CR NOTES 2024 Sample

ICAEW
Advanced Level
Corporate Reporting
2024 Edition
Integrated Workbook
Corporate Reporting
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P.2
CONTENTS
Page
Chapter 1 Introduction to Corporate Reporting 1
Chapter 2 Groups: Revision and update 23
Chapter 3 Foreign currency translation 103
Chapter 4 Financial instruments: recognition and measurement 145
Chapter 5 Share-based payments and distributable profits 221
Chapter 6 Employee benefits 261
Chapter 7 Reporting of assets and liabilities 281
Chapter 8 Industry specific standards 315
Chapter 9 Revenue 337
Chapter 10 Leases 375
Chapter 11 Earnings per share 415
Chapter 12 Financial instruments: hedge accounting 439
Chapter 13 Income taxes 493
Chapter 14 Corporate governance 539
Chapter 15 The statutory audit process 553
Chapter 16 Other assurance assignments 629
Chapter 17 Reporting financial performance 655
Chapter 18 Financial statement analysis 679
Chapter 19 References 739
Summary notes
P.3
Corporate Reporting
Paper introduction
Paper background
The aim of this ICAEW subject is to further develop the principles covered in
Financial Accounting and Reporting and Audit and Assurance, to enable students to
prepare extracts and full financial statements for a single entity and group in
accordance with IFRS, explain the relevant accounting treatment, and discuss the
assurance implications in relation to these scenarios.
Specification grid
This grid shows the relative weightings of subjects within this module and should
guide the relative study time spent on each:
Weighting (%)
Corporate Reporting – Compliance

55 – 65
Corporate Reporting – Financial Statement Analysis
Audit and Assurance 30 – 40
Ethics 5 – 10
Method of assessment
The Corporate Reporting exam will be 3.5 hours in length (2.1 minutes per mark)
containing three written test questions. Candidates may take any hard copy materials
into the exam although all ICAEW materials and the auditing standards will be
available on a digital bookshelf. The blue IFRS® Standards book will not be available
on the bookshelf.
Questions 2 and 3 will be integrated questions, testing a variety of financial reporting

and assurance topics. Question 2 will include 15 – 20 marks using data analytic
software (see below).
Question 1 will focus on financial reporting.
The pass mark is 50%.
P.4
Corporate Reporting
Data analytic software
In the exam, part of question two will involve data analytics representing
approximately 15 – 20 marks.
The ICAEW will issue advance information 7 weeks before the exam in the form of a
pdf document with background information and an 11-month dataset within the Inflo
software. In the exam itself, you will then be provided with the full 12 months of data.
More details can be found on the ICAEW website. You will also find guidance on
MyKaplan.
P.5
Corporate Reporting
Icon Explanations
Important topic areas, key to your success in the examination.
An area for you to make notes on what you have learned and work through test your
understandings.
Test your understanding

Following key points and definitions are exercises which give the opportunity to assess
the understanding of these core areas. Within the workbook, the answers to these
sections are left blank. Explanations to the questions can be found within the online
version, which can be hidden or shown on screen to enable repetition of activities.
Illustration
To help develop an understanding of topics and the test your understanding exercises,
the illustrative examples can be used.
Topic overviews and model answers.
P.6
Corporate Reporting
Assumed knowledge (from previous studies)
Alternative approach
Definition
Ethics
Exam technique point
Further reading
Key Point
Legal issues – key pieces of tax or other legislation
Open Book Text
P.7
Corporate Reporting
Advantages
Risks
To be studied at home
Illustration of exam question style
Professional skill area
British Values
Questions
Quality and accuracy are of the utmost importance to us so if you spot an error in any
of our products, please send an email to mykaplanreporting@kaplan.com with full
details.
Our Quality Co-ordinator will work with our technical team to verify the error and take
action to ensure it is corrected in future editions.
P.8
Corporate Reporting
Auditing standards
Here is a list of audit/assurance/quality control/other standards and guidance which
may be referred to within this publication:
International Standards on Auditing (UK) Abbreviation used
ISA 200 Overall objectives of the ISA 200

independent auditor and the conduct of an
audit in accordance with International
Standards on Auditing (UK)
ISA 210 Agreeing the terms of audit ISA 210

engagements
ISA 220 Quality control for an audit of ISA 220

financial statements
ISA 230 Audit documentation ISA 230
ISA 240 The auditor’s responsibilities relating ISA 240

to fraud in an audit of financial statements
ISA 250A Consideration of laws and ISA 250

regulations in an audit of financial
statements
ISA 250B The auditor’s statutory right and

duty to report to regulators of public interest
entities and regulators of other entities in the
financial sector
ISA 260 Communication with those charged ISA 260

with governance
ISA 265 Communicating deficiencies in ISA 265

internal control to those charged with
governance and management
ISA 300 Planning an audit of financial ISA 300

statements
P.9
Corporate Reporting
ISA 315 Identifying and assessing the risks ISA 315

of material misstatement
ISA 320 Materiality in planning and ISA 320

performing an audit
ISA 330 The auditor’s responses to ISA 330

assessed risks
ISA 402 Audit considerations relating to an ISA 402

entity using a service organisation
ISA 450 Evaluation of misstatements ISA 450

identified during the audit
ISA 500 Audit evidence ISA 500
ISA 501 Audit evidence – specific ISA 501

considerations for selected items
ISA 505 External confirmations ISA 505
ISA 510 Initial audit engagements – opening ISA 510

balances
ISA 520 Analytical procedures ISA 520
ISA 530 Audit sampling ISA 530
ISA 540 Auditing accounting estimates and ISA 540

related disclosures
ISA 550 Related parties ISA 550
ISA 560 Subsequent events ISA 560
ISA 570 Going Concern ISA 570
ISA 580 Written Representations ISA 580
P.10
Corporate Reporting
ISA 600 Special considerations – audits of ISA 600

group financial statements (including the
work of component auditors)
ISA 610 Using the work of internal auditors ISA 610
ISA 620 Using the work of an auditor’s ISA 620

expert
ISA 700 Forming an opinion and reporting ISA 700

on financial statements
ISA 701 Communicating key audit matters in ISA 701

the independent auditor’s report
ISA 705 Modifications to the opinion in the ISA 705

independent auditor’s report
ISA 706 Emphasis of matter paragraphs and ISA 706

other matter paragraphs in the independent
auditor’s report
ISA 710 Comparative information – ISA 710

corresponding figures and comparative
financial statements
ISA 720 The auditor’s responsibilities ISA 720

relating to other information

financial statements prepared in accordance
with special purpose frameworks

single financial statements and specific
elements, accounts or items of a financial
statement
P.11
Corporate Reporting
International Standards on Auditing Abbreviation used
ISA 810 Engagements to report on ISA 810

summary financial statements
(FRC, 2021).
International Standards on Review Abbreviation used

Engagements (ISREs)
ISRE 2400 Engagements to review ISRE 2400

historical financial statements
International Standards on Review Abbreviation used

Engagements (UK & Ireland)
ISRE 2410 Review of interim financial ISRE 2410

information performed by the
independent auditor of the entity
International Standards on Assurance Abbreviation used

Engagements (ISAEs)
ISAE 3000 Assurance engagements ISAE 3000

other than audits or reviews of historical
financial information
ISAE 3400 The examination of ISAE 3400

prospective financial information
ISAE 3402 Assurance reports on ISAE 3402

controls at a service organization
ISAE 3410 Assurance engagements on ISAE 3410

greenhouse gas statements
International Standards on Related Abbreviation used

Services (ISRSs)
Engagements to perform agreed-upon ISRS 4400

procedures regarding financial
information
Compilation engagements ISRS 4410
P.12
Corporate Reporting
Other Standards/Guidance Abbreviation used
ISQC (UK)1 Quality control for firms that ISQC 1

perform audits and reviews of financial
statements, and other assurance and
related services engagements
IESBA code of ethics IFAC Code
(IFAC, 2021).
FRC revised ethical standard 2019 FRC Ethical standard/Ethical standard
Bulletin (2020) FRC Bulletin
FRC briefing paper – professional Briefing paper

scepticism
(FRC, 2021).
ICAEW code of ethics (2020) ICAEW code of ethics
(ICAEW, 2021).
P.13
Corporate Reporting
Level 7 Accountancy or taxation

professional apprenticeship standard
A competent accountancy or taxation professional will meet the following
requirements. Given the variety of roles covered by this standard, the specific
activities which can lead to these requirements being achieved may vary.
Knowledge An accountancy or taxation professional will be able to:
Assurance, risk Provide a degree of assurance that stakeholders can trust

and control information (financial and non-financial) regarding the
organisation, as relevant to their role. In doing so, they will be
able to exercise professional judgement and consider both
risks and risk management approaches.
Business acumen Demonstrate knowledge of key business objectives and

measurements of success.
Financial Prepare, analyse and interpret an organisations financial

information information (both for internal and external purposes), as
relevant to their role.
Legislation Understand, interpret and apply the legislation, standards and

principles that apply to Standards and their role. This may
include, but not be limited to, accounting standards, auditing
principles standards, taxation legislation, ethical codes and
internal principles adopted by an organisation.
Strategic business Apply their judgement and make sustainable business

management and decisions (including recommendations for good governance)
governance using financial and non-financial information. Support
strategic decision making with meaningful financial analysis
and project appraisal. Present a balanced conclusion, with
supporting evidence, which includes internal and external
factors.
P.14
Corporate Reporting
Skills An accountancy or taxation professional will be able to:
Building Build trusted and sustainable relationships with individuals

relationships and organisations. Consistently support individuals and
collaborate to achieve results as part of a team.
Business insight Influence the impact of business decisions on relevant and

affected communities based on an appreciation of different
organisations and the environments in which they operate.
Communication Communicate in a clear, articulate and appropriate manner.

Adapt communications to suit different situations, individuals
or teams.
Ethics and integrity Identify ethical dilemmas, understand the implications and
behave appropriately. Understand their legal responsibilities,
both within the letter and the spirit of the law, as well as be
aware of the procedures for reporting concerns over
potentially unethical activities.
Leadership Take ownership of allocated projects and effectively manage

their own time and the time of others. Demonstrate good
project management skills to deliver high quality work within
the appropriate timeline. Act as a role model and motivate
others to deliver results.
Problem solving Evaluate information quickly and draw accurate conclusions.

and decision Assess a problem from multiple angles to ensure all relevant
making issues are considered. Gather the appropriate facts and
evidence in order to make decisions effectively.
P.15
Corporate Reporting
Behaviours An accountancy or taxation professional will be able to:
Adds value Anticipate an individual’s organisations future needs and

requirements. Identify opportunities that can add value for the
individual and organisation.
Continuous Take responsibility for their own professional development by

improvement seeking out opportunities that enhance their knowledge, skills
and experience.
Flexibility Adapt approach to assist organisations and individuals to

manage their conflicting priorities as circumstances change.
Professional Apply a questioning mind to conditions which may indicate a

scepticism possible misstatement of financial information due to error or
fraud.
P.16
Chapter 1
Introduction to Corporate Reporting
Chapter learning objectives
Upon completion of this chapter you will be able to:
 discuss the financial reporting requirements for companies in the UK
 discuss audit requirements for companies in the UK
and answer questions relating to these areas.
MyKaplan resources
This topic is covered on MyKaplan in the module Introduction to Corporate
Reporting.
ICAEW resources
The underpinning detail for this chapter can be found in Chapters 1 and 2 of your
ICAEW Workbook
1
Chapter 1
Overview
CORPORATE REPORTING
Financial
The role of
reporting Sustainability
audit
requirements
IASB
Conceptual
Framework
2
What is corporate reporting?
Corporate reporting is a term that refers not only to the annual financial statements,
but also other external reporting such as audit reports and environmental reports.
The syllabus focuses on the financial reporting of transactions and the related
assurance considerations in arriving at an audit opinion.
This paper will ask you to apply:
 Technical knowledge
 Analytical techniques, and
 Professional skills
to a range of compliance and business issues arising from the preparation and
evaluation of corporate reports, and from providing audit services.
You will need to identify, explain and evaluate alternatives and to determine the
appropriate solution to compliance issues, giving due consideration to the needs of
clients and other stakeholders.
The commercial context and impact of recommendations and ethical issues will also
need to be considered in making such judgements.
3
Chapter 1
Financial reporting requirements
Financial reporting is the provision of financial information to those outside the entity,
not to be confused with management accounting which is internal reporting.
2.1 Requirements to produce financial statements
In the UK, the Companies Act 2006 includes rules which

must be complied with by all companies, requiring all
companies to prepare annual financial statements giving a
true and fair view.
Available accounting standards
 IFRS® Standards – all UK companies whose securities are traded on a

regulated public market must prepare group accounts under IFRS Standards
 FRS – apply to the majority of individual company financial statements in the

UK
 IFRS for SMEs® Standard (small and medium sized entities) – there are no
quantitative thresholds for qualification as an SME. This should be determined
by a test of public accountability.
4
 New UK GAAP – effective since 1 January 2015. Made up of six standards,

FRS 100 – 105:
– FRS 100 Application of Financial Reporting Requirements which sets

out the overall reporting framework.
– FRS 101 Reduced Disclosure Framework which permits disclosure

exemptions from the requirements of EU-adopted IFRS Standards for
certain qualifying entities.
– FRS 102 The Financial Reporting Standard applicable in the UK and

Republic of Ireland replaces all previous FRSs, SSAPs and UITF
Abstracts.
– FRS 103 Insurance Contracts which consolidates existing financial

reporting requirements for insurance contracts.
– FRS 104 Interim Financial Reporting which specifies the requirements

(adapted from IAS 34 Interim Financial Reporting) for interim financial
reports.
– FRS 105 The Financial Reporting Standard applicable to the Micro-

entities Regime which concerns the smallest entities.
The main financial reporting standard is FRS 102.
An unincorporated entity such as a charity is exempt from the above but may be
governed by other regulations.
The CR materials assume financial statements are being prepared

in accordance with IFRS Standards.
5
Chapter 1
2.2 Objective of financial statements
To provide information about the entity’s financial position and

performance that is useful to users in making economic decisions.
These users may include:
 Present and potential investors
 Employees
 Lenders
 Suppliers
 Customers
 Governments and their agencies
 The public
2.3 Components of financial statements prepared under IFRS Standards
IAS 1 Presentation of Financial Statements requires that a complete set

of financial statements need to include:
 Statement of financial position
 Statement of profit or loss and other comprehensive income
 Statement of changes in equity
 Statement of cash flows
 Notes to the financial statements
6
XYZ Ltd
Statement of profit or loss for the year ended 31 December 20X2

£
Revenue X
Cost of sales (X)
–––
Gross profit X
Other income X
Distribution costs (X)
Administrative expenses (X)
–––
Operating profit X
Finance costs (X)
Investment income X
–––
Profit before tax X
Income tax expense (X)
–––
Profit for the year X
–––
7
Chapter 1
XYZ Ltd
Statement of comprehensive income for the year ended 31 December 20X2

£
Profit for the year (from statement of profit or loss) X
Other comprehensive income:
Items that will not be reclassified to profit or loss:
Gain on property revaluation X
Gains and losses on equity investments classified as FVOCI X/(X)
Remeasurements of defined benefit pension plans X/(X)
Share of gain (loss) on property revaluation of associates X/(X)
Income tax relating to items that will not be reclassified X/(X)
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translating foreign operations X/(X)
Cash flow hedges X/(X)
Income tax relating to items that may be reclassified X/(X)
–––
Total comprehensive income for the year X
Other comprehensive income includes income and expenses that are not recognised
in profit or loss, but instead recognised directly in equity.
In the CR exam, we need to consider several new items that are

recognised in other comprehensive income. These are dealt with in
subsequent chapters.
8
XYZ Ltd
Statement of changes in equity for the year ended 31 December 20X2

Share Share Revaluation Retained Other
capital premium surplus earnings reserves Total
£ £ £ £ £ £
Balance at 31 December 20X1 X X X X X X
Total comprehensive income X X X X
Dividends (X) (X)
Issue of share capital X X X
––– ––– ––– ––– ––– –––
Balance at 31 December 20X2 X X X X X X
––– ––– ––– ––– ––– –––
Additional columns can be added for any other reserves as required. These might
include reserves for:
 Translation of foreign operations
 Financial assets classified as fair value through other comprehensive income
 Cash flow hedges
which we will consider in later chapters.
9
Chapter 1
XYZ Ltd
Statement of financial position as at 31 December 20X2

ASSETS £ £
Noncurrent assets
Property, plant and equipment X
Investments X
Intangible assets X
–– X
Current assets
Inventories X
Trade and other receivables X
Cash and cash equivalents X
Non-current assets held for sale X
–– X
––
Total assets X
––
EQUITY AND LIABILITIES
Capital and reserves
Ordinary share capital X
Share premium account X
Irredeemable preference share capital X
Retained earnings X
Revaluation surplus X
Other reserves X
––
Total equity X
Noncurrent liabilities
Redeemable preference share capital X
Long-term borrowings X
–– X
10
Current liabilities
Trade and other payables X
Short-term borrowings X
Current tax payable X
Provisions X
–– X
––
Total equity and liabilities X
––
Note that reserves other than share capital and retained earnings may be
grouped as 'other components of equity’.
11
Chapter 1
XYZ Ltd
Statement of cash flows for XYZ Ltd for the period ended 31 December 20X2
£000 £000
Cash flows from operating activities
Profit before tax X
Finance cost X
Investment income (X)
Depreciation X
Loss/(profit) on disposal of non-current assets X/(X)
(Increase)/decrease in inventories (X)/X
(Increase)/decrease in trade receivables (X)/X
Increase/(decrease) in trade payables X/(X)
–––––
Cash generated from operations X
Interest paid (X)
Income taxes paid (X)
–––––
Net cash from operating activities X
Cash flows from investing activities
Purchase of property, plant and equipment (X)
Proceeds of sale of equipment X
Interest received X
Dividends received X
–––––
Net cash used in investing activities (X)
Cash flows from financing activities
Proceeds of issue of shares X
Repayment of loans (X)
Dividends paid (X)
–––––
Net cash used in financing activities (X)
–––––
Net increase in cash and cash equivalents X
Cash and cash equivalents at the beginning of the period X
–––––
Cash and cash equivalents at the end of the period X
12
13
Chapter 1
2.4 IASB Conceptual Framework
The Conceptual Framework (revised 2018) should be familiar from

earlier studies. It includes:
 Objectives of financial reporting.
 Qualitative characteristics of useful financial information

– Fundamental characteristics
 Relevance
 Faithful representation
– Enhancing characteristics
 Comparability
 Verifiability
 Timeliness
 Understandability
 Underlying assumption – going concern
 Definitions of elements of financial statements
– Assets
– Liabilities
– Equity
– Income
– Expenses
 Recognition and derecognition criteria for the elements
 Measurement bases.
14
The role of auditing
The purpose of an audit is to enhance the degree of confidence of

intended users in the financial statements. The audit provides an
independent review of the financial statements and the auditor will
express an opinion on whether the financial statements are prepared in
accordance with an applicable financial reporting framework.
3.1 Benefits of an audit
It could be argued that for small owner managed businesses, an audit is

irrelevant as there is no separation of ownership and management.
However, an audit may still be of value to management because:
 It provides an independent scrutiny of the business by

professionals.
 Additional assurance may be required for third parties e.g. banks,

tax authorities.
 It promotes discipline over maintaining accounting records,

reducing the risk of misstatement or non-compliance with statutory
responsibilities.
 Audits provide subsidiary benefits such as reports to management

on identified deficiencies in the internal controls of the entity.
15
Chapter 1
3.2 The audit process
This will be covered in detail in a later chapter, moving through the

phases listed below.
 Client acceptance/continuance.
 Planning the audit.
 Performing the audit.
 Evaluating the results.
 Issuing the audit report.
3.3 Requirement for an audit
The basic principle is that all companies registered in the UK

should be audited. However, companies qualifying as small
are granted an exemption. To qualify as small, the company
must meet at least two of the following criteria for periods
beginning on or after 1 January 2016:
 Annual turnover must be £10.2 million or less.
 The gross asset total must be £5.1 million or less.
 The average number of employees must be 50 or fewer.
At least two of the three conditions must be met and for two consecutive
years.
Some companies must have an audit even if they meet the criteria for exemption,
notably insurance companies, banks, plcs and where shareholders owning at least
10% of the shares ask for an audit.
16
3.4 Auditing regulation
Audit regulation promotes comparability of financial statements which

are all audited to the same standards and therefore improves public
confidence.
All assurance engagements are governed by:
 Ethics
 Risk assessment
 Terms of engagement
 International Standards on Quality Control (ISQCs).
In addition, UK audits are governed by:
 Companies Act 2006
 International Standards on Auditing (ISAs).
The IAASB issues International Standards on Auditing (ISAs). The FRC amends
these for any UK factors, and then issues them as ISAs (UK).
17
Chapter 1
Sustainability
4.1 Definitions
The technical definition of sustainability comes from the 1987

Brundtland report, and is defined as development that ‘meets the needs
of the present without compromising the ability of future generations to
meet their own needs’.
Transition risks are those associated with moving to a lower-carbon

economy due to extensive policy, legal, technology, and market changes.
There are varying levels of financial and reputational risk dependent
upon the nature, speed and focus of these changes.
Physical risks represent the tangible negative effects of climate change,

which may be acute or chronic.
Acute physical risks are caused by a particular event including extreme

weather such as hurricanes, floods and heat waves.
Chronic physical risks are caused by shifts in climate patterns e.g.

sustained higher temperatures, sea level rise and changing precipitation
patterns.
Double materiality: Consideration of not only the sustainability issues

that might create financial risks for the company (financial materiality),
but also those sustainability issues where a company’s activities
materially impact on people and the environment (impact materiality).
18
4.2 The International Sustainability Standards Board (ISSB)
In 2021 the IFRS Foundation formed the International Sustainability Standards Board
(ISSB), in response to investors calling for a comprehensive global set of
sustainability disclosure standards.
Objectives of the ISSB:
 develop standards for sustainability disclosures
 meet investors’ information needs
 enable companies to provide comprehensive sustainability information
 facilitate interoperability for jurisdiction-specific disclosures or disclosures aimed

at broader stakeholder groups
– In effect this means that the ISSB will provide a baseline for disclosures in
the sustainability disclosure standards, which can then be tailored for
specific countries or users.
ISSB responsibilities:
 developing a set of sustainability disclosure standards (IFRS Sustainability

Disclosure Standards) which complement IFRS Accounting Standards, covering
environmental, social and governance (ESG) sustainability topics with an urgent
focus on climate-related matters.
19
Chapter 1
4.3 IFRS Sustainability Disclosure Standards
The first standards were issued in June 2023 and aim to provide users with reliable,
comparable sustainability-related information. Sustainability Standards can be
adopted by any listed or private company on a voluntary basis but there is currently
no mandatory requirement to apply the standards.
The IFRS Sustainability Disclosure Standards require the disclosure of material

information about the sustainability risks and opportunities that the entity is exposed
to.
Sustainability-related risks and opportunities arise through an entity’s dependencies

and impacts:
How the decisions Examples:

and actions of an – Human rights
Impacts organisation – Worker rights
positively and – Health and safety
i.e. the effect of negatively affect – Carbon emissions
the organisation environmental, social – Scarce natural resources
and governance – Endangered species.
(ESG) issues.
Examples:
How environmental,
– Employee welfare
social and
Dependencies – Environmental pollution
governance (ESG)
issues can affect the and change
i.e. the effect on
organisation’s ability – Employee know-how
the organisation
to create and – Supplier and customer
maintain value. relationships.
20
IFRS S1 General Requirements for Disclosure of Sustainability-related

Financial Information
Requires companies to:
 identify, disclose and measure the widening spectrum of sustainability issues

that could affect performance.
 identify a complete and valid set of sustainability-related risks and opportunities

for effective monitoring and reporting.
 select appropriate metrics and targets for sustainability reporting.
The disclosures should only include information that is material and consistent with
the Conceptual Framework’s principles of relevance and faithful representation.
IFRS S2 Climate-related Disclosures
Requires companies to:
 disclose physical and transition risks and their potential impact on the move
towards a low carbon economy
 select appropriate metrics and targets for climate-related reporting, including the
disclosure of the amount of greenhouse gas emissions.
The disclosures should only include information that is material and consistent with
the Conceptual Framework’s principles of relevance and faithful representation.
21
Chapter 1
You are now in a position to attempt additional questions on this

topic area.
Visit the homework checklist on MyKaplan for a list of

recommended questions.
For further reading, refer to Chapters 1 and 2 of the ICAEW

Workbook.
22
Chapter 2
Groups: Revision and update
Chapter learning objectives
Upon completion of this chapter you will be able to understand and apply the
requirements of:
 IFRS 10 Consolidated Financial Statements
 IFRS 3 Business Combinations
 IAS 28 Investments in Associates and Joint Ventures
 IFRS 11 Joint Arrangements
 IFRS 12 Disclosure of Interests in Other Entities
 IFRS 13 Fair Value Measurement (business combination aspects)
and apply your understanding to acquisitions and disposals within group accounts.
MyKaplan resources
This topic is covered on MyKaplan in the module Groups: Revision and update
ICAEW resources
The underpinning detail for this chapter can be found in Chapter 20 of your
ICAEW Workbook.
23
Chapter 2
Overview
FAR revision
Consolidated
Consolidated Associates
Types of statement of Full disposal
statement of and joint
investment financial of subsidiary
profit or loss ventures
position
Acquisitions Disposals
Achieving Full disposal Part

Achieving No change
significant of associate disposals
control in control
influence
Subsidiary to
Subsidiary to Subsidiary to Associate to
smaller
associate investment investment
subsidiary
24
Types of investment
Shareholding
Held for
Significant
Control Joint control wealth
influence
accretion
Associate, Joint venture, Trade

Subsidiary,
equity equity investment,
consolidation
accounting accounting financial asset
1.1 Control
Per IFRS 10 Consolidated Financial Statements, group accounts are required when
one entity has control over another entity.
Control is presumed to exist when the parent owns > 50% of the voting
power of an entity.
IFRS 10 Consolidated Financial Statements states that ‘an investor controls an

investee if and only if the investor has all the following:
(a) power over the investee […]
(b) exposure, or rights, to variable returns from its involvement with the
investee […], and
(c) the ability to use its power over the investee to affect the amount of the
investor’s returns.’ (IFRS 10, para 7)
Power is defined as existing rights that ‘give the current ability to direct the
relevant activities, i.e. the activities that significantly affect the investee’s
returns.’ (IFRS 10, para 10)
If control exists, then consolidated financial statements should be prepared showing

the results of the parent and all its subsidiaries as a single entity.
25
Chapter 2
26
Investors should consider:
 whether they exercise the majority of votes
 rights to appoint a majority of directors
 agreements with other investors
 a contract giving control over the key activities of the investee
 whether other shareholdings are dispersed
 whether they hold potential voting rights resulting from convertible

debt or options that are currently capable of being exercised. The
holder must have the practical ability to exercise the right (i.e.
funds must be available) for the rights to be considered.
Illustration 1
Control
This illustrates the skill of problem solving and decision making by

evaluating information in order to form accurate conclusions.
Poppy holds 45% of shares in Sheba. It also owns warrants in Sheba which are
currently exercisable and would give Poppy an extra 10% of the voting shares
in Sheba. Poppy therefore controls Sheba:
Ordinary shares 45%
Potential shares 10%
–––
55%
27
Chapter 2
Illustration 2
Control
This illustrates the skill of problem solving and decision making by

evaluating information in order to form accurate conclusions.
Cloud is a public limited company. Its sole operating activity is to invest in other
businesses for the purpose of capital appreciation.
During the period, Slade purchased 47% of the equity shares in Cloud. The next
biggest shareholder owns 6% of the equity shares. Cloud has no potential voting
rights in issue. Attendance at Cloud’s annual general meetings over the past
five years has averaged 77%.
Decisions around the day-to-day management of investments, as well as

decisions to buy or sell equity interests, are taken by Cloud’s management and
its board of directors and do not require approval at the annual general meeting.
Slade has appointed one of the five members of Cloud’s board of directors.
Legal limitations in Cloud’s jurisdiction prevent Slade from taking a majority
position on the board.
Does Slade control Cloud?
Slade has less than 50% of the ordinary shares, and so does not have a majority
holding of the voting rights. That said, the other shareholdings are dispersed
making it unlikely that enough shareholders would oppose Slade’s position.
Moreover, it is likely that attendance at the annual general meeting is not high
enough for Slade’s position to be successfully opposed.
However, even though Slade is likely to control the vote at the annual general
meeting, it does not exercise power over Cloud. This is because the key
activities that affect Cloud’s returns are the buying and selling of investments.
These decisions are made by the board of directors, not at the annual general
meeting. Slade only has one director on the board of Cloud, and is prohibited
from controlling the board, so is not currently able to direct these key activities.
Therefore, Slade does not control Cloud.
28
29
Chapter 2
1.2 Significant influence
IAS 28 Investments in Associates and Joint Ventures defines significant

influence as ‘the power to participate in the financial and operating
policy decisions of the investee but is not control or joint control
of those policies.’ (IAS 28, para 3)
Significant influence is presumed to exist if an investor holds 20% or more of the

voting power of the investee, unless it can be clearly shown that this is not the case.
However, the existence of significant influence can also be evidenced in other ways:
(a) ‘representation on the board of directors or equivalent governing body of

the investee
(b) participation in policy-making processes, including participation in

decisions about dividends or other distributions
(c) material transactions between the entity and its investee
(d) interchange of managerial personnel, or
(e) provision of essential technical information.’ (IAS 28, para 6)
30
1.3 Joint control
‘Joint control is the contractually agreed sharing of control of an

arrangement, which exists only when decisions about the relevant
activities require the unanimous consent of the parties sharing
control.’ (IFRS 11, para 7)
1.4 Exemptions from preparing group accounts
A parent is exempt from preparing group financial statements ‘if it

meets all the following conditions:
(i) it is a wholly-owned subsidiary or is a partially-owned

subsidiary of another entity and all its other owners,
including those not otherwise entitled to vote, have been
informed about, and do not object to, the parent not
presenting consolidated financial statements
(ii) its debt or equity instruments are not traded in a public

market (a domestic or foreign stock exchange or an over-the-
counter market, including local and regional markets)
(iii) it did not file, nor is it in the process of filing, its financial
statements with a securities commission or other regulatory
organisation for the purpose of issuing any class of
instruments in a public market, and
(iv) its ultimate or any intermediate parent produces financial

statements that are available for public use and comply with
IFRSs, in which subsidiaries are consolidated or are
measured at fair value through profit or loss in accordance
with this IFRS.’ (IFRS 10, para 4)
A parent that does not present consolidated financial statements must comply with
the IAS 27 Separate Financial Statements rules.
Although a parent may not have to prepare consolidated financial statements, it may
wish to provide qualitative information about the nature and size of ownership of un-
consolidated subsidiaries as this could be beneficial to the users of the financial
statements.
31
Chapter 2
1.5 Other matters
Where one or more subsidiaries prepare accounts to a different

reporting date from the parent and the bulk of other subsidiaries in the
group:
 For consolidation purposes the subsidiary may prepare additional

statements to the reporting date of the rest of the group.
 Or, if this is not possible, the subsidiary’s accounts may still be

used for consolidation provided that the gap between the reporting
dates is three months or less and that adjustments are made for
the effects of significant transactions or other events that occur
between that date and the parent’s reporting date.
Uniform accounting policies should be used by all entities in the group.
32
Consolidated statement of financial

position
Consolidated statement of financial position for XYZ Ltd as at

31 December 20X8
£
Goodwill (W3) X
Investments in associates X
Assets (100% P + 100% S) X
––––
Total assets X
––––
Equity
Share capital (P only) X
Retained earnings (W5) X
Non-controlling interest (W4) X
––––
X
Liabilities (100% P + 100% S) X
––––
Equity and liabilities X
––––
33
Chapter 2
2.1 Standard workings
(W1) Group structure
(W2) Net assets of the subsidiary

@ period end @ acquisition post-acquisition
Share capital x x
Share premium x x
Revaluation surplus x x x (W6)
Retained earnings x x x (W5)
––– –––
x x
(W4) (W3)
(W3) Goodwill
Fair value of consideration X
NCI at acquisition (FV or share of NA) X
S’s NA at acquisition (W2) (X)
–––
Goodwill at acquisition X
Impairments (X)
–––
Carrying amount of goodwill X
–––
Note: If there is a gain on bargain purchase, this is immediately credited to the
consolidated profit or loss.
34
(W4) Non-controlling interest
Fair value approach:

FV NCI at acquisition X
NCI % of post-acquisition RE and reserves (W2) X
NCI share of goodwill impairment (X)
–––
X
–––
Share of net assets/proportionate approach:
NCI % × S’s NAs @ y/e (W2) X
(W5) Group retained earnings

100% P’s RE X
P’s % × S’s post-acquisition RE (W2) X
Impairment of goodwill (if FV approach only deduct P’s share) (X)
Gain on bargain purchase X
–––
X
(W6) Group reserves

100% P’s reserves X
P’s % × S’s post-acquisition reserves (W2) X
–––
X
Mid-year acquisitions
 You may not be given the subsidiary's reserves at acquisition. In which case
you will need to pro-rate S's profit for the year and either add it to the opening
reserves or subtract from the year end reserves.
35
Chapter 2
2.2 Intra-group adjustments
 At the year-end, current accounts may not agree, owing to the

existence of in transit items such as cash or goods in transit. The
usual rules are as follows:
– make the consolidation adjustment to the statement of

financial position of the recipient, as if the in transit item had
been received before year end:
– cash in transit adjusting entry:
 Dr Cash
 Cr Receivables current account
– goods in transit adjusting entry:
 Dr Inventory
 Cr Payables current account
– this adjustment is for the purpose of consolidation only.
– once in agreement, the receivable and payable should be

cancelled as for intra-group loans.
 Cancel the receivable in one company with the payable in the

other.
36
Unrealised profits – ‘PURP’ adjustments
Inventory PPE
Step 1 If PPE sold between group members,

adjust to reflect situation if transfer had
 Calculate profit included in closing not occurred:
inventory:
 no profit on the sale
– determine the value of closing
inventory purchased from  depreciation based on the original
another company in the cost of the asset to the group.
group.
To calculate the unrealised profit
– use mark-up/margin to adjustment for non-current asset
calculate how much of that transfers compare:
value represents profit earned
by the selling company. £
CA of NCA at y/e after transfer X
Step 2 CA of NCA at y/e if transfer
had not taken place (X)
Adjust profit of the seller
–––
P selling to S: Non-current asset PURP X
–––
Dr P’s retained earnings (W5)
Consolidation adjustment:
Cr Group inventory (on CSFP)
P → (W5)
S selling to P:
 Dr RE of seller
Dr S’s retained earnings (W2)
S → (W2)
Cr Group inventory (on CSFP)
 Cr NCA on CSFP
37
Chapter 2
2.3 Fair value of net assets

IFRS 3 Business Combinations requires that the acquirer should
recognise:
 the identifiable assets, liabilities and contingent liabilities of the
acquire:
 at fair value
 at the date of acquisition.
How to include fair values in your workings
To process a fair value adjustment in a consolidation question, you must consider the
impact both at the acquisition date and the reporting date in (W2).
 At acquisition, put an adjustment into the net asset working (W2) to bring the
net assets to fair value (affecting the goodwill working).
 At the reporting date account on both the face of the CSFP and in the net
assets working (W2) (affecting the NCI working).
2.4 Adjustments to provisional fair values of the subsidiary's net

assets
Ideally the fair value of net assets will be ascertained by the first year
end after the acquisition.
In practise this may not be possible, e.g. if the acquisition is in the last
month of the year.
IFRS 3 Business Combinations allows the use of provisional fair values.
Any adjustments to those provisional fair values will be dealt with
differently depending on whether the adjustments are made in the
measurement period or not.
 If the adjustments are made within the measurement period (less
than 12 months from the acquisition date), an adjustment is made
retrospectively and goodwill is recalculated.
 If the adjustments are made outside of the measurement period
(i.e. more than 12 months from the acquisition date) the
adjustments are treated as a change in accounting estimate and
adjusted for prospectively.
38
2.5 NCI measurement
IFRS 3 Business Combinations allows a choice of how to measure NCI:
 Fair value method.
 Share of net assets/proportionate method.
The choice is made on an acquisition by acquisition basis.
The value of goodwill and NCI will be affected by the method chosen.
39
Chapter 2
Test your understanding 1

Consolidated SFP
Completing this question demonstrates your ability to prepare financial

information.
Draft statements of financial position of Plant and Shrub on 31 March 20X7 are
as follows.
Plant Shrub
£000s £000s
PPE 100 140
Investment in S at cost 180
Current assets
Inventory 30 35
Trade receivables 20 10
Cash 10 5
–––– ––––
340 190
–––– ––––
Equity and liabilities
Ordinary £1 shares 250 100
Share premium – 30
Retained earnings – 20
–––– ––––
250 150
Non-current liabilities
10% loan notes 65 –
Current liabilities 25 40
–––– ––––
340 190
–––– ––––
Notes:
1 Plant bought 80,000 shares in Shrub on 31 March 20X5 when Shrub’s

reserves included a share premium of £30,000 and retained earnings of
£5,000.
2 Plant’s accounts show £6,000 owing to Shrub; Shrub’s accounts show

£8,000 owed by Plant. The difference is explained as cash in transit.
40
3 Year-end inventory in Plant’s SFP included £20,000 of goods purchased

from Shrub. Shrub sold these goods at a 10% profit margin.
4 The fair value of net assets of Shrub at acquisition were the same as the
carrying amount with the exception of a major piece of equipment which
had a fair value £30,000 above carrying amount and a 10 year remaining
useful life.
5 The fair value of the NCI on acquisition was £35,000.
6 Goodwill has been impaired by £5,000.
Required:
Prepare a consolidated statement of financial position at 31 March 20X7

under both the FV and share of NA/proportionate approaches.
41
Chapter 2
2.6 Fair value of consideration
Consideration could be in the form of cash or shares, which could be

paid immediately, could be deferred or even contingent on future
conditions.
Acquisition costs
Costs directly attributable to the acquisition of a subsidiary should be

recognised in the profit or loss of the group accounts.
Cash consideration
Dr Investment X (amount included in ‘consideration' in goodwill)
Cr Cash X
Share consideration
Shares issued as consideration on the day of acquisition are recorded at their market
value at that time.
Cr Share capital X
Cr Share premium X
42
Deferred consideration
Deferred consideration is consideration which is payable at a future date.
Deferred cash consideration should be discounted to its present value and is

recorded in the acquirer’s accounts by:
Cr Liability X
Remember that deferred consideration will unwind annually over time:
Dr Finance costs X
Cr Liability X
Deferred share consideration
Deferred share consideration is valued using the share price at the date of
acquisition. It is recorded in the acquirer’s accounts by:
Dr Investment X (amount included in ‘consideration’ in goodwill)
Cr Shares to be issued X (included in equity)
43
Chapter 2
Contingent consideration
Contingent consideration is an amount which may be payable at a future date,

dependent upon certain events.
E.g. an extra amount may be paid for an investment in a subsidiary if it achieves a

certain level of sales growth over 5 years.
Contingent consideration should be included as part of the cost of the investment and
measured at fair value at the date of acquisition.
 Contingent cash
Dr Investment X (amount included in ‘consideration’ in goodwill)
Cr Provision X
 Contingent shares
Dr Investment X (amount included in 'consideration' in goodwill)
Cr Shares to be issued X
2.7 Changes in fair value of consideration
The fair value of the contingent consideration at acquisition could be

different to the actual consideration paid.
Any differences are normally treated as a change in accounting estimate and

adjusted prospectively in accordance with IAS 8 Accounting Policies, Changes in
Accounting Estimates and Errors:
Dr or Cr Provision X
Cr or Dr SPL X
44
Test your understanding 2

Fair value adjustments on acquisition
Completing this question demonstrates your ability to prepare financial

information applying relevant International Financial Reporting
Standards.
On 1 January 20X5, ABC acquired 90% of DEF when the carrying amount of
DEF’s net assets was £18 million. The consideration was structured as
follows:
Three million ABC ordinary shares to be issued at the acquisition date; and an
additional one million ABC ordinary shares to be issued on 31 December
20X6, if DEF’s revenue increases by 10% in the interim two years. The fair
value of the contingent shares is £6 each.
The market price of ABC ordinary shares is £7 at the acquisition date and has
increased to £9 by 31 December 20X6.
ABC incurs professional acquisition fees amounting to £50,000.
It is ABC group policy to value the non-controlling interest using the proportion
of net assets method.
Included in the net assets at acquisition is a building with a fair value of

£2 million in excess of its carrying amount.
Required:
Calculate the goodwill arising on acquisition.
45
Chapter 2
2.8 Goodwill impairments
Goodwill cannot be considered in isolation when performing an impairment review.
Carrying amount > Recoverable amount
Per financial statements Higher of
Value in use Fair value less

costs to sell
PV of future cash flows Current market value
The recoverable amount can only be established for the subsidiary as a whole, and
as such, the carrying amount must also consider the entire subsidiary. This creates
an additional problem when considering the two methods for valuing NCI.
Per IAS 36 Impairment of Assets, if goodwill has been allocated to a

subsidiary in which:
 there is NCI (i.e. it is not a wholly-owned subsidiary) and
 the NCI has been measured using the share of net assets
method, and hence total goodwill calculated only represents the
parent’s goodwill,
then goodwill allocated for the subsidiary should be grossed up to include

goodwill attributable to NCI for the purposes of the impairment review.
This ensures that the recoverable amount and carrying amount are compared on a
like-for-like basis.
The additional goodwill is known as 'notional goodwill' and is not recognised in the
accounts, but merely calculated for the purposes of arriving at the impairment figure.
46
Illustration 3
Impairment review using share of net assets valuation method
This illustrates the use of knowledge to prepare financial information

applying relevant International Financial Reporting Standards.
Caesar is an 80% subsidiary of Wynn.
The net assets of Caesar are £370,000 and goodwill of £40,000 was recognised
in the CSFP. Following an impairment review the recoverable amount of Caesar
was found to be £410,000.
Wynn uses the share of net assets method to value NCI.
What is the carrying amount of goodwill following the impairment review?
Solution
Goodwill recognised in CSFP is £40,000 and only represents the parent’s

goodwill (i.e. 80%).
For the purposes of the impairment review, this goodwill needs to be grossed-
up to represent 100% i.e. £40,000 × 100/80 = £50,000.
47
Chapter 2
Impairment review
Carrying amount of individual Recoverable amount of subsidiary
assets of subsidiary
£ £
Goodwill (grossed up) 50,000
Net assets 370,000
––––––– –––––––
420,000 410,000
––––––– –––––––
Impairment loss = £420,000 – £410,000 = £10,000
Allocation of impairment loss
Per IAS 36 Impairment of Assets, impairment losses should be allocated to

goodwill first then to the other assets on a pro-rata basis in reference to their
respective carrying amounts:
Carrying Impairment Revised carrying
amount loss amount
£ £ £
Goodwill 50,000 (10,000) 40,000
Net assets 370,000 – 370,000
420,000 (10,000) 410,000
The goodwill is sufficient to absorb all of the £10,000 impairment. This leaves
£40,000 as total (100% of) goodwill.
However, under the share of net assets method, only 80% of the goodwill should
be shown in the CSFP. Therefore, the carrying amount of goodwill in the CSFP
will be £32,000 (80% × £40,000) and an impairment of only £8,000 (80% ×
£10,000) will appear in the CSPL.
48
Illustration 4
Impairment review using FV method
This illustrates the use of knowledge to prepare financial information

applying relevant International Financial Reporting Standards.
Caesar is an 80% subsidiary of Wynn.
The net assets of Caesar are £370,000 and goodwill of £40,000 was recognised
in the CSFP. Following an impairment review, the recoverable amount of
Caesar was found to be £400,000.
Wynn uses the FV method to value NCI.
Show how the impairment would be calculated and recognised in the

consolidated statement of financial position?
Solution
In a scenario where the FV method is used to value goodwill, there is no need

to gross up the goodwill, as the full goodwill value is already reflected.
The impairment is calculated as:

Carrying Impairment Revised carrying
amount loss amount
£ £ £
Goodwill 40,000 (10,000) 30,000
Net assets 370,000 – 370,000
410,000 (10,000) 400,000
The goodwill is sufficient to absorb all the £10,000 impairment. This leaves
£30,000 as total goodwill.
The impairment is charged to the CSPL and then allocated between P’s
shareholders and the NCI.
The journal in the CSFP would be:
Dr Retained earnings (80%) 8,000
Dr NCI (20%) 2,000
Cr Goodwill 10,000
49
Chapter 2
50
Consolidated statement of profit or loss
Consolidated statement of profit or loss for XYZ for the year ended
31 December 20X2
Revenue (W2) X
Cost of sales (W2) (X)
–––
Gross profit X
Operating expenses (W2) (X)
–––
Operating profit X
Finance costs (W2) (X)
Investment income (W2) X
Share of profit of associate X
–––
Profit before tax X
Tax expense (W2) (X)
–––
Profit for the year Y
–––
Attributable to parent company X
Attributable to non-controlling interest (W3) X
–––
Y
–––
51
Chapter 2
(W1) Group structure
(W2) Consolidation schedule

P S Adj Consol
Revenue x x (x) x
COS (x) (x) x (x)
Inventory PURP (seller column) (x)
Expenses (x) (x) (x)
Impairment (proportionate) (x)
Impairment (FV) (x)
NCA PURP (seller column) (x)
Tax (x) (x) (x)
–––– ––––
PAT x (W3) 0
(W3) Non-controlling interest
NCI% × S’s PAT (W2)
52
3.1 Adjustments
Mid-year acquisitions
 If a subsidiary is acquired mid-year, then the subsidiary’s

results should only be consolidated from the date of
acquisition, i.e. the date on which control is obtained.
 Time apportionment of the results of S in the year of

acquisition is required for this purpose. Unless indicated
otherwise, assume that revenue and expenses accrue
evenly.
Intra-group transactions
Sales and purchases
 Such trading will be included in the sales revenue of one group company and
the purchases of another.
– Consolidated sales revenue = P’s revenue + S’s revenue – intra-group

sales
– Consolidated cost of sales = P’s COS + S’s COS – intra-group sales
 The deduction of the intra-group sales in both cases should be shown in the
adjustments column of the consolidation schedule (W2).
53
Chapter 2
Inventory PURPs
 Calculate intra group profit on goods still in inventory at year end
 The required adjustment is:
– Dr Closing inventory in selling company’s cost of sales – unrealised profit

figure
– Cr Closing inventory in consolidated statement of financial position –

unrealised profit figure
 In practise, the debit entry should be shown as an increase to cost of sales in

the seller’s column in the consolidation schedule (W2).
NCA PURPs
 If one group company sells a non-current asset to another group company the
following adjustments are needed in the CSPL:
– Any profit or loss arising on the transfer must be deducted from the
appropriate category within the seller’s column in the consolidation
schedule (W2) in the year of transfer only
– The depreciation charge must be adjusted (again in the seller’s column of

the schedule) so that it is based on the cost of the asset to the group in all
years from transfer until end of asset’s useful life
 In most cases the profit on disposal and the depreciation charge are included in
the same expense line in the SPL and, therefore, only one adjustment is
needed.
54

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ICAEW

© Kaplan Financial Limited, 2023

Printed and bound in Great Britain.

Chapter 1 Introduction to Corporate Reporting 1

Chapter 2 Groups: Revision and update 23

Chapter 3 Foreign currency translation 103

Chapter 4 Financial instruments: recognition and measurement 145

Chapter 5 Share-based payments and distributable profits 221

Chapter 6 Employee benefits 261

Chapter 7 Reporting of assets and liabilities 281

Chapter 8 Industry specific standards 315

Chapter 9 Revenue 337

Chapter 10 Leases 375

Chapter 11 Earnings per share 415

Chapter 12 Financial instruments: hedge accounting 439

Chapter 13 Income taxes 493

Chapter 14 Corporate governance 539

Chapter 15 The statutory audit process 553

Chapter 16 Other assurance assignments 629

Chapter 17 Reporting financial performance 655

Chapter 18 Financial statement analysis 679

Chapter 19 References 739

Corporate Reporting – Compliance

Audit and Assurance 30 – 40

Questions 2 and 3 will be integrated questions, testing a variety of financial reporting

Question 1 will focus on financial reporting.

The pass mark is 50%.

Data analytic software

Important topic areas, key to your success in the examination.

Test your understanding

Topic overviews and model answers.

Assumed knowledge (from previous studies)

Exam technique point

Legal issues – key pieces of tax or other legislation

Open Book Text

Illustration of exam question style

Professional skill area

International Standards on Auditing (UK) Abbreviation used

ISA 200 Overall objectives of the ISA 200

ISA 210 Agreeing the terms of audit ISA 210

ISA 220 Quality control for an audit of ISA 220

ISA 230 Audit documentation ISA 230

ISA 240 The auditor’s responsibilities relating ISA 240

ISA 250A Consideration of laws and ISA 250

ISA 250B The auditor’s statutory right and

ISA 260 Communication with those charged ISA 260

ISA 265 Communicating deficiencies in ISA 265

ISA 300 Planning an audit of financial ISA 300

International Standards on Auditing (UK) Abbreviation used

ISA 315 Identifying and assessing the risks ISA 315

ISA 320 Materiality in planning and ISA 320

ISA 330 The auditor’s responses to ISA 330

ISA 402 Audit considerations relating to an ISA 402

ISA 450 Evaluation of misstatements ISA 450

ISA 500 Audit evidence ISA 500

ISA 501 Audit evidence – specific ISA 501

ISA 505 External confirmations ISA 505

ISA 510 Initial audit engagements – opening ISA 510

ISA 520 Analytical procedures ISA 520

ISA 530 Audit sampling ISA 530

ISA 540 Auditing accounting estimates and ISA 540

ISA 550 Related parties ISA 550

ISA 560 Subsequent events ISA 560