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reviewing the list of additions

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AA Exams › reviewing the list of additions

  • This topic has 1 reply, 2 voices, and was last updated 4 years ago by Kim Smith.
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  • July 28, 2021 at 8:46 am #629637
    Noah098
    Member
    • Topics: 935
    • Replies: 352
    • ☆☆☆☆☆

    Review the list of additions and confirm that they relate to capital expenditure items rather than repairs and maintenance.

    maam could you explain how the person reviewing will discern if a certain inclusion is of capital nature or revenue expenditure nature?

    July 28, 2021 at 9:17 am #629641
    Kim Smith
    Keymaster
    • Topics: 136
    • Replies: 8380
    • ☆☆☆☆☆

    If in doubt the auditor would refer to supporting invoice but for example:

    Car – $18,000
    Road tax – $500
    Extended warranty – $1,500

    You should be able to distinguish capital from revenue expenditure (assumed knowledge of FA/F3).

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