Session 1, 2019
ACCG 399 Capstone Simulation Assessment
50% Weighting
This is a group assessment and it has two components: a written report and an oral presentation.
Each group will submit a written report and students in each group will be given the group mark for the report. See the Unit Guide for the submission date and late penalties. The unit convenor has the right to review the contribution of each student towards the completion of the report and award an individual mark to a student according to his or her contribution.
Students will also make a group presentation in tutorial class as scheduled. An individual mark will be awarded to each presenter.
Introduction
Sustainable investing is an investment approach that considers environmental, social and governance (ESG) factors in portfolio selection and management. In Australia, sustainable investments now account for 50 percent of all professionally managed assets (GSIA 2016). Globally, sustainable investments grew by a quarter over the last 2 years, to $23 trillion, according to the Global Sustainable Investment Alliance (GSIA 2018).
Society today is placing increasing pressure on lending institutions to operate within transparent and solid corporate governance structures. Society and investors alike are becoming increasingly interested in a long-term sustainable economy where lending institutions invest in projects in a more socially responsible and sustainable manner. See commitments of banks other lending institutions (for example in their sustainability reports) to facilitate sustainable investments and social and environmental projects.
The role of accountants is changing to one of leadership in business, providing advisory, consultancy and assurance services. In order for accountants to be able to provide these services it is not simply about the possession of strong technical accounting knowledge but rather it is about the ability to integrate and apply the acquired body of knowledge for decision-making and solving complex business problems of today. Accountants need to be able to communicate effectively with users from diverse backgrounds, with a developed awareness of the importance of sustainable business practices.
Requirements
In this assessment, each group will:
- Think creatively and develop an idea for a sustainable investment. The investment must have benefits for society and/or the environment and also economic benefits to the investing entity.
- In view of the objective of item 1 above, students must first find an existing entity, it can be a business enterprise (company) or a not-for-profit-organisation. The proposed investment can be for an entirely new product, an expansion of the core business of the entity, a new segment added to the business, a technological innovation or upgrade, or any suitable ideas that students may have. It is important that students must sufficiently justify the investment, for instance, due to threat of disruption, opportunity (or threat) from technological advancements, opportunities for exporters from free trade agreements or threats from import tariffs, sector specific challenges (for example competition from increase in international wine exporters or periods of unfavourable weather etc) or opportunities (for example, economic and consumption growth in Asia and particularly China and India); just to give a few examples. Students must therefore research and thoroughly analyse the business entity and the sector that it is in. It is also necessary that the annual and financial reports and other information about the entity be readily and publicly available.
- The analyses and sources of evidence for supporting the proposed investment must include financial statements, other information in the annual reports (and if available, web-based announcements) and from Big Data sources, i.e. a variety of other web-based sources or Internet of Things (e.g. aerial video data from drones) of non-financial data (qualitative data) for example, Google Trends, Alibaba trends, ABS, Austrade, DFAT, global and domestic business trends and developments, global and domestic trade and economic developments, trade agreements, government policy announcements, subsidies and grants, corporate tax cut, and so on. The importance of non-financial data especially big data cannot be understated (see Skills for The Professionals of 2020: Big Data Accounting Course).
- An external funding source must also be identified to finance the investment, so it is necessary to project the profit outcomes and other benefits of the investment, the cash inflows and outflows and the amount and timing of funds needed to finance the investment. It is also necessary to justify the funding institution(s) that will be approached. Relevant evidence from the analyses of financial data (for instance, cash flow projections, profit history and projections, existing resources, etc.), non-financial data and big data sources must be provided to support the funding proposal.
- The written report is addressed to the board of directors and shareholders and the objective of the report is to appeal to the corporate social responsibility of the readers and to secure their support and approval for the investment by convincing them of the economic and other benefits and merits (social and/or environmental) of the proposed investment.
- The report must also include a sound financial plan (with supporting evidence and documentation) for the procurement of the finance to carry out the investment successfully.
- For the group oral presentation, each student will present for 4 minutes. The objective of the presentation is also to appeal to and to convince the audience of the economic and other benefits (social and/or environmental) of the proposed investment in order to secure their support and approval. The funding plan and supporting evidence should form part of the presentation.
- Page guide for the written report: 12-15 pages in total.
- See unit guide for details regarding submission of the written report. Only one submission per group. Submit the following in one document:
- the report
- cover sheet
- group meeting record
- self and peer contribution evaluation form