ACCA的考试是不是全部要用英语回答啊

正确答案：
(c) Site restoration
(i) Matters
■ The provision for site restoration represents nearly 2·5% of total assets and is therefore material if it is not
warranted.
■ The estimated cost of restoring the site is a cost directly attributable to the initial measurement of the tangible fixed
asset to the extent that it is recognised as a provision under IAS 37 ‘Provisions, Contingent Liabilities and
Contingent Assets’ (IAS 16 ‘Property, Plant and Equipment’).
■ A provision should not be recognised for site restoration unless it meets the definition of a liability, i.e:
– a present obligation;
– arising from past events;
– the settlement of which is expected to result in an outflow of resources embodying economic benefits.
■ The provision is overstated by nearly $0·34m since Volcan is not obliged to relocate the trees and de facto has
only an obligation of $60,000 as at 31 March 2005 (being the penalty for having felled them). When considered
in isolation, this overstatement is immaterial (representing only 0·2% of total assets and 3·6% of PBT).
■ It seems that even if there are local government regulations calling for site restoration there is no obligation unless
the penalties for non-compliance are prohibitive (unlike the fines for the trees).
■ It is unlikely that commencement of site development has given rise to a constructive obligation, since past actions
(disregarding the preservation of the trees) must dispel any expectation that Volcan will honour any pledge to
restore the valley.
■ Whether commencing development of the site, and destroying the trees, conflicts with any statement of socioenvironmental
responsibility in the annual report.
(ii) Audit evidence
■ A copy of the planning application and permission granted setting out the penalties for non-compliance.
■ Payment of $60,000 to local government in May 2005 agreed to the bank statement.
■ The present value calculation of the future cash expenditure making up the $4·0m provision.
Tutorial note: Evidence supporting the calculation of $0·4m is irrelevant as there is no liability to be provided for.
■ Agreement that the pre-tax discount rate used reflects current market assessments of the time value of money (as
for (a)).
■ Asset inspection at the site as at 31 March 2005.
■ Any contracts entered into which might confirm or dispute management’s intentions to restore the site. For
example, whether plant hire (bulldozers, etc) covers only the period over which the warehouse will be constructed
– or whether it extends to the period in which the valley would be ‘made good’.

正确答案：
(c) Quality control issues raised from the senior’s comments
There are several issues raised, all of which indicate that quality control procedures have not functioned adequately. The
planned audit procedures appear to be inadequate, further tests should have been performed to confirm the completeness,
existence and valuation of the balance.
In last year’s audit, the management representation was accepted as sufficient evidence in relation to the receivable. Possibly
the item was not identified as a related party transaction, or it was not considered to be material enough to warrant further
investigation.
At the planning stage, it is standard procedure to identify key related parties of an entity, and to plan procedures specific to
them. Inadequate planning may lead to a lack of prioritisation of this as an area of relatively high audit risk.
Work on receivables is often carried out by a relatively inexperienced member of the audit team. Audit juniors may not
appreciate the potential breach of IAS 24, or the complexities regarding materiality assessment for this type of transaction.
Insufficient review by the audit manager has been performed on completed working papers, which then failed to spot the
weakness of the management representation as a source of evidence. This year the audit senior has highlighted the matter,
which can now be resolved through additional audit procedures.

正确答案：
Part (b):
The difference between a person specification and a job description is that a person specification sets out the qualities of an ideal
candidate whereas a job description defines the duties and responsibilities of the job.

正确答案：

Gow’s net assets
IAS36 ‘Impairment of Assets’, sets out the events that might indicate that an asset is impaired. These circumstances include
external events such as the decline in the market value of an asset and internal events such as a reduction in the cash flows
to be generated from an asset or cash generating unit. The loss of the only customer of a cash generating unit (power station)
would be an indication of the possible impairment of the cash generating unit. Therefore, the power station will have to be
impairment tested.
The recoverable amount will have to be determined and compared to the value given to the asset on the setting up of the
joint venture. The recoverable amount is the higher of the cash generating unit’s fair value less costs to sell, and its value-inuse.
The fair value less costs to sell will be $15 million which is the offer for the purchase of the power station ($16 million)
less the costs to sell ($1 million). The value-in-use is the discounted value of the future cash flows expected to arise from the
cash generating unit. The future dismantling costs should be provided for as it has been agreed with the government that it
will be dismantled. The cost should be included in the future cash flows for the purpose of calculating value-in-use and
provided for in the financial statements and the cost added to the property, plant and equipment ($4 million ($5m/1·064)).
The value-in-use based on a discount rate of 6 per cent is $21 million (working). Therefore, the recoverable amount is
$21 million which is higher than the carrying value of the cash generating unit ($20 million) and, therefore, the value of the
cash generating unit is not impaired when compared to the present carrying value of $20 million (value before impairment
test).
Additionally IAS39, ‘Financial Instruments: recognition and measurement’, says that an entity must assess at each balance
sheet date whether a financial asset is impaired. In this case the receivable of $7 million is likely to be impaired as Race is
going into administration. The present value of the estimated future cash flows will be calculated. Normally cash receipts from
trade receivables will not be discounted but because the amounts are not likely to be received for a year then the anticipated
cash payment is 80% of ($5 million × 1/1·06), i.e. $3·8 million. Thus a provision for the impairment of the trade receivables
of $3·2 million should be made. The intangible asset of $3 million would be valueless as the contract has been terminated.
Glass’s Net Assets
The leased property continues to be accounted for as property, plant and equipment and the carrying amount will not be
adjusted. However, the remaining useful life of the property will be revised to reflect the shorter term. Thus the property will
be depreciated at $2 million per annum over the next two years. The change to the depreciation period is applied prospectively
not retrospectively. The lease liability must be assessed under IAS39 in order to determine whether it constitutes a
de-recognition of a financial liability. As the change is a modification of the lease and not an extinguishment, the lease liability
would not be derecognised. The lease liability will be adjusted for the one off payment of $1 million and re-measured to the
present value of the revised future cash flows. That is $0·6 million/1·07 + $0·6 million/(1·07 × 1·07) i.e. $1·1 million. The
adjustment to the lease liability would normally be recognised in profit or loss but in this case it will affect the net capital
contributed by Glass.
The termination cost of the contract cannot be treated as an intangible asset. It is similar to redundancy costs paid to terminate
a contract of employment. It represents compensation for the loss of future income for the agency. Therefore it must be
removed from the balance sheet of York. The recognition criteria for an intangible asset require that there should be probable
future economic benefits flowing to York and the cost can be measured reliably. The latter criterion is met but the first criterion
is not. The cost of gaining future customers is not linked to this compensation.
IAS18 ‘Revenue’ contains a concept of a ‘multiple element’ arrangement. This is a contract which contains two or more
elements which are in substance separate and are separately identifiable. In other words, the two elements can operate
independently from each other. In this case, the contract with the overseas company has two distinct elements. There is a
contract not to supply gas to any other customer in the country and there is a contract to sell gas at fair value to the overseas
company. The contract has not been fulfilled as yet and therefore the payment of $1·5 million should not be taken to profit
or loss in its entirety at the first opportunity. The non supply of gas to customers in that country occurs over the four year
period of the contract and therefore the payment should be recognised over that period. Therefore the amount should be
shown as deferred income and not as a deduction from intangible assets. The revenue on the sale of gas will be recognised
as normal according to IAS18.
There may be an issue over the value of the net assets being contributed. The net assets contributed by Glass amount to
$21·9 million whereas those contributed by Gow only total $13·8 million after taking into account any adjustments required
by IFRS. The joint venturers have equal shareholding in York but no formal written agreements, thus problems may arise ifGlass feels that the contributions to the joint venture are unequal.