FRACCA Paper FR December 2020 Exam was.. Instant Poll and comments

Hi everyone, I was surprised that I did not see any lease or financial instrument in my exam. Very weird. Mainly contracts revenue, PPE, intangibles and Gain in Exchange rate. This in section A and B In section C one of the questions was to do a CSPL. I got that NCI was a profit but there was a loss attributable to the Parent company? Thank you

I found it really difficult -Part A was a disaster: A lot of questions on really abstract parts of the syllabus which included exceptions to the standards... It felt like, if you didn't know every exception it was 0 marks. I guess I'll be retaking in March! :(

I couldn't figure out how to calculate the NCI for the CSPL - there was no information there about the acquisition itself...?

part A was complete disaster .. full of contracts and consolidation disposals and grants

Weird that most imp chaps was excluded from this exam ... full of weird revene , grants , foreign exchange , group disposals ques only

You dont need that for CSPL. For profit and loss it is only the share of the profit of the subsidiary -share of PUP

I think I got the same section C question as you. I also got a profit for the NCI and a loss for the Parent company. I really struggled with the exam. I’ve done a lot of revision on consolidated sofp and financial instruments but neither came up. I’m just thankful statement of cash flows didn’t come up either!

True! I was expecting more important ifrs to be tested..and didnt pay much attention to he details of other chapters, and what a disaster, all came in section A and B

@sflynn120 Thanks for replying. What a relief. Please keep positive. Fingers crossed we will pass.

zulma85 wrote:You dont need that for CSPL. For profit and loss it is only the share of the profit of the subsidiary -share of PUP

Thanks zulma85, that's what I did. Perhaps it wasn't a total disaster (fingers crossed)

I thought I was the only one that got a loss of about 14300 for CSPL, However, my NCI was a profit. I really struggled with Ratio analysis of Section C. Bearly had enough time to attempt the 14marks Question. Section A & B were fair, not great.

Hi, Section C : I got SPLOCI and SOCE ..... Lots of workings required confusing where to adjust what. I might have made over adjustments which were not required, so not expecting much. 2 question was for disposal of subsidiary and working out gain or loss ..... might have got tripped...my workings led to loss on sale. I spent 2 hours on these questions....it is so hard to read such long questions. I should have done section B first followed by C and then A or maybe A and then C. My section A was full of P/l determination involving sale of subsidiary. Section B w

On the whole I felt paper was more heavy on Consolidation and group disposals.

isowamhen wrote:I thought I was the only one that got a loss of about 14300 for CSPL, However, my NCI was a profit.

There were some adjustment to make on NCI share of profit, such as Dep of PPE & Amortization of Brand

For working out SOCE .....did not have B/f figures in the questions....found tricky

The exam is really tough only focused on consolidation and disposal and few other chapters....surprised it left out so much of syllabus and focused on few. Anyone got ratio analysis question and is it profit or loss for the group's account?

It sounded like there were two lots of section c questions I had the consolidated sporl and the ratio question on the cheese business

I got ratio analysis but on Bike's co company disposing scooter co

I only adjusted the NCI share of profit for amortisation of brand, from memory their profit was about (3050-220)x20%. I thought the Property belonged to the Parent so wouldn’t affect the NCI? I also got ratio analysis for cheese business but my mind went blank for net asset turnover so didn’t put anything and also didn’t show gearing as a %. I left the 14 mark explanation question until last and only ended up writing a couple of lines!!!

Hi, did you have Int. version? I think my question 3 was an Oil company

NCI too a lose figure right? PUP should be reduced as subsidiary was the seller...

Sec B I had Leases, Revenue and Assets. Sec C I got Box Co with Ratio analysis And Python & Snake consolidated SOFP. Both section C’s were not too bad. Did anyone have these and how did you find them?

I got this one. Did you get gain or loss on disposal?

Second time I sat this exam. First time round I failed with 49% and most of the questions were about revenue recognition.. not my favourite section. This time round, I found the section A & B to be tricky but ok as I had practiced a lot of impairments, financial instruments and EPS. Section C.... first question I had the consolidated SPLOCI, really tough as Im sure I messed up on a lot of the workings but in general I knew the pro-forma and did pick up on the fact that the acquisition was a mid year purchase. Second question, Cheese business... loved it! every single ratio I had on lock as I practiced September 2016 exam a night before and the section C was near identical to it. I made solid comments on the CEO's comments about the financial performance and the state of the business and made a good argument (even though the ratios didn't support his comments) that the CEO wouldn't be saying anything else but praising the business considering the company is a listed entity! We need 50% ladies and gentleman! That is all

I had the python and snake question but I think I’ve messed it up as I had negative goodwill (bargain purchase situation). The ratios weren’t bad but didn’t reach conclusion in end as it looked pretty bad but could be redeemable! You could easily work out ratios even if you didn’t remember them using previous years. The first section really confused me with the what amount would be chargeable for the 32m: 23.5/ 23.8 etc question for the service over 2 years and goods question section and then it continued over another question in year 2 which I had no clue about, this didn’t seem to appear on BPP syllabus unless I missed it

no csfp or cspl very hard sum of Single entity sopl

Iraitis, please tell me what you had put for you’re comments on cheese business ? I put they were heavily debt financed but I don’t know if I was barking up the wrong tree ! Messed my consolidated sporl completely forgot to include the revaluation despite calculating the revised depreciation. Section a b was so hard ! No revenue % work completed contract, just discounted service package. Sale loss on disposal sub. Diluted eps. Contingent liabilities on goodwill of sub. No leases or loan notes, just urgh!! What was this paper?

i completely didnt realise there was a revaluation surplus to be included too, however accounted for the depreciation! i had a question in section B how to account for revenue commission as being a agent for a travel company? i put down the commission of £150 as revenue and remaining as liability is that correct? I also included very heavily debt but decent profitability.

@Nbhinder , i think i got profit of 3.9 mn after including profits of NCI share into NCI as we need to consider value of NCI on date of disposal

Hi Claire, Please don't accept my word as gospel as I did fail my first attempt. For the commentary I argued that since the cheese business is in a supermarket industry the profit margins are small and the gearing tends to be high as that is how these businesses operate. I then commented on CEO comments that while the overall ROCE has decreased (small amount) which was technically a contradiction to the CEOs comments about the ROCE. Even though the EPS had increased and net asset turnover showed it had increased also, the operating profit margin decreased largely thanks to the professional expenditure the company had to pay for to obtain the two new contracts with the suppliers. In terms of the CEO comments, since the company was a listed entity a negative comment of any sorts would greatly impact the share price of the business and its marketability to any potential investors in the future. I made the above comment following my observation that the business was highly geared and as such I recommended that in order for the company to seek future finance would be via a share issue rather than rights issue (less cash ultimately is received from rights issue) and that financing from further debt via bank would be a silly thing to do. Does that make sense? or am I talking out of my arse?