Forums › ACCA Forums › ACCA SBR Strategic Business Reporting Forums › *** December 2021 ACCA SBR exam – Instant Poll and comments ***
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iraitis.
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- December 9, 2021 at 9:30 am #643106December 9, 2021 at 4:43 pm #643463
For me was complete disaster. I wrote the exam this afternoon, did anyone write in the morning and had different questions?
Question 1 was okay except the Statement of CF preparation, did not really understand what adjustmens they were expecting to see. I had the impression the accountant reclassed all investing activities as operating. Unfortunately the CF question had the most marks allocated.
Question 2 was not similar to any question in study quit or past exams. We had to discuss general topics, why not hedge accounting, new regulations implemented etc but was not really clear where is the ethical problem from my point view.
The second part about the leased player I was not sure if it’s a lease or should be recognised as PPE.Question 3, about a forestry company. They allocated for the deferred tax asset part a lot of marks, I did not really understand why and what should be discussed for soo many marks.
Question 4 was about cryptocurrencies. Honestly speaking my English was not good enough to understand it correctly therefore I think I messed it up.
I studies soo much and in the end was a complete disaster don’t understand why they didn’t make this exam similar to the published past exams.
December 9, 2021 at 4:48 pm #643467CSF adjustments were okay, except for financial asset value increase. It was horrible to understand the whole picture. for q2, probably the player’s contract was a lease. Crypto assets were on another level with ICO and what not. Overall, the exam was quite tough, to be honest
December 9, 2021 at 5:01 pm #643479I had same qestions.
Qestion 1 i think i well done
Qestion 2 only “C” part doneQuestion 3 i answered deffered tax assets recognise in the statement if there is probability to receive tax profit in the future. According scenario entity changes its jurisdiction which allows use tax losses only for 3 year period. Then entity must regnise its deferred tax assets only on 4 reporting period (after 3 years, because there is budget for 6 years). Effective tax rate must be used as it represents any future changes in the tax rate.
Question 4 I answered that all cryptocurrency is a financial assets through profit or loss. Development cost is operational cost and must be included in the statement of profit or loss in one time at the reporting period then such costs were be.
this is it(((
December 9, 2021 at 5:06 pm #643481The first question was about the NCI calculation 9marks and goodwill 4 marks with the foreign exchange difference whether it should be allocated to NCI at acquisition.
As well there was a tough question about trademark whether as it was leased and was quite confusing as to whether recognise the intangible or lease and ext
Q2 I guess it was about onerous contact it also was confusing whether revenue should be recognized or provision
And the ethic question was ok
Q3 was about impairment and contingent asset and the event after reporting a bit confusing
As well as the IFRS 13 for financial assets and investment property
Q4 was a disaster as was a combination of share-based payment and deferred tax I donot know
This was all confusing I hope at leased get pass markDecember 9, 2021 at 5:12 pm #643486..
December 9, 2021 at 5:19 pm #643493I had the same exam as above with the football Q and crypto etc
My takeaway from the whole exam. What a load of crap. So many marks on crypto? Seems insane to me to ask students to discuss the accounting process for something that doesn’t even have its own standard yet! I went down the ias 38 route as an intangible but may have mixed up and out FVTPL, think it should be FVTOCI if a gain and then FVTPL for a loss. Either way… questions just made little sense to me.
I got excited as the deferred tax part and then quickly disappointed when I realised it didn’t follow the typical deferred tax question and instead had to relate it back to FRS102 which I really couldn’t remember. Also I’ve never really seen a question that was relating to what seems like quite a niche company with slow profit progression? Wasn’t sure how to answer it as you wouldn’t carry the losses forward over multiple years if no profits expected?
The question about the crypto vesting scheme for the directors was bizarre, I didn’t really know how to answer it at first as I didn’t understand if they were given the coins and then also a car or If they were just given a car? I said liability at the end of the first year and then unwound it as and when the directors took the car but no idea.
Agree with what’s been said about the ethics question. Most ethics question seem to have a very obvious agenda. E.g can’t break covenant with bank or directors bonus is driven by profits. This one just felt like the director was lazy and negligent and didn’t really know how to manage risk? I’m wasn’t to sure the best way to answer. Seems more like he was incompetent at his job rather than he was intentionally acting unethical.
I too put lease for the football player but have since checked and think it should have been recognised as an asset due to the unconditional agreement to take to footballer on perm at the end of the free. I’m hoping someone can correct me and that the fact that they had to pay 10mil at the end of the 3 years meant it was a lease and then a purchase?
Overall, compared to other exams I reckon we were shafted haha ? see some of you at resits
December 9, 2021 at 5:43 pm #643510It was a crazy paper with time management big issue
December 9, 2021 at 5:52 pm #643515Absolute disaster of an exam, like most of you i got the question regarding the ico/crypto assets and the consolidated cash flow. I just found the whole exam baffling and it all didn’t make much sense at all.
A whole question to an crypto? What a joke.
I’d be happy with a good fail at this rate, barely any of the syllabus was tested only specific parts.
December 9, 2021 at 5:54 pm #643516I never comment after exams to criticise the efforts of the team setting them but I thought it was extremely disappointing to see that question on the forestry company and whether the bank relationship with the supplier was a debt or payable I think it was. They even had to provide a diagram for it such was the absolutely unnecessary complexity of the situation. That was just downright disappointing. Everything else was fair and square difficult and I concede that but they really should take note of such ridiculous scenarios and not put them into the exam.
Anyone else get that part of the question and can comment on the specifics?
I wasted 15 mins reading it and writing it out to interpret it before I realised it was likely a time trap hurdle. Then became angry and distracted which is not what ACCA should be setting out to do to participants.Again the majority of it was fair and square difficult but that left a bad taste.
December 9, 2021 at 5:57 pm #643518Yes I got the debt vs trade payable and this was an awful question. I barely even had time to look at the diagram. It just threw me off.
December 9, 2021 at 5:59 pm #643519Also got the one about crypto and whether it is employee benefits rather than share based payments.
Tough paper.December 9, 2021 at 6:04 pm #643522Actually that question about paying the directors of the crypto company in 5000 crypto tokens if they stayed for 2 years with the company. At the end of the 2 years, the tokens could be swapped for a car capped at 50k dollars.
The question said explain why this is not a share based payment but instead is an employee benefit. I would have initially thought it was SBP so I was glad they pointed out it wasn’t but then I was looking at it wondering, why exactly is it employee benefits lol.
I know ACCA use past papers to educate future students so that question is going to be released soon in a practice kit and an explanation will accompany it but for now, do any experts know why the tokens (to be swapped for a car) I’d benefits and not sbp?
I elaborated that the tokens only have a value because the car is attached to them whereas shares have an equity stake and external value attached (of which crypto tokens are not)
Anyone?
December 9, 2021 at 6:07 pm #643525What a complete mess of a paper. An entire question based around cryptocurrency which does even have an accounting standard, what a joke.
The football question I wrote a bit about leases but to be honest I think that’s wrong as humans aren’t assets? And the scheme about giving cars to directors… bizarre. I may have picked up valuable marks discussing ethics, deferred tax and management disclosures but I’ll be floored if it is enough to pass the entire paper.
There were just too many out of this world scenarios and I fail to believe how we are expected to link them back to what’s taught in the syllabus.
December 9, 2021 at 6:07 pm #643526I really think the exam was not fair at all as the parts we have been questionned on where So spécific… it is Not even like prior Year period examen . That was hard and Time management was also really difficult.
I can remember almost all thé questions because they were all tough.
Question 1
A) fair value measurement difficulty for a company i think it was Not quoted So Level 1 measurement difficult
B) profit on disposal of a participation
C) cash flow adjustment really hard i didnt understand and it was 14 points
D) i dont remember what it was about… sorry…Question 2
A) ethical issue over really hard items like New législation but i guess breach of professionnel compétence and hedging
B) how to account for a three year contract
C) différent payment received ( gouvernement, donation,…) and how to account for themQuestion 3 crypto asset … i dont know what to say…
A) crypto asset disclosure requierement
B) development cost and promotional costs as intangible assets?
C) crypto payment 1m and 10m how to account for it
D) why an offer was an employee benefit rather than a share based paymentQuestion 4
A) structured debt was trade payable or debt ?
B) deferred tax ias 12 vs frs 102
C) deferred tax asset in a situation which was incomprehensibleAt the end I was like I studied that much for so many specific parts of the whole book….
But I stay confident I hope at least what I have done is good enough for them…
December 9, 2021 at 6:24 pm #643536Anonymous
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1D was about IAS 37 Provision as i wrote. Conflict with supplier who will pay for damage a nd how to treat this event.
December 9, 2021 at 6:26 pm #643538For q1 I got calculating Goodwill and NCI but with foreign exchange differences.
Q2 was ethics but more to do with ethics of spyware as apposed to accounting treatment, very confusing!
Q3 was impairments of warehouse, can’t remember much else.
Q4 was share based payments, nightmare!
Think I’ll be lucky to get 25%
December 9, 2021 at 6:46 pm #643565irishproduce wrote:Actually that question about paying the directors of the crypto company in 5000 crypto tokens if they stayed for 2 years with the company. At the end of the 2 years, the tokens could be swapped for a car capped at 50k dollars.
directors recieved tokens and then tokens can be exchanged either a car which costs <$50 000 or $50 000 in cash
There isn’t Share-based payment because tokens aren’t shares. Equity share is share in net assets (assets minus liabilities).
I think it so
December 9, 2021 at 6:51 pm #643569There was no cash alternative on the crypto offering.
It was a car up to 50k$December 9, 2021 at 6:53 pm #643570Hi best of luck.
Do u remember the last paragraph in the exhibit with cash flow? Did it also pertain to the financial asset?December 9, 2021 at 6:59 pm #643571Chitaya wrote:It was a crazy paper with time management big issue
I believe that time management on the ACCA site is a fundamental mistake. This is 3 hours / 100 points = 1.8 minutes per grade. But they don’t pay attention to the fact that it takes time to think about the question and plan your answer.
I believe that exams should only be taken for 1, 3 and 4 scenarios, which give 80 points in an ideal situation. And the last 2nd scenario should be tried if you have time for it. If not, then at the start of preparation, plan your work only for 3 scenarios. If there is a great performance, then you will receive 80 points, and this is enough to pass.December 9, 2021 at 7:20 pm #643583I just came home and ate a whole packet of Tunnock’s Chocolate bars. This exam was horrible, I actually think my brain stopped working half-way through. Doing the mental marking if I pass it will a be a miracle but I am already thinking about a resit 🙁
Q1
(a) Difficulties in the application of FV estimate to Frogget Co
I wrote, the definition of fair value, and mentioned the ideal estimate uses level 1 inputs and market based approach, however only level 2 inputs in the share prices of similar sized entities are avaialbe. Concluded with the cashflow method being unsuitable due to Froggets poor performance.(ii) Group profit on Disposal – not too challenging; Cash proceeds $35mil add: retianed investment in Froget $5mil less subsidary (FV $45mil, goodwill ($6mil less 60% imparement = -$2.4mil); Non controlling interest -$8.4mil) – not sure about this one, i think i got $5.8mil.
(b) Consolidated cashflow statement and commentaries
Identified the non-cash adjustments – depreciation, loss on disposal of PPE. Also stated that any cashflows for PPE should go in the investing section.Reversal of $35million poreeds from sale – investing cashflow.
Working capital – nightmare, this really where I messed up and got seriously confused, i knew needed to apply the rule 2 of IAS 7 – remvoving assets and liabilites of the sub on disposal from the closing balances – adding to the closing movements less the subsidary’s recievables and inventory.**
**Anyone who answered this one confidently please share how you did it – I wasted so much time on this one 🙁
Ignored the financial instruement – actually, no I added it in the cashflow reconciliation, said it was in the wrong location so not part of operating cashflows
(c) The dispute with supplier – I’m guessing this was an event after reporting period, which I said should be adjusted if the amount had material significance, otherwise the note is suffiient – felt really dodgy this one!
Q2 – Ethics
Non-compliance with the profitability and sustainability report – I said the directors action indicated professional incompotence; tried to make the arguement that reporting goes beyond just the IFRS standards and users of the statements also require other forms of information to make informed decision. Also said the profitability reporting would in fact be useful to help management to properly manage the resources and stop things like over investing in players etc.Ethical implications of hedging instrument – tied this to proffessional compotence again, the need to consult external expert on the hedging policy of the club, clearly not doing so had contributed to losses.
Ethical implication on the assumption of going concern – I said it was possible the director was losing objectivity (over optimistic) in light of the club’s agenda to raise itself up into higher division, it may be the case that he unable to consider the current sitation objectivly and should consult external 3rd party e.g. auditors to see if approriate conclusion to draw.
(b) The accounting treatment for FC Gate Co for the transaction over 3 years:
I went with IFRS 16 – Leases, as the lessor FC Gate needed to recognise right of use asset and lease liaiblity, and discounted the liaiblity to present value using 5% discount rate over 3 years – recorded as $16.63mil; right of asset ($16.63mil + 7.0mil for wages – probably really wrong). For the one-off bonus just expensed through profit and loss when its incurred.
c) the governemtn payment – Ignored was running out of time
Q3. After this point complete mess – Defered Tax question under UK-Variant so asking for difference with FRS 102 – which hadnt prepared for. Lucky if I get 2 marks for the nonsense I wrote.
Q4. The final question I didnt even attempt.
Basically only answered half the paper! **weirdly very theraputic writing this.
December 9, 2021 at 7:39 pm #643592Ahh what a disaster that was :/
Question 1
For the cashflow question I was confused with how the inventory, payable and receivables affect the cash flow. Did you guys increase or deduct it from the cash flow?Question 4
I said it was debt as trade payable more for working capital. And this involved interest, also something about the credit in the bank decreasing so I said it sounded like a loanAnd for the deffer3d tax question I was so lost as I wasn’t very strong in this topic
It would be miracle to scrape 50
December 9, 2021 at 7:56 pm #643602This is the first time I comment and I just want to say I’m extremely disappointed.
The scenarios were way too many, worded in an overly complex way that made time management just impossible.In one of the scenario I had raw cotton in exchange of shares and whether or not it as under IFRS 9 or IFRS 2. I mean when does something like this actually happens? Was it necessary to add a 3 mark question with another scenario?
In the examiner reports they complain about students not getting in depth of the discussion, but realistically where is the time?
It takes time to decode the scenarios, understand the rule, state, apply, explain… all of it in 3 hours?
I had around 12 scenarios (3 per question) to understand and at least 8 IFRS standards.Anyways good luck to you all!
December 9, 2021 at 8:13 pm #643608Quite possibly the worst exam I’ve ever sat. I said the footballer was a contract asset but god knows. Can you even amortise footballers??
As for the crypto one it blew my mind, and then offering tokens to directors that they can exchange for a car?! Does this happen in real life ? I just mentioned you couldn’t really distinguish between whether it was equity settled or cash settled so must be employee benefit, but god knows
Then selling trees, that was a fun one too. Fair play to Acca for choosing the most random businesses that we have no exposure to in the notes!
The group question through me off, all the adjustments seemed related to investing cash flow rather than operating so I was stumped on that one!
On the plus side, the resit in March should be easier 😀
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