Westfarmers is a 500000-shareholder company based in Australia making it one of the largest

public companies in Australia. The company participates in a variety of businesses; supermarkets

and department stores, industrial and safety products, home improvement and office supplies like

coal mining, chemicals, fertilizers and insurance.

For the company to attain success it employed certain strategies; the company generated savings

through efficiency that helped in reinvestment, it also kept refurbishing its operating its program

and improved the network of employees. The company maintained good customer service and

offered quality goods.

Westfarmers has used a number of key accounting policies and standards that have contributed to

their success; The financial report has been prepared on a historical cost basis except for

investments held by associates which is measured at face value, the net value of inventory is the

estimated selling price, depreciation of plant and equipment is done on annually basis and is

affected by determining the useful lives of property, plant and equipment, another policy is

revenue recognition, revenue for sale of goods is recognized when the significant risks and

rewards of ownership have been transferred to the buyer. It is also recognized when the

shareholders’ right to receive the payment is established; revenue is recognized as the interest

accrues to the net carrying amount of the financial asset. Another policy is on trade receivables,

there have a 30 day term and are recognised at fair value and measured at amortised cost.

Managers select accounting policies on the basis on which a policy provides choices in the

manner in which transactions and assets are accounted. In the case for the use of historical costs,

there are a lot of choices to manage reported