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Tips for ACCA F7 Financial Reporting (INT)

Q1 Consolidated Statements of Income AND of Financial Position question

Pedantic ( 31 ) subsid, but no associate
Q2 Preparation of Financial Statements any of the questions from the BPP
revision kit (5) Winger through to (13 ) Pricewell AND questions 24 26
Telenorth Partway
Q3 Cash Flow AND report (71 ) Bigwood
Q4 Provisions and contingencies (51) Promail
Q5 Impairment of assets ( 21 ) Advent
(Numbers in brackets indicate questions to practice from BPP Revision kit)
Revenue recognition.
Substance versus form.
Convertible instruments (IAS 39).
Accounting for taxation.
Accounting assets IAS 16.
Important areas that have not been examined under the new syllabus and so may fe
ature are:
Construction contracts.
Impairment of assets.
IAS 37, accounting for provisions.
Consolidated SOCI and/or SOFP with one subsidiary plus associate
including adjustments for fair values, unrealised profit, intragroup trading, go
ods/cash in transit, other syllabus area.
Accounts restatement/preparation with adjustments depreciation, current/deferred
tax, inventory valuation, leases, substance over form issues, financial instrum
Interpretation and/or statement of cash flows, perhaps with written part on aims
of not-for-profit entities. Interpretation may focus on limited ratios and thei
r interpretation.
Conceptual framework.
Other areas regulatory framework, inflation, government grants, discontinued ope
impairments, deferred tax, leases, intangible assets, or provisions.
Q1 mixed consolidated income statement and statement of financial position (poss
ible adjustments to include PURP).
Q2 redraft of financial statements (also to include SOCIE) possible adjustments
could include revenue recognition, investment property, depreciation.
Q3 calculation of an element of a statement of cash flow and a report to include
calculation of ratios and interpretation of the accounts using the statement of
cash flow and ratio results.
Q4 & Q5 IFRS 5: discontinued operations, government grants, investment property.
Q1 consolidated income statement with IFRS 3 (Revised) discussion, or both CSFP
and CIS in same Q (last one Dec 2008).
Q2 re-drafting or published accounts.
Q3 interpretation mainly, with or without cash flows.
Q4 mixed standards, especially leasing, impairment, EPS, grants.
Q5 depreciation, provisions, deferred tax, standard setting

Tips for ACCA Paper F8 Audit and Assurance (INT)

1 Sales system internal controls and weaknesses
2 Corporate governance
3 Analytical procedures perhaps with reference to trade payables and accruals
4 Sampling
5 Audit reports, perhaps combined with events occurring after the reporting peri
Audit planning (analytical procedures).
The assessment of audit risk.
Audit procedures (both substantive and tests of control) relevant to key audit a
Not for profit organisations.
Subsequent events.
Audit reporting and materiality.
Regulation of audit, governance.
Small/not for profit organisations.
Systems: purchases/sales/payroll.
Specific standards; for example, ISA 210, ISA 260, ISA 530.
Completion and auditor s reports.
Non current assets.

Tips for ACCA Paper F9 Financial Management

1 Inventory control calculations + written on Miller-Orr cash management
2 NPV with inflation and tax + IRR, payback period, accounting rate of return
3 Business valuation, with WACC and CAPM + calculation of asset beta from equity
4 Foreign exchange risk forward contracts and money market + written on other me
thods available
The Miller-Orr model and Baumol model.
Debt factoring and settlement discounts.
SME finance (for more detail refer to the Student Accountant article
Business finance and the SME sector September 2001).
Purchasing power parity and interest rate parity theories.
Working capital questions on inventory management and receivables management are
Investment decisions net present value (NPV), often with tax and inflation. You
may need to calculate a weighted average cost of capital before you calculate an
Sources of finance a topical area, we would expect a part
question on financing problems covering gearing issues and problems for small an
d medium sized
companies. Ratio analysis is likely to feature here.
Business valuations commonly tested and a core syllabus area. In recent sittings
the examiner has looked to combine different syllabus areas within the same exa
m question; for example, asking you to calculate a cost of equity and then use i
t to value a company. Make sure that you are also able to value debt.
Financial environment & risk management recent exchange rate and interest rate v
olatility could impact on a company s financial management plans a part question o
n this area could be set, with further discussion and calculations on hedging te
Investment appraisal risk and uncertainty.
Working capital management models for inventory and cash management.
Valuations asset and cash flow based values.
Business finance gearing/capital structure calculations/commentary.
Risk management interest rate risk.
Investment appraisal tax and inflation.
Cost of capital project specific discount rates.
Business finance rights issue and gearing.
Risk parity theory and currency hedging.
WCM financing of WC and receivables.
Valuation PV of FCF.
NPV sensitivity analysis.