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This is day 01 there are 4 days. It is on youtube.
I said it was subsidiary but was not sure… as C had majority control and influence over the board for major decisions.
Is this correct?
I believe that C had control. Without veto it would have likely been a JV, but it said with Veto thus giving C effective control. See my post on page 2 with link.
Thanks to u all for ur kind gesture. I do really appreciate. I will advise at this junction that candidate should endeavor to read ACCA materials on line titled TRANSITION FROM P2 TO SBR. I have read this material. I am not surprised that the essence of calculator in the SBR march exams was almost useless.
Best of Luck to u guys.
for q4, i wondering that is it the same for EBITDA and debt to earning before interest,tax,depreciation and Amortisation ?
i get confused when i see the question..about the veto,i follow the IFRS 11, i think if i can veto the decision but other 4 board member can stand together to veto my decision too….so i believed it doesn’t control….
I think it is an associate based on the following example:
C holds 45% of the voting rights of D. The other 55% of D is held by two shareholders (each holds 26%), with the remaining 3% held by three other shareholders, each holding 1%.
C does not have power over D, because the two other significant shareholders (i.e., a relatively small number) could easily cooperate to outvote C. The size of C’s holding, and size of that holding relative to other shareholders, would not give it power.I don’t know if it is correct, but that’s what the thing was in my mind during the exam….
I think after reading al other commentary this one is the most sensible. Unfortunately I got this wrong in the exam.
@mehwishnaeem said:
I chose Subsidiary I don’t knowI also chosed Subsidiary and account for with Acquisition method
@badare said:
Question a: this was Joint venture as it fulfulled the joint venture requirement.1. the joint arrangement has separate entity- i think Kuran
2. Major decisions regarding the entity require unanimous decision of all parties
therefore should be accounted as joint venture in that ,Cyrpto should account their share of the assets and liabilities ( 45%) in Kuran.This was definitely not a subsidiary or associate
bcos in subsidiary the parent has control and makes all decisions
in associate also one entity has control and makes all decision.
also it is not joint operation as there is no separate entity in joint operationAnd where was unanimous decision required in this case?
@newington said:
I believe that C had control. Without veto it would have likely been a JV, but it said with Veto thus giving C effective control. See my post on page 2 with link.The issue with that is Crypto does not have control under the current arrangement as VETO does not mean control but only to stop others in making decisions. Control means the power to direct and make decisions over the entity and Crypto alone can not make decisions. if under the current arrangement, Crypto enjoyed control over Karun , they will be able to stop any changes to that arrangement through the use of veto but the current arrangement requires majority which they don’t have.
@kanchandhankar said:
I remember reporting date was 31 dec 20×6 but date of disposal of subsidiary was 31 sep 20×6I assumed goodwill and assets needs to be retranslated before the disposal as sales proceeds was in dollar.
There was some impairment in year ended 20×5
If I remember correctly My goodwill was 42m Dinars and after impairment it was 36 ?
Functional currency q marks was 7 marks
Calculation of goodwill on acq and just before disposal and exch diff was 5 marks
Discuss goodwill calculation and exch diff was 5
Calculation of profit or loss on disposal 3 marks (I remember mine was profit)Same result here for goodwill but then it was supposed to be translated in dollars with Sep 20×6 rate
@tinolo1988 said:
I think it is an associate based on the following example:C holds 45% of the voting rights of D. The other 55% of D is held by two shareholders (each holds 26%), with the remaining 3% held by three other shareholders, each holding 1%.
C does not have power over D, because the two other significant shareholders (i.e., a relatively small number) could easily cooperate to outvote C. The size of C’s holding, and size of that holding relative to other shareholders, would not give it power.I don’t know if it is correct, but that’s what the thing was in my mind during the exam….
Definitely not associate
Associate would mean that Cyrpto had only significant influence.And Significant influence is the power to participate in the financial and operating policy decisions of the investee but is
not control or joint control of those policies.with its veto, C had joint control because no decision can go through without its approval
likewise C can not approve a decision without others agreeing to itCrypto just holding the 45% share but not voting rights and Crypto can appoint 4 board member which is half of the board…i think this is different case
@93kiwi said:
Thoughts from attempting this exam.I felt it was very time pressured exam having to rush two questions.
Didn’t think there was enough time to sit and think (plan) what the questions were asking with info provided in the scenario.Question 3 was a disaster for me, I would be surprised if I scored any marks on this one.
I looked through the whole paper, and was shocked to see Foreign Sub as Q1.
But saw Q4 and thought probably will be able to gain most marks here (in my opinion this was a nice question if you knew the contents)But I found it difficult to relate the scenario with questions… so wrote was whatever came into my mind.
I don’t know if I will pass, not sure if gained enough marks as answers were not as detailed due to time pressure.
Fingers crossed, have done enough to get 50.
I had the same approach
@mari15 said:
Same result here for goodwill but then it was supposed to be translated in dollars with Sep 20×6 rateYes I translated it at sep 20×6 for goodwill just before disposal .
We needed to calculate exch diff as well.
I did translate at dec 2×15 rate and calculated the exch diff.@tinolo1988 said:
I think it is an associate based on the following example:C holds 45% of the voting rights of D. The other 55% of D is held by two shareholders (each holds 26%), with the remaining 3% held by three other shareholders, each holding 1%.
C does not have power over D, because the two other significant shareholders (i.e., a relatively small number) could easily cooperate to outvote C. The size of C’s holding, and size of that holding relative to other shareholders, would not give it power.I don’t know if it is correct, but that’s what the thing was in my mind during the exam….
The other shareholders relationship with each other is to consider too. Was there any mention of them relating to each other. I dont remember there was any.
Sound like disaster. Is there a way to obtain the actual March exam paper – even without the suggested answers?
I also felt it was an Associate as there was significant influence on the board even though Crypto did not have control via 45% voting shares.
Any idea whether question paper is available or not. In Dec18 it came out very fast , ie, within a day or two after the exam date
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Unfortunately, I studied a lot of consolidation calculation. Hope they just make 5 or 6 questions and then we can choose to answer 4 questions.
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Kurran is a joint venture, it seems like a separate vehicle to me.
The exam was hard. It was my third attempt. I found it very different from the previous exams.
It says here on the ACCA website:
“From 2019:
We will publish past exams twice a year, after the June and December sessions.
Each past exam will contain a selection of questions from the two preceding sessions.
The questions are selected by the examining team as being most helpful for students to practice.”Guess that means we won’t get to see the March paper until after the June exam session.
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