder, us to better connect to and understand our firms.
9 October 2017