*** P7 March 2016 Exam was.. Instant Poll and comments ***

Q5 absolutely threw me – it was material to the P&L but immaterial to the balance sheet – what would the audit opinion be? Would it be qualified as performance materiality is usually lower and there were too many adjustments not complied with?
Overall the exam was OK but found extremely time pressured – I had practised in timed conditions and usually found it reasonable but I felt my answers were not as in-depth as I was constantly fighting the clock

Hard exam and the option questions were strange ie Q3 & Q5

@stuartpearce said:
Very time pressured. I made the mistake of leaving Q1 once I had run over the allotted time, at which point I had hardly started the question.

Then I returned to it in a hurry, trying to think of business risks with what I could remember of the scenario – all I could remember was the rabbits.

I thought of one risk now – which is customers could buy the bunny rabbits thinking they might do something funny and then returning them when they are not funny. Maybe the risk would be understatement of warranty provision – however do rabbits come with a warranty?

The flip side is the risk that someone buys a rabbit that is funny and they put it on youtube and blame it on the pet shop. The risk would be to reputation and hence possible overstatement of inventory?

Staff are well trained so they should be able to advise that rabbits are not supposed to be for human entertainment – although that will be a hard sell as most people won’t understand.

Also what packaging do the pets come in? If they are too snugly packed they might not survive unless they are a spider or something.

What about the risk is that someone might buy reptile thinking it can do stuff which it can’t – like change colour.

Or they might buy one that does change colour and then return because it wasn’t following the rules.

Also the risk that some of the inventory may be consumed by some of the other inventory – you only need to type snakes into youtube to see what could go wrong here.

I think of all this stuff now – something tells me I haven’t passed.</blockquote

lol. This is the funniest post on this forum. I wrote the exam yesterday and I’ve not been particularly happy. This post made my day. I just refer to it anytime I want to laugh and it always leaves me in stitches. LMAO.

@jodukwe said:
@ Samy and Ify..’im going to try and put it on my phone so once i stop at a red light i will read it and laugh!!..Better cure than a doctor..

I wouldn’t advise this as it would be a non-compliance risk. To safeguard against this maybe laugh at your phone after you have exited the vehicle and are safely indoors:-)

Thank you @Jay14 for your very kind comments, thank you @Michael, @Baljit and @ifyujay for saying the post made you happy – I was the same as you after the exam so you have cheered me up too.

I am a bit slow in digesting these exam questions – I find I only really get into the question when its too late, or I have already written something else.

They say you should structure the answer in a professional way with the primary issues featured first and respond with the appropriate format. So maybe the bunny rabbits were a decoy. With this hindsight here is what I should have put:

To: The Audit Partner
From: The Audit Manager
Subject: The Audit of that Pet Shop

Thank you for your email. Correct me if I have misunderstood but in the background information you supplied it says that the group had £200m odd in cash and someone spanked £150m on some disused shops. The punchline is the directors are not sure what they are going to do with the shops.

I have half a mind to request a meeting with the directors and bring a megaphone with me so that to shout to them ‘THEN WHY DID YOU BUY THEM?’

I think I know what’s happened here. In the kerfuffle with the different animals, they’ve clearly lost the company credit card and it has found it’s way into the hands of an imbecile who splashed out one fifty mil like it was nothing.

Now the directors are trying to style it out like that was the plan all along.

I wouldn’t even spend £1.99 on an ice lolly unless I knew what I was going to do with it.

And I certainly wouldn’t trust these guys with an ice lolly. Even if we did trust them with ice lollies the worse case is a liquid asset – which is far from the case here.

Who is going to buy 20 run down battered shops which need (£8m x 20) refix? Haven’t they read the news about high streets shops losing out to online? Pity they don’t sell rats as pets, otherwise they would be onto a gold mine.

Then there’s the issue with the staff holidays. They are running both a manual and a computerised system. These guys are too much. Any more financial tom foolery and they are all going to be taking one big holiday.

I say we press control alt and delete with these people and send them a letter of resignation.

Don’t reply anymore of their emails and if we see them in a conference or something we can pretend we don’t know them.

I attempted 80% of the exam paper as I ran out of time and couldn’t attempt the final question of 20 marks. Does anyone know if anybody had passed p7 without attempts 20 mark question?
Do I stand a chance to pass it, if so, how much?

Comments are welcome!

Exam was driect but it’s harde require more time written and first question was lenghty and it’s difficult to find directly business risk as the senari base was about anamils snak and spuder so which standard will apply it’s isa 2 and qiestion 4 it’s directly in distant able but I couldn’t exaplain in depath and detiles as the timing

I kind of did a sketch on Qn.5, then quickly abandoned in favour of Qn.3.
My interpretation was that the qn was based on ISA 260 (Communication with those charged with governnes) and ISA 580 (Written representations)

I could only think about such things below and I thought I could write more elsewhere (another question).

– Uncorrected misstatements whether in isolation or in aggregate if material should be reported to mgt and asked to be corrected. If mgt refuse to correct – impact on report.

– Sometimes matters are material by nature i.e lack of disclosures

– All uncorrected misstatement (material or not) should be recorded and reported to Mgt or those CWG.

– Matters reported to those CWG if significant should be reported in writing and in time.

– A written representation letter should be sought from mgt acknowledging that they are aware of the uncorrected misstatements and reasons why they didn’t correct them (if in aggregate are not material)

If auditor has doubt about mgt integrity and feels that the written representation doesnot provide sufficient appropriate evidence, then the report shall be modified with qualified opinion, “except for…..” or a “disclaimer of opinion”.

P5? Passed it in 1 go!

Q1 pretty unusual, biological assets scenario. Business risks and risks of misstatement
Q2. a. On ISA 240 with respect to revenue recognition. Y auditors presume risk of fraud.
b. On usuall cash transaction indicating money laundering issues.
c. Capital expenditure procedures.

Yes, I don’t think IAS 41 can be applied here since it is not agricultural activity.

This is my first try for P7 and I felt if I had another 30 minutes I would have confidence passing it. Too much to write in a short time to provide an answer in depth. Definitely need to practise more.

The only hardness of this paper is a matter of time. Time should be added or the questions should be arranged to 50,25,25 marks. Moreover, each of sub-questions should not be morethan 3. Like a,b,c. Otherwise, the paper is discouraging & can be stopped. Even i don’t want to think about it.