[Ruby]

Passed with 72% 🙂 So happy! 🙂

[Ruby]

Thanks Mike, I kept thinking isn’t it like an “impairment loss”? Then it should go to P/L.
Anyway, thanks for your prompt answer! 🙂

[Ruby]

Hi Mike,

I would like to ask about asset ceiling test

For example, if after remeasurement at year end, the pension liability is 300, the plan asset is 400m, so there is a net asset of $100m.

However, the asset ceiling is 70m, so we need to write off 30m on the plan asset.

My question is where should this 30m be recognized? P/L or OCI?

[Ruby]

Hi Mike, remeasurement gain/loss is recognized under OCI in SOCI and ends up in OCE in SOFP, correct?

[Ruby]

Ah….. I see what you mean here.

However I’m still confused.

For subsidiary assets, we translate (from sub’s SOFP) at closing rate and that’s done. Because any depreciation is charged in the sub R.E and finally we translate the post R.E at average rate.

But for Goodwill, since we recognized it in our SOFP since acquisition, at the reporting date its value maybe different due to exchange rate change, so we have to translate again at closing rate. Impairment loss happens through out the year so translate at average rate. then any difference is FX gain/loss. Correct?

Opening GW @ opening rate
less impairment loss @ average rate
FX gain/loss (balance)
= closing GW @ closing rate

This is the method I was told in the revision class of one lecturer. I find this in conflic with your method. I wonder if there is any rules on this or is it subject to flexibility?

[Ruby]

Average rate. All P/L items. Unless i know the rate at the day of transactions took place

[Ruby]

Is it a rule or is it specified anywhere in IAS21? As i thought impairment loss in a P/L item, therefore it should be translated at average rate?

[Ruby]

Dear Mike,

How come remaining 40 is credited ro revaluation reserve? Then where is the debit side? It can’t be to PPE right? Because asset cannot be revalued to a carrying amount that is higher than its value had the impairment not taken place (which is 80)
So 32 is revesal of impairment loss and asset is now at CV =80.
I would ignore the 40.
Please explain this. Thank you!

[Ruby]

If the question specifies that one sub using FV, the other sub using proportionate of Net Asset, then just follow the requirements. It is totally fine!

Just remember that if NCI at FV then GW is in full and any impairment loss need to be shared between Parent and NCI.

If NCI at proportionate of net asset, any impairment loss is attributable to parent ONLY.

[Ruby]

Liability on defined benefit plan =
opening net assets/deficit
+ finance cost
+ Current year service cost
+ past service cost
– Contribution paid to scheme.

Therefore, if you reduce the contribution paid, your liability will increase.

[Ruby]

The group FX exchange difference will end up in OCE so I think it is okay if you include it in OCE, as long as you show your workings. 🙂

[Ruby]

Yep, if NCI at FV then impairment loss is shared between Parent and NCI.

I’m planing to take P2 in June, hope we can help each other out 🙂

[Ruby]

@john_girgis_Iskander said:
According to IAS21,

Is the foreign exchange arise from operation can be presented under cost of sales?

I think it depends on whether you are dealing with individual company account or group account.

– If individual company:
Exchange difference is recognised as profit or loss in Income statement. If it is from operating activites then it can be under COGS i guess. But I would take it as separate line though. Ask Mike Little for clarification.

– If group account:
Any exchange difference occured is recognized in Other components of Equity, not in P/L. (Unless later the subsidiary company is disposed of)

I hope this helps.

[Ruby]

Hi, I would like to share my understanding with you regarding this scenario.
But first you need to know what is the group policy in measuring NCI. (At fair value or proportion of sub’s net assets?

1) My understanding of adjustment
Since goodwill is a group entry, any impairment upto the goodwill amount will be adjusted to the group profit. Adjustments above this amount will impact the “investments” of the parent’s stand alone financials, if I am not mistaken.

==================>
WHAT I THINK:
Yes, partly correct. If the group’s policy is to value NCI at propotion of Sub’s net asset, then ALL the goodwill as well as ALL G/W impairment is attributable to PARENT ONLY. In this case, in the Retain Earnings of parent will be decreased dy the amount of impairment loss.

However, if NCI is measure at Fair value, it means Good Will is in full (100%), and any impairment loss will be shared between Parent and NCI with their holdings. NOT all impairment is to parent company.
______________________________________________

2)My problem is, what will be the carrying value of investment to be compared with NRV?

================>
WHAT I THINK:
In order to calculate the impairment loss, you will need to compare the CARRYING VALUE of the sub with its RECOVERABLE AMOUNT (which is higher of: Fair value less cost to sell, and Value in use)

The carrying value of investment to be compared with its recoverable amount (which you refer to NRV) is: Subsidiary’s Net asset at year end + Good will

I hope this helps. Please let me know if you need to discuss further 🙂

Regards,

Ruby

[Ruby]

Actually I’m done with all F papers. F4 was my last one. I left it until the last minute because I didn’t like theory paper so much, all the reading makes me bored. Then I checked out your F4 videos and found out F4 was not that horrible, it was very interesting the way you delivered the subjects.

Now I’m preparing for P1 and P2, just watched 1 of your P2 lecture, it is so great. Once again, thank you so much. OT and your lectures are the best thing I’ve found during my ACCA journey. God bless you Mike!

[Ruby]

Thank you very much! I did the CBE test today and guess what, I got a few questions on company resolutions!!!

Anyway, I passed with exactly 90%, so lucky! Thank you so much for your wonderful lectures and your kind help!

Best regards,

[Ruby]

1st attempt. Got 90% CBE today:)

[Ruby]

@mfe100 said:
any one know the answer Please – Im sitting CBE tomorrow

how was your cbe exam?

[Ruby]

@mikelittle said:
I’ve just put into the search engine “AGM short notice” and the Company Law Club appears to confirm my 95%!

Let me know if you still disagree

Sir, I am still confused because I practiced the MCQs on this website yesterday and I got the same question on how many % member need to consent for short notice of AGM. I still chose 100% instead of 95%, and my answer happened to be correct!

[Ruby]

I’ve been reading BPP text book only, the latest version, and I could send you a snapshot of the page, because I did take notes about this detail. But I’m not sure if it is correct because bpp book sometimes does contain mistakes (I personally found out while reading other papers as well)
oh my god I’m so confused!!!

[Ruby]

Dear sir,

I don’t think I agree with you on your answer for question e

“In answer to your question “Is it possible to hold an AGM of a public company with only 2 days’ notice?” Yes, IT IS possible to hold AGM of public company with only 2 days’ notice provided short notice has been approved by holders of 95% (not 100%) of votes”

As far as I understand from reading book, the rules is like this:

++ Short notice for AGM: 100% member of plc must consent

++Short notice for OTHER general meeting:
– public company: 95%
– private company: 90%

So in this question, to hold an AGM of public company in 2 days notice, 100% of members must approved.

What do you think?

Im also taking f4 next week so hopefully I could get these small details cleared up. Thank you so much!!!

[Ruby]

Pass with 75% 🙂

[Ruby]

Pass with 63%. I only attempted around 75% and expected to fail, but luckily I don’t have to resit! Thank god!

[Ruby]

First attempt on F8, got 63% 🙂 lucky me!

[Ruby]

First attempt and got 73%. Im more than happy. I expected to fail before. So surprised to see the result.

[Author]

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