*** September 2023 ACCA SBR exam – Instant Poll and comments ***

Sounds like a difficult question, I didn’t have that one.
I would imagine they were trying to hedge against the exchange rate moving in the wrong direction, so they were hedging to offset the exchange rate risk.
Was it a stand alone question unrelated to the other parts of the question?

I am not sure how I feel lol did the afternoon UK version. I had the knowledge on some of the questions but putting them words together felt a disaster. Question 1 on acquisition – Rubul Co acquiring marble Co compare goodwill when NCI is calculated using fair value vs proportionate .. there was a question on ethics 10 marks – there was a lot to write but felt the time was limited.. cash flow hedge .. this is where my heart sunk! I literally used general knowledge on this one since I did AFM .. FRS 102 /IFRS 9 .. I rushed through the last question. Let’s see if miracles do happen if I pass this one!

Question 1:

1. land used for factory converted to residential. The company has no intention to convert it but government encourages other companies to convert to residential. I believe the highest and best use would be current use which is factory because there is no clear decision whether to convert it to residential. Anyone have different view?

2. Is goodwill the only impaired item for both methods? The total impairment amount can only allocated to goodwill as the impairment amount is not huge to allocate to other items.

The spreadsheet part in Artica co was of 14 marks. There was first part 5 marks NCI Increase calculation, second 11 marks theory for 3 parts and spreadsheet

Did we have to discuss the treatment as well in spreadsheet part? Or just adjustments had to be done in Articat Q1?
Actually, I didn’t even read that requirement that’s why asking.

I had ethical and professional issues due to the conduct of FD and Chief accountant in Q2 for 9 marks.
Justification why the lease was operating, something like that and can’t recall the rest.

Q3 was the most challenging which really threw me off guard. There was a case in which a Co classified a loan which was due in a year time as non current liability. We had to discuss whether it was according to IAS 1.
Another part was the lease accounting for lessor.
And the 3rd I can’t remember.

Q4 was relatively easier as there was some general discussion over the principles that should be considered while taking decision to disclose information in FS.
Another general discussion was about how disclosures about operating segment disclosures help investors.

Another requirement was the calculation and explanation whether the given operating units or divisions are reportable as per IFRS 8.

And the last requirement was to identify who is the chief operating decision maker in the given scenario. (A CHIEF OPERATING OFFICER regularly reviewed the financial information of the all divisions, allocated resources to them, which led me to conclude that he is the CODM, the work of COO WAS THEN reviewed by a committee)

Hello, all those who sat SBR(UK) exam in the afternoon, could anyone elaborate on details regarding what topics composed the parts in question Q2, Q3, Q4.

I just did begin bits, as panic setin with the time diminishing in the exam and I just couldn’t attempt the full lengths of each question.

Time is too little for the huge amount of twists and turns in the scenarios and to read and decifer whats the Q all about, let alone then to structure good full ans.

Time is also lost with CBE due to cumbersome and awkward nature of typing and spreadsheet etc, the ACCA exams were time pressurised always,

but the CBE mode has added another dimension of awkward of significant nature of consuming time, this significantly increases chances of failing with the 45 to 49% mark.

As with slow typing speed and key board skills easily looses time of 20mins+ from 3hr15mins,

I prefer the old paper Exams, where you could swiftly think/write answers down about the acca syllabus knowledge and keep moving, all this typing etc is not testing Acca knowledge, but rather an element of How Fast an IT Secretary/PA you are. Far from the exam about showing your acca paper/ syllabus knowledge.

Now that the covid pandemic is settling/ under control, I would like ACCA to think about returning to written/pen& paper exams. Or alternatively to modify the CBE e.g to allow a writing pad facility where those like me who are slow typists could write the narrative parts of the answers more swifty. Now that would be too good.its so demoralising when you have the knowledge but just cannot get it out to the marker due to the typing/IT etc.

Anyway thanks to any replies regards the Qs .

I was really confused with the ethics question. The exhibit was describing money laundering and fraud, but these are more criminal offenses than ethics issues. Aren’t they? And the ethics issues should have been described from the chief accountant perspective, while most of the issues were concerned with the financial director.. I completely mixed this question. I wrote some thing I could relate to the specifically CA ethical issues and described what I remembered from the law syllabus knowledge what to do when you suspect money laundering, but I’m really struggling to guess, what they really wanted us to write here for 10+2 prof. marks…

First question was the most challenging that I ever saw for a consolidation scenario. Q1 part a was a reverse of calculations with subsidiary for goodwill already provided, missing piece was purchase consideration and apportionment of subsidiary results with fv adjustment and part disposal of subsidiary. 5 marks only allocated for this part of the question whereas the answer takes more than twice of the time required and had to move to other questions instead. Part b and c of Q1 was also on consolidation. Q2 part a was on ethics and fundamental principles with a lengthy and confusing scenario whereas part b required detailed explanations on finance v operating lease. Q3 was in 3 parts on accounting treatments – part a on IAS 1 with a fair discussion but difficult conclusion on substance over form; part b on IAS 20 and was ok and part c on IFRS 13 fair value which has not often been tested. No time for Q4 which included a question on operating segments.

I see the paper of yesterday as certainly one of the most challenging in the history of Advanced Financial Reporting / Corporate Reporting / SBR.

Question one

Fair value of the factory a non-financial asset highest and best use after potential cost

Work out Goodwill using the proportional value of net assets and the fair value method

Discuss and explain the methods as per above ie full partial Goodwill and impairment split with NCI.

Work out impairment in goodwill

Define benefit contribution workings and adjustment to the statement of financial position.

Question two

Sales agreement identify a contract and explain why.

Explains why it is cash flow hedge requirements and how to account for the change in risk.

Ethical issues regarding issues – cryptocurrency intimidation fraud and competence of both the financial director and the chief accountant
Actions to be taken.

Question 3

Under FRS 102 distinguished between leases and whether the scenario is a finance lease or operating lease

Expected credit losses how it should be accounted for after.

Decommissioning provisions has it been correctly accounted for a potential storme which is unlikely to occur.

Question 4

Fair value measurement uncertainty using IFRS 13 forl financial assets.
Uncertainty of measurement of provisions.

How this will cause general challenges for the users of financial statements

Last requirement had various issues to the financial statements and gave descriptions on areas which require how they will be treated under IFRS
Issues included

Cash generating units
Impairment of Goodwill
Provisions
New legislation
One more forgotten

Surprisingly areas which did not come up such as

Deffered tax
Foreign transactions ie translations
Cash flow statements
No Intra company transactions ie PUP
Share based payments
APMs
Conceptual framework
No step acquisition/disposals
No associates or investments
No NCA Held for sale
No joint agreements/ventures

I had the opposite opinion tbh. My logic was:

If the building was worth say $100m as residential use and $10m as commercial, the company that owned the building would not sell for less than $100m regardless of the intentions of the purchaser. So if you intend to keep it commercial you’d be buying the company for $100m and have to put $90m to goodwill and $10m to assets which seems silly to me.