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Homework answers / question archive / a) For this part, I have used the Yahoo Finance data to to make this grahp which is four year period from 30 Jube 2016 to 1 July 2020

a) For this part, I have used the Yahoo Finance data to to make this grahp which is four year period from 30 Jube 2016 to 1 July 2020

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a) For this part, I have used the Yahoo Finance data to to make this grahp which is four year period from 30 Jube 2016 to 1 July 2020. I have divided into four parts, the time period of Graph 1 is from June 30 2016 to 1 July 2017. The Graph B is from 1 July 2017 to 1 July 2018. The Graph C is from 1 July 2018 to 1 July 2019. The Graph D is 1 July 2019 to 1 July 2020. In addition, I provide the daily graph of July 2020. Graph 1 from 30 June 2016 to 1 July 2017 Graph 2 from 1 July 2017 to 1 July 2018 Graph 3 from 1 July 2018 to 1 July 2019 Graph 4 from 1 July 2019 to 1 July 2020 Daily Graph of July 2020 b) The peaks between 30 June 2016 and 1 July 2020 The troughs between 30 June 30 and 1 July 2020 The major troughs in July 2020 The major peaks in July 2020 In this parts, I had highlighted the major peak of 4 year period which is from 30 June 2016 to July 1 2020. It is the highest point in four year period. It is on 20 Oct 2016. The exchange rate of AUD to GBP is 0.6284. However, the major trough is on 3 April 2020. The lowest point from 30 June 2016 to 1 July 2020 is 0.4891. These data are from Finance Yahoo (2021). In addition, I also highlight the major peak and trough of daily graph of July in 2020. The trough point of daily graph in July 2020 is 0.5491, the peak point is 0.5606. c) In this part, this report will use a variety of sources to identify the reason of major peaks or troughs and use different aspects to analyze what causes major peaks or troughs. First, this report would identify the major peak and trough between 2016 and 2020 then this report continue to analyze major peak and trough of daily graph in July 2020. The major peak of exchange rate of AUD to GBP in 2016 has two aspects to analyze. It is economic and political. For economic sides, PARLIAMENT of AUSTRALIA(2019) states exports of goods and services rank UK as seventh largest export market of Australia in 2015-2016, and representing 45 percent of total export of Australia to European Union. In addition, there is no the other EU countries featured in the top 15 market of Australia in 2015 to 2016 (Australian Institute of International Affairs, 2017). As British exit the European Union, Australia need to consider the new agreement between Europe and Australia, also British. European Union may put more pressure on new agreement between Europe and Australia because European Union may pay tariff to United Kingdom after the exit of British. In other words, British would give some discounts to Australia in new agreement. Also, the export of Australia to United Kingdom had increased significantly since 2014. The export of Australia to United Kingdom is 8,382 billion dollars but it is 14,978 million dollars in 2016(Department of Foreign Affairs and Trade, 2016). British has strong demand into product or service of Australia. In other words, the power of AUD has increased. These had caused the fall in British Pound. For political sides, BAS (2019) indicates that the level of trust in government has fallen way quietly noticeably after leaving European Union. This causes the fall in GBP. The major trough of exchange rate of AUD to GBP in 2020 has two aspects to analyze. It is from political sides and economic sides. From political sides, Australia has ruled out a post-Brexit agreement that involves visa-free travel and work arrangement and Australia has banned Huawai from participating in the nation’s own 5G network (Gocardless, 2019). This way decrease the export of Australia to Kingdom, this had causes the fall in the AUD. For economic sides, ABC (2021) indicates that a call for a COVID-19 investigation has destroys relationship between China and Australia. This affect the several significant export industries because China is the largest trading partner for Australia. These cause the fall in the AUD. Therefore, AUD to GBP reaches the lowest point in 3 April 2020. d) It is obvious that if Australia continue to make trade war with China, Australia economy would continue to fall down. According to POUND STERLING FORECAST (2020), China has slashed its imports of Australian wheat to a nine-year low of 880 tonnes in November 2020. In addition, the AUD-GBP will future decided largely by the coronavirus spread and lockdowns in the UK (POUND STERLING FORECAST 2020). According to BBC (2021), more than 33 million people in the UK had received at least one dose of a coronavirus vaccine. British Pound would increase and AUD would decrease but it also need to consider the new agreement with European Union. The new agreement between UK and EU also increase the value of British Pound. 2. According to RBA (2021), the Australia Dollar Trade-weight Index is increasing since 2019. Although it is increasing since 2019 but it would fall down due to the freezing point relationship between Australia and China. The Trade-weighted index is based on the average weight value of the Australia dollar with respect to a basket of currencies (PARLIAMENT of AUSTRALIA, 2021). The largest trading import and export is China, this would cause the fall in Trade-weighted index due to the freezing point relationship between China and Australia. Reference List Yahoo Finance 2021, AUD-GBP Charts, Yahoo, viewed 25 April 2021 https://finance.yahoo.com/quote/AUDGBP%3DX/chart?p=AUDGBP%3DX Yahoo Finance 2021, AUD-GBP Historical Data, Yahoo, viewed 25 April 2021 https://finance.yahoo.com/quote/AUDGBP%3DX/history?p=AUDGBP%3DX PARLIAMENT of AUSTRALIA 2021, Overview of Australia’s trade with the United Kingdom, PARLIAMENT of AUSTRALIA, viewed 25 April 25 https://www.aph.gov.au/Parliamentary_Business/Committees/Joint/Foreign_Affairs_Defence_an d_Trade/tradewithUK/Interim_Report/section?id=committees%2Freportjnt%2F024101%2F25066 GOCARDLESS 2019, What impact will Brexit have an on Australian Business, Payments Regulation Services, viewed 25 April 25 2021 https://gocardless.com/en-au/guides/posts/brexit-impact-on-australian-businesses/ Australian Institute of International Affairs, Brexit and Australia: The Way Forward, Australian Institute of International Affairs, viewed 25 April 2021 https://www.internationalaffairs.org.au/brexit-and-australia-the-way-forward/ British Social Attitudes, Political consequences of Brexit, British Social Attitudes, viewed 25 Apirl 2021 https://www.bsa.natcen.ac.uk/media/39374/bsa37_political_consequences_brexit.pdf ABC News, Australia called for a COVID-19 probe China responded with a trade war, ABC News, viewed 25 April 25 2021 https://www.abc.net.au/news/2021-01-03/heres-what-happened-between-china-and-australiain-2020/13019242 POUNDSTERLING FORECAST 2020, AUD to GBP Rate Higher as Virus Outweighs Brexit, POUND STERLING FORECAST, viewed 25 April 2021 https://www.poundsterlingforecast.com/2020/12/aud-to-gbp-rate-higher-as-virus-outweighsbrexit/ POUNDSTERLING FORECAST 2020, Pound Sterling Forecast –Will GBP rise or fall in June , POUND STERLING FORECAST, viewed 25 April 2021 https://www.poundsterlingforecast.com/2020/06/pound-sterling-forecast-will-gbp-rise-or-fall-injune/ Reserve Bank of Australia 2021, Australian Dollar Trade-weighted Index, viewed 25 April 2021 https://www.rba.gov.au/chart-pack/exchange-rates.html BBC News 2021, Covid vaccine: How many people in the UK have been vaccinated so far?, viewed 25 April 2021, https://www.bbc.com/news/health-55274833 BBC News 2021, Australia provokes China anger over scrapped deals, BBC News, viewed 25 April 2021 https://www.bbc.com/news/world-australia-56840299 PARLIAMENT of AUSTRALIA 2021, Trade Weight Index, PARLIAMENT of AUSTRALIA, viewed 25 April 25 https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/ pubs/MSB/feature/EXCHANGE Objective: This assessment task aims to support you in achieving the following Subject Leaming Objectives: 1. Describe and explain the reason for the diversity in accounting practice around the world 2. Explain the concepts and accounting issues involved in recording and reporting a variety of frequently occurring international transactions 3. Evaluate major issues in international accounting including transfer pricing, foreign currency financial statement translation and international taxation Task description: This is a group assignment. Groups are to comprise 2-4 students. Assignments will only be accepted from individuals who have written permission from the Coordinator and have provided documentation of extraordinary circumstances. This is a team assignment. Assignment length and format Approximately 1,000 words (+/- 10%) per student in the group (excluding bibliography). Please use Harvard Referencing style. Please use the cover page provided here Assignment questions PART 1: Complete A, B, C, D or E If the last digit of the student number of each member of the group adds up to 0 to 4, then please do (A) below le.g. student numbers 98765432 and 87654310 would be 2+0 = 2, so do A). For the last digits adding up to 5-8 please do (B) from Part 1 (e.g. 11112222 and 33334444, 2+4 = 6). For last digits adding 9 to 12 please do (C). For last digits adding to 13 to 16 please do (D) while if the last digits add to 17 or more please do (E). For groups of three and four do as above PLUS A this is for Part 1 only. If you have any doubts please contact Jin. (A) Australian Dollar (AUD) and US Dollar (USD) (a) Construct a graph of the Australian dollar against the USD for the five-year period 1 July 2016 to 30 June 2020. For the month of July 2020 construct a daily graph (b) Highlight on the graphs the major peaks and troughs in the value of the AUD against the USD. (c) Discuss what caused each of the major peaks and troughs in the value of the Australian dollar against the USD. Ensure you include detailed research as part of your discussion. Whilst your research can come from a variety of sources, a requirement is that your research includes articles from the business press (The Australian Financial Review, for example) as articles in the business press will give a much fuller explanation of what is happening with exchange rates and why there are rises and falls. (d) Predict and discuss what you think the value of the AUD against the USD will be at 31 December 2021. (B) Australian Dollar (AUD) and British Pound (GBP) (a) - (d) As above except GBP rather than USD (C) Australian Dollar (AUD) and Euro (EUR) (a) - (d) As above except EUR rather than USD. (D) Australian Dollar (AUD) and the Chinese Yuan (CNY) (a) - (d) As above except CNY rather than USD. (E) Australian Dollar (AUD) and Japanese Yen (JPY) (a) - (d) As above except JPY rather than USD. PART 3: Discuss the relevance of the currency you have been allotted to international accounting for Australia. Which country apart from Australia would be interested in their exchange rate with the currency you have been allotted? Why would they be interested? PART 4: Impact of Foreign Exchange currency movements on business operations and strategic direction • Research an Australian company which has interacted (through sales or through key purchases) with the above currency you have been allocated (USD, GBP, EUR, CNY or JPY). For example, the Australian company could sell to the Japan, so interaction could be sales in JPY. Alternatively, the Australian company could buy key materials from China, where purchases with China are generally transacted in USD. • Discuss the effect that the changing exchange rate of the identified currency to AUD has had on strategic direction and operations of the Australian company over the last 5 years. • Refer to your predictions developed earlier in Part (d) of the assignment. For your identified currency, discuss the impact that this prediction of value of the AUD against the identified currency at 30 June 2020 will have on the company. • What does the company you have chosen in Part 4 disclose of their foreign currency activities? PART 5: Indicate one other aspect of International Accounting relevant to the currency you have been allocated or company you have chosen and why it is relevant

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