Hutchison Telecom Australia, discuss the available information about Hutchison revenue position, revenue policies, and size of revenue for Hutchison in 2010 financial year and compared to 2009 financial year

Authors Avatar by parthenos99 (student)

Executive summary

 Business is one of the oldest activities on earth and the main purpose of this activity it is earn profit either by selling product or by service. Profit is the difference between revenue earned in a period of time and expenses incurred to earn that revenue. Under the Australian Corporations Act 2001 companies must prepare a financial report at the end of each financial year, to show the gross inflow of economic benefit during a particular period. However this report highlighting some of the definitions to explain the rule of revenue in the telecomm companies on measurement and recognition, discuss the available information about Hutchison revenue position, revenue policies, and size of revenue for Hutchison in 2010 financial year and compared to 2009 financial year.

 The Financial Accounting Standards Board has been wrestling with revenue recognition for years, they are in the midst of a project to develop a comprehensive statement that is conceptually based and framed in terms of principles, whit this development principle it is likely to provide more accurate recognition but it may need telecom to exercise judgement when determining whether a transaction should be recorded on a gross or net basis.

INTRODUCTION

The main purpose of any business is earning profit either by selling a product which is tangible or by providing a service which is intangible in nature. Profit is the difference between the revenue the business has earned during a particular period of time and the expenses incurred by the business to earn that revenue .In accounting revenue is gross earnings from certain business activities. It is a price charged to customers for goods sold or services provide accruing from sales, fees earned and other incomes ( bookkeeping financial accounting resources, 2011).

Hutchison Telecommunications Australia Limited is a listed company which has a 50% interest in Vodafone. Hutchison Australia Pty Limited offers mobile telecommunications under the Vodafone, 3 and Crazy John’s brands. Hutchison Telecoms was listed on the ASX in 1999 and in 2003 launched Australia’s first 3G services, under the 3 brand. According to the Chairman total revenue attributable to Hutchison was $2,410.9 million in 2010, an increase of 18.2% from 2009. Operating margin and Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), grew strongly reflecting growth in post paid customers and the benefits of scale and cost reduction delivered through the integration of the Vodafone and 3 businesses (Hutchison Annual Financial Report, 2010).

Join now!

Australian companies and accounts for revenue

Under the Corporations Act 2001 both small and large companies in Australia must prepare and lodge a financial report for the end of each financial year. A large company has to include a directors’ report for each financial year. The accounts must be audited unless ASIC exempts the company. According to the AASB118, revenue is the gross inflow of economic benefits during the period arising in the course of the ordinary activities of an entity when those inflows result in increases in equity. Revenue includes only the gross inflows of economic benefits received and ...

This is a preview of the whole essay