FAE 2011 Where to begin

Colts

p13 wrote: »

Colts wrote: »

Just realised I cocked up my IMS recommendation! Everything else was ok, and meant to go back and change it but ran out of time! So annoyed with myself!

What was the IMS recommendation? I said off the shelf as it said about straightforward requirements of management

Ok, so did I! Just did the build something case study there and it said their off the shelf system was insufficient.

You've made me feel infinitely better, thanks for that. I reasoned that it was needed immediately and that they wouldn't have the time to develop the new system. Plus they could always implement something more complex in the future.

Again thanks, now to run out of the thread before someone posts something to the contrary

FAEStudent1

Burger King Man - can you put up the indicators you got today in SIMS?

ahtfulal

Tough today for time started with sim 3 spend way too long then made a balls of da 2nd one I think and spent about 20 mins on sin 1 at d end threw down some points. What there loads of audit and tax today or is that just me?

Rickyroma

ahtfulal wrote: »

Tough today for time started with sim 3 spend way too long then made a balls of da 2nd one I think and spent about 20 mins on sin 1 at d end threw down some points. What there loads of audit and tax today or is that just me?

Sim 3 very long I thought.

Loads of Audit and Tax which I'm quite happy about. If there had only been 2 tax or audit indicators over both days and you missed one then very difficult to pass. The fact that there were 3 - 4 each gives everyone a better chance I reckon, as you can make up for one bad indicator.

Hanley

Knee deep in tax and IMS today....

Could easily have been 4 tax indicators, and that's assuming I didn't miss any....
1) retirement planning
2) benefits of ltd over partnership
3) revenue audit
4) effect of returned stock on VAT and CT

And 2 big monsterous IMS indicators today?! 3 over the past 2 days?! Crazy!!

Hanley

...and Sim 3 could have been a comprehensive case study in its own right it was so long. I spent most of my time on tax there cos it's my weakest area, zoomed thru IMS cos I'd covered it well elsewhere I think, and spent about 3 minutes on the revaluation.... PLEASE tell me it was as simple reval?

RonaldRayGun

Would he evaluation in Sim 1 be Finance? If not, reckon i'm in the Finance red zone.

FAEStudent1

SIMS 1
1. Controls (general discussion and specific recommendations)
2. Evaluation of IT proposal (PV of future savings/costs, qualitative factors)
3. KPIs (general discussion and specific recommendations)

SIMS 2
1. Revenue Audit (General points/unprompted disclosure/VAT refund/CT payable, pre audit review)
2. Directors Duties (i.e. compliance, Corporate Gov)
3. Audit of Inventory (Weakness/Implication/Recommendation, Consider new auditors)
4. FR (IAS 2/IAS 8/IAS 10/IAS 21)

SIMS 3
1. Tax - (Cash Extraction/Incorporation)
2. IT - (Value of New system, Data Protection)
3. Finance - (Short vs. long term debt, matching, alternative options)
4. HR - (maybe - relocation of employee - half pager)
5. FR - (Impairment of property IAS 36)

Please let me know if I missed something. Terrible feeling I have.

Hanley

FAEStudent1 wrote: »

SIMS 1
1. Controls (general discussion and specific recommendations)
2. Evaluation of IT proposal (PV of future savings/costs, qualitative factors)
3. KPIs (general discussion and specific recommendations)

SIMS 2
1. Revenue Audit (General points/unprompted disclosure/VAT refund/CT payable, pre audit review)
2. Directors Duties (i.e. compliance, Corporate Gov)
3. Audit of Inventory (Weakness/Implication/Recommendation, Consider new auditors)
4. FR (IAS 2/IAS 8/IAS 10/IAS 21)

SIMS 3
1. Tax - (Cash Extraction/Incorporation)
2. IT - (Value of New system, Data Protection)
3. Finance - (Short vs. long term debt, matching, alternative options)
4. HR - (maybe - relocation of employee - half pager)
5. FR - (Impairment of property IAS 36)

Please let me know if I missed something. Terrible feeling I have.

Sim 1:
Same as, but I didn't PV the T.C.O it cos I knew I wouldn't have time later, just did an annual cost off replacement costs, training costs and maintenance, bit on commercial factors and how even tho the co's not established long, if they're Irish we can investigate the directors and their lineage, and recmmended co B cos it was cheaper, more robust and local support

Sim 2:
Pretty much same... but
-tax was prompted no? It's only unprompted if disclosed before receiving a letter notifying you of revenue audit as far as I know
-recommended the auditor's position be reviewed
-IC weakness re: stock and journals to adjust
-didn't mention IAS 21 in the FX q, dammit!! outlined the journals posted, what should have happened and steps to correct (I think), did a short 3/4 page on use of FX strategies as well

Sim 3:
Had about a milion and would have to look back, but off the top of my head...
-retirement planning (relief, tax free lump sums, pension etc)
-partnership v ltd (CT, interest relief, limited liability, capital allowances and something else)
-S.O.F (possible finance lease to reduce overall borrowing costs for office fitout because other co was highly geared, VC and IPO not appropriate, debt may be best option, may be able to get Michael to invest via share premium)
-reval of prop
-IMS in context of IC weakness re: segregaton of duties w/ book keeper, apparent lack of review, no understanding of finance dept. and time pressures on Jim and woman means it'll only get worse
-Question tax efficiency of dividends
-Validity of the woman getting paid the same as Jim even tho she's reduced working hours to part time when they used to work equal amounts

REALLY hard to know what they wee looking for in that.

Rickyroma

For what its worth, here's what I included -

Sim 1 - AMY

Audit - Appropriate internal controls
Finance - Project Appraisal, System A v System B
BL - Strategy KPIs for AMY


Sim 2 - International Tiling

BL - Ethics - Comment on reluctance to inform stakeholders
Audit - Stocktake issues and advice
Audit/FR - Impact of errors re Inventory and Foreign Currency transaction.
Tax - Advice re prep for Rev Audit



SIM 3 - Real Job

PM - Review of current performance and industry
Finance - Potential sources of finance and current funding structure
IMS - Benefits of system in light of expansion
Tax - Cash Extraction
Tax/PM Commercial considerations for Ltd v Partnership




I was very very pushed for time so took a huge gamble with Sim 2 - I couldn't work out a diplomatic way to tell the manager that he has to inform stakeholders of the developments so I cc'd the FD and justified cc'ing him on the basis of the urgency of the issue. Not sure if I'll get away with that (or even if its right).

RonaldRayGun

Hanley wrote: »

Sim 1:
-didn't mention IAS 21 in the FX q, dammit!! outlined the journals posted, what should have happened and steps to correct (I think), did a short 3/4 page on use of FX strategies as well

Short 3/4 pages? Do you mean lines?

ahtfulal

RonaldRayGun wrote: »

Would he evaluation in Sim 1 be Finance? If not, reckon i'm in the Finance red zone.

Had to be finance ur right, hadn't time to do the pv calc could be cuttin it tight in finance myself! So much info to get thru it's very difficult to construct an answer!

dchitz

terrible day today, spent far too long answering sim 1 and 2 (badly) and only got to about 2/3 of the indicators in sim 3 as spent too long reading/planning answer

Vaioer

Sims 3 I saw the reval and totally discounted it. You were there as an advisory firm, not an auditor.

I mentioned the reval is passing as part of a sale and leaseback as part of their financing requirement.Even if you reval down, it would still release enough finance.

If that is an FR indicator I am undoubtedly f*cked in terms of passing it. I made no reference to impairment etc.

The report asked for their specific requests so I concentrated on that
- Cash Extraction, Tax Implications
- IMS
- Cash for the expansion
- Ltd v Partnership

Vaioer

In relation to Sims 2

The journals/impact indicator
- Does the fact that the events were discovered/ noted after the financial statements have been authorised but not issued have a major impact? I had a major freak out about this in the exam.

RonaldRayGun

ahtfulal wrote: »

Had to be finance ur right, hadn't time to do the pv calc could be cuttin it tight in finance myself! So much info to get thru it's very difficult to construct an answer!

Reckon Finance will do for me anyway. Talked complete, and very truncated, crap about the funding in Sim 3.

Didn't bother with PV's in Sim 1, just said they were both 5% so makes no odds. Would have expected the PV tables in the material if they wanted a serious PV calc.

Kingdomkerry

Sim 1:
PM - KPIs specific to not for profit organisation
Audit - fraud and weaknesses in internal controls
Finance/IMP/PM - evaluate system a and b and recommend (financial and non-financial

Sim 2:
Audit - weakness in stocktake
PM - IAS 2 and IAS 31(?) fx
Tax - preparation for revenue audit

Sim 3
PM - IAS 36 and IAS 16
Tax - cash extraction (pension scheme, retirement relief and share buyback in detail and listed alternatives)
BL/Tax - Incorporation vs Partnership
Finance - sources of finance. need equity finance if company is to expand
IMP - benefits of good IMS

RonaldRayGun

Vaioer wrote: »

Sims 3 I saw the reval and totally discounted it. You were there as an advisory firm, not an auditor.

I mentioned the reval is passing as part of a sale and leaseback as part of their financing requirement.Even if you reval down, it would still release enough finance.

If that is an FR indicator I am undoubtedly f*cked in terms of passing it. I made no reference to impairment etc.

The report asked for their specific requests so I concentrated on that
- Cash Extraction, Tax Implications
- IMS
- Cash for the expansion
- Ltd v Partnership

Agree with the sale and lease back angle. I plumped for it too. Just mentioned there may by some resrtictions imposed by the bank who gave you the loan in the first place. Didn't bother with any FR reval adjustments, thought they could use the cost model if they wanted.

Was almost tempted in Sim 1 to go for "Haitian mudhut erection rates per quarter" as a KPI, but bottled it.

dchitz

also not really sure point of aarf exam (if thats what if was even called) as about 12 standards came up over the two papers

dchitz

RonaldRayGun wrote: »

Reckon Finance will do for me anyway. Talked complete, and very truncated, crap about the funding in Sim 3.

Didn't bother with PV's in Sim 1, just said they were both 5% so makes no odds. Would have expected the PV tables in the material if they wanted a serious PV calc.

haha i was so spaced thought the discount rate was a discount they were getting for being a charity....doh

FAEStudent1

guys - audit elective - there was total of 9 preparatory case studies - is that correct? Our group wasnt given them.

RonaldRayGun

FAEStudent1 wrote: »

guys - audit elective - there was total of 9 preparatory case studies - is that correct? Our group wasnt given them.

Yeah, I have 9 excluding Sample papers and Mocks etc. I'm including Sullivan’s Grocery in the 9 (only got that off here the other day).

LightningBolt

Think I messed that up. Knew the standards they were looking for for financial just messed up. I threw in lines about IAS 33 for the earnings per share figure in sim 2.

Finance sim 3 I went off the wall and did gearing, creditor/debtor days and some other nonsense. Talked about fixing the overdraft rate.

Absolutely panicked after sim 3. Took me over 2 hours. So foolish.

Hanley

RE: Sim 2 - did anyone mention the FD's reluctance to mention any issues to the stakeholders as being a self interest threat due to him being a shareholder and not wanting to effect share value!?

Or is that even relevant cos it's only listed on IEX/AIM?!

FAEStudent1

Thanks RonaldRayGun.

Does anyone have any tips/key areas to focus on/new standards orregulation this year that they would advise focusing on in advance of tomorrows audit elective exam?

SL10

I got pretty similar to most people on here..thought it was difficult enough today. Was a expecting a bit more BL so a bit worried i may have fallen down here

Sim 1
1. Audit Controls
2. IMS evaluation- Finance- I did NPV here and then qualitative factors
3. KPI's
4. I did an ethics indicator here cos I felt really short on BL. Just went on about the ethics of acting for the comany and needing a practising cert and professional indemnity!

Sim 2
1. Aud- Weaknesses in Stocktake
2. FR/Audit- Errors, IAS2, IAS21 (tho i forgot to mention it was IAS21) and then IAS 8
3. Preparation of Revenue Audit- literally raced through this as wasnt sure if it was an indicator or not.
Also mentioned very briefly that he would have to tell the stakeholders and correct the accounts

Sim 3
Pretty much same as everyone else but I missed the Impairment.

So glad the core is over! Soo tired at this stage

RonaldRayGun

FAEStudent1 wrote: »

Thanks RonaldRayGun.

Does anyone have any tips/key areas to focus on/new standards orregulation this year that they would advise focusing on in advance of tomorrows audit elective exam?

Sean Murray in the last Dublin Lecture gave (spoke, no handouts) a list of key areas we should focus on. I think the lecture is online. The ISA's he hotly tipped were:

ISA 450 - Misstatements
ISA 550 - Related Parties
ISA 600 - Groups

I would add to that, from reviewing my class notes and lecture comments about examinability:

ISA 240 - Fraud
ISA 540 - Estimates

Also going to go through Core Session 7&8 Q pack which I found very useful leading up to the mocks.

dchitz

LightningBolt wrote: »

Think I messed that up. Knew the standards they were looking for for financial just messed up. I threw in lines about IAS 33 for the earnings per share figure in sim 2.

Finance sim 3 I went off the wall and did gearing, creditor/debtor days and some other nonsense. Talked about fixing the overdraft rate.

Absolutely panicked after sim 3. Took me over 2 hours. So foolish.

Ya did this too, talked about there loan expiring too as it was a 7 year loan got in 2004

Hackysack

Completely forgot about IAS 33. Didn't cross my mind. The PY adjustment error would have likely impacted on the PY EPS wouldn't?

Seriously made an absolute mess of the FR indicator in the second case. My journals were utter gibberish as well. Was just panicked, flustered and stuck on time.

Seriously relying on the other PM indicators to save me. Who knows how I did with the rest.

I'm very discouraged about it all. So demotivated now!

FAEStudent1

Thanks again RonaldRayGun.

If by any chance you have Core Session 7&8 Q pack handy - can you upload? Cant seem to find it.