FAE September 2012

funkymonkey9

figrolls wrote: »

Anybody know somewhere I could get a decent audit work programme with test by assertion?

Really struggling with test of controls as we only do substantive testing in my office

This might help?

LR987654

What are the two Irish annex provisions we are required to audit?

Acc7777

Username2011 wrote: »

I only noticed one error in the OBC solution, in that you didn't have information to calculate the first years increase in working capital. I'm surprised to hear there were errors as this was an exam paper question. What errors did you come across?

Acc7777 wrote: »

Has anyone done the OBC valuation finance indicator in the 2010 FAE Sim paper?

I have one or two issues with the PE based valuation for Silverturn Meats and was hoping someone could perhaps shed some light.

Issue 1

In the Appendix to the solution it states the following:

Year 5
Profit increase 84,312
Savings 40,000

---

Total 139,926

This obviously doesn't tot and I presume the profit increase should be 99,926.
If I'm missing something here please let me know.

Issue 2

I'm having trouble reconciling the profit increase figures I calculated to what is in the solution.

I got the same figures as the solution for year 1 of 61,972.80 (154,932*0.4) and roughly the same figure for year 2 of 79,325 ((154,932+61972.80)*1.08 - 154,932)

However ever years 3 to 5 are calculated on an 8% increase on the additional profit i.e.

Year 3 79,325*1.08 = 85,671
Year 4 85671*1.08 = 92,524
Year 5 92,524*1.08 = 99,926 (which reconciles issue 1)

On the basis of the calculations for years 3 to 5 I would have thought that to be consistent the profit increase figure for year 2 should have been 61,972.80*1.08 instead of increasing the total profit by 8%

Or that the calculations for years 3 to 5 would be based on total profit as opposed to additional.

To be honest if this was in one of the resource pack solutions etc I wouldn't have cared too much and just chalked it up to errors but since its an actual past paper solution I feel like it's much more likely that the solution is correct / I'm missing something.

One of the most popular stories on BBC news at the moment is
"Why do we procrastinate so much?"
Made me wonder if they somehow know I'm meant to be studying

froggatt2011

When does a company listed on AIM cease to be a Limited company and re-register to become a plc? Is it when the share capital is increased to £50,000 and the company memorandum is changed? So it is possible to be listed on AIM and not be a plc?

7upfree

Acc7777 wrote: »

Username2011 wrote: »

I only noticed one error in the OBC solution, in that you didn't have information to calculate the first years increase in working capital. I'm surprised to hear there were errors as this was an exam paper question. What errors did you come across?

Acc7777 wrote: »

Has anyone done the OBC valuation finance indicator in the 2010 FAE Sim paper?

I have one or two issues with the PE based valuation for Silverturn Meats and was hoping someone could perhaps shed some light.

Issue 1

In the Appendix to the solution it states the following:

Year 5
Profit increase 84,312
Savings 40,000

---

Total 139,926

This obviously doesn't tot and I presume the profit increase should be 99,926.
If I'm missing something here please let me know.

Issue 2

I'm having trouble reconciling the profit increase figures I calculated to what is in the solution.

I got the same figures as the solution for year 1 of 61,972.80 (154,932*0.4) and roughly the same figure for year 2 of 79,325 ((154,932+61972.80)*1.08 - 154,932)

However ever years 3 to 5 are calculated on an 8% increase on the additional profit i.e.

Year 3 79,325*1.08 = 85,671
Year 4 85671*1.08 = 92,524
Year 5 92,524*1.08 = 99,926 (which reconciles issue 1)

On the basis of the calculations for years 3 to 5 I would have thought that to be consistent the profit increase figure for year 2 should have been 61,972.80*1.08 instead of increasing the total profit by 8%

Or that the calculations for years 3 to 5 would be based on total profit as opposed to additional.

To be honest if this was in one of the resource pack solutions etc I wouldn't have cared too much and just chalked it up to errors but since its an actual past paper solution I feel like it's much more likely that the solution is correct / I'm missing something.

One of the most popular stories on BBC news at the moment is
"Why do we procrastinate so much?"
Made me wonder if they somehow know I'm meant to be studying

This day next week there'll be no time for procrastination. I have loads to still get through but just sick of it at this stage. Just hoping on the day I can just keep writing I tend to get bored after about 2 hours although panic on the day usually drives me through exams.

Szewinska

cross selling came up in gems case study. does anybody know where in our notes this is. thanks

Siobhang4

Szewinska wrote: »

cross selling came up in gems case study. does anybody know where in our notes this is. thanks

BL Marketing.

Ex 88

Mother of god I just did the first case in Sample Paper 1! The length of the solution is insane I was pushed for time and didn't get near what was required down on the page in 80min! Anyone else feel like that? I thought I was doing ok and was full of confidence yesterday just want to jump out the feckin window now!!!!!

Beckymc85

Acc7777 wrote: »

Username2011 wrote: »

I only noticed one error in the OBC solution, in that you didn't have information to calculate the first years increase in working capital. I'm surprised to hear there were errors as this was an exam paper question. What errors did you come across?

Acc7777 wrote: »

Has anyone done the OBC valuation finance indicator in the 2010 FAE Sim paper?

I have one or two issues with the PE based valuation for Silverturn Meats and was hoping someone could perhaps shed some light.

Issue 1

In the Appendix to the solution it states the following:

Year 5
Profit increase 84,312
Savings 40,000

---

Total 139,926

This obviously doesn't tot and I presume the profit increase should be 99,926.
If I'm missing something here please let me know.

Issue 2

I'm having trouble reconciling the profit increase figures I calculated to what is in the solution.

I got the same figures as the solution for year 1 of 61,972.80 (154,932*0.4) and roughly the same figure for year 2 of 79,325 ((154,932+61972.80)*1.08 - 154,932)

However ever years 3 to 5 are calculated on an 8% increase on the additional profit i.e.

Year 3 79,325*1.08 = 85,671
Year 4 85671*1.08 = 92,524
Year 5 92,524*1.08 = 99,926 (which reconciles issue 1)

On the basis of the calculations for years 3 to 5 I would have thought that to be consistent the profit increase figure for year 2 should have been 61,972.80*1.08 instead of increasing the total profit by 8%

Or that the calculations for years 3 to 5 would be based on total profit as opposed to additional.

To be honest if this was in one of the resource pack solutions etc I wouldn't have cared too much and just chalked it up to errors but since its an actual past paper solution I feel like it's much more likely that the solution is correct / I'm missing something.

There are definite errors in the Suggested solution.
From my calculations year 1 profit is 40% of organic beefs current profit i.e. €154,932 @ 40% = €61,973. Then I increased this profit figure by 8% each year so year 2 = €66,931, year 3 = €72,285, year 4 = €78,068 and year 5 = €84,313.
Obviously all of the above are before adding on the annual cost savings of €40,000.
This gave me an average profit if € 112,714 for the five years.
This agrees to the figure used for average profit in the calculation of Accounting Rate of Return method in the tutorial note also.

Would anyone have an up-to-date list of the indicators per case study they would share?? Please and thanks!

faer2203

For management accounting the main points are
- Pricing/costing
- Transfer pricing
- Divisional performance
- Budgeting
- Variances

Am I leaving anything out?

Siobhang4

faer2203 wrote: »

For management accounting the main points are
- Pricing/costing
- Transfer pricing
- Divisional performance
- Budgeting
- Variances

Am I leaving anything out?

Balance Scorecard and KPI's

Username2011

Does anyone know if its ever justifiable to not depreciate buildings?

Chalk_Farm

Does anybody know on Park4Square the indicator solution number 4 where he gets the 57% from!!??

whytenc

Username2011 wrote: »

Does anyone know if its ever justifiable to not depreciate buildings?

Have to depreciate buildings always-even if the land on which the building sit isnt depreciated....

Elle2012

Chalk_Farm wrote: »

Does anybody know on Park4Square the indicator solution number 4 where he gets the 57% from!!??

Think they utilized 43.4% in 2011 so unutilized then is 57% (100% - 43.4%)

Chalk_Farm

Elle2012 wrote: »

Think they utilized 43.4% in 2011 so unutilized then is 57% (100% - 43.4%)

Cheers you're right...not really liking this case at all!! :mad:

tt1

Does anyone know if its ever justifiable to not depreciate buildings??

Have to depreciate buildings always-even if the land on which the building sit isnt depreciated....

In cap2 audit summer exam last yr, the directors chose a policy of not depreciating buildings cause they were increasing in value. Then a few yrs down the line they changed the policy to depreciate them and this was accounted for as a change in policy ias 8!!

Username2011

tt1 wrote: »

Does anyone know if its ever justifiable to not depreciate buildings??

Have to depreciate buildings always-even if the land on which the building sit isnt depreciated....

In cap2 audit summer exam last yr, the directors chose a policy of not depreciating buildings cause they were increasing in value. Then a few yrs down the line they changed the policy to depreciate them and this was accounted for as a change in policy ias 8!!

Yep. I'm fairly sure there are circumstances, I just can't find them!

haribo12

In primus pet foods case in indicator 6 where are they getting the 48 per cent, 19 per cent etc .... received by division it's really wrecking my head

louise1985

haribo12 wrote: »

In primus pet foods case in indicator 6 where are they getting the 48 per cent, 19 per cent etc .... received by division it's really wrecking my head

Its given n appenix 4

Szewinska

Siobhang4 wrote: »

Szewinska wrote: »

cross selling came up in gems case study. does anybody know where in our notes this is. thanks

BL Marketing.

Hi Siobhan

i must be gone at the game, but is it part of them chapters in the resource pack. cant find it there on a quick skim through.

whytenc

does anyone know the acc treatment for buyback of shares? doing the sim 2, SP1 and their journal entries are
Dr Capital redemption reserve
Dr Revenue Reserve
Cr Bank

I thought IAS32 said that the repurchase of shares would result in the reduction of share capital so that there would have been some form of Dr SC entry.....any thoughts?

BESman

Szewinska wrote: »

cross selling came up in gems case study. does anybody know where in our notes this is. thanks

There are cross selling notes in that pack from the guy that came first last year. They should be attached on the thread. Think they're part of his business leadership notes or strategy.

On another note, does anyone have a good summary of the main control risks for each financial statement area (like revenue, stock, etc)? Someone put up some great notes on controls earlier so something similar on risks/weaknesses would be great!

ferike1

I am most worried that they will be assh*ts and trick us. So like there is a big long strategy indicator or something and you put together a great answer but there is one line thrown in at the start with the BS intro that makes your answer NC.
All information given indicates a certain course of action but that one line (which you can easily miss in an exam) makes it a no-go

E.g Bill Williams proposed move into the African market would make financial and strategic sense except we don't recommend it because Bill is a racist.

Or EIIS doesn't apply because Jane's Sex shop doesn't qualify as the right type of trade.

haribo12

BESman wrote: »

Szewinska wrote: »

cross selling came up in gems case study. does anybody know where in our notes this is. thanks

There are cross selling notes in that pack from the guy that came first last year. They should be attached on the thread. Think they're part of his business leadership notes or strategy.

On another note, does anyone have a good summary of the main control risks for each financial statement area (like revenue, stock, etc)? Someone put up some great notes on controls earlier so something similar on risks/weaknesses would be great!

Agree could you send me the link for the control notes

Butterflyguy

tt1 wrote: »

Does anyone know if its ever justifiable to not depreciate buildings??

Have to depreciate buildings always-even if the land on which the building sit isnt depreciated....

In cap2 audit summer exam last yr, the directors chose a policy of not depreciating buildings cause they were increasing in value. Then a few yrs down the line they changed the policy to depreciate them and this was accounted for as a change in policy ias 8!!

As far as I know, you don't have to depreciate buildings if they qualify as either investment property under IAS40, or as held for sale under IFRS5.

figrolls

Anybody have any suggestions on the best way to study WACC?

everytime i look at it I get so confused I just give up!

figrolls

Somebody was saying a while ago they were struggling with investment appraisal, this might be some help

http://financial.kaplan.co.uk/Documents/ICAEW/MI_Ch3_p.pdf

I know its pretty simplistic but Im hopeing we wont need anythin too detailed!

mrduffy

faer2203 wrote: »

Hey guys, just wondering if anyone done Green Homes, just in the valuation of the co, how are they getting the express valuation formula? looks like there multiplying profit by 6.6, but dont know where the 6.6 comes from

Can anyone please tell me this formula 'express valuation' ? I have googled it and their is a rant of physics about it !!

ferike1

Just doing the Brilliant Bee case study

Peter Fox - the person you are in this case study has his own personal hives...WTF

No wonder people think accountants are weird. What kind of nutjob in the institute thinks a normal person has their own honey bee hives. Hahaha,