[meteor_slideshow slideshow=”arp1″]
ACCG 399 Case Assignment
Semester One, 2012
Quality Equipment Hire Ltd.
Background to the Case
You are the Chief Financial Officer of Quality Equipment Hire Limited (QEH), a
company newly listed on the Australian Stock Exchange, which owns and rents 18 sites
throughout the eastern states of Australia, with a head office in North Ryde, Sydney.
There are two divisions – one leases and rents-out equipment for construction and
mining sites (mainly) and the other division leases and rents out motor vehicles. The
main cost for QEH is the purchasing of equipment for rental, with equipment suppliers
based in the US and Japan.
QEH’s CEO and owner, Jane Jones, is concerned about the impact of the new carbon
tax (or more accurately, the new ‘carbon pricing mechanism’) on the QEH business
model and financial results. She is especially concerned about the possible impact on
the QEH share price, which has been gradually falling since the company was listed a
year ago.
Ms Jones has asked you to advise her on the business implications of the new carbon
price on the business, and the actions QEH can take to mitigate this impact and how
QEH’s position might be communicated to investment analysts.
After discussions with the CEO, you agree that you will undertake the following
activities to meet her requirements:
• Complete a greenhouse gas (GHG) inventory of the business to establish the
company’s current carbon footprint
• Identify the information which will need to be captured from now on in order to
monitor the GHG footprint of QEH
• Identify what information should be reported to investment analysts to enable
them to accurately reflect the financial impact of the carbon tax in their
valuation of QEH
• Identify opportunities and make recommendations to cost effectively reduce
elements of the company’s GHG footprint over time and capitalise on business
opportunities arising from the introduction of a carbon tax.
You have also downloaded the following reference documents:
• The National Greenhouse and Energy Reporting (Measurement) Technical
Guidelines 2011, available at:
http://www.climatechange.gov.au/publications/greenhouse-report/ngertechnical-
guidelines/2011.aspx
• National Greenhouse Accounts Factors (July 2011), available at:
http://www.climatechange.gov.au/~/media/publications/greenhouseacctg/
national-greenhouse-accounts-factors-july-2011.pdf
QEH GHG Inventory calculation
After determining QEH’s organisational and operational boundaries, you complete a
comprehensive stock-take of QEH’s current business operations to discover the
following main sources of greenhouse gas and underlying raw data on quantities used in
the financial year ended 30 June 2011:
GHG Source Quantities used
Scope 1 – Direct Emissions
Own transport fleet fuel usage 400,000 litres
Scope 2 – Indirect Energy
Purchased electricity NSW – 2,000,000 kWh
Victoria – 1,000,000 kWh
Queensland – 250,000 kWh
Scope 3 – Indirect Other
Own transport fleet indirect fuel extraction 400,000 litres
Purchased electricity (indirect fuel extraction and line loss) NSW – 2m kWh
Victoria – 1m kWh
Queensland – 250,000 kWh
Customer use of vehicles (unleaded fuel) 800m litres
Customer use of equipment (Diesel fuel) 300m litres
Your assistant has begun the GHG inventory by determining the Scope 1 emissions for
QEH and using the following calculation:
GHG Source Quantities used Calculation Emissions
tonnes CO2-e
Scope 1 – Direct
Emissions
Own transport fleet fuel
usage
400,000 litres =(400,000/1000)*34.4*(
69.22/1,000)
952
ACTIVITY 1 – Briefly discuss the 4 different methods of determining Scope 1
emissions and why the first method is most appropriate for QEH. (2 Marks).
(hint: refer to the NGER Technical Guidelines)
ACTIVITY 2 – Briefly explain Scope 2 emissions and how Scope 2 emissions from
electricity purchased from the main electricity grid in NSW, Victoria and Queensland
are calculated.
(hint: refer to the NGERS Technical Guidelines).
Using this information, complete the table below to calculate QEH Scope 2 emissions.
(2 Marks).
GHG Source Quantities used Calculation Emissions
tonnes CO2-e
Scope 2 – Indirect
Energy
Purchased electricity –
NSW
Purchased electricity –
Victoria
Purchased electricity –
Queensland
ACTIVITY 3 – Briefly explain Scope 3 emissions and identify the emission factors for
fuel and electricity purchased. Using this information, complete the following table to
calculate QEH Scope 3 emissions. (2 Marks).
(hint: refer to the National Greenhouse Accounts Factors – July 2011).
GHG Source Quantities used Calculation Emissions
tonnes CO2-e
Scope 3 – Indirect Other
Own transport fleet
indirect fuel extraction
Purchased electricity
(indirect fuel extraction
and line loss) – NSW
Purchased electricity
(indirect fuel extraction
and line loss) – Victoria
Purchased electricity
(indirect fuel extraction
and line loss) – Queensland
Customer use of vehicles
ACTIVITY 4
1. Given the components of QEH GHG footprint in relation to Scopes 1-3, list the
information that will need to be captured from now on in order to monitor QEH’s
GHG performance. What impact will this have on the accounting system?
Discuss whether you think this information should belong as part of the
accounting information system and identify three reasons why this may not be
possible? (3 Marks).
2. In future, what other information may be useful to calculate the QEH’s GHG
footprint? (2 Marks).
ACTIVITY 5
Identify what information should be reported to investment analysts to enable them to
accurately reflect the financial impact of the carbon pricing mechanism in their
valuation of QEH? (2 Marks).
(hint: you may wish to refer to the website detailing the carbon pricing mechanism
http://www.cleanenergyfuture.gov.au/ and discussion papers such as fact sheets 19 and
20 at http://www.cleanenergyfuture.gov.au/clean-energy-future/our-plan/ )
ACTIVITY 6
Identify opportunities and make recommendations to cost effectively reduce elements
of the company’s GHG footprint over time and capitalise on business opportunities
arising from the introduction of a carbon price. (2 Marks).
1. Due Date: Tuesday 8th May 6pm in BESS (E4B 106). Late penalty at 20% per
day.
2. The assignment must not exceed 5 pages in length (excluding referencing). The
assignment must be word-processed, double-spaced, and printed on one side
only of A4 paper. The word size should be 12 with ‘Times new roman’ font
type. Your student number must appear on the top right hand side of each
page of the assignment
3. Bullet points are not acceptable.
4. Each answer must be clearly marked by the designated activity to which it
corresponds.
5. Must include individual cover sheet which can be located at:
http://www.efs.mq.edu.au/student_support/eric with your tutor’s full name.
6. The assignment should be within the range of 2000 words.
7. Please list any references (books, articles, web-based material) you use at the
end of your assignment in alphabetical order, using the referencing style seen
in academic articles (i.e. with in text references and bibliography, as in the
Harvard referencing style).
A failure to comply with these guideline will result in your assignment not being
graded.
Place your order of custom research paper With us NOW. The assignment will be written from scratch by our qualified and experienced writers.
[meteor_slideshow slideshow=”arp2″]
A-Research-Paper.com is committed to deliver a custom paper/essay which is 100% original and deliver it within the deadline. Place your custom order with us and experience the different; You are guaranteed; value for your money and a premium paper which meets your expectations, 24/7 customer support and communication with your writer. Order Now
Use the order calculator below and get started! Contact our live support team for any assistance or inquiry.
[order_calculator]