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Really appreciate it Mike for your assistance to ACCA students through all these years.
Really i am short of words to express my gratitude.
Just wanna thank you for your efforts for us. Its people like you who will be remembered forever for what you do for others.
Gladly and proudly your former student and admirer. 🙂
Yes, matters to consider include a wide range of issues like ethical, commercial and business implications and guess that is all the difference between both the requirements.
Thanks Mike.
I guess i chose the wrong words to ask my query 😀
Still a little confusion Mike as the matters we have considered is because they are potentially risks of material misstatement apart from the ethical matters. Also, what you meant by quantifying risk of material misstatement ? If can elaborate a little more will be great.
Thanks Mike 🙂
Not referring to the verbs Mike it is about what fundamental difference will be when answering fr a question asking matters to be considered and risks of material mistatement. Are these both requirements same and shall be answered alike.
Mike, isn’t it when you initially recognize an asset to calculate the cost of an asset. And it can be argued as same can be deemed necessary for maintenance and repairs. Is it with the necessity or a requirement ? there is a difference between continuing to provide economic benefit and improving the benefits from that asset.
And lets say for example we have a oil rig from which we have realized decommission cost and we intend to sell that asset. How will we account for such a provision ?
Thanks Mike.
Yes with provision i didnot refer to IAS 37 anyways it was helpful in the context. In the same context why decommissioning cost is capitalized and provision realized and later increasing the provision with time.
Well, referring to the Dec 09 paper Q1 where a warehouse is required to undergo major health and safety inspection because of a new regulation. It was quite confusing as how can inspection result in economic benefit to a company or improve the economic benefit from an asset to be capitalized.
Thanks Mike 🙂
What will cause financial statements to be misleading as in a way material mistatement will also mislead the financial statements giving a false view of an organization. what the term ‘misleading’ means in reference to FS ?
Yes, very well summarized just during the audit planning suppose we are new EA for the company and last year audit file is a very important source of information which we can’t access in this case what other documents can help us fill this gap of information and which documents will come to our aid at the planning stage of an audit.
@ Thutha
You made the right point here. Giving reference to ISA standards is important for P7 as yesterday i went through examiner guidance on approaching P7 it had it written there to give specific reference to the ISA along with the IAS/IFRS as applicable in the paper. As you need to apply those standards and its principles in the given scenario.I am interested too. Well weekends will be preferable for the session and it can be conducted on OT chat or skype is also a feasible option. Balbina are you willing to administer these sessions ?
Ask for official ACCA Australia and ACCA Canada email address and mail them with your queries they sure will assist you. You can get official email address by asking them on there facebook pages. Kindly let me know their answer about it once you get reply from them too.
<cite>@surepass said:</cite>
Examinees
Do you know tat you can pass this silly exam by not attempting Q1 consol or even Section B and yet you still able to achieve a Pass. Trust me yes is true. I had friends did tat. Even mine was totally garbage and yet still Pass. My advice don’t bother too much time on this paper. Just answer 1.5 question and A sure guarantee pass. 3hrs to do 1.5 question is possible. Answers need not quality.You had a dream ? :p
Truly OT deserves this because of their dedication and resources they are putting up for accountancy students for free and assisting them in achieving their qualification.
I myself am very thankful to OT for their efforts and it has always been a key part of my studies. I find myself very lucky to have access to OT which adds a great deal towards my success.
Thank you OTAnd what about the retained earnings b/f of this year for the subsidiary, which is post acq’n? at whch rate will it be converted to so thn it can be allocated to parent nd nci.
To get more into perspective can refer to the jun08 exam where the subsidiary zian is acquired 2 years before the reportin date. I am unable to understand this adjustment.Its because we will calculate the effective interest of parent in the sub subsidiary 56% (70% of 80%) parent hence we hav NCI int of 44%(30% of 80%+20%) in the sub subsidiary.
So, the rights issue by the subsidiary to the NCI will account for as a cash inflow in financing activities ? and in this question we are only given the cash raised in total of the rights issue no details of the share capital is given, just the holding is given.
Sometimes m unable to understand what an NCI is for the parent company and in respect to group accounts, is it like any other reserve in the equity section as like an increase in the NCI because of rights issue constitutes as a cash inflow and dividend paid by sub as an outflow ?Hey mike,
can you please elaborate this adjustment more ? i am still not clear. Here is this adjustment because all the inventory had been sold before the year end ?
Also can you tell me which other items can be adjusted like inventory in this question and how we will identify them ?When in a mid year acquisition profits are distributed according to the pre and post periods and if there is a purp or any fairvalue adjustment related completely to the post acq period we need to deduct first the purp from the profit from the year and than appportion according to pre and post for the goodwill calculation. Can you explain me this concept and is this for only post acq adjustments for the calculation of goodwill ?
@sids, yes i have gone through but my answer page where the graph is plotted is misprinted so here i am. And, this the only such adjustment i found in the kit where there is a constraint where the product must be more or equal to the constraint so some doubts. Any problem ?
yes, this is what i came across in answer but just i am not able to figure out how it will effect the feasible area in the graph what would we plot in graph for this constraint ? and can we do like taking 2/3 of 11000 gallons and plot a line at 7333 on x axis being for super petrol and 1/3 of it 3667 on y axis ?
Why the inventory is adjusted like that ? normally with inventory, the excess fair value is added to the net assets at date of acquisition and no adjustment take place in the post period assuming that the inventory will be used up till then as told by the comprehensive example. Actually, mid year acquisition is really confusing me in both CSOFP and CSOCI as i am using kaplan study materials it does not state much regarding mid year acquisitions and nor regarding to the transactions that take place in post acquisition periods that which are to be apportioned and which are not.
Can you help me with reference to examples ?They are charged as administration expenses in the SOCI unless, stated otherwise in the question that they are to be charged as the cost of sales, then they will be charged as cost of sales.
Hope it helps.
