Directors shouldn’t second-guess asset values: RSM Australia warns

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Regardless of their size, past acquisitions are coming back to haunt the financial statements of a growing number of ASX-listed companies. This is one of the major conclusions within the latest annual Business Acquisition and Impairment Review (2016) by national accounting firm RSM Australia (RSM) which has been assessing the financial reporting impact of recent acquisitions on the financial statements of ASX-300 and non-ASX 300 companies since 2013.

While median acquisition size for all classes of ASX-listed companies has increased in line with the All Ordinaries index, the 2016 review reaffirms the need to reassess future business plans and profitability forecasts in light of post-acquisition financial performance of acquired businesses.

Impact on reported earnings
What’s driving the need to reassess future business plans and profitability forecasts, advises Glyn Yates, Director and National Head of Corporate Finance at RSM, are rising impairment charges that significantly impact an entity’s reported result and net asset position.
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RSM Bird Cameron says business owners must ask more of their accountants in tough times

October 17, 2011RSM Bird Cameron, one of the largest mid-tier accounting firms in Australia, says business owners must ask more of their accountants in tough times.

Andrew Graham, national head of business solutions, RSM Bird Cameron, said, “It is easy to have accountants for many years that do the basics well – but not fully realise the value they should be offering beyond that. Or sometimes a business simply outgrows their existing accountant in terms of what they need and what can be offered.

“The depth of experience your accountant has, and the advice they can give, is vital to the success of your business, and should be a resource you can call on. This is particularly important as many businesses face an uncertain economic future.

“Most accountants provide basic retrospective analysis on the numbers given to them, coupled with some compliance, tax and super advice. The best accountants offer real practical business advice on how to effectively operate, manage and grow the business.” Read more ❯