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Technical article on asset ceiling test

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA SBR Exams › Technical article on asset ceiling test

  • This topic has 1 reply, 2 voices, and was last updated 4 months ago by Stephen Widberg.
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  • February 14, 2022 at 8:53 am #648585
    andreeagaitan101
    • Topics: 3
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    Hi tutor,

    I’m trying to go through the technical article on asset ceiling test. Just before the heading on Uderstanding the context of ICO… there is a computation of the figure to be recognised in OCI. My logic was that we should recognise in OCI the excess of the net pension asset as compared to the ceiling. So, my computation would have been: (12-11) mil $ to be recognised in OCI, but I see that 1,84 mil $ are indicated to go to OCI.

    May I kindly ask you to help me understand the point?

    Many thanks.
    Andreea

    February 14, 2022 at 9:04 am #648586
    Stephen Widberg
    Moderator
    • Topics: 10
    • Replies: 2531
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    Bear in mind that many marks are given for the words so don’t spend ages on the numbers.

    B/D NA = 4
    NIC @ 4% = 0.16
    CONT = 7
    SERVICE COST = (5)
    CURTAILMENT = 3
    OCI (BAL FIG) = 1.84
    C/D NA = 11

    Make sure you understand the reason for the ceiling – prevent overstatement of assets that may not be recoverable, prudence, and quote the definition of an asset in the framework.

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