[Baljit]

@StuartPearce I felt quite bad about the exam until your post cheered me up 🙂

[Baljit]

Q1
– easy marks for layout, intro and conclusion

– I actually managed to find lots of business risks, expanding into new industry, animal welfare standards due to keeping living animals, going concern issues due to significant advertising and huge drop in cash balance, reliance on overseas manufacturer, credit offered to customers.

– ROMM were IAS 2, IFRS 15 annual plan revenue needs to be recognised over 12 months, IAS 37 provision for refitting and potential redundancies, Payroll error maybe materially overstating expenses and IAS 38 potentially capitalising brand name.

– Couldn’t think of the impact on planning for the outsourcing of credit control, what did anyone else put?

Q2
– IAS 12 = Deferred tax asset treatment was correct as the company had now begun to post profits rather than losses, however the change in business strategy may have violated the restriction in place, so they shoudl enquire with management to see if they think it would and also reach out to the local jurisdictional body to see if it would

– IAS 17 Lease = discount needs to be spread out through period of entire lease, so expense in the year of $150k was understated as it should have been $270k. Need to see the lease agreement to verify lease term, payment and discount, also review board minutes to see if lease was discussed.

Both the Deferred tax asset and lease were material.

– Part B the examination procedures on Capital Expenditure, just explaining different types of audit procedures i.e. getting a breakdown of the costs and analysing for reasonableness and assessing the architects work using ISA 620. Also this had elements of prospective financial info as it involved forecasting so mentioned PFI

Q3
– Didn’t have a clue for part A, literally just wrote money laundering in cash based businesses can affect revenue recognition. Probably got no marks on this.

– Spoke about money laundering issues and that evidence would need to be obtained, if not then they need to speak with the audit committee or those charged with governance about it. If none of this was done a qualified opinion should be issued because it is not pervasive.

– IAS 37 = provision didn’t necessarily have to be recognised providing the auditors obtain sufficient and appropriate that it shouldn’t i.e. written representations legal claim against them will not succeed. Also they should review the board minutes to see if the legal issue has been discussed. A qualified opinion should be issued if the provision evidence is not obtained.

Q4
– Due to time issues could only attempt part A which was Intimidation and talking about how the guy didn’t understand what auditors do and the partner should arrange a meeting to explain what they do

Overall gutted as I could have done more but ran out of time and failed in Dec 2015, hope I pass this time but due to only attempting part A on q4 and no answer for part A on Q3, fear I have failed again.

[Baljit]

It’s my first attempt at this paper and I’m wondering why I chose P4!!!

Q1 seemed to be a standard project NPV including foreign currency. Funnily enough I think this was easier than the optional questions, which is surprising because in the build up to the exam I found I did better on the 25 mark questions. However it was very time consuming. In Part A I spoke about if they had there own assembly plant they would have better control, acquire high calibre employees because the scenario said people from Yilandwe where ambitious and well educated.

Q2 was about dark pools and deciding whether a company should or should not dispose of there shares. I found the written part of explaining what dark pools were ok but didn’t really know how to answer the area of should they dispose of there shares. I valued the company using the P/E Ratio model and asset basis but didn’t get much time to talk about the results, while also working our the EPS and Share price and comparing to the industry averages which were supplied. Basically said how every calculation was below industry standard and they should divest.

Q4 was about interest rate futures, options and collars.I found the calculations ok but part b was a written element about discussing margin payments and futures prices changing daily which I had no idea about and ran out of time so didn’t really write anything. Seriously WTF did anyone write about the futures changing daily?? I thought those prices were valid for the whole month!!

Overall I don’t think the exam was a BEAST and I’m already fearing i’ll have to do it again.

[Baljit]

marija1507 sounds like you did really well, I think you’ll pass easily

[Baljit]

Sublime you won’t have failed, stay positive I did p2 last June and thought I definitely failed but some how passed!! Chin up

[Baljit]

Kate did you mention harmons process matrix for q2?

[Baljit]

Why would you not talk about harmons matrix? The question said would you continue to outsource or bring in house, that is pretty much what the model does.

[Baljit]

Q1 – quite long here’s what I did:

Part A

I) applied SWOT, BCG matrix and ashridge model

Ii) used JSW’s SAF criteria, gearing of the airport seemed extremely high

Part B

Defined bowmans strategy clock and talked about hybrid criteria, was struggling for time so I didn’t get to apply it to the scenario, but I drew the clock lol.

Q2

Part A
quite easy involved straight forward evaluation of what they were doing good and bad and recommended improvements. I talked about Process Redesign Methodology

Part B

Talked about harmons process matrix and applied 3 types of issues to it, I think I did:

Service contract – automate
Refunds – outsource
Technical support – improve

Q3

So bloody hard!! Probably because I only had 30 minutes left. Defined the triple constraint but found it very hard to apply to the scenario. The BPP syllabus didn’t have anything for effective risk management to my knowledge. So I just said all risks have to be disclosed and either accepted, avoided, mitigated or transferred

Overall I think I failed!!

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