FAE September 2014

Abbey14

Hi,

In the Audit elective - Fundi Limited case it is debating the use of internal audit. It says the guy in internal audit "reports directly to the finance director and part of his salary consists of a performance bonus and share options".

In the solution under independence it says "Positive - Barry's salary is not dependent primarily on the performance of the company"
I assume that is incorrect as he has shares in the company and a bonus so a financial interest in it to do well and hide any issues??

myshirt

Anyone have a diagram or decision chart for audit reports?

I don't work in Audit, and haven't a rashers.

littlemiss123

myshirt wrote: »

Anyone have a diagram or decision chart for audit reports?

I don't work in Audit, and haven't a rashers.

See page 55 and 72 of the APB Bulletin 2006/1 in the below link:

https://www.frc.org.uk/Our-Work/Publications/APB/Bulletin-2006-1-Auditor-s-Reports-on-Financial-Sta.pdf

Shows two flow diagrams - one excluding going concern issues and the other including. These are also in the standards book: page 1268 and 1284 if you have the green version of the book.

Abbey14

There is one at the back of the audit standards book - pg 1,268. It is only okay - can be helpful with the questions.

womandriver

myshirt wrote: »

Anyone have a diagram or decision chart for audit reports?

I don't work in Audit, and haven't a rashers.

This was part of the notes for the Chartered AAE revision course in March

womandriver

Chris Partlow wrote: »

So its not a case of adding another paragraph (EOM, Other Matter), its just a case of not signing?

Is this launch session 6 lecture you're referring to? I'll have to have a quick look over it again. Happy enough with Audit Reports in general but I found this indicator a bit odd.

Thanks for your help.

CORE audit session 9&10, skip to 3.39 and also 3.44.

Dellboy2007

womandriver wrote: »

CORE audit session 9&10, skip to 3.39 and also 3.44.

I find the lectures very good to watch when I'm having difficulty sleeping.

PhilipLuke

Dellboy2007 wrote: »

I find the lectures very good to watch when I'm having difficulty sleeping.

I'd say you have that problem quite a bit all right

Dellboy2007

PhilipLuke wrote: »

I'd say you have that problem quite a bit all right

Would you yeah? Oh right then, thanks.

womandriver

Dellboy2007 wrote: »

I find the lectures very good to watch when I'm having difficulty sleeping.

Dellboy, you're doing the AAE too right?

Do you have the solution to the Rowland financial services case study? I don't see it anywhere on the portal.

Dellboy2007

womandriver wrote: »

Dellboy, you're doing the AAE too right?

Do you have the solution to the Rowland financial services case study? I don't see it anywhere on the portal.

Yes womandriver, I have it but I'm not near a computer. Is it in this zip file?

https://www.dropbox.com/s/jol2p0m8h3tognc/FAE%20AAE%20-%20Solutions%20to%20cases%20-%20session%206%20to%209.zip

womandriver

Dellboy2007 wrote: »

Yes womandriver, I have it but I'm not near a computer. Is it in this zip file?

https://www.dropbox.com/s/jol2p0m8h3tognc/FAE%20AAE%20-%20Solutions%20to%20cases%20-%20session%206%20to%209.zip

Yes it's there, thanks a mill.

autumnbelle

Any one know why in telfer group in Derry cotter book property when transferred to hfs is transferred at increased market value when all the notes I have for ifrs 5 say you revalue to lower of npv or fv minus cost? Please

Aidodub87

autumnbelle wrote: »

Any one know why in telfer group in Derry cotter book property when transferred to hfs is transferred at increased market value when all the notes I have for ifrs 5 say you revalue to lower of npv or fv minus cost? Please

Go back 2/3 pages and I think this was discussed... I think

autumnbelle

Thanks Aido I'll catch up someday! Just checking it now

laser08

Just did 2012 comp link. Just shows how crazy this exam is. The last indicator asks for an assessment if their current marketing plan and if a formal marketing plan would be more useful. In the solution this is down as an imp indicator?? How is there any logic to that

PhilipLuke

laser08 wrote: »

Just did 2012 comp link. Just shows how crazy this exam is. The last indicator asks for an assessment if their current marketing plan and if a formal marketing plan would be more useful. In the solution this is down as an imp indicator?? How is there any logic to that

Thats just an error on the examiners part. It is a marketing indicator!!

It doesn't actually say Information Management Principles, it says Information Marketing Principles.

kenner24

Surely something like logic med cant come up?? It is a train wreck.... from the cross marking session i wrote down what Paul Monahan said the Board said about the case.... "if they can do this they will be fine in September...."

im scared

littlemiss123

kenner24 wrote: »

Surely something like logic med cant come up?? It is a train wreck.... from the cross marking session i wrote down what Paul Monahan said the Board said about the case.... "if they can do this they will be fine in September...."

im scared

The more cases I'm doing the more worried/less confident I'm getting! I am glad I did the exam papers first though, they are a lot more forgiving that the steps/integrated cases.

I don't think I have ever been so unconfident going into an exam.

laser08

PhilipLuke wrote: »

Thats just an error on the examiners part. It is a marketing indicator!!

It doesn't actually say Information Management Principles, it says Information Marketing Principles.

Is it though cause Paul Monaghan keeps banging on how there has never been a marketing indicator and that we should expect one this year

vnervous

Could not agree with you more , but I definitely feel like the 2012 paper was harder than previous papers and then 2013 was harder again. I really hope this isn't a trend ....that Mick exam was horrendous for the most part. Hoping this isn't a sign of things to come.

PhilipLuke

laser08 wrote: »

Is it though cause Paul Monaghan keeps banging on how there has never been a marketing indicator and that we should expect one this year

Read the Examiners comment on the indicator on the Examiners report and I quote:

"Given that this was the first time that a marketing indicator had been examined on FAE Core Comprehensive, the information in Appendix 3 on the marketing approach was presented to provide candidates with a suggested structure to their answer."

Don't know what Paul Monohan is bullin on about if he said that

myshirt

Littlemiss, no no no!

Go into this thing as confident as f#ck. Back yourself, don't let it get you down.

Walk in there chin up, tits out, and fight; you are well capable; you'll nail parts; you'll be clueless on others, and everyone will; and you'll take a reasonable approach to the rest; and you'll pass.

Walk in there with self confidence and deal with that paper as best you can.

Sher look at Delboy2007 after he got a C in the AAFRP

littlemiss123

PhilipLuke wrote: »

Read the Examiners comment on the indicator on the Examiners report and I quote:

"Given that this was the first time that a marketing indicator had been examined on FAE Core Comprehensive, the information in Appendix 3 on the marketing approach was presented to provide candidates with a suggested structure to their answer."

Don't know what Paul Monohan is bullin on about if he said that

My money is on a change management indicator. Hasn't really been a proper one yet.

galway321

laser08 wrote: »

Just did 2012 comp link. Just shows how crazy this exam is. The last indicator asks for an assessment if their current marketing plan and if a formal marketing plan would be more useful. In the solution this is down as an imp indicator?? How is there any logic to that

After it states 'information marketing principals' in the solution the numbers included in brackets are; (2.5)
2.5 is marketing so it's classified as a marketing indicator.

House of Wolves

Hey guys just wondering for referencing ISA and IAS are yous giving particular paragraphs or just going with the appropriate standard e.g IAS18 and throwing in the paragraph number if it's to hand?

LOccitane

littlemiss123 wrote: »

My money is on a change management indicator. Hasn't really been a proper one yet.

I agree with you Littlemiss.

My money is on 1 Corp Gov, 1 Change Management and the balance being a Strategy/Ethics mix. We'll know soon enough either way!

littlemiss123

myshirt wrote: »

Littlemiss, no no no!

Go into this thing as confident as f#ck. Back yourself, don't let it get you down.

Walk in there chin up, tits out, and fight; you are well capable; you'll nail parts; you'll be clueless on others, and everyone will; and you'll take a reasonable approach to the rest; and you'll pass.

Walk in there with self confidence and deal with that paper as best you can.

Sher look at Delboy2007 after he got a C in the AAFRP

Haha brilliant!

Thanks for the words of encouragement! Yeah, I have good days and bad days, I think today is just a bad, low confidence day! I really just cannot wait for this to be over, it's like an emotional rollercoaster!

littlemiss123

Anyone have an approximate breakdown of what subjects people fail on? Be interesting to know...

Also, came across this, worth a quick read...

http://www.morganmckinley.ie/article/expert-tips-how-pass-your-faes

ASOT2012

myshirt wrote: »

Littlemiss, no no no!

Go into this thing as confident as f#ck. Back yourself, don't let it get you down.

Walk in there chin up, tits out, and fight; you are well capable; you'll nail parts; you'll be clueless on others, and everyone will; and you'll take a reasonable approach to the rest; and you'll pass.

Walk in there with self confidence and deal with that paper as best you can.

Sher look at Delboy2007 after he got a C in the AAFRP

Where?..the old lad in the back ground chatting up your one?

Dellboy2007

ASOT2012 wrote: »

Where?..the old lad in the back ground chatting up your one?

No I'm the one taking the woman to do a shot and then straight up to the room for a bit of depreciating

ASOT2012

Dellboy2007 wrote: »

No I'm the one taking the woman to do a shot and then straight up to the room for a bit of depreciating

You sure its not impairment?

Dellboy2007

myshirt wrote: »

Walk in there chin up, tits out...

The Little Fella

Dellboy2007 wrote: »

FAE14

Feeling confident now ! Finally I am ready for this exam and I understand what this whole year was about !

LOccitane

kenner24 wrote: »

Surely something like logic med cant come up?? It is a train wreck.... from the cross marking session i wrote down what Paul Monahan said the Board said about the case.... "if they can do this they will be fine in September...."

im scared

I'm just after looking at this and can I rant and say what a pile of tosh of a case! There is nothing remotely like the complexity of the Financial Reporting in there is ANY of the AAFRP Questions, Past Final Papers or DC cases (which are the prescribed relevant materials). Netting off DT amounts against Goodwill in Journals etc.

The amount of waffle in the solution is insane as well. For example, it takes the solution FIVE typed lines to say that Venture capitalists do not generally invest in R&D but might do so because of the medical sector nature of the activity.

Fair enough - if the Final is anything like this then I'm in big trouble. If not, why even distribute cases like that?

I understand the need for pushing the bar up etc. but this seems excessive.

GR3YFOXXX

FAE14 wrote: »

Feeling confident now ! Finally I am ready for this exam and I understand what this whole year was about !

Lieing bastard!


: p

galway321

LOccitane wrote: »

I'm just after looking at this and can I rant and say what a pile of tosh of a case! There is nothing remotely like the complexity of the Financial Reporting in there is ANY of the AAFRP Questions, Past Final Papers or DC cases (which are the prescribed relevant materials). Netting off DT amounts against Goodwill in Journals etc.

The amount of waffle in the solution is insane as well. For example, it takes the solution FIVE typed lines to say that Venture capitalists do not generally invest in R&D but might do so because of the medical sector nature of the activity.

Fair enough - if the Final is anything like this then I'm in big trouble. If not, why even distribute cases like that?

I understand the need for pushing the bar up etc. but this seems excessive.

While the adjustments etc in Logic Med are over the top (what auditor would sign off on accounts omitting warranties and pensions as in the case) I think the general outline could be similar to the exam as it basically covers everything predicted;

Your a subsidiary of a multinational, who acquired a subsidiary in the year and has to consolidate European accounts to be sent to the parent.

FR - Acquisition in year - EU consolidation - acquiree possibly in local GAAP, implement IFRS
Mgmt - KPI's of new subsidiary / transfer pricing / implement ABC in new subsidiary etc
Change mgmt/HR - redundancies in new sub / synergies - mixing mgmt teams etc
Tax - on acquisition / dividends received / use of acquires losses etc
Finance - financing acquisition / valuing company / did we get a good deal
IMP - using two systems - should we buy one overall IMS system etc
Audit - internal controls / reporting to parent / group audit requirements
Corp Gov - non exec's from parent on our board, not giving us sufficient time / audit committee non effective etc

Obviously the above is speculative but logic med gives a good basis for a lot of the above.

Debs23

What cases are good for PM. Haven't really done much for this!

LOccitane

galway321 wrote: »

While the adjustments etc in Logic Med are over the top (what auditor would sign off on accounts omitting warranties and pensions as in the case) I think the general outline could be similar to the exam as it basically covers everything predicted;

Your a subsidiary of a multinational, who acquired a subsidiary in the year and has to consolidate European accounts to be sent to the parent.

Obviously the above is speculative but logic med gives a good basis for a lot of the above.

Much agreed in terms of the outline. I think one thing to watch is that the Competency Statement specifically notes that a Step Acquisition is examinable from a Consolidation (FR) perspective so that might also be in the mix.

Having a subsidiary in Ireland as well might pander to an ethical issue around washing profits through Ireland (related directly to MA TP) and which was highly topical when the Papers would have been written.

galway321

LOccitane wrote: »

Much agreed in terms of the outline. I think one thing to watch is that the Competency Statement specifically notes that a Step Acquisition is examinable from a Consolidation (FR) perspective so that might also be in the mix.

Having a subsidiary in Ireland as well might pander to an ethical issue around washing profits through Ireland (related directly to MA TP) and which was highly topical when the Papers would have been written.

Good point - Hadn't thought of that tax/ethical issue. It would tie into reading the financial times as well re what other companies are doing it.

What's the solution though - hard to say stop doing it if it's saving the company millions and bringing in tax revenue to Ireland!

Would love to see step acquisition to be honest, though I might regret saying that!

Mark1916

galway321 wrote: »

Good point - Hadn't thought of that tax/ethical issue. It would tie into reading the financial times as well re what other companies are doing it.

What's the solution though - hard to say stop doing it if it's saving the company millions and bringing in tax revenue to Ireland!

Would love to see step acquisition to be honest, though I might regret saying that!

Another thing that has crept up recently was the north getting to bring their corp tax rate in line with the republic and also banks threatening to leave the uk and set up base in Ireland if the uk leave the eu although they are recent developments, handy to keep in mind tho!

Dellboy2007

galway321 wrote: »

What's the solution though - hard to say stop doing it if it's saving the company millions and bringing in tax revenue to Ireland!

Duty to maximise profits, not evasion but planning, it's not illegal, transparency re: public accounts, Ireland is a developed country paying minimum wage through which the company is providing many jobs, etc, etc...

Nonamerequired

FAEStudent2014 wrote: »

In the CGS book it is
1) not more than €7.3m turnover
2) not more than €3.65m in balance sheet
3) not more than 50 employees
Have to meet two to qualify..

There are the old audit exempt thresholds before they were updated to 8.8 4.4 and 50

myshirt

The solution is a big F.U to the rest of the world.

Chartered Accountants support the retention of the headline rate of CT; and they support the holding company exemption; and reorganisation relief where the target company doesn't have to be Irish registered. We are pro business, we are pro globalisation, and we are pro IFRS.

They won't go there and try be ethical heros in a public document when their public position is not one of leadership on this, but one of strong lobbying for retention behind the scenes and a reactive keep it quiet unless we've to speak PR policy where they'll defend CT in Ireland.

At most, in a case study we'll have to merely identify that there is an issue, tell the company to keep the head down, take it handy, don't be greedy, and ensure the high tax country doesn't find out a reference price for your product. Instead, insist on the transfer price you charge as being fair.

You are entitled to manage your tax affairs with a global tax policy. This is a nice fee earner due to company's sh!tting their pants at the moment aswell, as is the R&D tax credit that the KPMG examiner at CAP2 is obsessed with. The institute are not going to put a controversial dilemma on the paper when members livelihoods depend on it, and members are strongly pro international business and pro irish tax regime.

20 Times 20 Times

myshirt wrote: »

The solution is a big F.U to the rest of the world.

Chartered Accountants support the retention of the headline rate of CT; and they support the holding company exemption; and reorganisation relief where the target company doesn't have to be Irish registered. We are pro business, we are pro globalisation, and we are pro IFRS.

They won't go there and try be ethical heros in a public document when their public position is not one of leadership on this, but one of strong lobbying for retention behind the scenes and a reactive keep it quiet unless we've to speak PR policy where they'll defend CT in Ireland.

At most, in a case study we'll have to merely identify that there is an issue, tell the company to keep the head down, take it handy, don't be greedy, and ensure the high tax country doesn't find out a reference price for your product. Instead, insist on the transfer price you charge as being fair.

You are entitled to manage your tax affairs with a global tax policy. This is a nice fee earner for company's sh!tting their pants at the moment aswell, as is the R&D tax credit that the KPMG examiner at CAP2 is obsessed with. The institute are not going to put a controversial dilemma on the paper when members livelihoods depend on it, and members are strongly pro international business and pro irish tax regime.

Totally agree with this !!

No chance of them coming out and getting involved in this debate in a HC solution that would have to be released.

Mark1916

20 Times 20 Times wrote: »

Totally agree with this !!

No chance of them coming out and getting involved in this debate in a HC solution that would have to be released.

Be funny tho in the exam if you accused CAI of being part of the problem lol

Risk: CAI supporting unfair practices
Mitigant: Get rid of the CAI
Benefits: Everyone's a winner

Accountant81

galway321 wrote: »

While the adjustments etc in Logic Med are over the top (what auditor would sign off on accounts omitting warranties and pensions as in the case) I think the general outline could be similar to the exam as it basically covers everything predicted;

Your a subsidiary of a multinational, who acquired a subsidiary in the year and has to consolidate European accounts to be sent to the parent.

FR - Acquisition in year - EU consolidation - acquiree possibly in local GAAP, implement IFRS
Mgmt - KPI's of new subsidiary / transfer pricing / implement ABC in new subsidiary etc
Change mgmt/HR - redundancies in new sub / synergies - mixing mgmt teams etc
Tax - on acquisition / dividends received / use of acquires losses etc
Finance - financing acquisition / valuing company / did we get a good deal
IMP - using two systems - should we buy one overall IMS system etc
Audit - internal controls / reporting to parent / group audit requirements
Corp Gov - non exec's from parent on our board, not giving us sufficient time / audit committee non effective etc

Obviously the above is speculative but logic med gives a good basis for a lot of the above.

Thanks for this Galway - that certainly mapped out my study plan for the day!

LOccitane

Folks; just a follow up on that LogicMed solution.. It states that Warranty provisions are tax deductible as created.

Does anybody have the relevant TCA sections or Revenue guidance references for this? I've searched online but can't seem to find anything. Thanks.

galway321

Accountant81 wrote: »

Thanks for this Galway - that certainly mapped out my study plan for the day!

*year