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I’m convinced I missed a 5 mark question on section C for the single entity SPLOCI, because I do not think ACCA would given 20 marks for this – but I can’t remember seeing anything!
Could someone put me out of my misery and tell me if there was another question please?
There was a mcq on event after reporting date in section A…
Was the item ‘held for sale’ an adjusting or non adjusting event?…If we had the same exam then it was single entity SOPLOCI and then Smithers and Burns leased asset and how to account for it
Yes, there was a part b for a leased asset and extractions to show the double entry.
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kinza1997 wrote:There was a mcq on event after reporting date in section A…
Was the item ‘held for sale’ an adjusting or non adjusting event?…I don’t think so. I believe an item qualifies as held for sale when it meets specific criteria according to IFRS5 i.e when sale is highly probable and the asset is ready for sale anytime in its presentcondition. And sale is highly probable if
1. The asset is mktd at a reasonable price in relation to its FV
2.there is active plan to locate a buyer
3.sale expected to take place within 1 year
4. EtcSo I think the date when these conditions are met then that’s when it is classified as HFS. This doesn’t provide additional evidence of a condition that existed at reporting date because classification as HFS took place after reporting date.
I did it as the carried forward balance at the end of the lease table as the SOFP figure for the asset, the implicit rate as the finance cost in SOPL, and the second year carried forward balance between split current and non current liabilities
But now I am realising I didn’t depreciate the right of use asset!kavindi95 wrote:Yes, there was a part b for a leased asset and extractions to show the double entry.
Was the asset held for sale after the reporting date?….
I completely missed out on the date…
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After reporting period events are events which take place between the reporting date (balance sheet date) the date on which financial statements are authorised for issue and A transaction or event is an adjusting event if it provides evidence of conditions that existed on the reporting date e.g bankruptcy of a debtor who was included under receivables at reporting date sale of inventory or PPE between reporting period and date when Finacial statements are authorised for issue at less than their reported value at reporting date etc. On my opinion classification of an asset as HFS which takes place before reporting period is not an after reporting period events because it falls within the reporting period. Classification of an asset as HFS after reporting period does not provide evidence of a condition which existed at reporting period since the conditions to class an asset as HFS takes place at a particular date and must fall within the period in which the conditions are met.
I don’t know maybe am wrong. My opinion is not conclusive.
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@iManji92 did you also write the morning paper
It should be
Debit: Accumulated amortization $20m
Debit: Expense(P/L) $10m
Credit: Cash $30msection C was like a typical FR section C I’d see in past questions but the objective test questions were not so cunning. in terms of how they set thier questions with so many right answers and one correct one.
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Anyone who had a goodwill question in Section A which required you to choose 2 correct options which had answers on
1. Goodwill is not supposed to increase in value
2. Contingent consideration
3. Contingent liabilities and contingent assets etc…. I don’t still remember here the complete statement
3. Gain from a bargain purchase to be recognised immediately in P/L.How did you tackle it
was i the only one who thought the team was lengthy? like my question #32 had analysis plus 3 requirements.
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Vania2000 wrote:was i the only one who thought the team was lengthy? like my question #32 had analysis plus 3 requirements.
I am not sure if Iam getting you. What I know is question 32 required
i) Calculation of ratios
ii) Explanation of the treatment of the gvt grant (including adjusting reported profit)
iii) Analysis of financial performance and financial position after adjusting for the effect of the reversal of the grant.
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