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The question that asked to apply various IFRS for treatment of costs related to films was tough. Rest of the exam was fairly simple. Group question was easier than expected.
I agree that Q1 was fairly easy, and was looking for some hidden tricks and I just cannot believe that I forgot to include the Investment in Associated in Q1.
I got stuck on the question related to costs of the firm. Was confused on what I shall start with and applied IFRS 15 which I think was absolutely wrong.
I agree with you guys, I also had the same version and that first question seemed a bit easy.
Q1 – explain why the entity was a subsidiary (5 marks)
– then explain why the entity was an associate (6 marks)
– then adjust the prepulated sheet (it was CSFP and you needed to derecognise the subsidiary and account for it as an associate instead (thank the heavens it wasn’t cash flows cause I would have cried) (12 marks)
– explain how can an entity account for impairment of investment in subsidiary (7 marks) (not gonna lie I did not bother with this one, I moved on)Q2 – nice lovely question on ethics
– generous 10+2 mark to start off with, about an FD that was trading with the company of his family in another country (loads of self interest threat evidence, objectivity, all that jazz)
– then the question on how to account for the three manufacturing firms (8 marks) I actually REALLY loved. I talked about the abandonment prospect and how that would exempt them from falling under the scope of IFRS 5, I talked about the probability threshold of the temporary business disruption through the eyes of IAS37, then I also talked about the impairment of assets due to extreme weather conditions, I used the scenario for evidence.Q3 – very heavy on IFRS 15 revenue from contracts with customers, I think more than half of the marks were about this which I was very very pleased indeed.
– also on Q3 FRS 102 a few issues on deferred tax and calculating the deferred tax assetQ4 – Financial instruments (yeah this was nasty.) I didn’t attempt all of it so it’s played on my confidence a lot. But it was basically about methods of accounting for financial instruments and how investors might find all these different ways confusing
Overall, I think some parts were easy and some parts were ew. I think it’s a pass but if I’m lucky. And it will be by a whisker haha. (First attempt)
I had the same. I Didn’t find it actually hard. You just had to to state if the development costs could be capitalized or not if they meet the criteria of PIRATE. I think two of them did but the last one no because it was loss making.
I fount the paper easy going and this is strange and at the same time very scary because i think that in this kind of papers you fail more easily because maybe there were a lot of traps
I had same questions as you – starting with Q2, Q4, Q3 and Q1 as I understood most people fail wasting time on Q1. So, my plan was to answer the interpretation questions and theory ‘easy mark’s and then have time for Q1. My time management was good but sadly Q3 and Q4 were not what I had prepared for per mocks and tuition. Praying for a 1st time pass and miving on next week in faith to sart studying AAA knowing that 15% of this syllabus is still applicable to SBR so no time really wasted if need to resit in September. But may stick to just the INT versions. Good luck everyone for the results in July.
joint venure must have equal rights to make decision and it was not the case in this scenario.
They also had 2 of 5 directors and 49% of shares and no ability to make most of decisions on their own, therefore I have choosen an associate
I got a question about how CLIMATE CHANGE affects IMPARIMENTS and PROVISIONS.
Personally I don’t like this kind of very general questions that tend to rewards people are good at making up things rather than those who studied well…I chose to be subsidiary because he can control the distribution and all of the contracts through his company so he controls the variable returns from operation
I put JV as conditions were agreed in advance and couldn’t be changed hence decision would have been unanimous and contractual as can’t be changed, also the separate legal entity and the fact both were making decisions on different areas suggesting joint control over significant influence. Also the fact it represented an interest of net assets over the entity. I think it could have been argued any one of the three ways as the line was very blurred (we’ve all given a different answer!) and hopefully the mark scheme allows for this.
all the decisions in regards to conses was made before the incorporation of the entity
I got exactly the same questions. Does anyone know how to answer Q3. why do investers find equity instruments and debt instruments confusing?
Many thanks
Does anyone know the answer to the last question on SAR? I only worked it out the for cash settlement basis
I had only about investments in shares and I wrote that investment in shares are valued at OCI or fair value through profit and loss and that usually not many people understand the reason for inclusion some of the entries in OCI
Also that the inventor will look at profit and loss to access the financial performance which will also give them insight of earnings per share
Confusing because different measurement methods of the same investment cannot be compared like for like
If other company which have the same investment measures this investment through other comprehensive income and other through profit and loss then there is no comparison between these twoI had about CEO who had choice to take it as cash or equity
And in the end he chose cash
But we needed to provide with the results for 1 Jan 20×6 so at the beginning these share options were given and that time company did not know which option CEO will chose
In the end I did this wrong
But I think it was counterparty where this should be split between liability and equityI have 3 question like @addieboo123 but question 4 is the climate change and impairment and provision but I can not remember clearly. Anyone can help me state the content of this question @hotteto?
can you state more information about question 4. I have the same set of questions as you from question number 1 to 3 but fore question 4, i am unsure and I cannot remember.?
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