[sarah762]

OK! Thank you so much 🙂

[sarah762]

Does that mean the question is asking about “general” acceptance procedures to be considered?

[sarah762]

Thanks

[sarah762]

Yes, I saw that post and had read it before I asked this question but still don’t totally understand

Is it correct to say audit procedures are substantive procedures and TOC?

If that’s the case, then it is not wrong for me to write audit procedures like how we write substantive procedures in AA, correct?

From the technical articles, the audit procedures written look similar to substantive procedures in AA

[sarah762]

What if the premiums are quoted in CHF/$, how to calculate?

Is it we will divide instead of multiplying (ie 98 x CHF 125,000 / CHF 0.0086 = $1,424,419) ?

Is that correct?

[sarah762]

Thank you 🙂

[sarah762]

Thanks

[sarah762]

Thanks

[sarah762]

Thanks

[sarah762]

I remember in paper FM, the maintenance costs are always deducted in arriving at the taxable profits (deductible for tax purpose). I think it was in the lease or buy topics

But in this case, the maintenance costs are deducted after tax (not deductible for tax purpose). What is the reason for that?

[sarah762]

I went to rewatch the lecture and I realized I mistook and treated maintenance of the assets in arriving at taxables profits which what I done is wrong.

No wonder my question didnt make any sense. Please ignore my question above

Now I understand. Even if we want to add back the TAD and then deduct the similar amount for the maintenance of the asset after the taxable profits, we will still get full mark for that?

Did I understand that correctly?

[sarah762]

Yes, I have watched your lectures where you explained this 🙂

Will the amount be the same if we deduct both the maintenance and TAD separately before calculating tax but only adding back the TAD after calculating tax (because it is a no cash flow item)?

I guess I am confused about the mathematical logic part

[sarah762]

Apologies, my bad! Will start a new thread for different questions next time

I have forgotten which past paper it was. If not, I would have posted the name/year of the past paper for you to have a look. Too bad!

Anyways, thanks 🙂

[sarah762]

3. If we do not add back the TAD again after deducting it due to the cash outflow of the same amount for the maintenance of the assets, does that mean that the TAD is similar to the maintenance of the assets?

Because if we do not add back the TAD, we are assuming they are treated as ‘one’ instead of separate items?

[sarah762]

I see…thanks for clearing up my confusion

Another question is, let’s say a question mentioned in a scenario “time pressured audit”.

If the answer given only states, intimidation threat to objectivity in the marking scheme, and I talk about self interest threat to objectivity (because auditors will try to cut corners in the audit). Does this mean this point will get no mark?

What if my point is not in the marking scheme?

[sarah762]

In the ACCA technical article on the exam
technique for answering ethics question is,

(a) Identify threats to independence

(b) Evaluate the significance of the threats identified, and

(c) Apply safeguards, when necessary, to eliminate the threats or reduce them to an acceptable level

Does that mean we always need to talk about the significance of threats identified when answering ethics question in exam?

Can we talk about the implications only because some of the answers given did not talk about the significance of threats identified

[sarah762]

How do we know if a threat is significant when we are answering an ethics question during the exam?

If we say ‘a threat’ is significant but the answer says otherwise, does that mean we will we zero mark?

[sarah762]

Thank you so much

[sarah762]

I think I just understood what you said

Is it the difference between 12 months expected credit losses and lifetime expected credit losses is due to the “percentage used for the probability of default” ?

Did I understand that correctly?

[sarah762]

Can you provide an example for the calculation of 12 months expected credit losses?

In all the past papers that I have done so far, only requires us to calculate the lifetime expected credit losses

Does that mean the 12 months expected credit losses will be given most of the time?

[sarah762]

Thanks

[sarah762]

Yes, that’s what I thought but in this question, they specifically asked for the gain or loss in the SEPARATE financial statements

So, I wonder why the ‘formula’ as shown in the Kaplan textbook wouldn’t work for this question

[sarah762]

I saw this example given in the Kaplan textbook

Rock has held a 70% investment in Dog for two years. Goodwill has been calculated using the full goodwill method. There have been no goodwill impairments to date.

Rock disposes of all of its shares in Dog.

The following information has been provided:

Cost of investment 2000
Sales proceeds 3000

Answer given:
Sales proceeds 3000
Cost of shares sold (2000)
Gain on disposal 1000

My question is,
In this question, they deducted the original purchase consideration but in the exam question they deducted the full carrying amount of the subsidiary at the disposal date?

[sarah762]

Thanks 🙂

[sarah762]

Got it thanks

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