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Anyone had conso goodwill of 6mil?
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Q1 – goodwill was positive or negative???
Do you include contigent liability in your calculation???@royyston said:
Anyone had conso goodwill of 6mil?yes, i think i got 6 mil $ after impairment…
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@perist1984 said:
yes, i think i got 6 mil $ after impairment…That’s great!
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For tax in q2, the movement in deferred tax was a -200 or +200?
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i think movement in deferred tax was 3800. if i remember correctly on TB it was 1200 and needed to be 5000?
@royyston said:
For tax in q2, the movement in deferred tax was a -200 or +200?I think it was DR D.tax 200, CR C.tax 200
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goodwill i also 6 million after impairment
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how did everyone answer the financial analysis in q3 ? as in what points did you make
In q3, i pointed out the investment (in Non current Asset) which is special item. Coz of this, different result in ROCE.
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@aneeq7 said:
how did everyone answer the financial analysis in q3 ? as in what points did you makeFinancial Performance:
-Compare ROCE between the two sectors. ROCE can be calculated by multiplying the net asset turnover and operating profit margin, and this is an indication of both profitability and efficiency.
-OP margin was lower than the sector but asset turnover was higher implying better utilization of assets.
-Next, compare GP margin. GP= (Sales -COGS), so can touch a little on their sales and cost of sales.Operating performance:
-Compare current ratio with the sector. Higher current ratio= Better able to meet their short term liabilities.
-Inventory turnover is higher than the sector, and this has an effect on the current ratio because inventory contribute to the total amount of current assets.
-Payables payment period was faster than the sector which is not advisable as this will not give them a cash flow advantage.Gearing: D/E ratio was lower than the sector implying that it does not have that high of a financial risk compared to the sector. Higher financial risk may cause liquidation problems. Nevertheless, gearing is still high and this is attributable to the loan note that the company has taken up.
Conclusion: The company showed signs of declining profitability but operating performance was good and risk was well managed. However, a cash flow would be useful here to give a more thorough assessment of the company. A rights issue may also help to improve the situation.
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Q1- Conso SOCI: Couldn’t figure out the investment income part for dividend in associate and forgot to charge total goodwill to COGS.
Q2- Published accounts: Adjustment 1 was tricky, but the rest were relatively ok.
Q3- Ratio analysis: Messed up for average inventory turnover but the rest was straightforward. Analysis took a while and had no problem with the limitations of ratio analysis.
Q4- Theory on understandability and comparability was alright. Did workings on construction contract cos had problem showing extracts.
Q5- Relatively straightforward except for the last part.- Topics: 0
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it was not mid year, it was 9 months since acquisition..
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yup 9 months, so everything pro-rate 9/12.
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Found this exam quite easy. No problems with time what so ever.
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:((( Overall, was a very easy paper, however did not do good, because did not practise the IS and Fin Position consolidations enough, and messed up all…
Just got it, the IS figures in Q1 should have been apportioned :(( BTW, should the deferred consolidation also be discounted for 9 months? :(( I did that way and the figures were getting pretty unfriendly.There were some tricky notes, which I believe I will not be able to answer even with the Study Text on hand, because that was not mentioned in the study text.
1, the treatment of the new equipment in Q5. It said, that they have to apply it in 2 years, but have not done yet at year end. So should they decrease the provision, if they are not getting the benefit yet? I answered, that they should capitalize the additional expense (for filters,or…) and decrease the provision if it is probable that the filter will be applied, however not sure…2. There was a note, saying that the company sold smth for 10m, but included 600 000 at cost costs of warranty, or smth like that in the costs and will provide service or warranty for 3 years. Sooo, what is this? how should be treated?
10 m should not be deducted from sales, imho, because the sale is valid, may be the 600 000 should be provided for??- Topics: 0
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In regards to revenue there was deferred income that would decrease revenue and have to be included in liabilities in SFP.
i think that the deferred consideration did nt discounted for 9 months bcoz how did u discount lyk 1/1+r^n,where n=9 months or what ?if yes itz wrongly done mate.
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Worked through every number and every part. I’m glad I allocated my time well and did not linger too much on the parts I wasn’t sure I was doing right. There were some things I’m not sure about in all questions, but I think I’ve got the pass mark secured phew!
Now audit for tomorrow and financial management for the following day.
It was not that bad. I did q1 q2 q3 pretty well and just managed up until part a of q4 . I cudnt manage the time, I was too carried away by the analysis of ratios. Guys u reckon , wud I pass? By just doin 3 and half questions ?? And yes also managed to do the last 4 marker ias37 contingent liability.
The deferred consideration doesn’t require time apportionment as far as I understand cause it it is used in g/w calculation at date of acquisition and it comes due in one full year (31Dec12) anyway… But the discounted difference goes into finance costs ( time apportioned). – prove me if I’m wrong.
Q2 sales had to be reduced by 2 years worth of service grossed up ( 600 x 2 x 100/75). I know it now cause I got it wrong there – I deducted 3 years…in ques 1, goodwill calculation, how to take contingent liability? is it taken as FV adjustment or is it added with cost of Investment calculation?? and what to do with the investments received from associate? did anyone get share of associate as (2000 x 40% = 800 )?
Cud any one plz tell me was I right in taking off the contingent liability in net assets working in q1. Do we put the associate profit 40% of 2 million in income statement.
Q2. Does the loss of 1300 go to cos in fair value-investment?
Q5 is the provision for the contingent liability provided in f/s..coz it was a government decision and is that 33% of 18000 recognised?? Thanks
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