- This topic has 5 replies, 2 voices, and was last updated 5 years ago by
.
- Posts
1. is it necessary to know about break up basis in detai for AAA P7 ? isn’t enough to just know what the concept is about and how is briefly prepared on FS e.g all liabilities into current liability (since bankrupt/sold)
2. i saw the IFRS disclosure list from the IFRS website but there’s no mention that the reason for disposal is stated. Usually do firms disclose the reason for disposal ?
3. for audit risk, in the question Q1, if finance director states that non amortization is appropriate then, can the existence of finance director in the company be an audit risk ? (specifically) the risk is the credit risk because there’s a risk that finance director might set up weak controls on financial reporting/system given the wrong conclusion given on amortization ?
4. If a firm disclosed material uncertainty in the disclosure notes of FS, then do we put in material uncertainty related to going concern paragraph ( in the audit report) ? or in KAM(if client is listed)/EOMP(if client is non listed) or both ?
Thank you
1. What it means is enough.
2. I am not aware that this is a requirement.
3. The risk is that non-current assets are overstated due to non-compliance with IAS 16.
4. Please see page 119 of the notes.2. Usually in a company, if they dispose one of their subsidiary, do they disclose the reason why they disposed that particular subsidiary to the shareholders ?
3. Then there’s no audit risk finance director might set up weak financial reporting process ? i thought this was part of control risk
2. I cannot find this in IFRS.
3. It is the company, led by the entire board, that decides on the accounting policies. If an accounting policy is stated to be one that does not comply with IFRS such as non-depreciation of a certain class of assets, that is transparent. I don’t think anyone “sets up weak controls” – either you put/have controls in place or you don’t. If assets are not being depreciated, then a control such as an independent check of the reconciliation of depreciation in the non-current asset register to the ledger accounts is irrelevant (since there is not depreciation to reconcile).
3. so for number 3, audit risk or risk of material misstatement in question 1(a) does not arise from incompetence or unprofessional behavior of finance director ?
The risk arises from non-compliance with IFRS – we don’t have to “cast aspersions” on the FD’s competence or behaviour in order to state this.
If you are looking Q1 in the Specimen – the reason for non-amortisation of the brand is that the company invests in maintaining the value of the brand.
Brand names do not have to be amortised – it it has an indefinite useful life, it must not be amortised but tested for impairment (annually).
- You must be logged in to reply to this topic.