SBR*** June 2023 ACCA SBR exam – Instant Poll and comments ***

Very lengthy and tricky

Gosh my time management is poor that I spent so much time on section A with barely sufficient time in section B. So much so I missed looking at one exhibit pertaining to a requirement and just answered the question generically. There were points I could've discussed but didn't due to lack of time. Really hope to scrap a pass! It would take a miracle :(

Called my mum after the exam and started crying. I can be quite dramatic , lol. It would have been a different thing if I didn’t study. Will probably retake it September and add AAA or something. The questions looked easy except from the hedging part. But the problem was time and too many marks allotted for what I call basic requirement, which meant the examiner wanted more. Best of luck guys!

This was very difficult! First attempt and final exam and I highly doubt I passed. Left out 3 requirements due to time which equated to 20 marks and only had 15 minutes at the end to try and jot something down for each. On first glance I initially felt confident with the questions, but after a while I realised I had no clue. The groups question was probably the easiest then downhill from there apart from a small cashflow question

2nd time attempting this one. (41% first time) Felt a lot better this time so hoping I’ve done enough to get 50%. Stick with it guys, can only get easier with consistent revision and hard work!

So it sounds like we all had a similar paper. I similarly cannot remember what I wrote but on reflection realised I missed out some substantial marks on Q1. Completely forgot about mentioning an Associate holding after loss of control and subsequent measurement... I was mainly worried about not answering all the questions so just flew through everything. 3 hours is not enough!

can anyone explain what they did on the question where there was 3 assets with reducing balance depreciation and mid year additions and disposals?

Did anyone get the revenue question in regards to sponsorship contracts? What did you write for it, I spoke about performance obligations and recognition of revenue but completely chatted rubbish. Will be keen to hear what others wrote? Also the 10 marker on indefinite life, what is all that about I literally had nothing to write for that don’t know what you can say about indefinite lives for 10 marks

Booked the wrong version on my first attempt and failed due to time management...2nd attempt today and eish..praying for a miracle...I just want to move on to AAA.I took for granted Management commentary and skipped it this morning whilst revising and unfortunately it came with loads of marks

for revenue i mentioned that it needed to be recognised over the life of the contract and that it can’t be a lease as control hadnt passed over as they had to authorise any advertising but probably wrong i mentioned it can be indefinite life if no foreseeable period but needs to be tested for impairment - also i think they were using value in use as the recoverable amount but that may have been unreliable due to the future cashflow being hard to measure with it being indefinite but wondering if any of that is right or just waffle to be honest

Yeah I raised the same points as you, all I could logically think of. The three assets question you mentioned I just calculated what the NBV would be at the end of the year taking into consideration the disposal of the assets and reducing balance

I came back to that question and just set out the requirements of IAS 16 and calculated the carrying amounts at the reporting date. No idea what they expected really. The questions are vague af.

For infinite tangibles I said had to be under 10 years per FRS 102 and best guess had to be applied.. I completely broke at the first question, forgot everything groups etc and just had a panic attack! Finally sorted myself out (lost about 10 minutes) and then just wrote anything i could think of ? did not enjoy at all, will prob be doing again in sept! Also stupidly selected the UK variant which had an additional chapter to learn - only do this if you need the UK content to be a practice partner, if not INT paper is easier!

i think the 10 years limit for intangibles life related to UKGAAP which wasn’t attributable to the SBR international version but tell me if i’m wrong haha!

I wasn't entirely sure about this, but I did what I would do on a fixed asset register and did c/f plus additions minus depreciation and disposals to get the c/f figure, but no idea if that's what I was supposed to do!

This was my 5th!! attempt at SBR today. I missed it by 1% last time. Its the first time I have come out of the exam feeling like I could pass. I knew the topics for almost every question. The open tuition video covering UK Gapp on youtube was stuck in my head. I also summarised the notes in the textbook. I used to skip the Gapp questions or guess because I didnt have enough knowledge to answer the questions. Thank you open tuition!!

For sponsorship revenue I also mentioned performance obligations and that revenue should be recognised over time rather than point in time, including the 12 month contracts, not sure if that is correct? I also said not a lease due to no control being passed. With regards to ias 38, and the indefinite life of the database, I said it should be recognised with a finite life as technological products will need upgrading /replacing over time and therefore would not be an indefinite life asset, but I could be wrong.

In one question, the parent company sold 40% of their shares leaving them with a 50% interest, did anyone recognise the residual interest as an associate or subsidiary?

for that one the way i looked at it was you had to work out how to account if maintained control (keep sub) (reduce goodwill and increase NCI??) and then the same but if lost control so that’s when i mentioned about derecognising a sub and instead an investment in associate using equity method but again could be wrong what did you do?

When no control is lost it’s a transaction between equity holders. I forgot to mention the associate recognition! So gutted if I fail on that.

I need books for f7 ready to pay postage

Tomstrong96, yes I did the same. Then there was a further scenario asking whether they still retained control at 50%, I.e should they still recognise as a subsidiary, but I said it should now be recognised as an associate as they had few voting rights and control over the day to day activities

I said they didnt lose control because the biggest shareholder has to be 12% to veto decisions and the biggest one is 10% while it’s believed that shareholders are dispersed to collectively come together thats why the company still has control Whatever is ur conclusion is justified u will score mark even if its not in the marking scheme

Hello Just wondering how to check whether my exam was successfully submitted ; towards the end a message displayed on the screen asking to click ok as I was browsing through to review my questions then only flagged question was displayed at the back . I clicked ok and checked the status of my exam this morning for self assurance but It is displaying « awaiting results » not exam attempted is that ok? Does it mean my exam has been successfully submitted ? Thanks

1. Groups, part i was to calculate consideration and explain on it and also calculate and explain influence of PL of acquirer. Consideration included cash, share based payment that was replaced with new share based payment scheme of the acquirer, deferred consideration and legal costs. I made a guess and expensed legal costs through PL, although I had a thought to include them as a consideration. Regards acquisition costs I found this on ACCA website: All acquisition costs, such as professional fees (legal fees, accountant fees etc), must be expensed in the statement of profit or loss and not included in the calculation of goodwill. With deferred consideration everything was straightforward - discount it to present value, unwound costs to PL. Part b Calculate net assets of acquirer It was messy, so many adjustments of deferred taxes that will change the amount of net assets and after the acquisition the client has sold the revalued asset with the amount higher that has been revalued. Should we adjust goodwill in a reason of real FV is actually higher than it was at the date of acquisition (less 12 month after acquiring etc)? I really do not know, but i suspect that I should comment on this in the explanation part. b ii Calculate NCI in SOFP and goodwill Goodwill was impaired, the task was for 3 marks, so I wrote a sentence that part of impairment of NCI will be accounted in SOFP as NCI measured at FV Hope that was right. iii Was about how adjustments to deferred tax will influence cash flow statement (indirect method). Tough question. Did not really know what to say there, although DT is an accounting concept and not really cash flow, it should be somehow adjusted as an examiner asked on indirect method. I think that DT should adjust PBT before operation activities section of CF. Unfortunately this though came to me now and not at the exam. I was panicking already at that time, DT questions stressed me a lot. Question 2 Ethics and accounting treatment For ethics it was illegal transaction that CEO forced to do CFO. Incorrect determination of useful life of intangible asset IAS 38, the same CEO was determined that an intangible had indefinite useful life, where in exam it was clear that operation cycle life of intangible has shortened, so, in my opinion its definitely finite useful life, so had to be reconsidered UL and applied prospectively as a change in estimate. Also, what do you think, should the asset has to be impaired? It is an impairment indicator, but I am not sure whether we had to test on impairment or not, as if we had reconsidered new UL of the asset so we can expensed high portion of the asset through PL. For ethics part was a big mark allocation, which is good I think. CEO definitely breached all ethics standards, we just had to link them to scenario to score high marks and advice CFO what to do in situation where she was forced to to illegal transaction. Feel ok on that question overall. Question 3 Sale and lease back questions First part was to determine how transaction should have been accounted in the books of company that bough a retail unit being a company that specialise on development of the office buildings. Basically it could be anything haha, I assume that to obtain the marks we have to discuss how to account the property that we bought in light of different standards. It could be Inventories, since we specialise in office buildings, but on the last minute I changed my decision to investment property for the reason that in the question the client will redevelop this property and than sell it, so I assumed that it was bought for a reason of a capital appreciation, so investment property and not an inventory or PPE. Hope that I had enough to say for a good mark. Next part was to conclude sale and lease back transaction Explain whether the transaction was a sale, I made a point that it was a sale because the transfer of risk and rewards has happened (legal title was passed + we leased back property for time much less than remaining UL even with the option to buy it as the option stated that to buy it back we had to pay extra 50% on FV, so I conclude that is not going to happen because in substance no one will pay that extra. Part 4 Management commentary explain what it is, how it ally to ESG and investor issues on MC Made points on MC practice statement Issues that is not part of IFRS, potentially can be lacked of quality characteristic as it mostly narrative etc Part 2 was on alternative perfomance measures (APMs). EBITDAR used in management commentary and how it can be misleading Wrote something that MC should be written is simple language etc Note that EBITDAR was strangely calculated adding prior years amortisation And couple more points Key things that I took after the exam: 1. To practice more on narrative part as english is not my native so its takes additional time to clearly present what i want to say 2. If I cannot state something straight away in simple language - that will add stress my brain in exam situation and i will potentially lose marks, so in the practice almost always using short clear sentence is a way to pass 3. Paying more attention to the details during preparation, it may sounds ok during preparation until you try to write something :) 4. Better time planning management

1. Groups, part i was to calculate consideration and explain on it and also calculate and explain influence of PL of acquirer. Consideration included cash, share based payment that was replaced with new share based payment scheme of the acquirer, deferred consideration and legal costs. I made a guess and expensed legal costs through PL, although I had a thought to include them as a consideration. Regards acquisition costs I found this on ACCA website: All acquisition costs, such as professional fees (legal fees, accountant fees etc), must be expensed in the statement of profit or loss and not included in the calculation of goodwill. With deferred consideration everything was straightforward - discount it to present value, unwound costs to PL. Part b Calculate net assets of acquirer It was messy, so many adjustments of deferred taxes that will change the amount of net assets and after the acquisition the client has sold the revalued asset with the amount higher that has been revalued. Should we adjust goodwill in a reason of real FV is actually higher than it was at the date of acquisition (less 12 month after acquiring etc)? I really do not know, but i suspect that I should comment on this in the explanation part. b ii Calculate NCI in SOFP and goodwill Goodwill was impaired, the task was for 3 marks, so I wrote a sentence that part of impairment of NCI will be accounted in SOFP as NCI measured at FV Hope that was right. iii Was about how adjustments to deferred tax will influence cash flow statement (indirect method). Tough question. Did not really know what to say there, although DT is an accounting concept and not really cash flow, it should be somehow adjusted as an examiner asked on indirect method. I think that DT should adjust PBT before operation activities section of CF. Unfortunately this though came to me now and not at the exam. I was panicking already at that time, DT questions stressed me a lot. Question 2 Ethics and accounting treatment For ethics it was illegal transaction that CEO forced to do CFO. Incorrect determination of useful life of intangible asset IAS 38, the same CEO was determined that an intangible had indefinite useful life, where in exam it was clear that operation cycle life of intangible has shortened, so, in my opinion its definitely finite useful life, so had to be reconsidered UL and applied prospectively as a change in estimate. Also, what do you think, should the asset has to be impaired? It is an impairment indicator, but I am not sure whether we had to test on impairment or not, as if we had reconsidered new UL of the asset so we can expensed high portion of the asset through PL. For ethics part was a big mark allocation, which is good I think. CEO definitely breached all ethics standards, we just had to link them to scenario to score high marks and advice CFO what to do in situation where she was forced to to illegal transaction. Feel ok on that question overall. Question 3 Sale and lease back questions First part was to determine how transaction should have been accounted in the books of company that bough a retail unit being a company that specialise on development of the office buildings. Basically it could be anything haha, I assume that to obtain the marks we have to discuss how to account the property that we bought in light of different standards. It could be Inventories, since we specialise in office buildings, but on the last minute I changed my decision to investment property for the reason that in the question the client will redevelop this property and than sell it, so I assumed that it was bought for a reason of a capital appreciation, so investment property and not an inventory or PPE. Hope that I had enough to say for a good mark. Next part was to conclude sale and lease back transaction Explain whether the transaction was a sale, I made a point that it was a sale because the transfer of risk and rewards has happened (legal title was passed + we leased back property for time much less than remaining UL even with the option to buy it as the option stated that to buy it back we had to pay extra 50% on FV, so I conclude that is not going to happen because in substance no one will pay that extra. Part 4 Management commentary explain what it is, how it ally to ESG and investor issues on MC Made points on MC practice statement Issues that is not part of IFRS, potentially can be lacked of quality characteristic as it mostly narrative etc Part 2 was on alternative perfomance measures (APMs). EBITDAR used in management commentary and how it can be misleading Wrote something that MC should be written is simple language etc Note that EBITDAR was strangely calculated adding prior years amortisation And couple more points Key things that I took after the exam: 1. To practice more on narrative part as english is not my native so its takes additional time to clearly present what i want to say 2. If I cannot state something straight away in simple language - that will add stress my brain in exam situation and i will potentially lose marks, so in the practice almost always using short clear sentence is a way to pass 3. Paying more attention to the details during preparation, it may sounds ok during preparation until you try to write something :) 4. Better time planning management

I had the same paper, but made a mistake and included Legal cost. As for the intangible asset, I made the same point it had indication that the life was not indefinite so it had to be definite but I added a point saying that if it were to be indefinite it had to be tested for impairment annually. Tbh it was my second attempt doing SBR and I think this paper was was better than the last one. Finger crossed I passed.

Yes, that legal cost part got into my mind too haha. Thanks for sharing! Good point on impairment, now I think that right thing to do was to add on annual impairment test before changing useful life

This was quite stressful. So first of all it was a public holiday for me and here I was spending my holiday traveling and getting examined for 9 hours :D... Due to public holiday there also was some sort of folk festival in the city and thus there was constant background music, which really killed my concentration in the beginning.. Now for the exam: Questions seemed weirdly phrased and i had to read through them quite a few times to get what was actually asked. Barely got through the questions and had to take shortcuts in calculations and explanations quite a few times due to lack of time. I guess there must be tons and tons of spelling errors. For example there was a current issue question of the development of a common ESG reporting standard and I just wrote down the 2 points I could come up with on the spot and there wasnt enough time to brainstorm for any more. So lets see, hopefully my waffling around is enough for a pass.

Did anyone get that small calculation of deferred tax in a group cash flow statement? There was a portion of DTL in OCI and I can’t stop thinking about whether that should have been included in the cash movement workings or not? Considering OCI has no relevance to PBT, but it would still be payable as tax, so I thought it should be in the working