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AAA*** ACCA Paper AAA September 2018 Exam was.. Instant Poll and comments ***
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@lukman94 said: It was a new client as the question said “was assigned to the audit “ - apart from this it wasn’t very clear. Audit risks for Q1 were as follows ; - Listed Entity - risk of management bias I.e reversal of provisions - New client - risk if misstated opening balanced - Reliance on component auditor - risk of reduced audit quality - Intangible Assets - included research costs, overstating assets and profit. - finance costs not in line with increase in borrowing - PPE increased with no sign of capex or depreciation - goodwill increased by 130, 30 being unaccounted for. Risk of overstatement - decline in revenue and Increased competition could merit impairment. Ethical issues in Q1 - Integrated Report ; Management responsibility + Self review threat. Mgt responsibility cannot be mitigated, decline request. Self review can be mitigated by use of different teams, howerver listed status would require to decline. Q2 - Uncorrected Statements Brief intro talking about how misstatements should be discussed with management and those charged with governance before modifying report. Leases - Qualified - Not pervasive Claims - Adverse - Material to both profit and assets. Aggregate impact of leases and claims - Adverse opinion Assets - Not material- Unmodofied This is all I remember. Please feel free to add on to this,Q3 on forecasted profit n loss Refer to latest sample from acca. It almost the same
@jmmyjimmy said: Regarding case 2, I have put pervasive as the misstatement represents 50% of pbt. Do you think it is a mistake?I would say no. Did you give the fact that it effect Assets, expenses and disclosures as another justification for saying it was pervasive? So more than one FS item for example. I think we’re okay as long as we did give a solid argument. And it was adverse of course because it would be down to a disagreement. Them not wanting to recognize a major, major court action worth 1.2 million against the company by canceling out the liability and pretending it never happened sounds very pervasive alone.
what a terrible paper - i sat the UK version where the breakdown of marks isnt provided for question 1 - i dont suppose anyone could help me out with the split at all please?
Thanks alot!
looks like i might of done this wrong... i put £1.2m wasnt material to the PBT because it represented 5% (thoughts the PBT was £22m... probably read that bit wrong) therefore would give a qualified opinion as its unlikely to be pervasive to all the financial statements ??? .. ops! going with everyones previous comments looks like ive done it wrong!
I know the audit risk part was 24 marks but I also did UK.
What did you put for question 3 part b regarding the implications to the directors of Krupt Ltd?
Sat the UK variant.
Q1 agree very lengthy but plenty to go at so not overly concerned I didnt get everything that you guys have validly flagged, I think 10 or so solid points will be decent enough.
Other elements of part 1, being procedures on acq goodwill (good q), the component auditor (so so for me) and ethical points (usual rush to stick to exam technique plan I set myself!)
Q2 I got the same as Billy - lease issue my tech was rusty but think other bits were ok.
Q3 part a was great and part b was fantastic as i’m a qualified insolvency practitioner and work doing pfi reviews and insolvency.
Paper overall was fair from difficulty perspective imo but time was ridiculous for volume of info in 1.
@jmmyjimmy said: Regarding case 2, I have put pervasive as the misstatement represents 50% of pbt. Do you think it is a mistake?There is a question on lease which state that the lease agreement do not permit the firm to purchase the asset. that implies it will never be in control on the equipment. As fat as i know it is an operating lease, but in the question it had been classified as finance? anyone can clear this pls>?
Questionn 1 required a lot of planning before hand. obviously get the 5 marks for the ratios and the n you need 9 risks to give yu 24 marks. i only wrote 7-8 risks because of time but i still had more risks in the tank. I think it was where i did well because i chose my best and most obvious risks as per analytical procedure.
question 1 had a lot of easy marks .
1.evaluation of audit strategy 10 marks
2.audit risks 24 marks
3.goodwill procedures 6 marks
4. ethical and professional considerations on integrated reporting service engagement (e
question 3
legal claim 5 marks
impairment 5 marks
lease 7 marks (very hard for me )
review of audit planning and perfomance 8 marks (easy marks but time was limited)
question 2
consideration before accepting review engagement. 6 marks
procedures for auditing forecast. 9 marks ( saved me som time as i race through)
ethical and professional considerations arising from loan to audit member and request for secondment 10 marks ?
It was unfair paper at all and ridiculously long exam. I would really wonder if anybody could finish off everything in 3h15minutes. It wasn't tough in terms of knowledge and I would score 90 if I can answer verbally. I took 40 minutes only reading and trying to understand how to approach Q1!!
@robertoh said: Sat the UK variant. Q1 agree very lengthy but plenty to go at so not overly concerned I didnt get everything that you guys have validly flagged, I think 10 or so solid points will be decent enough. Other elements of part 1, being procedures on acq goodwill (good q), the component auditor (so so for me) and ethical points (usual rush to stick to exam technique plan I set myself!) Q2 I got the same as Billy - lease issue my tech was rusty but think other bits were ok. Q3 part a was great and part b was fantastic as i’m a qualified insolvency practitioner and work doing pfi reviews and insolvency. Paper overall was fair from difficulty perspective imo but time was ridiculous for volume of info in 1.I agree to a certain extent. Volume of info mean there was plenty to chose from which is better than looking a scenario then having to imagine answers. time management is of the essence. you just have to stop!! you cant write endlessly . aim for at least 3/4 of the marks a if you are running out of time then you can fall back to 50 %. if you go for all the marks in question 1 you will definitely lose out on easier marks.
Agree - you have to be disciplined and think exam technique. You get 4 marks for setting it out neatly and like briefing notes so you start with that before even reading the question (or at least I do). I spend first 5 mins annotating time at which I stop writing about each part of the question and leave half a page minimum after each part so then can go back if my knowledge is weak in some areas compared to others.
I don’t understand why people insist on spending a disproportionate amount of time on q1 in the exam? All the kaplan/lse/bpp tutors tell us this day 1!
Suppose exam pressure sometimes throws people off but i’ll stick to the plan for APM on Weds
It is more of how you deal with volume than knowledge.And for people with poor handwriting like me....May God help us.
Such a joke of an exam. How on earth can we be expected to finish such a lengthy paper in 3.15hrs? I believe even the examiners cannot achieve such a feat. It is simply ridiculous.
I could hardly think straight/digest the information in question 1 before rushing to write down my answer, no time to process the complex information. This is not a true test of students' knowledge at all, with the way the exam is always time pressured.
Any way we can petition/lay an effective complaint about this? Who or what body regulates ACCA anyways?
@dumonde said: Exam was very similar to the pilot paper on the website as you’d expect but my goodness it was longer.... Examiner must think it is a four hour exam with the amount of read time required. I don’t understand, ACCA are looking for professional people giving professional answers but then you’re expected to respond well to that, it’s just incredible. Where was the mark allocation for question 1. Was it just make it up as you go along. Wow, wow, wowMore like ridiculous..ACCA seem to be looking for professional speed writers rather because I do not understand how they expect students to process so much information in so little time, with exam nerves and still produce decent answers. In the real world, professionals are definitely not giving advice under such conditions.
I see that it says Auditor was appointed to audit group...
@jmmyjimmy said: Regarding case 2, I have put pervasive as the misstatement represents 50% of pbt. Do you think it is a mistake?What I learn is that if the misstatement is more than 60% of PBT, it should be adverse. So less than 60%, I think still Qualified.
Dear jdealy same is the case here when a survey email come from Acca mention in it two things that paper was tough and long
Q1.a.24 marks and audit risk
Why emphasis paragraph he didn’t record anything it may be KAM if I am not wrong
Not a new client. Same is the case only two questions attempt .
In Acca survey Email please mention that paper was tough and lengthy as it will have effect on marking.00923159350593
Based on 18% I calculated it.
00923159350593
@vikar said: Not a new client. Same is the case only two questions attempt . In Acca survey Email please mention that paper was tough and lengthy as it will have effect on marking.00923159350593
It seems like no one talks about Analytical Procedures?
Last sitting I got 49 Marks. I think I would have performed little better than last sitting but everything is depending on the examiner and the marking team. Severe time pressured paper. We have to read a very lengthy paragraph for question 1. For me the question 1 ,I have spent more than 1 hour and 55 minutes. For the second question I have spent 45 minutes and for the last question I have left with less than 35 minutes. In order to answer the last 10 marks question I had only 12 minutes left and again I have to read another lengthy paragraph. I had no alternative other than reading one or two sentences every time picking up an issue and writing in the answer booklet , again reading two more sentences & so on..... . The real difficulty is it may take more than one hour & 15 minutes to read and grasp the question paper and only 2 hours left to answer.
8y ago#55The leases should be capitalized or expensed as less than of 6 months and with no purchase option. Or it is compulsory that amount should not be material. The client capitalized 2 and 1 did not, what was the right treatment.
//What I learn is that if the misstatement is more than 60% of PBT, it should be adverse. So less than 60%, I think still Qualified.// Yes. I also agree and in my answer I have stated it is not pervasive.
I did a table at start of answer with 5/6 APs in there - talked about revenue changes in light or Lynx acq and the fact profit hadnt moved directionally as expected - mgt bias etc - linking in the Lynx acq.
Most other APs I commented on tended to be SOFP related - ie goodwill going up 30m if you strip out Lynx acq etc.
I calculated only 5 ratio like: OPM, ROCE, Interest cover, Tax rate, Current ratio. But I talked only about OPM and ROCE together, Tax rate, and Current ratio. But m not sure if I talked about Current ratio right or not.
I am also prepared for Analytical Procedures question, but when in exam, I feel so nervous that I almost forgot what I need to do. Really pressurised.
Any idea?
@raoul7370 said: most exchange differences on retranslating a sub go to P or L, not OCI. But these harder accounting issues are not what fails people so are best not worrying about. The moment you see a new sub acquired, that is overseas, even if story says same year end, they use IFRS and have same acc policies, and even with story saying ignore disclosure risks (I did not do the exam but am told it said that?), you have at least 4 audit risks (initial GW, impaired GW at y/e, forex retranslation, pre v post acqn reserves calc). That is 8 marks if well explained. Add on 6 for ratios, 3 for Prof Marks, and surely there are 4 standard goodwill tests on any company and you have 21 already having barely touched the scenario (if at all). No controls testing, and use of IA staff, must be worth at least 2 easy marks? That's 23 and still haven't read the story that everyone will always say is too long. Pass the question on easy to get marks first. Read 3-4 paragraphs of scenario to find another 3-4 accounting areas for audit risks, then ditch Q1 completely, or alternatively tell yourself you are safe, stop Q1 after 97.5 mins, and job done. But if you have fallen foul to overrunning due to a failure to do the above, worry not (well not too much). So many people will have done the same, and surely ACCA want a pass rate no worse than 30%? If you have written answers in a decent technique then even if you haven't finished I am sure you will be safely through :)Per Stow Group in December 2013, it also talks about exchange difference arises from translating Subsi that gain/loss goes to OCI, not P/L. I think you should check it.
@jmmyjimmy said: Regarding case 2, I have put pervasive as the misstatement represents 50% of pbt. Do you think it is a mistake?What I learn is that if the misstatement isnore than 60% of PBT, it should be adverse. So less than 60%, I think still Qualified.
@reazdusmahomed said: There is a question on lease which state that the lease agreement do not permit the firm to purchase the asset. that implies it will never be in control on the equipment. As fat as i know it is an operating lease, but in the question it had been classified as finance? anyone can clear this pls>?No more operating or finance lease for Lessee. All are accounted the same for Lessee if it is a lease.
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