*** ACCA Paper AAA December 2019 Exam was.. Instant Poll and comments ***

@cjacko said:
Which Qu was this, the one asking what extra info would be needed?

Q3A

@uzair52 said:
Q3a was about the matters to query with manager about intangible assets
And part 2 what additional information needed on their financing

Mind sharing how you answered it?

@ezehrobinson said:
Mind sharing how you answered it?

I struggled with the intangibles part. The requirement asked for ‘specific’ questions to ask management and there wasn’t much to glean from the info (unless I totally missed it), so I said inquire about any known or suspected breaches of the licensing regulations and for the patent – was there any new technological advances or processes that management was aware of that might affect the value of the patent.

@Fidget said:
I struggled with the intangibles part. The requirement asked for ‘specific’ questions to ask management and there wasn’t much to glean from the info (unless I totally missed it), so I said inquire about any known or suspected breaches of the licensing regulations and for the patent – was there any new technological advances or processes that management was aware of that might affect the value of the patent.

I struggled too on that question.

How about the second part on Financing?

@ezehrobinson said:
I struggled too on that question.

How about the second part on Financing?

For financing I added;

Venture Capital – are there are any terms or bonus targets which may impact funding or result in additional costs
Loan – are there are covenants which could be breached risking PPE
D/E ratio compare to prior year, has Gearing deteriorated?

@kbourne said:
Yep i did. It was an audit risk but also the procedures in part c(i) related to that. Stated it was material and possibly overstated if fair value estimation not accurate

Yes, I did too under IFRS5 reporting as a discontinued operation.

Business Risks-dependence on local farmers,international trading risks,Brand power threats,legal case, Redundancy…???

I had Modified (material misstatement), not modified (immaterial misstatement) and Modified (for luck of disclosure of contingent per IFRS requirement).. In that order 🙂

I calculated 1000 options * 1.7 FV * 1000 employees=1700000/1000000 to convert it into millions so got 1.7 and it was material so recognise the expense over the vesting period.

Yeah I wrote discontinued operations as an audit risk and pretty confident that was one.

@emwitton said:
Oh no. After reading all these comments I don’t feel as though I have written professionally enough or covered enough area to obtain a pass. Everything I commented on was pretty obvious and basic and definitely didn’t write enough about the audit risks. I really struggled to find them. Ethics was fairly straightforward but now I’m questioning whether I did that well enough!

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.

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 😉

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?