FAE 2016

colint104

Anyone got any tips for audit elective?

Particularly with other engagements and audit reports?
Anything else would be greatly appreciated.

Thanks in advance

CAstudent

Anyone have any guidance on the best way to prepare for audit? One of my highlighted weaknesses from the mocks... feel like I have a pretty good plan for the other subjects but worried audit will be lost in the shuffle!

TG860

I find with the audit elective that the lecturer's notes are quite good in an exam environment.
They hit all the key points and thought process you need to do for a question on each area, and they have the paragraph references for the standards you need to then go and apply.

For the mocks I just printed off the notes for all of the elective sessions.
Once you're in the exam, just identify what area the indicator is about and go to the slides for that particular area.
You can very quickly plan your answer then and apply the relevant standard paragraphs to the question.

In terms of learning the material, I found reading through the standard in full before watching the lectures worked best for me. Do the questions for that session listed in the planning and delivery schedule afterwards.
It does take time to go through all of the sessions, but it is worthwhile.
You don't really need to remember anything in detail, it's just getting that rough idea of everything so you understand what the indicator is looking for. Then you can refer to slides & standard for the nitty gritty detail on the day.

dm1992

Any chance somebody could upload them Audit elective notes, don't fancy watching 3 days worth of sean murray lectures and audit core is a disaster!
Thanks in advance!

y0ssar1an22

Hope everyone's study is going well. lovely day, pity to be stuck inside!

Have a question hoping someone may be able to clarify:

Self Study case: Lowland Bank Ireland Limited, pg 52.

the 2nd indicator revolves around making a recommendation for a customer phone-in service, considering financial and non-financial factors.

In the case, the Irish call center staff will be paid €7 per proposal completed, with 12000 sales expected. ie: €84,000. It also says that 12000 sales is based upon 60000 calls with a 20% hit rate.

The solution presents this cost as 420,000 (60000 calls @ 7 per call), but should it not be 84,000 as only 12000 proposals are completed?

You could probably argue it either way in the exam, but would like to hear what other people think. Or maybe I'm reading it wrong?

Thanks

Garrigai

The call center would be paid per call not paid per successful proposal, in reality you would probably expect 7 per call and then some commission or top up per successful proposal.

kolbasin88

Hi everyone,

I have posted this earlier but I l give it another try. Most of you heard PM mentioning study groups. I looked to set one up but no luck. Just putting a word out there that if there is a lone sole like me in the UCD library, send me a PM and we can see if can meet occasionaly and discuss cases.

Take care all

CAstudent

y0ssar1an22 wrote: »

Hope everyone's study is going well. lovely day, pity to be stuck inside!

Have a question hoping someone may be able to clarify:

Self Study case: Lowland Bank Ireland Limited, pg 52.

the 2nd indicator revolves around making a recommendation for a customer phone-in service, considering financial and non-financial factors.

In the case, the Irish call center staff will be paid €7 per proposal completed, with 12000 sales expected. ie: €84,000. It also says that 12000 sales is based upon 60000 calls with a 20% hit rate.

The solution presents this cost as 420,000 (60000 calls @ 7 per call), but should it not be 84,000 as only 12000 proposals are completed?

You could probably argue it either way in the exam, but would like to hear what other people think. Or maybe I'm reading it wrong?

Thanks

I read it as when a call is made a proposal is filled out which may or may not lead to a vehicle being purchased. Don't really see a way to include the effect of the proposals coming directly through the website since this would reduce the cost of outsourcing even further but I suppose an assumption could be made.

krumykris

Hi. Im just wondering if anybody understands hedging using the money market? I am looking at the Finance theory and practice book by Anne Marie Ward and can't seem to work out how the hedge in example 18.4 equals $15m... Anybody got any idea?
Thanks

CAstudent

krumykris wrote: »

Hi. Im just wondering if anybody understands hedging using the money market? I am looking at the Finance theory and practice book by Anne Marie Ward and can't seem to work out how the hedge in example 18.4 equals $15m... Anybody got any idea?
Thanks

They are receiving 15M Usd in 3 months time so they borrow an amount now that will give them a matching 15M liability in 3 months at 4.5%. They convert the cash received when the loan is taken out into Euro to lock in an effective exchange rate.

CAstudent

Has anyone looked at the plastic products MA case? Having issues with some of the figures in the NPV, particularly the working capital requirements in year 0 and the capital allowances throughout, solution just gives the figures.

FAEs2016

The working capital requirements are detailed in Appendix 3 of the solution.

The capital allowances for Years 2006 - 2010 are equal to the €400k cost of the machine * 20% capital allowance * 40% CT rate.

The capital allowance in 2011 relates to a balancing allowance (Question notes a useful life of four years)

The TWDV is €400k - ( €80k X 4 years ) [80k is the capital allowance of 400k * 20%]
So the TWDV is €80k but we have a residual value of €50k per the question which leaves a balancing allowance of €30k. This at the CT rate of 40% gives the €12k figure per the solution.

y0ssar1an22

kolbasin88 wrote: »

Hi everyone,

I have posted this earlier but I l give it another try. Most of you heard PM mentioning study groups. I looked to set one up but no luck. Just putting a word out there that if there is a lone sole like me in the UCD library, send me a PM and we can see if can meet occasionaly and discuss cases.

Take care all

I'm also a lone wolf, but am too far away to ever make it to UCD library. However if I ever make it out that way I will PM you to see if you're about.

Ryder_SM

I was wondering does anyone have a copy of the cheat sheets that are going around for FAE core? Thanks in advance

krumykris

CAstudent wrote: »

They are receiving 15M Usd in 3 months time so they borrow an amount now that will give them a matching 15M liability in 3 months at 4.5%. They convert the cash received when the loan is taken out into Euro to lock in an effective exchange rate.

Cheers for above.. I'm just not getting how €9,169,251.57 (loan + interest) translated at the 3 month forward rate 1.59 (1.6 - 2.1(as premium)) would equal the $15m?

It says it does soon the top of page 672, but I just can't for the life of me figure out how they're working it out???

Dublin Student1992

Ryder_SM wrote: »

I was wondering does anyone have a copy of the cheat sheets that are going around for FAE core? Thanks in advance

Hey, I have the 2014 cheat sheet if that's any use to you? PM me your email address and I'll ping it on to you!

CAstudent

krumykris wrote: »

Cheers for above.. I'm just not getting how €9,169,251.57 (loan + interest) translated at the 3 month forward rate 1.59 (1.6 - 2.1(as premium)) would equal the $15m?

It says it does soon the top of page 672, but I just can't for the life of me figure out how they're working it out???

Are you looking at the same example throughout? No mention of premiums in 18.4 but there is in 18.5.

y0ssar1an22

Dublin Student1992 wrote: »

Hey, I have the 2014 cheat sheet if that's any use to you? PM me your email address and I'll ping it on to you!

What are these cheat sheets? Never heard of them. Could you also send onto me please? Will PM you my email address.

Uncle Mclovin

Anyone have the old mock papers from 2014 back?

connect1988

Hi folks

I just wanted to see if anyone had tried the coating and fabrications steps case yet?

I really struggled (and still struggling!) at understanding the valuation they placed on the acquisition of panel repairs limited? It uses the profitability of the acq company as a starting point then adds the additional contribution it would get for the acq. Does anyone understand this calculation?

Thanks for any feedback.

superb choice of username

Is anyone else losing the will to live at this stage? I feel like the deer staring into oncoming car with the full beam headlights on...

Uncle Mclovin

superb choice of username wrote: »

Is anyone else losing the will to live at this stage? I feel like the deer staring into oncoming car with the full beam headlights on...

Think everyone is in that boat. Just gotta keep on truckin'.

sarmurphy

Hi guys, does anyone know where to find the mock past papers on the student site?? I feel like my brain has finally given up on me as I cannot find them anywhere!
Ps: I am also losing the will to live.

CAstudent

sarmurphy wrote: »

Hi guys, does anyone know where to find the mock past papers on the student site?? I feel like my brain has finally given up on me as I cannot find them anywhere!
Ps: I am also losing the will to live.

I think it's just last year's up there under the updated past paper area.

Mccers16

sarmurphy wrote: »

Hi guys, does anyone know where to find the mock past papers on the student site?? I feel like my brain has finally given up on me as I cannot find them anywhere!
Ps: I am also losing the will to live.

Not sure where they are located on the institutes site but I googled "FAE 2013 mock" and was able to get the 2013 one that way. Hope that helps you!

Risteard

superb choice of username wrote: »

Is anyone else losing the will to live at this stage? I feel like the deer staring into oncoming car with the full beam headlights on...

Had a bit of a mini meltdown yesterday alright. Took some time out yesterday afternoon to get away from it.

rarara06

Has anyone done the 2015 Sim mock "Smart Case Ireland"? Having trouble understanding the TERP calc. Are there any notes about for TERP??

gilla93

Sorry to spam your post would any one have any advice on wheather I should do the cap 2 exams all together or on a modular basis? Starting in November and have all my cap 1 exemptions

Niamhmon

Do them all together so when it comes to FAE, all the information is fresher in your head and you are used to dealing with the volume of work required.

Niamhmon

Does anyone know why the solution to Raven calculates ROCE using PAT instead of PBIT? How did they calculate Capital Employed as well?

Also, where are we supposed to find industry norms for P/E Ratios, ROCE, etc?

connect1988

ROCE = 81,000 plus adj for Property increase of 56,000 (80m - 24 on b/s) less LT Borrowings of 28,350 = 108,650. 1915/108,650 = 1.76%, this is half year results so a full year would be 3.52%.

Hope this helps.

Legwinski

Niamhmon wrote: »

Does anyone know why the solution to Raven calculates ROCE using PAT instead of PBIT? How did they calculate Capital Employed as well?

Also, where are we supposed to find industry norms for P/E Ratios, ROCE, etc?

This might help also...
http://www.boards.ie/vbulletin/showpost.php?p=96574792&postcount=499

ALDon88

Hey there folks! Just wondering if there is anyone that could send me on the mock core papers and solutions for 2016 ?? I am a repeat student and I am looking for additional cases to work through. Thanks :-)

emsy315

connect1988 wrote: »

ROCE = 81,000 plus adj for Property increase of 56,000 (80m - 24 on b/s) less LT Borrowings of 28,350 = 108,650. 1915/108,650 = 1.76%, this is half year results so a full year would be 3.52%.

Hope this helps.

Was also wondering about Raven solution- why is the adjustment for long term borrowings needed? I had thought capital employed was debt+equity or total assets less current liabilities? Also wondering why PAT is used instead of PBIT if anyone has any idea?

PunkFreud

emsy315 wrote: »

Was also wondering about Raven solution- why is the adjustment for long term borrowings needed? I had thought capital employed was debt+equity or total assets less current liabilities? Also wondering why PAT is used instead of PBIT if anyone has any idea?

I recall an email from the Institue, just before last year's CAP2 Exams. Essentially it doesn't matter, once you make it clear what you're doing. You can use PBIT, PAT, or PBT - once you give reason (it can depend on the industry/company). Same goes for the capital element.

Let's remember that they don't care for this nitty gritty in FAE. They want to see your explanations, thought process, and a balanced argument... Not whether you used an ever so slightly different figure than the marking scheme.

Uncle Mclovin

What are peoples suggestions for studying audit for the core? I have done case study but feel this is my weakest area. Any recommendations would be appreciated.

y0ssar1an22

Hey guys/gals,

Anyone know what the story with IFRS 15 is? There's no mention of it in the competency statement, but it comes up a lot in Derry Cotter's financial reporting case study book.

Thanks

y0ssar1an22

ALDon88 wrote: »

Hey there folks! Just wondering if there is anyone that could send me on the mock core papers and solutions for 2016 ?? I am a repeat student and I am looking for additional cases to work through. Thanks :-)

PM sent

Obrieski

y0ssar1an22 wrote: »

Hey guys/gals,

Anyone know what the story with IFRS 15 is? There's no mention of it in the competency statement, but it comes up a lot in Derry Cotter's financial reporting case study book.

Thanks

IFRS 15 is not on our competency statement and so should be ignored. We deal with IAS 18 as part of the course.
That's the approach I'm taking but of course, if things go badly, nice to have an excuse up the sleeve

CAstudent

Obrieski wrote: »

IFRS 15 is not on our competency statement and so should be ignored. We deal with IAS 18 as part of the course.
That's the approach I'm taking but of course, if things go badly, nice to have an excuse up the sleeve

Also my approach, not sure why it's in the Cotter book.

ACA2015

IFRS 15 was on the statement then pulled I think. It's on the CAP 2 statement, so I'm guessing that's why he has it there. I think the CAP 2 people use the same book and Cotter would have made it with the up to date standards in mind.

I could be wrong but I think it was pulled because of the AARFP being moved forward. I don't think they had their ducks in a row for it in time and it's not in the standards books provided (as well as possible confusion with existing audit text books?).

The confusion over it would make you hope neither revenue or construction contracts come up. Either way, I will be raging if Construction Contracts come up. One of my weakest areas and the mock was ridiculously hard. IAS 18 is just too easy to exam so has to come up in audit or FR for me

y0ssar1an22

I emailed Paul Monahon about IFRS 15 but he is yet to get back to me. I'm also ignoring but bringing in some notes on it just in case.

Hoping someone may be able to clarify something for me.....

why are credit notes such a big deal in auditing? How can they be used to mis-state the accounts? surely its an easy check to see if they are legit ----> compare the invoice with corresponding bank lodgement, the excess of lodgement over invoice should equal credit note.

Thanks

PunkFreud

y0ssar1an22 wrote: »

I emailed Paul Monahon about IFRS 15 but he is yet to get back to me. I'm also ignoring but bringing in some notes on it just in case.

Hoping someone may be able to clarify something for me.....

why are credit notes such a big deal in auditing? How can they be used to mis-state the accounts? surely its an easy check to see if they are legit ----> compare the invoice with corresponding bank lodgement, the excess of lodgement over invoice should equal credit note.

Thanks

I think it's unlikely Paul will get back to you, at this late stage. He said in the exam review session that once he's reviewed the exam paper (which I suspect he has), he can't respond to queries.

The competency statement is black and white: IFRS15 is not examinable.

Risteard

Also I'm almost certain that we got an email/announcement about IFRS 15 not being examinable but can't for the life of me find it.

Squareball2010

Risteard wrote: »

Also I'm almost certain that we got an email/announcement about IFRS 15 not being examinable but can't for the life of me find it.

Just had a look as I too remember an email re IFRS 15 and happened to find it and it clears up what we already knew I think which is Comp Statement clearly states IAS 11/18 examinable and IFRS15 is not (despite what DCs book contains) - it stated:

That there is a discrepancy in respect of IAS 11, IAS 18 and IFRS15 between the Competency Statement and the Addendum to Competency Statement, and that students are reminded that, as always the Competency Statement takes precedence and it is to this document that students should refer for examinable material

Masterxd

Risteard wrote: »

Also I'm almost certain that we got an email/announcement about IFRS 15 not being examinable but can't for the life of me find it.

The Examinations department have asked that a clarification be issued to students in respect of IAS 11, IAS 18 and IFRS 15. There is a discrepancy between the Competency Statement and the Addendum to Competency Statement. This discrepancy is regrettable and students are reminded that, as always the Competency Statement takes precedence and it is to this document that students should refer for examinable material.


Kind regards,

The FAE team

Email received in June

ACA2015

y0ssar1an22 wrote: »

I emailed Paul Monahon about IFRS 15 but he is yet to get back to me. I'm also ignoring but bringing in some notes on it just in case.

Hoping someone may be able to clarify something for me.....

why are credit notes such a big deal in auditing? How can they be used to mis-state the accounts? surely its an easy check to see if they are legit ----> compare the invoice with corresponding bank lodgement, the excess of lodgement over invoice should equal credit note.

Thanks

It's unlikely you'll ever get an invoice corresponding with a lodgement. Maybe for a service orientated business like a bar where revenue would be recognised daily based on a lodgement.

Most post year end cash receipts you would expect would come in the terms you've set (i.e. 30 days payment you owe X relating to Y, Z.. invoices), but it really isn't that simple. What you also need to consider is that potentially the customer could, post year end, decide to make a prepayment to you or could pay you still with issues over faulty products not entirely sorted out, but they have a good relationship so keep up payment and wait until the credit note situation is sorted. As such when you as the auditor look at the lodgements you might think that's grand as lodgements =/> the balance, but in reality a credit note was issued a month later which really should bring your current year sales down. Credit notes are another way to test the existence of revenue/receivables around year end. Most manufacturing/service type company should have a provision (or documentation discussing the need for a provision) for this type of thing which the auditor would expect to see and be able to test. CNs should like invoices have some sort of sequential numbering which you can test against the system.

CAstudent

What's everyone focusing on for the final week? Kind of crunch time now...

I still have the updated exam papers to do so will look at those and probably some of the FR cases. Likely do a few hours of elective today or tomorrow and then all core.

superb choice of username

CAstudent wrote: »

What's everyone focusing on for the final week? Kind of crunch time now...

I still have the updated exam papers to do so will look at those and probably some of the FR cases. Likely do a few hours of elective today or tomorrow and then all core.

This stress gave me a massive migraine so had to take nearly two days off. Back at it slowly today though.

Like you, have a few more papers to go through. Really trying to focus on simplifying my answers. When looking at the solutions, they are fairly basic, but dunno why my brain wants to try make it complicated I think at this stage, there isn't really any more time for learning of technical knowledge, instead it is more about exam technique.

So last week, last few exam papers, maybe take a day to reorganise/condense notes, but the main thing is trying to keep the head on straight and fight the temptation to panic!!

PunkFreud

CAstudent wrote: »

What's everyone focusing on for the final week? Kind of crunch time now...

I still have the updated exam papers to do so will look at those and probably some of the FR cases. Likely do a few hours of elective today or tomorrow and then all core.

It's squeaky bum time now, so I'm focusing on maintaining my routine - doing cases, exercise, and eating healthy.

In terms of study, I'm doing the final few exam papers and going through the competency statement for the final time, to make sure I've covered everything.