- This topic has 32 replies, 28 voices, and was last updated 2 years ago by
.
- Posts
The most difficult was the time allocation. I spent too much time on Q1. I’ve not practiced full exam environment at home. This might fail me.
I didn’t miss knowledge, I missed the time. I had 1h for Q3 and Q4. I couldn’t even proper read the scenarios on these 2Q, trying to type as much as I can, didn’t do any calculations.
Q1
PPE foreign purchase before YE, at YE part paid
PPE purchase and disposal, how to account in cash flow from investing activities
Step acquisition 6% + 64%. Goodwill calculation. Contingent consideration and PPE revaluation after the acquisition
Q2
Gov grants, employee retention scheme, interest free loan if condition met. The condition was not met for any.
Q3
Lease of a floor 5y, then additional floor 3y, contract extention. I put this is rent rather than lease as short term. No info was provided to help identify lease financial or operating, only says lease
Q4
Revenue recognition about phone service. They had free minutes in the contract and used only 70%Q1 was goodwill with contingent liabilities and PPE with currency translation and some IAS 37 liabilities stuff
Q2 was a relatively easy ethics question, nothing too crazy here. The question on held to collect also came up, and I said it did not seem that the business model had actually changed, and IFRS 9 says this should be rare.
With respect to the government grants, I stated the treatment but noted that they had not actually been granted at the year end. I also stated that if received it would be a non-adjusting event, just in case.
Q3 had some relatively weird questions on IFRS 16, I believe the first scenario was to be treated as a new contract, whereas the second was a remeasurement, but I’m not too sure on that
Q4 had ECL and IFRS 15 with variable consideration. I treated them as two separate obligations, and calculated on the 61,000 minutes, but again not sure on the second part.
Overall, I felt the exam was very fair, and not too difficult compared to some others I’ve seen
EDIT: Also I forgot two of the questions:
IFRS for SMEs. I stated that its based on who the FS is accountable to (owners and maybe tax only). Company 1 would be IFRS for SMEs, but should reconsider if it issues the bond, as creditors may wish to review as well.
I stated Company 2 was not eligible, due to the disclosures on the interest free loans.
Fair Value: I stated the main points of the principal vs advantageous market. Concluded that it seemed likely the first market was the principal market as it is the major market in the region. Just to be sure, I stated that if this could not be determined, then they should use Market 2 as the most advantageous.
Hardest ACCA I’ve sat to date.
Time pressure was brutal and question 1 was nothing like I have seen in past papers, specimens or mocks.
Also the whole paper tested a tiny percentage of the syllabus and some questions were pretty repetitive. Wasted a lot of time learning the whole syllabus and not much of a range came up which was pretty disappointing! Also nothing on current issues 🙁 I had the same questions as tbmks below.Not sure it I will be able to get 50% – super disapponting as I spent so much time and effort on this exam and it in my opinion it wasn’t a fair exam at all – especially question 1!
For the first question right? Even I got negetive goodwill
There was an inventory with fv of 1.1 and ca was 0.8 (1m *80% (20% discount was there so)) so there was a fb adjustment of 0.3mAlso there was a bldg whose fv was either 5.2m or 5.5m (open market value)
For Q1 goodwill I included the provision as I thought it was an adjusting event that should have been in included in net assets. Not sure if anyone else did this?
That does look like a decent enough set of questions.
I’ve a got a nasty set of obscure questions:
Q1 – goodwill calculation (pretty standard, few tricky FV stuff)
theory behind goodwill, shares measured at FVTOCI, contingent liability, disposal of associate
Q2 – pretty standard ethics stuff, some discourse around prudence, materiality, and relevance.
Q3 – Hedge accounting with entries (!), deferred taxes, FRS 102 goodwill (I did UK variant)
Q4 – restructuring stuff and termination benefitsMy brain was fried towards Q4, I wrote a lot but wasn’t structured properly and I nearly ran out of time.
I feel I’ve unloaded all my knowledge but wasn’t particularly confident in my answers.
Fingers crossed…I got negative goodwill originally, but as the conditions for $4.3 million and $200k existed at the acquisition date, the goodwill was revised within 12 months. This gave a positive goodwill on acquisition
Reading some of these comments is making me feel like i may have failed. Lol Oh well. A possible resit in September 2022 at the worst right now. The syllabus is too broad. Time is always an issue, however compared to the previous exams on the ACCA website the format of the exam was easier to follow and the question did indicate which specimen to look at, if the question was general, etc. I’m not sure how to feel after the exam. I’m just happy to get it over and done with, for now!
@GeorgeB169, I got the same questions as you. I felt it was a narrow range of questions and I got no questions on anything I felt really confident about. I definitely haven’t passed. How do you feel about it?
- Topics: 0
- Replies: 19
- ☆
It sounds like most people got slightly different questions (of course UK variant will be diff)
From memory my paper consisted of the following:
Q1 a) 30 marks
Acquisition of Subsidiary (Sarda Co) 60% with consideration paid part cash and part contingent consideration (shares of parent with payment due in a few years after acquisition) – this was deemed to be 55% probable that no shares would be due to be transferred. First part of question asked for explanation of contingent consideration amount.
Calculation of goodwill required along with discussion of the calculation and treatment of a few adjustments required – these were city property Fair values and Inventory which was marked up incorrectly in the subs own accounts (inc 20% discount). £1m carrying amount in books and £1.1m Fair value at acquisition date.
NCI was based on proportionate method.
Q1 b) Disposal of Associate. 20 marks
Q2 20marks
– Prudence more important than Relevance (discuss) – this of course is making a reference to the Conceptual framework
– Impairment of Music venues and Value in Use model / Government Grants (accepting of and not paying money due back to government putting towards general overheads) in Pandemic backdrop for economic environment
– Ethics generally (fairly standard) various threats – Chief exec asking FD not to impair music venues using 20 year forecasts (5 max usually per IFRS and then extrapolate – e.g. see Value in Use model for decommisioning provisions) and questionable inputs such as growth rate above inflation etc and also forecasts showing much higher capacity versus historical actuals resulting in higher VIU amount so no impairment dueQ3 (25 marks)
(i) Intangible Assets – customer lists / contracts …as part of acquisition (IAS 38 / IFRS 3 / Fair value) – touch on definition of asset, capitalised in books with indefinite useful life – comment on fair values – can also touch on control of intangible asset for recognition etc
See article below for discussion on this
https://www.cpdbox.com/009-capitalize-customer-list-ifrs/(ii) Deferred Tax Liability – trees planted 17 years ago ..have 3 years left to maturity, 0% tax due for first 5 years, company not recognising deferred tax liability because liability would be reversed / offset in first 5 years — suggesting deferred tax asset..comment on correct accounting treatment
(iii) Cash flow hedges and double entry in books (13 marks I think)
Q4 a) Restructure of Hotel / leisure group
– Comment on restructure provision for 3 marks and then IAS 37 provisions etc with reference to dates (treatment in accounts) – planned restructure , communication to public for general comment – can’t remember rest
b) Termination Employee Benefits (5 marks) Principle of termination benefits – not much calculation required …restaurant business (I think from memory) going to cease trading so willing to give say $5000 to each employee if leave company before termination date or $11,000 to staff who stay until the termination date.
Probabilities given to each scenario with likely no of employees doing each option. Payment for either would be on termination date.
Relevant points here (extract from iasplus) – second part in particular:
(i) termination benefits to encourage employees to leave service voluntarily (voluntary termination benefits) should be recognised when employees accept the entity’s offer of those benefits.
(ii) termination benefits provided as a result of an entity terminating employment (involuntary termination benefits) should be recognised when the entity has communicated its plan of termination to the affected employees and the plan meets specified criteria, unless the involuntary termination benefits are provided in exchange for employees’ future services (i.e. in substance they are a ‘stay bonus’). In such cases, the liability for those benefits should be recognised over the period of the future service.
Yes I got gain on the retranslation of amount payable in respect of purchase of PPE
Had the same paper as @kristinaivanova. Question 1 was the toughest for me. Didn’t finish it. I always stick to the time allocation per question. The rest of the paper wasn’t too bad but I’ve written enough exams to know that you can never be sure how you performed until the marks come out. #justneed50
I got the same paper as @george. Very frustrating only few standards asked after all the hard work put on the subject! Also they were difficult (cash flow edging) and lots of tax requirements.
One full question on restructuring is crazy.
Leaving out about 15/20 marks I’m not confident I’ll pass. But the big problem is if every exam will be like this one only the word “luck ” will help to pass it!
- The topic ‘*** June 2022 ACCA SBR exam – Instant Poll and comments ***’ is closed to new replies.