AAA*** March 2022 ACCA AAA exam – Instant Poll and comments ***

I realised after the exam, that I named my subheading for Q1 Audit risk instead of Risk of material mistatement. Will this be penalised?

i got procedure of goodwill for 8 marks, n dint get any other procedure questions, the paper was kinda weird

It was very time pressured as usual. I tried to put something down for each part then swiftly move on. Not sure I achieved my aim! Q3 was a weird one on due diligence! Couldn't make head or tail of it. By the time I got to grips with the requirement it was time for me to move on to the next question. Q1: (a) The usual suspect - evaluate- ROMM (24 marks) (b) Audit procedures (c) Money laundering and (d) Weaknesses in new client acceptance procedures. Q2: Completion stage: Matters and evidence/effect on auditor's report (I think!) and something discovered before financial statements/audit report signed (plan to sell the company). I made some silly mistakes so it could go either way! This is my final exam so it would be lovely if ACCA would give me a pass :-)

@asila It was indeed :-) Very weird.

Q3 accrual of revenue rebate, pension, Q2, Preference shares of cfo and ceo, Q1 the goodwill/acquisition of company related to prior year. These questions destabilised me, i just pray for a miracle to pass.

why CBE :( switching from screens is weird, at lest qtns should be on paper sheet. please someone ask to ACCA

Ahh I just realised I kept saying audit risk instead of risk of material misstatement. Do you think I will be penalised for this:/

Yeah same time pressure again. lots of procedures which was weird also. overall i tried to answer all questions i wasn't too sure about question 2 - just wrote about the warranty provisions. Fingers crossed! last paper, pls ACCA have mercy

if any, may be 1/2 or 1mrks

damity wrote:I realised after the exam, that I named my subheading for Q1 Audit risk instead of Risk of material mistatement. Will this be penalised?

There is no negative marking - candidates are credited for what they get right - there is no deduction of marks for getting things wrong.

littlemiss94 wrote:Ahh I just realised I kept saying audit risk instead of risk of material misstatement. Do you think I will be penalised for this:/

RoMM is a subset of audit risk - so it is not technically wrong to described a RoMM as an audit risk - only less precise. (Whereas all RoMMs are audit risks, not all audit risk are RoMMs - because detection risk is not RoMM.) Although I would encourage candidates to be careful and always be as precise as possible, there is no negative marking - and it will be what is described as the risk that gets the credit.

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%?

Materiality threshold Profits 5-10% Revenue 1/2 - 1 % Assets 1-2% (P.R.A)

Jennie_fierz wrote:Materiality threshold Profits 5-10%<br>Revenue 1/2 – 1 %<br>Assets 1-2%<br>(P.R.A)

well, thanks for the reply but it does not address my question :)

So trying to remember the exam – please correct me if I’m wrong Section A – Theme Park industry, potential money laundering issues. 1 – 24 marks on Risk of Material Misstatement 2 – 6 marks on procedures around impairment of an asset 3 – 8 marks on money laundering (a lot were quite obvious in the text around the Sons upping revenue) 4 – 8 marks evaluating Meadow Co, a similar company, audit engagement assessment. Was quite difficult as not much info given beyond a basic check list Section B 2 – 16 mark question on enquiries specifically around intangible assets and financing in a textile company – found this very difficult as not much info given to match up to 16 marks. 2b – 9 mark question on audit evidence in regards to the financing 3 – ai) – question on fieldwork undertaken by the audit team, specifically in regards to intangible assets for a smart vacuum – tricky question Ii) was around the audit evidence you would expect in relation to the above (or procedures cant remember) 3b – 9 mark question on ethics with an FD as we go to get an audit with a company we have provided non audit services for. More straight forward. Overall i think this was a tough exam, mainly because the industry’s were niche (textiles, theme parks, smart tech), there weren’t clear signposts for bits of the answer especially in section A there was alot of content to think about and then Section B was okay if you knew alot about intangibles, if not I think you struggle here. Confusing financial information too, so materiality wasn’t as simple. Going to be a very close pass if I get it.

barbadoshk wrote:What ROMM did you guys highlight?

By Yes, you mean if the % is between the brackets you can still say the underlying figure is material?

What do you mean about goodwill/acquisition question being previous year ?

Does 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?

Yes 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?

But 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?

Yes 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.

ROMM were analytical trend analysis, first year of consolidation, biased management, provision, legal case, going concern disclosure. What u did?

No i have not but i have AFM in june. From m where u took classes of afm?

TBH 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 business

for 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.

Licence 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

For Question 2 on quality control - what did you all focus on?

I have 10 marks for business risk in question 1. did you have this question?

for the new acquire it was after the reporting date and I mentioned the standard IAS 10 and the risk of incomplete disclosures

The 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.