*** P2 December 2012 Exam *** Instant Poll and comments***

By the way I am gonna write a negative review on exam room conditions. Almaty, KZ exam centre sucks at organization!!!! Rooms were hot ! No air conditioning! No water was supplied this time (was supplied in June). I was really uncomfortable sitting there.
And, hey, rest rooms were shared, I mean guys and girls to the same rest room. What a shame!!!!

Q1: Whooaa,, amazing one, I managed to create the dbl entries of all the adjustments but still got a difference of exact 10m 😀 … dunno where it wnt wrng, there was imparment resulting for Henney only. IFRS 5 required general discussion as to give details for the criteria of recording the asset under IFRS 5. Ethical issues and accounting implications for subsidiary selling property lower than the market vale to its parent ( I implemented IAS 24 here 😛 )
Q3: In my opinion, IAS 16 for letting property and collecting rents, IAS 40 for holding lands for capital appreciation, and IAS 2 (which was a pure blunder :() for buying and selling i.e. trading of properties. IAS 17 finance leases for vehicles used for carrying waste, that was provided by Waste Co. IAS 37, for disclosing the event in notes as there was no reliable estimate of wht is gng to be paid by buckcutt. IAS 16 for school and I guess the cost for converting in library will be expensed as there is no increase in the performance of the asset.
Q4: Principles relating valuing assets under IFRS 13. Hierarchy for levels under IFRS 13. I didnt understand the 2nd part at all , what were we supposed to do, what was specifically asked?? no hint to fair value all the markets or only australian,,, 😀
Cheers.

I also treated green certificate incentive as grant goverment. Not have time to touch Q2 part d. I don’t know how to calculate fair value for the decommission liability in question 4 also.
The exam was not really hard but I was not good at time management, wish that I could have more few minutes. Just cross fingers for 50 marks !!!

@lsoltobaeva said:
1) I didn’t get the impairment part. Per my calculation assets weren’t impaired.

I had to do that calculation again. The first time there was no impairment per my caluculation either, but the tone of the note was suggesting that there was, and reading it again, it mentioned the given recoverable amounts not including total liabilities for either of them, so I did the calculation again taking the total liabilities for bower & heeny off the given recoverable amounts, leaving me with a $50m impairment for heeny, which sounded good, so I went with that. Whether it’s right or not remains to be seen. lol!

hi admin….
is it necessary to mention the IAS number or name for the treatment in the exams… Or u think by treating the scenario appropriately with the regulations of the International Standards without mentioning say, IAS 17 or IFRS 5, is acceptable??

@emz168 said:
I got 50 impairment also and none on bower but I think I has goodwill of 190..
How did you treat the impairment?
What about question 3 I got confused and part b of q4 wasn’t sure of decommissioning…

I have got 190 goodwill for D and 8 goodwill for the other.

50 impairment attributable to :

35m intangible asset
15m Goodwill.

Q1 – the structure of the group wasn’t D shaped! The parent (M) didn’t have direct holdings in heeny.

@emz168 said:
I got 50 impairment also and none on bower but I think I has goodwill of 190..
How did you treat the impairment?
What about question 3 I got confused and part b of q4 wasn’t sure of decommissioning…

190 sounds familiar as well for goodwill in Bower. I allocated the impairment 56% group (taking it off group retained earnings), and 44% deducted off NCI.

I didn’t do question 3. The only bit I might’ve had a chance with was the vehicle lease. So I went for Q2 instead. Q4 I did, and part (a) was fine. Wasn’t really sure what to do with part b), so did a random calculation using the unit volume and selling price to show a full fair value of each sector – excluding the transaction costs, then advised that the valuation to be used would need to be the australasian one since it’s where the company did all its buying and selling. Excluding the transaction costs was the right thing to do I think.. the rest was a stab in the dark.

Similarly with the decommisioning. I based a calculation on the labour cost, overheads, inflation and industry mark-up, and said the rest wasn’t allowed in the calculation. Again, a stab in the dark as I didn’t know.

Still.. part a) was worth 13 marks I think, so if I get another couple of marks for the rest of it, I’d be happy! 🙂

@fidget said:
190 sounds familiar as well for goodwill in Bower. I allocated the impairment 56% group (taking it off group retained earnings), and 44% deducted off NCI.

I didn’t do question 3. The only bit I might’ve had a chance with was the vehicle lease. So I went for Q2 instead. Q4 I did, and part (a) was fine. Wasn’t really sure what to do with part b), so did a random calculation using the unit volume and selling price to show a full fair value of each sector – excluding the transaction costs, then advised that the valuation to be used would need to be the australasian one since it’s where the company did all its buying and selling. Excluding the transaction costs was the right thing to do I think.. the rest was a stab in the dark.

Similarly with the decommisioning. I based a calculation on the labour cost, overheads, inflation and industry mark-up, and said the rest wasn’t allowed in the calculation. Again, a stab in the dark as I didn’t know.

Still.. part a) was worth 13 marks I think, so if I get another couple of marks for the rest of it, I’d be happy! 🙂

I take the 35m impairement and split into nci and RE of parent but the 15m I give it totally to parent – full goodwill method? Am not sure 🙁

I messed up in attributing impairment, I thought per ias 36 impairment had to go first to goodwill and then to assets pro rata woops hopefully will pick up some marks
My balance sheet was out. I think I did not account for ifrs 5 correct… I spoke about criteria for ifrs 5 in part b and c I wrote about related parties and I also mentioned the accoUnting policy change although not sure that was correct.

@fidget said:
I think you’ll need to wait til they publish the answers online. It’s difficult to say how much marks they they’ve allocated to each working.

6 impairment

@taofinal: hey, don’t be doubting yourself! I just treated the impairment in the way I did because I thought that’s what to do with it. Could be completely wrong! 🙂