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For an entity to be exempt from preparing consolidated financial statements it must meet certain criteria specified in IFRS 10 Consolidated Financial Statements.

Which of the following conditions would give exemption from preparing consolidated financial statements?

A.

The parent's securities are publicly traded.

B.

The parent is in the process of issuing securities in a public securities market.

C.

The parent is a wholly owned subsidiary of another entity.

D.

All of the parent's subsidiaries are in one country.

An entity has a number of subsidiary and associate investments.

Which of the following must be disclosed in the entity's separate financial statements if it is exempt from presenting consolidated financial statements?

A.

The bases on which significant investments in subsidiaries and associates have been accounted for in those separate financial statements.

B.

A copy of the summarised financial statements of each of its subsidiaries.

C.

A list of all its significant investments in subsidiaries and associates which includes the date of acquisition and the price paid.

D.

A list of its top ten shareholdings including number of shares held and their market value.

The financial statements of JK for the year ended 31 August 20X4 were approved on 10 November 20X4.

Within these financial statements which of the following would have been treated as a non-adjusting event in accordance with IAS 10 Events After the Reporting Period?

A.

Inventory which was originally valued at its cost of $45,000 being sold for $37,000 in September 20X4.

B.

A fire in JK's main warehouse on 3 September 20X4 destroying 60% of the inventory that had been held at the year end.

C.

Notification received on 31 August that one of JK's major customers had gone into liquidation and was unlikely to pay any outstanding invoices.

D.

The completion of a court case on 5 November 20X4 in which JK was ordered to pay damages of $150,000.

Statements of financial position for YZ, BC and DE at 31 March 20X2 include the following balances:

YZ purchased 90% of BC's equity shares for $508,000 on 1 January 20X2. On 1 January 20X2 BC's retained earnings were $183,000. YZ uses the proportion of net assets method to value non-controlling interest at acquisition.

YZ purchased 30% of DE's equity shares on 1 April 20X1 for $112,000. DE's retained earnings at 1 April 20X1 were $88,000.

On 1 February 20X2 YZ sold goods to BC for $28,000 at a mark up of 25% on cost. All the goods were still in BC's inventory at 31 March 20X2.

Calculate the value of the investment in associate to be recognised in the consolidated statement of financial position at 31 March 20X2.

Give your answer to nearest whole $.

Country X levies corporate income tax at a rate of 25% and charges income tax on all profits irrespective of whether they are distributed by way of dividend. Country Y levies corporate income tax at a rate of 20%.

A, who is resident in Country X, pays a divided to B, who is resident in Country Y. B is required to pay corporate income tax on the dividend received from A, but a deduction can be made for the tax suffered on this dividend restricted to a rate of 20%.

Which method of relief for foreign tax does this describe?

A.

Exemption

B.

Deduction

C.

Tax credit

D.

Restricted

Which of the following is the responsibility of the International Financial Reporting Standards Interpretations Committee?

A.

The development and publication of new international financial reporting standards.

B.

To provide a forum for interested parties to participate in the formulation of international financial reporting standards.

C.

To provide authoritative guidance on the application of international financial reporting standards where conflicting practice has developed.

D.

To advise the International Accounting Standards Board on the agenda and priorities for future work.

Which of the following is a condition that has to be met for an entity to be exempt the requirement to prepare consolidated financial statements?

A.

The parent entity's debt or equity instruments are not traded in a public market.

B.

The parent entity's equity instruments are only traded in one country.

C.

The parent's equity has a nominal value of less than $1 million.

D.

The parent's net asset value is less than $1 million.

PZ has the following working capital ratios:

Which of the following could be the reason for the movements?

A.

PZ has introduced a new policy to take discounts from suppliers during 20X1.

B.

The workforce of PZ have been on strike for a month during 20X1 but deliveries of inventory have still been received by the entity.

C.

A new credit controller has been employed who has been more rigorous with their collection procedure of receivables.

D.

PZ has implemented a just-in-time system of ordering inventory during 20X1.

The subsidiary company of Group XY has purchased £150,00 worth of goods its parent company. However the goods purchased have yet to arrive at the subsidiary at the end of the financial year 20X4, meaning there is

a disagreement in the current account balances between the parent and subsidiary.

With Group XY looking to produce its CSOFP for the end of the financial year, which of the following statements are true in relation to accounting for this disagreement? Select ALL that apply.

A.

The adjustments to resolve this disagreement, need to be accelerated, so they can be included in the consolidation of assets for the CSOFP for 20X4

B.

£150,000 worth of inventory will be debited into the subsidiary's inventory account

C.

As the goods have not reached the subsidiary by the end of the financial year 20X4, they will be included in the CSOFPfor the next financial year

D.

£150,000 worth of inventory will be credited into the subsidiary's inventory account

E.

£150,000 will be debited to the payables account of the parent company

F.

£150,000 will be credited to the payables account of the subsidiary company

G.

£150,000 will be credited into the receivables account of the parent company

Which of the following is a characteristic of a defined contribution post-employment benefit scheme?

A.

The amount of the post-employment benefits paid to former employees depends on how well the scheme's investments have performed.

B.

The employer would make additional contributions into the scheme if the actuary predicted a shortfall in the funds available to pay post-employment benefits.

C.

The amount of the post-employment benefits paid to former employees is determined at the date of their retirement using a predefined formula.

D.

The employer may take a contributions holiday and stop paying contributions for a period, if the scheme's assets appear to be more than are required to meet the scheme's obligations.