*** F7 December 2013 Exam was.. Post your comments ***

Yeah as @vishali says it done now!

Should really move on to my next paper…

I had cash flow from ops of 3,400, investing (6,100) and financing 2,200 leading to (500) for the year, factor in the positive bank balance b/f of 300 and was left with (200).

I got the purp 600 , and negative goodwill 11950 is it right?

Q1, Got a negative value for goodwill which was expected and profit realised in the P/L. PUP was 600 which was taken out of Southstar’s profits and therefore the NCI. Eliminated 4000 out of both P and S (Revenue and COS), 200k loss went through the P/L and the investment less cash investment in S went down by 200k in the SOFP. Time apportion all of S’s figures (6/12),

Q2, construction contracts with revenue and cost matched based on work certified / agreed price (40%), the revaluation for buildings increased by 400k, ie this increase the carrying amount by 400k and the inc. dep charge by 400k/remaining life.
Land reval was ok no depreciation for land. The finance lease was a tricky one in this exam, finance lease was recorded at cost (35m), however, the present value of the payments (9.2m) per year amounted to 34.875m so it should be recorded at this amount, this also slightly changed the depreciation amount, owned plant and machinery was easy depreciation.

Q3 Quite straight forward, part b especially, mentioning a few profitability ratios and confirming what the operations manager thought

Q4, part a, faithful rep, ensuring free of error and complete, difference is that fundamental characteristics ensure the information is accurate and representative of the business and gives a true and fair view of the status of the business, enhancing characteristics such as comparability increase the value of information for users.

part b, the amount due depends on finease retrieving the monies, which is not in control of the company in question, therefore, disclose as a contingent asset is it is probable that money will be received and if not then dont disclose.
the 10k and 2% charge would usually be a provision but since none of the receivables were recovered at the end of the year, the money due is an obligation and therefore a financial liability.

part c, since the property is being used solely to earn rentals on, it will be capitalised as an investment property even though they are not the legal owner of the building (substance over form)

Q5, the operating lease – another tricky one, this one ceased to be an operating lease because the lease term was 20 years and UEL was 8 years, ridiculous, most people would have put down 2.4m rentals to the P/L every year.

That restructuring of 7m is specific to the building and company using it, so once again supports the notion of a finance lease , however, the 5m would have to be provided for against this 7m.

That’s what I made of it. Decent paper overall

operation 3000
investing ( 2900)
finance (600)

cash (500)
opening cash = 300

answer (200) as bank was in liability so bank od

Not an easy paper though. Had lots of workings to be completed in that limited short period of time.
Question 1 and 2 took a lot of time, at some instances in past exam papers, there has not been such a demanding preparation of financial statements as seen on this paper. Not so friendly adjustments, “nasty little tricks’ and Steven Scott is very good at that. If they had asked for one financial statement on qn2, it was going to be a normal exam. Question 4 and 5 were very tricky and I have done what MikeLittle says..something is better than nothing…at some point I though of scribbling something and again I debated the idea that this might be too off track and the examiner will laugh…..but I wrote it anyway.

Time pressure exam, the examiners have to understand our handwriting to that effect. God bless, hope to pass!

This was pretty time pressured, I managed to get Q1 done in about half an hour, and it balanced, I got negative goodwill of 3,400 and put it in non current liabilities, don’t know if this is correct, but I did the UK paper and I didn’t have a clue on the difference between UK GAAP and IFRS treatment for negative goodwill.

Did anyone eliminate both the 4m goods transfer and 9m sales? I got a 600 PUP

Question 2 was the most difficult, I spent about an hour or so in this, so question 3, 4 and 5 was rushed.

Hoping I scraped enough to pass. Hope everyone else done well 🙂 on to F8 tomorrow!

It Was………Was on Q 3 when I had less than 1hr left 🙁

practiced almost all past questions, went to exam with expectation of 80%. messed up in question no. 1 and then started to panicking. done all adjustments in qn 2 but did not finish final sfp and is. cashflow did not balanced either. wrote something about faithful representation, substance applied in factoring question. very time pressurizing exam. dnt think i will even get 40. all my hard work for 4 months went in to vain. i put incredibly huge effort as i had poor financial accounting background. my lecturer was telling me at exam center that there is no reason to fail student like me. extremly frustrated but i can not see the point of giving up acca at this point as i have already passed other 8 fundamental papers and . sorry for the cry here! gud luck to me in p3.

Q3 cash balance b/f 300, c/f (200) therefore net cash flow for the year should be (500). I was having problem tracking 5000 expense in the year and eventually found it in dividend paid (1300 revaluation reserve transferred to retained earnings and should be accounted for while doing dividend paid calculation) and purchase of TNCA (by doing simple calculation on last year figure and current year figure) during the year. Purchase of TNCA during the year was 5100(3700+1400(investment property)).

@jaya1990: if you know you couldn’t have put anymore work into it then i am sure you’ll pass 🙂

yes, very time pressured