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We are going to compare and contrast the way in which Domino's Pizza UK & IRL Plc and Pizza Express PLC discharge their responsibilities of disclosure of information.

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Introduction

Section Title Page 1 Introduction 2-3 1.1 Aims and objectives 1.2 The importance of accounting methods, policies and associated disclosures 1.3 Overview of 2 companies: Domino's Pizza UK & IRL plc & PizzaExpress Plc 2 Accounting Principles 3-4 2.1 Chairman's Report 2.2 Tangible and Intangible Fixed Assets 2.3 Cash Management 3 Domino's Pizza UK & IRL plc 4-5 3.1 Chairman's Report Summary 3.2 Tangible and Intangible Fixed Assets policies 3.3 Cash Management 4 PizzaExpress Plc 6-7 4.1 Chairman's Report Summary 4.2 Tangible and Intangible Fixed Assets policies 4.3 Cash management 5 Conclusion 7-8 5.1 Domino's & PizzaExpress differences in Principles 5.1 Domino's & PizzaExpress commons in Principles 5.2 The summary to conclude both companies' performance during 2 years: - 6 Recommendations 8 6.1 For Domino's Report 6.2 For PizzaExpress's Report 7 Bibliography 9 List of Illustrations Figure 1 Domino's Pizza EPS chart Figure 2 PizzaExpress 's EPS chart 1 Introduction 1.1 Aims and objectives We are going to compare and contrast the way in which Domino's Pizza UK & IRL Plc and PizzaExpress PLC discharge their responsibilities of disclosure of information. The disclosure requirements are found in a number of regulatory sources and "guidelines" issued from the accounting bodies and issued codes of conduct and accountability. We can refer to the Financial Reporting Standards (FRSs 1-19) and Statements of Standard Accounting Practice (SSAP). Directors of companies are required by the Companies Act to prepare accounts that give a true and fair view of the state of affairs of the company and of its financial position at the end of the financial year. We are going to identify three main areas to examine both companies' methods, policies and associated disclosures: - Tangible and Intangible Fixed Assets; the Chairman's Report and Cash management. 1.2 The importance of accounting methods, policies and associated disclosures When we look at the annual report which includes a lot of issues such as Chairman's Statement, Chief Executive's Report, Directors' Report, Auditors' Report, Profit and Loss Account, Balance Sheet, Cash Flows, the last three issues are the accounting figures for the year of the companies. ...read more.

Middle

3 Domino's Pizza UK & IRL plc 3.1 Chairman's Report Summary Domino's Pizza is a market leader in the pizza-delivery business in UK, they delivered their fresh-baked pizzas to more than one million households. Their goal is to reach more than 2.5 million households by 2006, and planed to have 500 Domino's stores throughout the UK and Ireland. They emphasis to have undergone refurbishment or rebuilt all the Domino's stores every five year so as to maintain the average age of stores was less than two year. Their advertising campaign was successful so they are going to widen the advertising scheme by adding more TV advertisements. 3.2 Tangible and Intangible Fixed Assets policies Goodwill Positive goodwill is capitalized and it is classified as an asset on the balance sheet and amortised on a straight line basis over its estimated useful economic life up to 20 year. Any goodwill has not been amortised is taken account in profit or loss on sale or closure. Regarding for their goodwill, we can find it in P/L's amortisation of (�5,000) for the year, and in B/S the goodwill net book value is �1407 at 31 December 2000, and �1884 at 30 December. Intangible assets It is acquired separately and capitalized at cost. It is separate from goodwill if its value can be measured. Intangible assets are not capitalized and expenditure is charged against the profits. It is amostised on a straight line basis over their useful lives: - Franchise fees over 20 years Interest in leases over the life of the lease Tangible Assets Interest incurred on significant property developments is capitalized after completion of the project and also depreciated in accordance with the group's policy. Depreciation is calculated to write off the cost less residual value over its expected useful life: - Freehold buildings over 50 years Plant and production equipment over 10 years Leasehold building improvements over the lesser of the life of the lease plus 14 years, or 30 years Computers, fixtures and fittings and ...read more.

Conclusion

47.22 26.81 Operation margin (%) 7.33 17.88 Annual dividend per share (� British Pounds) 0.01 0.11 Current ratio 1.27 0.97 As a conclusion, we may say Domino's Pizza has more potential to be invested, although their capital may not be as much as PizzaExpress, their increasing profits, sufficient cash flows, and relative ratios can show us Domino's Pizza is in a healthy position. 6.1 Recommendations 6.2 For Domino's Pizza Report Both companies are in the food sector and their objectives are mostly the same as their Chairman mentioned. They mentioned to expand their numbers of stores/restaurants, maintain high standard of their food & service. However, we should highlight the refurbishment for Domino because as we know Domino is a pizza delivery store, the mode of their business is to deliver the pizza. The stores throughout the world are for delivery pizza. However, the proposal for keeping the age of their store less than 2 years and rebuild the store seems not really practical. They should try to concern about their delivery facilities such as the delivery van, 6.3 For PizzaExpress's Report We may suggest that they should put more attention to promote through the advertisements, or sponsorships in order to increase their market shares. On the other hand, they have negative cash flow at 2002, so they may consider issuing more share capital and debentures to help their shortage of cash flow. Bibligraphy Financial Management for Non-specialists, second Edition, Atrill, Prentice Hall Annual Report and Accounts 2001, Domino's www.dominos.co.uk Annual Report 2002, PizzaExpress PLC www.pizzaexpress.co.uk For the update EPS/Dividend charts: - http://profiles.wisi.com/profiles/scripts/corpinfo.asp?cusip=C826US200 http://profiles.wisi.com/profiles/scripts/corpinfo.asp?cusip=C826F1420&curconv=826 For News Group Recent news of PizzaExpress http://news.bbc.co.uk/1/hi/business/232217.stm http://news.bbc.co.uk/1/hi/business/2803445.stm http://news.bbc.co.uk/1/hi/business/2747711.stm http://news.bbc.co.uk/1/hi/business/2549345.stm http://news.bbc.co.uk/1/hi/business/2495731.stm http://news.bbc.co.uk/1/hi/business/2396323.stm http://news.bbc.co.uk/1/hi/business/2248331.stm http://news.bbc.co.uk/1/hi/business/2062619.stm http://news.bbc.co.uk/1/hi/business/1813546.stm http://www.investavenue.com/article.html?ID=2221 Recent news of Domino's http://news.bbc.co.uk/1/hi/business/2642717.stm http://news.bbc.co.uk/1/hi/business/2148576.stm http://news.bbc.co.uk/1/hi/business/1822049.stm For the Enron and WorldCom Scandals' comment Analysis by Prem Sikka, Professor of accounting, University of Essex For the summary of FRS http://www.asb.org.uk/technical/standards.cfm?Category=Financial%20Reporting%20Standards%20(FRSs) 1 Gearing ratio measures the contribution of long-term lenders to the long-term capital structure, if the level of gearing is high, the company needs to have a stable or growing figure in the business because of the high level of lenders. 0 ...read more.

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