Ryder (9/19)

A good question but here’s a definition based on IFRS 10:
“Investment entity – an entity which:
– obtains funds from one or more investors in connection with its BUSINESS of providing INVESTMENT MANAGEMENT SERVICES;
– commits to those investors that those funds will be invested solely for returns from capital appreciation or investment income (or both); and
– measures and evaluates the performance of substantially all of its investments on a fair value basis.”

Ryder Co does not “trade” – i.e. does not provide goods/services – so clearly does not meet the first criterion. As an aside, I don’t think a parent could be an investment entity in an AAA group planning question because it wouldn’t provide a suitable scenario for the learning outcomes of the syllabus which all revolve around consolidation, etc.

Yes I think it is correct to say that but you would need to be clearer/elaborate on what you mean by “not recognised”. Since it has been received – something has to be done with the other side of the entry – so it has to be recognised as something somewhere.

I don’t know what you mean by/what your question is relating to “the marking scheme only give mark for condition point”. The marking scheme is “up to 3 marks for each audit risk evaluated unless otherwise indicated” (and it is not otherwise indicated for government grant).

But if a liability should be recognised the adjustment required is Dr P/L and Cr Liability.
If it shouldn’t have been included in operating profit it will also be Dr P/L – where are you going to put the Cr if not to liability?
What I am trying to say is that you are looking at the “other side of the same coin” – as a matter to be evaluated which will be awarded up to 3 marks it doesn’t need to be spelt out in more detail in the marking scheme.

Thank you for sharing your success – that’s always terrific to hear!!!

Perhaps if you have a particular tip to share with those who were not successful you could post it here on the results thread https://opentuition.com/topic/acca-aaa-march-2020-exam-results-instant-poll-and-comments/
Especially if you could endorse any of the article I’ve flagged – there are so many good resources and far too many candidates not even looking at them.