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I’m guessing that due to the length of Q1 everyone over ran it slightly, 1.5 marks per good point made so out of 14 that must be 8-9 points to explain plus marks for calculations of materiality regarding intangible assets etc.. Luckily ethics was big in this exam so most of Q2 and all of Q4 so finished everything just in time along with Q3 on quality control.
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i did it ..i think this was a material inconsistency between the FS and Other information basically ( the chairman report) .
@arvind111 said:
In the top paragraph it said that the auditors were appointed in Sept 17, mid way through the year they were auditing, which just opened the flood gates for many easy detection risks.i spotted this too…mid year engagement!
guys, in which question no. and which part was pfi ?
what did u write for q3 and q5 ?
i was really not confident, but were ur points…?so, q3 was quality control…what were the parts ?
q5 was reporting…did it hav any parts ?
where was pfi ?
@pallabyasin said:
where was pfi ?
PFI was Q2b can’t remember how many marks it was worth though
@tj200 said:
PFI was Q2b can’t remember how many marks it was worth thoughdo u remember what was it abt ?
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it was 9 marks and it was a revision a two year forecast on a company that designed cards..
@machanga said:
it was 9 marks and it was a revision a two year forecast on a company that designed cards..oww…thanksss ?? i remember now…hmmm…
so q 2 a and b were 8 and 8 marks each may be…ethics and due diligence, right ?!!
and q2 c was 9 marks pfi company making gift cards want assurance for bank overdraft facility…
q3 was quality control with 3 senarios…
q4 was ethics with may b 3 scenarios…
i gav q5…was reporting…was it one question with may b 3 scenarios ?!!
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i think q5 had 4 scenarios..or maybe Question 3. One of those did anyways
Q3 looked pretty hard to me and QC questions are always tricky. I dunno why so many ppl went for it.
Pretty sure Q3 had 4 scenarios .
Only reason I did Q3 was because I had 20 minutes left and it looked like the easier question (out of Q3 & Q5) to pick up marks on. Hopefully I was right.
what did you guys wrote about Qn1aii. Identify and explain the matters which the audit team should approach with professional scepticism.
I only wrote about forex miscalculations on revenue/receivables, impairment of assets, disclosures about ops segments and intangible assets.
the rest of issues I wrote for Q1ai Audit risk – inherent, control or detection
and i messed up the other Qns
This was my third attempt at P7 and probably the nicest paper yet. I over ran on Q1 like everyone else by the sounds of it and only near the end remembered I read it was a new client so right at the end added a sentence or two on that. Not enough time to answer Q1 well I didn’t think.
I chose questions 3 and 4 but spent a good 5 minutes deciding whether to do 3 or 5 so hope I made the right choice.
I felt a lot more preapred but missed a lot of points I think because this exam is so time pressured and so broad.Hi all – I think this was a very fair paper. Good questions with plenty of marks available!
Couple of points which I am hoping people who did the same questions can confirm/challenge
Q1, part B –
I described what professional scepticism was, and then explained the cooperate governance issue with the CFO and Audit commitee being weak. I also mentioned something on the politcal un-rest and how this could be an area of concern, and also something on the client lacking accounting knowledge (abit vague)
What did others write here as after the corporate governance stuff, I didn’t really see too much?
Q4, part A
I explained that this may be a Noclar issue as there had been a theft in the year and the cfo was saying to not report to authorities/regulatory body and therefore matter should be discussed with those charged with governance?
Other points
Intimidation
Potentially get legal advice
Discuss intimidation threats with audit committee
Odd that we discovered issue via board minutes and were not told about it – may be other problems- Topics: 0
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I’m a tutor not a student and have not seen the paper. But based on feedback from students, including what I have read on here, a few observations. Hopefully these will make you happier not sadder!
Q1, audit risk, a group with an overseas sub and its own auditor, and sub bought during the year? If that is all true, immediate audit risks (without the time pressure of reading the story detail) will be mid year acqn making pre and post acqn reserves fiddly, forex retranslation of the sub, goodwill initial calc at FV = subjective, need for a y/e goodwill impairment review (so a risk of overstatement if not done), IFRS 12 under-disclosure, if group is listed then new sub perhaps a new operating segment for IFRS 8 disclosure. For 14 marks, there are enough risks in that list to get full marks, if well explained, whatever the rest of the story says.
But … with risks it is ALL about the explanation quality.
Q2 re significant component, it is significant if it is significant! It is NOT just about a calculation. The 15% threshold is not a rule – it is given as an example of what a firm might choose to do, in the appendix of ISA 600, it is certainly not fixed threshold. The point is that the bigger a sub is, the bigger the risk that an error in the sub could be material at group level. If the sub was overseas and needed translating, that itself could deem it significant.
As for time management I say this every 3 months … on every Q1 on P7 you need to write 31 marks of content and aim for the 4 Prof Marks. They are therefore all equal in terms of time needed. If a scenario is longer, that should not cause a problem, because the risks are separate – read enough to find 7 issues (as it was 14 marks), explain the risks in the normal way, and you will score 1-1.5 marks per explanation and pass.
From my experience, risk questions are not difficult to pass. It is the supposedly simple ethics questions where the explanations are often weak or non-existent, and yet I cannot see much (if any) feedback on that question on here.
Anyway what’s done is done folks, so good luck with results and let’s hope the pass rate is well above 30%…
kwakwa, time pressure that’s what everyone is saying. i recognised that i was left with only about an hour and fifteen minutes more after completing question one. this is my third attempt and pray that i pass because my time is running fast if after some period my already ”P” passes will be cancelled.
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