Myer Holdings Pty Ltd is one of Australia’s largest department stores catering to all customers through a range of products. Myer has expanded its brand offerings to customers and has developed its loyalty program to ensure its competiveness in the retail market whilst expanding its relevance and target demographic. They have invested over 600 million dollars in capital to deliver the best possible merchandise and to maintain this level of excellence with the introduction of the latest merchandising and point-of-sale systems. These measures have been imperative in the survival of Myer Holdings in its current economic climate where sales profits have reduced over the last few years, moving the focus to the customer experience. These strategies implemented have delivered to shareholders the best possible dividends within the current market and have optimised the performance of Myer; buildings its portfolio of upgraded its flagship store in Melbourne in expansion and developing employees training in order to sustain profits and keep shareholders investing within the current economic climate.
The key accounting policies that Myer Holding has used in analysing its financial position include total assets of inventories, PP&E and intangible assets as well as borrowings, revenue, depreciation and foreign currency. The effect of these policies is apparent in the company’s annual report consisting of its statement of financial position and performance as well as providing a summary of these impacts in the notes to the financial statements. Throughout this report we discuss the ramifications on Myer Holdings financial position when reviewing their choices in AASB accounting standards and how they have been applied in practice.
In evaluating the flexibility of the figures depicted we are able to ascertain whether they are a true representation of the company’s short and long term approach. We show within this report the motivation derived from initiatives within the company such as its remuneration package with key performance indicators for short term and long term benefits as well as the short term impacts these incentives have upon the statements of financial position and performance within the annual report of 2011.
We assess the quality of disclosure within the 2011 annual report for Myer Holdings and have found this information derived from both the statements and notes discussed are in-sufficient in giving shareholders a satisfactory understanding of the company’s financial position. Within both the statements and notes for some categories there is a lack of elaboration in the information given which is supplemented within the notes, however not to the degree adequate for a large corporation. In some areas there may be some discrepancies between the information given within the notes and the figures within the statements which doesn’t offer clear detail to make a clear distinction to the shareholder and to clarify the company’s assumptions. These examples are evaluated below and a conclusive answer is presented.
2. Summary of Myer Group’s activities and its strategies
Myer is known as the Australia’s largest department store group and has been synonymous with style and fashion for over 100 years. Consequently Myer has a strong connection with its customers with one of the most reputable and well known retail brands throughout the country. The Myer store network includes 67 stores in prime retail locations of which 28 stores are in the top 30 shopping centers across Australia. With the reopening of its flagship Melbourne store and continued investment in improved merchandising systems, it has developed cost-saving initiatives to combat its current loss of profit to prosper in the future.
The success of Myer Holdings Pty Ltd is largely impacted upon by its merchandise. Myer offers eleven core product categories including: Women wear; Menswear; Youth fashion;