*** P7 December 2013 Exam was.. Post your comments ***

Question 3 (A) requirement Plz ??

Spent more time on difficult ones and left the easiest one as I ran out of time. Q2 was terrible as it is difficult for any one to write about due diligence for 16, 18 marks in part b especially when examiner asked about general benefits and reporting styles in separate parts.
Im regretting i couldn’t complete question 4 which was the easiest part overall.

I can see that time management was the issue with every one so hoping a pass.

i feel…depressed. reading all of y’all’s answers…i don’t think i even wrote that..

qs 1 asks about the FS risks during planning the group audit. i think we have to take the restructuring of the audit into consideration.
there was acq of sub so for the risk, i talked about the forex translation and their inappropriate treatment which could result to an overstatement or understatement of asset.

now for cash in transit…i ruined that, it should’ve been intragroup consolidation, but i talked about theft during transit and inventory may be overstated.

about the disposal…that was abit tricky…it asked about the principal audit procedures regarding the disposal of sub.
it says that someone else became the principal auditor of that subsidiary so i talked about that the group auditor should communicate with the prospective auditor regarding any matters arising from the disposal sub?

due diligience part b..i think i lost my mind. i had no idea what i wrote in there. i talked about financial statements, comparing trends.
i talked about some numbers may be incorrect and therefore needs to recalculate. i talked about the bank balance of $500 000 and that there may be a possible CF problems since the wages are high due to its specialist nature of work.

qs 3… that coal mining…
i think i messed up with part 1. it asked about matters to consider when reviewing the draft FS and working papers.
i talked about non compliance to the law and regulations. the H&S…i talked alot about the regulations and prof skepticism.
audit evidence was probably alot easier.

and the last part was asking for the auditor’s responsibilites and what they should do since the management is not disclosing the accident to the regulatory body.
so i talked about idenfitying non compliance, obtain suffiicient appropriate evidence, discuss with governance and consider resigning if this is not solved. talked about confidentiality so reporting to regulatory body due to the laws and public interest.

what do you think? 🙁 not hopeful at my end here

Thanks 🙂

Q4 I did calculate materiality for the actuarial valuation $105k / $35m = not material.

But now I’m worrying that I may have used the total assets figure of $35m given for part a) or even b)….so not relevant to the company in c)….doh!!

I write that the actuarial valuation could be done by a separate team. Considering the immaterial nature of the balance this would be allowable. Fees from the combined audiit and acty services cannot exceed 15% of the total audit fees.

I think that with regards to Qs4 c, they were right to get the company to offer them assurance services to calculate the defined benefit plan as this has to be done by an Actuary. It was not material to the accounts, however only one audit partner could do this calculation, so who is going to check his work, especially as complex calcs? Also, even though he’s a qualified Actuary, he is working as an Audit partner, therefore could be out-of-touch etc.

Q1: Was difficult and lengthy but one ca say it was attempt-able. There were some key issues which were spotted.
Q2. Was in simple words ridiculous. Quite a lot knowledge based at this level and then making it so lengthy as well.
Q3. Did not read.
Q4. Mixed feeling about this some stuff managed to write down but the time management forced to skip some easy bits.
Q5. I though this was quite OK. Attempted most of it well.

Overall i think it was a hard paper considering the difficulty level and time issues. Best of luck all for this and up coming exams for those who are supposed to be giving any other paper.

it was fair hoping for the best

yea that is what i thought and mentioned self-review..

Anyone want to share what they put for Q1 ROMMs and Q2 (b)… would like to get an idea of whether I was completely wrong or heading in the right direction..

thanks,

For Q4 part C I wrote that the company not accept the service as there was a self review threat as they were auditing the company. They can either audit it or go for the acturial service. Part B had a advocacy and intimadation threat. Part A self review too

Reading comments here I think I might have done a bit better than I thought lol or you all did as bad as I did.

Over all the paper was doable and Due Diligence was kinda expected if you read Kaplan tips though I gotta say I barely read it thinking only a small part would come not a whole 25 marks question. Hopefully will pass! Umeed pai duniya kaim hai

The exam was too lengthy. Q2 was only abt due diligence; i think it should cover various topics as it is worse to be best in one thing than being good in everything.

Feeling like crying ………. spend too much time on Q1 and was completely lost when I saw the due diligence question. Answered question 5 in bullet points… anybody with the same feeling..