ACT505 Accounting Theory, Semester 1, 2021

ACT505 Accounting Theory, Semester 1, 2021
Assignment 2
30 Marks – Weight 20%
Due Date: Sunday 23rd May Midnight (week 11)
? This assignment consists of two question. The due date and time is noted above.
? It is your responsibility to ensure you factor in any time difference between Darwin and other locations
when submitting your assignment.
? Please upload your file using the submission point for the assignment on Learnline.
? Assignments submitted via e-mail will NOT be accepted.
? There is no need to complete a university cover sheet but DO please include your name, Student Number,
and your tutor’s name.
? This is not a group assignment; it is an individual assessment. Your answers will likely be different from
other students. If portions of your assignment are copied or very close to copying, all parties will be penalised
for copying. Copying would be considered plagiarism and CDU has restrict policies in this regard (please see for details).
ACT505 Assignment 2, Semester , 2021 Page 1
5/21/2021 65015 – ACT505 Accounting Theory, Semester 1, 2021Assignment
Question One (15 Marks)
Banks to slash extra 1000 jobs
On 21st August 2002 the Commonwealth Bank (CBA) announced that it would slash 1550 jobs while
creating 550 jobs, a net loss of 1000 jobs. It planned to reduce inefficient operations, task duplication & some
back-office processing functions, but stated that it would not close more branches even where closures had
been planned. The news received hostile reactions from both unions and consumer advocates like the
Australian Consumers’ Association (ACA).
Union officials said that the job cuts were scandalous, and that bank staff were suffering from uncertainty
following previous cuts and closures. ‘ It is unbelievable’ said Tony Beck, Finance Sector Union national
secretary. ‘ They have just shed 500 jobs, all from the retail network. Now we get this punch with another
1000 jobs.’
The ACA was equally unimpressed. Its finance policy officer Catherine Wolthuizen asked when the losses
would stop. ‘ How much profit is enough for greedy banks like CBA and how much further will it flout
consumer and community demands before the Government acts?’
The ACA wants a social charter set up to delineate minimum standards around access to banking and
affordability. It has been lobbying the Federal Government to act for consumers in the face of massive bank
CBA’s annual profit leapt 11percent to $2655 billion in the previous financial year, increasing income (over
$1.8m) from fees, commissions and other charges contributing to the profit surge. The strong housing market
contributed to an increase in lending fees income: $618m, up 3percent. Commissions and other fees raised a
massive $1.242 billion, up 6 percent.
Explain whether you think the banks would or should respond to the concerns of the ACSA and/or concerns
of the Finance Sector Union. What theory(s) did you rely on (if any) to form your judgement?
Question Two (Marks 15)
Explain the efficiency perspective and the opportunistic perspective of Positive Accounting Theory. Why is
one considered to be ex post and the other ex ante? Give two examples to illustrate your answer.
ACT505 Assignment 2, Semester , 2021 Page 2