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I’m speaking with faith! This is the last time I’m getting results from Acca. I’m passing my finals and that’s it!
Do you remember if that acquisition of the sub was an event that occurred after year end? Just realized I didn’t pay attention to the date of acquisition.
Plus… Did you recommend an opinion in the event that management refused to change the accounting treatment
I went with adverse opinion… Because if they had consolidated, the subsidiary was practically making a loss as it was not functioning and management integrity was questionable for not consolidating… That could mislead intended users
What was the right opinion for the subsidiary that was accounted for as an investment?
see an extract from the notes to our accounts for the year ended 2019:
29. Contingent liabilities and leases Az Bank Nigeria Limited has only short term leases. The Bank has renewal options for all lease contracts for which the renewal is at the discretion of the Bank or jointly with the respective lessor. The Bank prior to commencement prepays a minimum of three (3) years rent. The Bank has each and every lease cancellable by either party; the cancelling party need only give a notice period of not more than 6 months prior to cancellation. Instances where the Bank opts to cancel, all un-utilized rents already prepaid would be refunded by the lessor. Where the lessor opts to cancel, the Bank would be reimbursed un-utilized portions of the rents prepaid.
As required by the standard, the Bank recognizes all of such leases as short term leases with no option to purchase and accounts for them in that manner. Lease payments on short-term leases and leases of low-value assets are recognized as expense in profit or loss on a straight-line basis over the lease term. The Bank did not have any outstanding and non-cancellable operating lease obligations as at 31 December 2019, as all leases are paid in advance. Prepayments in respect of these leases stood at N266 million as at the reporting date.
(a) Lease prepayment & amortization
N`000 2019 2018
Prepayment for leases 265,437 360,209
Amount amortized to P&L during the year 157,668 167,199I’d suggest you go again In march …your knowledge is still fresh… You just need to do a lot of revisions and past questions and watch all opentuition videos again… Plus the Sbr webinar wouldn’t hurt.
59%
First attempt!
Thank you very much opentuition!
Wish I could hug the lecturer!50% … I am forever grateful to opentuition!
First attempt!
I love the lecturer… He was so detailed!I added the $1m from the legal cost relating to the share for share purchase consideration… And advised that the $2m be expenses as it would have been incurred whether the acquisition finally went through or not… Someone tell me I was right? Please! ?
I also deducted the net pension liability that had not been taken into consideration… Was that the right treatment?
Took think that I spent the whole 2020 preparing for this Sbr sha
chi.dao wrote: @cl10 i got PPE, cashflows, exchange rates, step acquisition for question 1
How?
Which version did you write?I was thrown off balance!
Was expecting a section of cashflow or c-sofp and the likes… But defined benefit scheme?! Expected credit loss?!I stated in my response that the branches with less than 5 partners were small, those with 5 – 20 were medium while those with above 20 were big… Like a judgement call.
Total number of partners in branches with less than 5 partners were 14. So I took an average.
Total revenue from that category divided by 14… I saw something like that in one old p3 video… I just hope it makes sense to the examiner… I felt it was better than just making qualitative point… Since they asked for analysis
PS: the exhibits were arranged in a way that they followed the questions. Or at least, it felt like that to me.
Where did you apply SFA?
I just realised TARA could have been applied to responding to the risk question… I didn’t specifically mention TARA in my responses… I just suggested mitigations …should I be worried?
Using calculations, Look at revenue per partner, operating costs of the small and medium branches were higher than that of the big branches, the big branch also had the highest operating margin. Also the firm would benefit from economies of scales from centralised support departments (I.t. HR, audit etc), closure of the small and medium firms would save cost etc. It was majorly applying common sense for me.
I actually watched the online lecture again and got it right.
I did the discounting factors for the 3 years and I got the same answer provided in the kit. But I still don’t understand how they used the annuity factor provided in the question to arrive at the answer – in case of an exam situation.
100,000 x 1/1.09 – yr 1
100,000 x 1/(1.09)^2 – yr 2
2,100,000 x 1/(1.09)^3 – yr 3Financial Liability = $1.797m
Equity = $0.203m (balancing figure)Good morning Sir
Please Sir, help me with a clear (step by step) explanation on how to answer the above question.
I tried looking at the answer but I still couldnt figure out how they arrived at the workings and answer in general.
Best Regards
Please, the mcq about absorbing cost for small and big
Units produced 80k for small and 60k for big
Units per batch 1600 for small and 1200 for big
Set ups per batch 2 for small and 3 for big….Please what was the answer to that?
I’d we are bin honest, the questions weren’t exactly difficult, I think it’s a matter of understanding the questions. The questions are set to make it difficult for the students to understand what is actually bin asked.
