How was your AAA exam? Please post your comments below, and vote in the Instant Poll
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AAA*** ACCA Paper AAA December 2019 Exam was.. Instant Poll and comments ***
Yeah I wrote discontinued operations as an audit risk and pretty confident that was one.
Can anyone remember what the actual questions were?
I'm trying to total up where I might have scraped a pass!
Just didn’t have enough time for Q1 - so much info to digest. Definitely missed a lot of audit risks - thought I’d have time to go back. Just didn’t want to jeopardise the rest of the paper. I thought Q2 was ok. Just wasn’t sure about the lack of information in relation to the legal case. I said it should be disclosed, it it wasn’t disclosed it could be adverse opinion & possible disclaimer if no further info could be received? It would be detrimental to the business. The first one was qualified and the second was not material.
I wrote that this was a contingent liability as it was only possible, but that it should be disclosed. However not pervasive to the financial statements as a whole therefore qualified opinion. I also stated the forward contracts were immaterial but should still be corrected in line with ISA 450. Just threw that in hoping to grab 1/2 a mark ;)
@sal2222 said: I won’t worry so much as long as what you wrote was well explained you should have done well. I didn’t feel time pressure because I did what I knew and moved on, I tried not to stress as that then would have effected the quality of my next answer. Didn’t answer everything but managed to do what I knew, hope it’s enough. I think I got the opinion questions wrong :( I did modified except for for the first. Then unmodified and last one on legal action was modified except for. :/ I think I got most of the risks and procedures. I did 5 business risk for 2 marks each and about 8 or 9 audit risks including detection first on opening balances. There was a lot going on so lots of risks to pick out. Procedures were straight forward inspection of minutes of meetings about closure of mill, physical inspection of mill and machinery for existence, inspection of non current register to confirm carrying value, request external expert for valuation of mill to compare to carrying value. Share base procedures were inspect fair value of shares, inspect payroll leavers file to confirm staff turnover, inspect documents of terms and conditions of shares. Question 2 was the toughest I thought.You are making me feel better about my script, phew ? I put about 5 business risks down and only managed 6 audit risks even know probably needed 10 to get the full 20 marks. Hopefully got at least 15/30 plus the 3 professional marks. Procedures were easy enough for sure pretty confident about IFRS5
@aynat said: Q1 audit risk- there is no discontinued operation, since there is only plan to transfer the activity? Or I read wrong the task? So far I understood, there is machinery held for sale if the criteria are met. My English in not perfect and when I am nervous- it is even worser than I can. Kindly reply my- there was plan to relocate , or the relocation have been done in the reporting year?There was a plan to relocate hence provision due under IAS37. I called it as asset held for sale as it referred to the machinery only. However I mentioned discontinued operation as a possible disclosure requirement in the procedures
@aynat said: But there is yet NO announcements have been made to employee, so the criteria are not met for such provision.Indeed. But we weren’t given the financials either, so I just stated what the requirements of IAS37 were, and that of met, a provision should be recorded. It also wasn’t clear if this had been provided for.
@aynat said: But there is yet NO announcements have been made to employee, so the criteria are not met for such provision.Management has started to implement that plan by appoiting surveyor and negotiating with buyer so provision for redundancy could be recorded.
@aynat said: Yes, of course. (1000*1.7*(1000-150))/3 Yes?Was it 2.5 FV at grant date or 1.7?and no of employees to taken were 1000.
@syeduzairnaqvi said: Was it 2.5 FV at grant date or 1.7?and no of employees to taken were 1000.I thought this is the equity share based payment then it should be recognized with FV at grant date ($1.7) over vesting period of 3 years (as issued from 1.Oct.20X4) Many marks for ethical issues and i don't have enough time to think and point out clearly. Feel under-expected with my working :(
Overall fair exam, no nasty surprises although after reading some answers in here I didn’t pick up the assets held for sale and discontinued operations, ran out of time, took too long reading Q1, a lot of marks on ethics which I was happy about!
Had a feeling intangible assets would come in and impairment!
Surprised to see audit risk especially as they were tested in Sept sitting.
But overall good exam could have wrote for another 3 hours to be honest!
@ezehrobinson said: Here's the risk I identified Foreign Subsidiary Opening balance Restructuring cost Held for sale Share based payment Capitalization of construction Which other one did you identify? I missed capitatization of construction and was hazy on held for sale! I did also have: Business strategy - not well thought out, move away from traditional luxury customers to mass market Raw material prices - likely to go up, pressure on margins and do need to ship out to new factory Employees - being skilled are a key resource, would new employees have the same level of expertise But I found it difficult to quantify things for Audit risk - can anyone remember how many marks were for Audit Risk? I can't make up the 50 marks breakdown for Q1.
it was 10 marks for business risks, 20 for audit, 14 for procedures and 6 for internal audit I think?
Also for audit risks I did :
- new client
- assets held for sale/disc. operation
- development and research capex
- inventory - possible impairment due to flood
- share based payments
- listed client : possibility of earnings management/ additional disclosures
- FX (this one was a long shot...)
- revenue and operating expenses poss. misstatement
- possible impairment of investment due to drop in revenue
- possible provision for redundancies - it wasn't clear if they will be announced in that year so just said if announced then provision should be booked
anyone had anything else?
@aniam said: Also for audit risks I did : - new client - assets held for sale/disc. operation - development and research capex - inventory - possible impairment due to flood - share based payments - listed client : possibility of earnings management/ additional disclosures - FX (this one was a long shot...) - revenue and operating expenses poss. misstatement - possible impairment of investment due to drop in revenue - possible provision for redundancies - it wasn't clear if they will be announced in that year so just said if announced then provision should be booked anyone had anything else?Insurance claim receivable could have been recorded despite not covered in policy
@aniam said: Also for audit risks I did : - new client - assets held for sale/disc. operation - development and research capex - inventory - possible impairment due to flood - share based payments - listed client : possibility of earnings management/ additional disclosures - FX (this one was a long shot...) - revenue and operating expenses poss. misstatement - possible impairment of investment due to drop in revenue - possible provision for redundancies - it wasn't clear if they will be announced in that year so just said if announced then provision should be booked anyone had anything else?Branch could be recorded as subsidiary and consolidated
Hello
All I always read comments after exams finish most people thinks n describe like me that exam was like that I was run out of time that question was hard this question I did not understand bla bla bla but when result comes out mostly who commented negativity how they pass I wonder ? It's been my 4th attempt of P7 last time my exam went very well stil could not pass I think like all u guys but wonder when I see the review after result the negative things turn to positive n most of you pass the exam is that luck ? Or is that some people don't openely tell how they actually attempted tha exam !!!!!
@aynat said: But there is yet NO announcements have been made to employee, so the criteria are not met for such provision.I considered this from both angles. Remember that the date was 1 July 20x5, and the year end was 30 Sept 20x5, so there was still time for the announcement which would require a provision if announcement made, or no provision if no announcement made. There was a risk that a provision would be created when it shouldn't've been, or vice versa depending upon the position at 30 Sept.
@ezehrobinson said: I thought the last sentence said they're treating it like subsidiary I didn't see the flood issue. I believe it is because of time pressureNo, it said they were treating it as a branch and not a subsidiary. The flood issue was one of the last pieces of information given in the question.
Will patent (brand name) be considered for impairment?
6y ago#51@ezehrobinson said: I think one have to strategize on passing professional level. If one can attempt the 50 Mark and 25 Mark very well and use any remaining time to touch the last 25, the person would be guaranteed to score above 50. In our quest our attempting all,we may produce low quality answerAs someone who has marked the real exam, I can tell you the exact opposite is true. I would say the vast majority of students would be doing well to score more than around 42/43 out of 75, so are going to need at least 7 or 8 marks on the final 25 marker. That is a bit more than a "touch". I would suggest you need to spend a minimum of 30 mins on each of the 25 markers to stand a reasonable chance of passing overall.
6y ago#52@sal2222 said: 3 marks for audit risk if it had materiality. Although this is limited to 4 marks for materiality. So I calculated you need about 8 risks so you may have only missed out on 4 marks hopefully. I think I wrote to recognise contingent asset you need to be able to measure reliably and has to be virtually certain. If it's probable it's a disclosure. But am wondering if it still needed to be measured reliably. Oh well. Might have picked up one or 2 marksIf audit risk is worth 20 marks and there is no requirement to do analytical calcs, my experience as a marker is that there will be 2 materiality calcs marks (for items that you believe are audit risks). I have seen this stretch to 3 on occasion, but would always presume 2 and therefore be aiming for 9x2m risks and 18m overall. But ... and this is important ... 6 reasonably explained risks at an average of 1.5 marks, plus 2 materiality calcs, is 11/20 and a pass on that part. If the procedures part of Q1 asked for tests on IFRS5 and IFRS2, then there are two of your audit risks immediately (otherwise you would not be asked for procedures on them), so if you can find another 4 audit risks welcome to Safetyville, Population = you :).
6y ago#53@Fidget said: I considered this from both angles. Remember that the date was 1 July 20x5, and the year end was 30 Sept 20x5, so there was still time for the announcement which would require a provision if announcement made, or no provision if no announcement made. There was a risk that a provision would be created when it shouldn't've been, or vice versa depending upon the position at 30 Sept.I have not seen the question, but given Q1 is planning and typically set BEFORE the accounting year has finished, there is no way of concluding on the accounting treatment for things like this because, as you quite correctly state, there is still time for the conditions to be met. Even if the conditions for a provision already exist on 1 July X5, the provision might not be needed at 30 September as it could already have been paid. So good point, well made! Also, bear in mind the audit procedures in part c would be tests to be done on the final audit visit (primarily) and therefore AFTER the year end, meaning you could then check if an announcement HAD occurred, and if the HFS conditions WERE all in place.
6y ago#54@aynat said: I did not catch that the date of Risk assessment is 01/07/2015. But i caught that there is NO word "announcement", just "reminder was not made". And I briefly discussed this point. But definitely you are right that they have time to make announcement.There is no need to "catch" that information. The entire AAA exam is set based on today's date being 1 July 20X5 (a rule that came in from the Sep19 sitting), so you should have walked into the exam hall with info already "caught"!!!
6y ago#55Is the following close to correct everyone?
Q1
Business risks for 10 marks
Audit risks for 20 marks
Audit procedures on IFRS5 and IFRS2 for 10 marks
Reliance on internal audit for 6 marks
Prof Marks = 4 (for Briefing notes)
Q2
Matters to consider, and Impact on Audit Report for 3 separate scenarios (17 marks):
- PPE
- Hedging
- Legal Claim
anyone know the marks split on the above?
Ethics and Prof Issues for 8 marks
Q3
Intangible assets and the financing of those, additional info required from discussion with management = 14 marks
Ethics and Prof Issues for 11 marks
@aynat said: Great! Thank you! Can you please explain about DD request. The question was " Within DD work, Auditor must assess target company (specifically Intangible Assets) Which enquirers will you send to the Target Company"s management?" I wrote several sentences, every of which was beginning from " Kindly, provide us with the following..." and then I listed: Licence Agreement with details, opening balance figures, calculation of amortization, Confirmation letter regarding alternative use of that intangible assets. I have never seen such requirements in Past Papers.... Thanks in Advance!I struggled with this part. The requirement was what *specific questions* would you ask management in relation to the intangible assets. So it wasn't asking what info you would need about them such agreement details etc. The intangibles were a license and a patent. In relation to the licenses I said ask if there's been any previous, current or suspected breaches of the licensing agreement to assess risk of fines or loss of license. For the patent I said ask if they are aware of any developments in processes or emerging competition to assess risk of impairment. Couldn't think of anything else. In hindsight, I think other questions would be how does management ensure that licensing conditions are being adhered to, and how does it test the patent for impairment. Too late now!
@raoul7370 said: Is the following close to correct everyone? Q1 Business risks for 10 marks Audit risks for 20 marks Audit procedures on IFRS5 and IFRS2 for 10 marks Reliance on internal audit for 6 marks Prof Marks = 4 (for Briefing notes) Q2 Matters to consider, and Impact on Audit Report for 3 separate scenarios (17 marks): - PPE - Hedging - Legal Claim anyone know the marks split on the above? Ethics and Prof Issues for 8 marks Q3 Intangible assets and the financing of those, additional info required from discussion with management = 14 marks Ethics and Prof Issues for 11 marksQ1: Yes, that was the mark allocation. Q2: There wasn't a split of marks for the 3 scenarios - they were worth 12 marks with no split between them given. The audit opinion was worth 5 marks and 8 marks for the ethics part. Q3: The requirement for 14 marks (no split given) was: i. What specific questions would you ask management in relation to the intangible assets. ii. What additional information would you need to be available in respect of financing. 11 marks for professional & ethical considerations.
Can anyone remember the requirement of Question 3 part (a)-1 & 2. Is there a procedure for intangible assets on Due diligence report in Part (a) -1 and Additional Information for financing arrangement?
6y ago#59@aynat said: Do you have any source of this information? Thanks!!Yes. Source is the ACCA examining team, who informed all tutors of this in early 2019.. So your tutor should have told you, and the past exam questions in your question bank should all have dates that say 20X4, 20X5 etc instead of real dates, and every question should tell you to assume today's date is 1 July 20X5. ACCA themselves will not update past Q+A on accaglobal so those questions will still have the original dates in them (which were real dates - i.e. a planning question in December 2016 paper would probably say the year end is 31 December 2016, and therefore 3-4 weeks in the future).
@aynat said: Do you have any source of this information? Thanks!!I have a Kaplan exam kit, and it says it in the 'paper specific information' at the front of the book. It says the 'current' date will be 01/07/20x5.
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