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- December 10, 2013 at 5:59 pm #152222AnonymousInactive
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Unexpected, unusual, unfair. IAS 8 in full details, looked more or less at a first glance, but in substance not so easy, not sure at if I put enough point on it
Q4a
– Discussion on policy selection – judgments, materiality
– Discussion on changes of accounting policy, why user find it difficult
– Errors correction and possible manipulations
Q4b
– Borrowing cost capitalized in 4m 2012 and 2m 2013
– Twice entered payable in the last year ledger
– Change in depreciation method from straight-line to reducing balance (there was something confusing about consumption – so I thought it was not appropriate to change – not sure if it was right)December 10, 2013 at 6:01 pm #152223I agree with what you said about the language challenge that we have with papers cultural terms are superseding the objective in some questions. You then drift off the question because or the terms used when revising you find out you knew the answer but was miss led by a term sometimes not even in the framework.
December 10, 2013 at 6:03 pm #152224What did u guys get for q2 n 3 n 1b
December 10, 2013 at 6:06 pm #152225Disaster ..never expect that Cash Flow statment will be examine for 35 marks..
December 10, 2013 at 6:09 pm #152226Think the nic was q3 a) . I too treated it as a finance liability due to the fact there was a contractual obligation to pay the principle of b shares.
Was dreading cash flow but I didn’t think it was too bad. I got dt on in acq as $1.5m too which in turn increases the goodwill on acquisition. Had no idea about the borrowing costs part of ppe or the capital grant but think I got everything else. Part b I spit each section between the deposit / finace income and penLty. Discussed how each would be treated in soploci and consequently in the cash flow. Ie deduct the finance income and add the interest received. Re the 7m loan did any treat this as a financial asset instead of cash equivalent due to the fact it wasn’t extremely liquid? There using amortized cost and discount to presnt value??? ( might be completely wrong here) ethics part was straight forward enough.
Q 2 a was rev recognition of services . Just talked about stages of completion and allocating revenue to the elements of the contract. B was asset held for sale and whether or not proviso s should be accounted for under 3 scenarios. Not 100% on that one. Spoke Bout ifr5 the concentrate on each of the 3 items and how they should have been Ccontes for. I don’t think any needed a provision. Part c was sale and lease back cv 4.2m fv 5m and different sp. of 5m or 6m or 4.8m or 4m. I said that for both. Sale price of 5 or 4.8 a profit is recognised and charged to pl. sale price of 6 there was profit of 0.8 and 1m was treated as a loan and spread over the life of the lease. Sp of 4 was a loss to pl.
Q3 was next. I just discussed was an nic should be. That is fb of nic at acquisition plus share of post acq profits. Further more said should be finance liability as contractual right to repay the holders. (Min of 3ys )
Part b was hedging. Hate hedging but think I got enough down like can only hedge any item at inception . So could not use the associate .
Part c was hell. Had no idea. Just waffled on what little I know about combinations. Hated this part the most.
Didn’t look at q4 in depth but didn’t revised on my current issues. Was predicting debt vs equity which would have been my knight in shining armour.
I revised really well for this exam but thought the exam was horrible overall. No main topics any where.., where was NCA / sbp / financial instruments / pensions. Income taxes . I will be incredibly lucky if I pass this exam
December 10, 2013 at 6:12 pm #152227AnonymousInactive- Topics: 0
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Q1 b) two 12 months deposits, if remember right
3,5% can be withdrawn but 21 days prior notice – no intention to withdraw
3% can be withdrawn but 14 days prior notice. If terminated earlier – only 2% like on short term deposits. Company wants to keep in available (so I thought they can withdraw it any time)
I stated it is a current asset (again not sure – 12 months, on the edge), can be classified as C&CE because short term <3 months, although a prior notice required it’s only 14-21 days (have no idea what the point was to put this 14-21 days, any ideas?)
It is not prudent to accrue interest on 12 month on the deposit which is likely to be withdrawn earlier, so 2% only as it goes in time
Disclosures required in the notes on limitation to use C&CE (again written something about these stupid 14 & 21 days)December 10, 2013 at 6:13 pm #152228I really don’t understant what the examiner is trying to achieve!!! I have covered so many technical articles, read all the current issues, covered most of the standards and many consolidations revisions. This was to give myself a better chance of passing. I was so dissapointed with the paper. Most of the Q2 and Q3 was only put there to confuse us. The examiner chose small areas of the subject and then he tried to confuse us with the words. This does not even begin to resemble the actual world. So well done to the examiner for making the paper less relavant to corporate reporting.
Having said that Q1 was good but i don’t think that is enough to pass!!
December 10, 2013 at 6:16 pm #152229AnonymousInactive- Topics: 0
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Does anybody remember what was about the deferred tax on goodwill? was it taxable? I think I wrote it was a permanent difference (((
December 10, 2013 at 6:18 pm #152232AnonymousInactive- Topics: 0
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Thank God cash-flow came.
Hopefully done enough to pass .
I went for question 1,2&3
P2 books for sale any one interested?
I am sure I will not need it againDecember 10, 2013 at 6:21 pm #152233I may be incorrect but the th fair value was 20 and the tax base was 15. Therefore a temp dif of 5m at 30% is 1.5m. This then needed to be deduced from the fair value of assets acquired. So goodwill was 30 less fav of na of 20 less the dt of 1.5. So goodwill was 11.5. (That’s what I calculated anyway). So this increases the impairment of goodwill to be added back in operating activities.
December 10, 2013 at 6:28 pm #152235Much too much mechanics at this level, supposed to be a professional level paper! I think this paper should be fully based on theoretical areas, and discursive questions entirely,; why are we being tested on cashflows anyway, this is not the making of an accountant of the modern age, number crunching bits are now undertaken by accounting systems so why do exams keep trying to flog us to do mathematical contorsions when any old pc with a consol program will do that 35 minute question in less than one minute.
December 10, 2013 at 6:35 pm #152236Can someone say horrible in another language?
I really tried for the cash flow. Attempted q2 n4. What on earth was question 3 asking? So help me GodDecember 10, 2013 at 6:37 pm #152238AnonymousInactive- Topics: 0
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This exam is just pure evil. I left exam with a big headache. It seem the examiner set out to ensure that people fail the exam It is just too bad. It was not relevant to most of the core areas we were asked to focus on, I am just very tired now and felt like i have wasted a lot of money, time preparing for an exam that was not possible to pass. I feel sorry for tens of thousands non-native English speakers, they don’t stand a chance of passing as the language was used to just confuse people.
December 10, 2013 at 6:38 pm #152239Disaster……..so well prepared but could not done proper….need to sit again……
December 10, 2013 at 6:45 pm #152242AnonymousInactive- Topics: 0
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Not so terrible provided that you were ready for CF. Only very annoying thing is the language…. It is always a problem to understand what exactly you are asked about, but this time it was like a mad tea party – I’ve spent plenty of time rereading and rereading the questions. As always – no problem with the exam, problems with being not prepared enough to pass it…
December 10, 2013 at 6:49 pm #152244I guess question 1b meant to discuss held 2 maturity fixed deposit loan…if d loan is held within 12 months, then the principal and interest should be shown on cash and cash equivalent balance @ year end. But if the coy. Decides 2 terminate d loan a penalty will be charge, which implies that the cash and cash equivalent @ year end may not be up to 3m or 7m. Also, the company can decide 2 reinvest d fixed deposit, if the do reinvest it, the value @ the year end can not be cash and caash equivalent….well DAT was my answer ..don’t know if it’s what the examiner wanted.
December 10, 2013 at 6:50 pm #152245AnonymousInactive- Topics: 10
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I agree with most people here (and those frustrated outside the exam hall) that the paper was unexpected and MESSY!
1- Cash Flows are pretty typical in their own, but I felt some of the adjustment details were even incomplete.
– government grant in regards to land: very unclear accounting entries(which were already done in draft statements)
— Pension obligations mentioned that:acquired subsidiary’s pension obligation ($1m) was entered in current cost center, ALTHOUGH the expense to PnL were correct. I took the hint from *although* and decided that acquired 1m obligation shouldnt be expenses. Therefore, current service cost charge would have been (8-1 = 7m) in the statements.
b) Deposits are cash equivalents. So I recommended that both can be *called* from the bank in less than a month, so the company can consider it as a cash equivalent (highly liquid). I used some experience as bank customer, where usually such deposits are (Flexi-deposits). Although penalties were applicable, the item in itself is at least liquid and can be converted quickly into cash. Mentioned terms as premature withdrawal etc. Hoping examiner would appreciate connecting from real life.
c)Importance of Code of Ethics. The only straight-forward question in the paper. Could have written more but I was hell tired from the other questions.
2- a) was about rendering of services. Quoted IAS 18, conditions for rendering (couldn’t remember 4th! but vaguely tried to sound know-it-all). Mentioned matching concept. Criticized lack of information whether contracts specify different prices for different services. Are the service “only in package” or can be bought separately?
b) On provisions.
– restructuring. plus IFRS 5 Held-for-sale.
– other provisions: future operating costsc) Sales and Operating Leaseback. Was ok.
Q3. a) Put-options. NCI treatment. Question was, since NCI had put-options and there were some terms written, what should have been the NCI? To be hoenst, out of the entire syllabus, where are put options mentioned properly? After minutes wasted thinking about it, I just moved on. Marks lost in this question.
b) Financial Instruments – hedging questions. Cash Flow hedge was accounted for wrongly through profit or loss (should be other comprehensive income)/
Suggested setting up hedge for associate.
c)Did not go into details but identified the relationship between Bental and Lental as reserve-acquisition set up. Doubt I wrote enough to score ful l10 marks.
December 10, 2013 at 6:52 pm #152246Agreed, it was a strange paper. Those who attempted Q4; how did you address the issue on the operating lease with varying selling prices? Apart from the obvious lease rentals (assuming operating lease), removal of depreciation and added cash in the bank, what else could have been discussed? Or maybe I’m not seeing the bigger picture?:(
December 10, 2013 at 6:54 pm #152247AnonymousInactive- Topics: 10
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Meester, the main thing they were asking was: whether gain/loss should be amortized or recognized immediately in profit or loss. There is this flow chart in texts. If FV = Sale price, then recognize immediately. And so on.
That is why examiner provided multiple selling price options, so we could form examples.
December 10, 2013 at 6:54 pm #152248This is what to be expected from now on….. as u guys may or may not know acca just changed status and went to a post graduate status!!!!!! Anyway the exam was horrible xD
question 1 B wasn’t it about ifrs9 financial instrument? recognising the loan deposit as a financial asset since angel was entitled to contractual cash flows.December 10, 2013 at 6:57 pm #152249AnonymousInactive- Topics: 0
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Please anyone tell me the answer for this one??? which value to take from 100% subsidiary for the purpose of inventory, payable and receivable? is it fair vale or cost???
December 10, 2013 at 6:59 pm #152250it’s a nightmare to me when i saw both q3 and q4, select either one i die anyway, i though q4 will always be harder but q3 is almost there too. anyway i wrote 3a, which might be wrong that any amount that shareholder invested not exceeding can be classified as equity, those that exceeded shall be classified as liability.
part b wrote a few lines says hedge should not be used as it is a translation currency risk, or sth… dunno
part c din read at all.all in all lost about 30 marks. terrible.
spent too much time figuring out q1. stuck with ppe and tax.
135.5 for tax payment?
impairment of GW 31.5 anyone?
impairment other intangible asset is 90 i think
inv in assoc 71
goodwill 11.5, the dtl inclusive 1.5 taken to dtl t account is it?December 10, 2013 at 6:59 pm #152251AnonymousInactive- Topics: 10
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Fair value
December 10, 2013 at 7:00 pm #152252AnonymousInactive- Topics: 0
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really hard exam and looking back, made many mistakes on the cash flow- probably too many as need to score well here to pass. I agree with some comments above – far too much of the syllabus is ignored and having spent a great deal of time preparing for the exam, and feeling as if I know enough to pass, the randomness of the questions just make you feel that you know nothing. So much of your revision is wasted as such a small part of the syllabus is tested. Hoping for a very generous marker who does not get bored of my waffle.
Failed this exam twice already. really is a tough one 🙁
December 10, 2013 at 7:01 pm #152253AnonymousInactive- Topics: 0
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Does any of the loss get allocated initially agains the revaluation reserve that had been built up previously?
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