Forums › ACCA Forums › ACCA AAA Advanced Audit and Assurance Forums › *** March 2022 ACCA AAA exam – Instant Poll and comments ***
- This topic has 103 replies, 29 voices, and was last updated 2 years ago by Kim Smith.
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- March 7, 2022 at 10:25 pm #650133
I think ROMM were
1-Risk that repairment cost could be of capital nature so should be divided between capital expenditures and expensses.
2-New acquiral of subsidiary’ net assets fair value can be over or under stated.
3-Revenue recognition risk may be recognised too early
there were few more which if you remember can tellMarch 8, 2022 at 3:14 am #650138Does someone had that Q1 business risk, ROMM, goodwill paper? Any one rememer exact requirements of Q2 which were pensions, accruals and revenue rebate, and how did you answer that?
March 8, 2022 at 3:16 am #650139Yes i did, that the correct treatment has been identified by the auditor, and that 5.5m should be recognised in this current year according to matching concept. I dont know if its right or wrong. What u did?
March 8, 2022 at 3:26 am #650141i did the same for 5.5m and in Q 2 i think in first issue the opinion would be modified with an except for.
And in Q1 te business risks were i think regulated industry issues e.g penalties, any customer can get harmed by the old bulidings which happen to one person in scenario, and `too much repairs are needed for old buildings which can have an impact on cashflows of company and another i Put people are not too much into teaters they can go to other mediums of entertainment. and i think financing wa the issue as well
ROMM I wrote in above commentMarch 8, 2022 at 3:45 am #650143But issue one was pensions and the amount was 1.6m and it was not material , so how the opinion was modified due to scenerio 1? The amiunt of 5.5 m was material. Isnt it?
March 8, 2022 at 3:53 am #650144May be I am confusing Q2 and Q3 with each other you are right 1.6m was not material but somewhere in q2 and 3 there was an except for opinion supposed to be given in one of the issues but may be i got it wrong,lol.
And Q3 was about the quality of the audit so chances are i am mixing these two.
In q1 what ROMM did u write if you can rememberMarch 8, 2022 at 4:32 am #650146Yes in Q2 scenerio 3 was for qualified opinion. Secondly i want to ask what u did for the second part of Q2 which was inventory. I did that the suggestion provided by the auditor is correct cuz the inventory is measured at lower off cost or NRV. The company should recognise the scrap value amount which was obtained after the year end.
March 8, 2022 at 4:34 am #650147ROMM were analytical trend analysis, first year of consolidation, biased management, provision, legal case, going concern disclosure. What u did?
March 8, 2022 at 4:35 am #650148Sorry i do not remeber about the inventory one at all,
March 8, 2022 at 5:13 am #650149ROMM i have mentioned in previous comments now I have SBR and AFM coming up have you got more exams coming this week?
March 8, 2022 at 5:20 am #650150No i have not but i have AFM in june. From m where u took classes of afm?
March 8, 2022 at 5:23 am #650151I have studied my self and I think i have made a mistake lol if i fail then i will take classes from Skans
March 8, 2022 at 6:25 am #650154TBH i struggle to gather up 12 RoMM but my list are below, can’t remember the rest off the top my head:
Cash based transaction
new system – movement to electronic payment
sale and lease back
toy shop revenue recap
land valuation
impairment of theme park
management bias – family businessMarch 8, 2022 at 6:30 am #650155for Q2 were there was an event relating to sale of the byre co discovered at the completion stage of the audit, what was the impact on the audit report?
i was running out of time for this part so i just mentioned , its a going concern issue and by nature material and pervasive. audit opinion will be modified and audit report will include adverse or disclaimer depending on the outcome of discussion with management.
March 8, 2022 at 9:22 am #650194I think I said more work needed to be done now to the report too as auditors have a duty to the users to show a true and fair view of the company.
Obv the sale needed to be disclosed but my mind was so blurred by time pressure I couldn’t think straightMarch 8, 2022 at 9:23 am #650196What did anyone put for the matters question in Q2 worth 16 marks I think regarding licence and patent ?
March 8, 2022 at 9:26 am #650202Licence and patents were due diligence review for asset valuation procedures, no? pls tell me i didn’t mix uptake questions. Then there was shares, loan agreement and venture capitalist procedures
The question 2 was something to do with inventory and warranty matters to consider and evidence for them
March 8, 2022 at 10:18 am #650211For Question 2 on quality control – what did you all focus on?
March 8, 2022 at 11:23 am #650217Tbh I can’t remember what question the licence and patent was now??
March 8, 2022 at 11:50 am #650218I have 10 marks for business risk in question 1.
did you have this question?
March 8, 2022 at 11:52 am #650219for the new acquire it was after the reporting date and I mentioned the standard IAS 10 and the risk of incomplete disclosures
March 8, 2022 at 12:58 pm #650226The Pension amount of $ 1.6 was material to Revenue if I am not mistaken it becomes 0.73% of the total revenue and if you check from the total asset then it was immaterial to FS. Due to the Revenue amount is material to FS.
March 8, 2022 at 2:40 pm #650242you are right it was the first issue in Q 2 i think and 1.6m was material to the revenue i put except for opinion if the misstatement is not corrected
March 8, 2022 at 6:11 pm #650287Chris777 wrote:If an account balance is 1.6% of total assets and you say that it is material, would that be correct given the general materiality threshold is between 1-2%?
Well, I guess we had similar question in one of our courses.
And the answer, if I remember correctly, was simple – these are possible thresholds auditor may use depending on the company. Since you’re not preparing a deep company evaluation here with final materialities, just justify that that this amount is between possible materiality thresholds and highly likely gonna be material or that it is prudent to assume material or smth. Basically the lower % is the threshold for materiality.
Anyone feel free to correct me if I am wrong.
March 8, 2022 at 7:22 pm #650295In question 2, I founded research and development and warranty provision
But in final portion of this question they asked you “implications of the completions of the audit and actions” they have not asked you regarding the audit report impact on that question which was willing to sold off towards venture capitalist
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