Connect And Reflect Week

Question 1

What are the main topics covered in the module?

Answer 1

• PP&E and Revaluation
• Impairment
• Leases
• Government Grants and Investment Property
• Inventories
• Statements of Cash Flows
• Financial Analysis

Tutorials outstanding include Statements of Cash Flows and Financial Analysis.

Question 2

What is the IAS 16 related to?

Answer 2

PP&E and Revaluation

It includes topics such as depreciation, derecognition of asset, and measurement after initial recognition.

Question 3

What are the two models for measurement after initial recognition under IAS 16?

Answer 3

• Cost model
• Revaluation model

The choice of model affects how assets are reported and depreciated.

Question 4

What must be recorded when using the revaluation model?

Answer 4

The current year depreciation charge

This includes the elimination of accumulated depreciation.

Question 5

What is the treatment of gain/loss on revaluation?

Answer 5

Revaluation reserve/SCI dependent on prior periods

This affects how gains and losses are reflected in the financial statements.

Question 6

What happens to subsequent depreciation after revaluation?

Answer 6

It is ‘reset’ using new value, remaining useful life, and check residual value

This ensures accurate depreciation reflecting the asset’s new value.

Question 7

What are the options for revaluation reserve treatment?

Answer 7

• Leave
• Amortise

The choice depends on the company’s accounting policy.

Question 8

What are the terms related to impairment of assets under IAS 36?

Answer 8

• Impairment
• Recoverable amount
• FVLCD
• VIU
• CGU

Understanding these terms is essential for impairment assessment.

Question 9

What indicates the need for an impairment review?

Answer 9

Indicators of impairment

Companies must assess whether an impairment review is necessary based on specific criteria.

Question 10

What is the ‘CAP’ method used for?

Answer 10

Compare actual NBV to LOWER OF:
1) What the NBV would have been
2) The recoverable amount

This method determines the impairment loss.

Question 11

What are the IFRS 16 definitions and terminology?

Answer 11

• Right-of-use
• Lessor
• Lessee

These terms are fundamental to understanding lease accounting.

Question 12

What is a key consideration in lease accounting under IFRS 16?

Answer 12

Depreciate over SHORTER of lease term and useful life unless transfer of ownership occurs

This affects how leased assets are recorded and reported.

Question 13

What are the treatment options for grants towards expenses under IAS 20?

Answer 13

Treatment options vary based on the type of grant received

Organizations must choose the appropriate accounting treatment based on grant nature.

Question 14

What are the two methods for assets under government grants?

Answer 14

• Deferred income method
• Net method

The choice influences how grants are recognized in financial statements.

Question 15

What are the two models for measuring investment property under IAS 40?

Answer 15

• Fair value model
• Cost model

This decision impacts the valuation and reporting of investment properties.

Question 16

What is the examination structure for the course?

Answer 16

Section A: FOUR compulsory questions (85%)
Section B: ONE question from a choice of TWO (15%)

The exam is closed book, PC-based, and on campus.