AAA*** ACCA P7 December 2017 Exam was.. Instant Poll and comments ***

@arvind111 said: Q4 - anybody do this? Within the second section, did you talk about professional appointments and how the new auditor needs to speak to the previous auditor before accepting the new engagement?

I said something along the lines of them not responding doesn't mean you turn down the audit just means they become high risk.

I mentioned Government grants and how income had to match the costs in that period. With regards to the second one, i mentioned Investment properties as the properties were solely for rental income

@dclch said: What were the Q2 questions? I sat the exam today and cant remember for the life of me!

It’s so funny you’re saying that.....I’m exactly the same, couldn’t hazard a guess

For q1 I got 1)mid year acquisition 2)ifrs 15 revenue recognised when dept stores sell the product. 3)website sales need to be integrated to the accounting system-control risk 4) Goodwill discount rate could be inappropriate???? Goodwill fv could be inaccurate 5)internally generated brands not to be capitalised (or was this q2) its all a blurr B) check consignment agreenents Physically inspect inventory at the dept stores to confirm thar they are from the subsidiary. Etc C) is it something about a component auditor and placing reliance? Think we check the auditors approach/methodology, qualifications of those on the audit team. The auditor had an extract which i cant remember details off. Think they had a checklist for romm which is useful but the risks vary from audit to audit. The partner was too familiar with the company. In q2 there was something about using the valuers of some paintings in the opinion which should not be done as it may give the impression that the audit opinion is not solely that of the audit firms. The audit firm did not get access to the board minutes. This is a prerequisite for any audit and is in the engagement letter. This also was not duscussed with the audit committee due to the possible conflict with the fd. The audit partner should have enough exoerience ro be able to challenge management.

q2) there was a famiiarity threat to independence as the audit managers brother is now fc. This should hsve once again been discussed with the audit committee. The communication to management was sent 6 weeks after the audit report was signed. This was too late and should be ongoing communication about controls and any adjustments shiuld be advised prior to the audit report being signed. Cant remember what else but i may have just stated rhe obvious in the exam but i just ended up stating why what happened was wrong. Does anyone know the requirement of this area? Q5) immaterial hence no modification B) ias24 material by nature. Qualified except for a material misstatement C) was it %ge of 1 months revenue. This was confusing so i wrote immaterial.

Hi It was investment property IAS40 not 16

@tj200. Everything u have said like looks like me. I answered the questions in this same order and I’m a finalist too. Wish us the best of luck.

I think if the examiner wants to test us in audit then do so. But please don’t make the exam a race for time- which is unfair. You want us to plan, you want us to have a ligible handwriting, you want to see professional answers. It is reasonable to want to see those at a professional level. But we need time to plan and write these out legibly. I just hope you mark fairly with the not so legible handwriting. This paper is becoming unpopular with the lowest passing rate for the previous sitting. What do you guys think? Comments? Suggestions? Good luck everyone!

Practice management. mainly quality control

Q2 was about external quality control review and students had to comment on reviewers findings. firm wide Materiality policy (inappropriate use), Use of expert (Can't tag expert in audit opinion) and there's another matter too which i am forgetting.

@sahil1234 said: What was the answer to Q5 part a ,state 3 different types of missatements recognised in ISA 315 ?

Check latest article on ISA 450

i am just here to read comments as i will be sitting this paper in march ff

Interesting exam today. Very time pressured in my opinion, and one that I did not quite finish as I would have liked to. I did Q1 first, and this was very good in my opinion, lots of Audit risks available on the brand name that was not being amortised, online sales, detection risks, related party disclosures, intercompany transactions, inventory valuation, good will impairments and good will recognition, I even mentioned something on currency translation risks as the group was a world wide brand and therefore assumed sales must also be worldwide. The next part asked for some procudriews on inventory valuation and to finish by evaluating elements of what the composite auditor was proposing to do. Not bad - but it was for 10 marks and was probably the hardest part of the question. I then did Q3 on the procedures for the performance information and the matters and evidence, and again, I think this was a very good question, with lots of pretty easy marks available. The standards in use were IAS 16 PPE and IAS 20 on grants - anyone else agree with that here who did the question? The problems however started with Q2, which was complelty different to any quality control review seen. The review had been done, and we had to comment on the findings in an odd way which in the time we had, I just found difficult to really get. The first part, for 6 marks on the benefits and findings of cold reviews, was decent and I think I scored well on that, but overall, from 25 marks available, I think I probably got 7/8 marks which was disappointing. I then did Q4 on the ethics, and this was not as easy as I first assumed. The question was broken into 3 chunks and there were some obvious ethical issues. Definitely tricky but hopefully a pass overall. Overall, I am hopefully a good show in Q1 & Q3 will pull me through and make up for the poor show in Q2, but based on what I have read, everyone found Q2 hard so that's reassuring. Lol...

Q2 is horrible.I did not elaborate my point much due to running out of time :( What's the issue to write regarding the auditor did not have any engagement letter with auditor expert ?

Yes i found the number too large and confusing . i wasted a few minutes doubting my own judgement about whether it was billions they were giving us.

There are 1.8 minutes per point and it is vital to stick to this time... . I just find it impossible to finish the exam. You can not think, write and keep track of the time at the same time. I managed 80% of the exam and this is my third time sitting it.

Agree regarding the large balances, not necessary as time was an issue. Depreciation charge I said was not material, but if the error was discoverd in the other £100m other fixed assets it could become material, control risk should be reported to TCWG.

The loan mas material by nature due to it being a related party transaction

This was my final paper and a resit. Hoping for a pass but didn't revise quality control and ran out of time to properly answer Q1 - why was there no business risk? All my revision questions had that! Ended up bullet pointing the audit procedures in brief and for the component audit I just wrote bullet pointed questions that I should have answered by reading the text but didn't have time. Hoping for some half marks at least there! Q5, I said material if the dep'n issue was across as assets and material for the loan as it should be disclosed as a related party transaction and immaterial for the provision as they did have a a provision in No idea how well/badly I've done though - last time I was confident of a pass and got 44%!

Guys, relax re Q2. I have not heard a single good word about it, which means everyone will be in the same boat. Hoping they will release this question in the Sep/Dec 2017 sample questions so I can take a look (from a tutor's perspective), but in the mean time bear in mind that audit risk with a new acquisition and some audit tests is hardly an unpredictable Q1, and the ISA 450 article seems to have been tested a fair bit in Q5, both knowledge and then application. Swings and roundabouts people. However, I do worry when people say there were too many risks to write. What would you rather - not enough? If it is worth 16 marks then find 8 risks, explain them the right way, and you should be pushing 12/16 at least. If you have more than 8 and time is ticking, stop writing after 8. I worry even more when I read 1.8 mins a mark...

I agree acca didn't make it easy with the ridiculous balances.I got confused myself. PBT was material so that part was a qualified opinion. Depreciation wasnt material.

Yes I said they should of got permission to contact previous auditor to get professional clearance. Then went onto the ethical parts.

i went to a revision course with a guy that is a marker for this exam in london and that is what he says...multiply each mark by 1.8 minutes and thats your time allocation for the question . I tried to do it but its too hard! . Also he said that if you make a fundamental mistake like not mentioning money laundering anywhere in the exam your 60% can turn into a 49%..i

Well number 1 the exam is 195 mins, so it is 1.95 mins per mark. And number 2, if a marker does not know that I would be tempted not to have a huge amount of assurance about when they last marked...we have been 3 hrs and 15 mins for quite a while now. The comment re money laundering is ridiculous. The exam is marked in incremental half marks and you can leave out entire topics and still get 100%, because there are always a lot more than 100 marks worth of content available. If a student capable of 60 is getting 49, it will be for one of the following reasons: - forgot to explain enough of the points they raised - totally misread / misunderstood a large requirement (e.g. did business risks instead of audit risks) - did an audit report question with out of date knowledge If anything, too many students throw things like money laundering and going concern into as many answers as they can, without any justification, btw.

@rafayazhar said: How many finalists do we have here?

I am a finalist, and i will be extremely lucky if i pass. to make it worse i am under the seven year rule..so they will be taking away my p1,p5 and p3 exams. Kind or regret taking a break from the acca now ! damn i was sooo close to finish!

@arvind111 said: Q4 - anybody do this? Within the second section, did you talk about professional appointments and how the new auditor needs to speak to the previous auditor before accepting the new engagement?

I remember this one . I think that the point was that if the previous auditor does not reply it means that the potential client is categorized as risky.

He is a current marker.The 1.8 minutes comes from taking out the 15minutes that you need for planning,thinking , etc. Re money laundering, i am glad you say that because i couldn't find a topic in the exam to talk about it. I ended up mentioning it one of the ethics scenarios, but very broadly. Anyways..it's done! We will stop thinking about the exam in a few days hopefully :)

@machanga said: i went to a revision course with a guy that is a marker for this exam in london and that is what he says...multiply each mark by 1.8 minutes and thats your time allocation for the question . I tried to do it but its too hard! . Also he said that if you make a fundamental mistake like not mentioning money laundering anywhere in the exam your 60% can turn into a 49%..i

Who was the lecturer I heard the same thing aswell, surely cant be correct if its not warrabted in the question.

p7 lecturer at city colleges in Dublin

Hi Muhammad Husain I attempt part 1 part first and wrote that the benefit of QC is help in planning ,ehicaly engagement,paper work each work and don’t lose information.i leave the second part as out of time. Different materiality level used depends on risky balances ,also define materiality,touch a little bit performance materiality.not communicating to audit committee leading to scope limitation affect our work.and I think 2 or three professionals issues identified now I don’t no either I will secure 7/20 or not.