2020年ACCA考试《财务会计》备考考点(1)

正确答案：

正确答案：

(a) Deferred taxation

A deferred tax asset should be recognised for deductible temporary differences, unused tax losses and unused tax credits to the extent that it is probable that taxable profi t will be available against which the deductible temporary differences can be utilised. The recognition of deferred tax assets on losses carried forward does not seem to be in accordance with IAS 12 Income Taxes. Cate is not able to provide convincing evidence that suffi cient taxable profi ts will be generated against which the unused tax losses can be offset. According to IAS 12 the existence of unused tax losses is strong evidence that future taxable profi t may not be available against which to offset the losses. Therefore when an entity has a history of recent losses, the entity recognises deferred tax assets arising from unused tax losses only to the extent that the entity has suffi cient taxable temporary differences or there is convincing other evidence that suffi cient taxable profi t will be available. As Cate has a history of recent losses and as it does not have suffi cient taxable temporary differences, Cate needs to provide convincing other evidence that suffi cient taxable profi t would be available against which the unused tax losses could be offset. The unused tax losses in question did not result from identifi able causes, which were unlikely to recur (IAS 12) as the losses are due to ordinary business activities. Additionally there are no tax planning opportunities available to Cate that would create taxable profi t in the period in which the unused tax losses could be offset (IAS 12).

Thus at 31 May 2010 it is unlikely that the entity would generate taxable profi ts before the unused tax losses expired. The improved performance in 2010 would not be indicative of future good performance as Cate would have suffered a net loss before tax had it not been for the non-operating gains.

Cate’s anticipation of improved future trading could not alone be regarded as meeting the requirement for strong evidence of future profi ts. When assessing the use of carry-forward tax losses, weight should be given to revenues from existing orders or confi rmed contracts rather than those that are merely expected from improved trading. Estimates of future taxable profi ts can rarely be objectively verifi ed. Thus the recognition of deferred tax assets on losses carried forward is not in accordance with IAS 12 as Cate is not able to provide convincing evidence that suffi cient taxable profi ts would be generated against which the unused tax losses could be offset.

(b) Investment

Cate’s position for an investment where the investor has signifi cant infl uence and its method of calculating fair value can be challenged.

An asset’s recoverable amount represents its greatest value to the business in terms of its cash fl ows that it can generate i.e. the higher of fair value less costs to sell (which is what the asset can be sold for less direct selling expenses) and value in use (the cash fl ows that are expected to be generated from its continued use including those from its ultimate disposal). The asset’s recoverable amount is compared with its carrying value to indicate any impairment. Both net selling price (NSP) and value in use can be diffi cult to determine. However it is not always necessary to calculate both measures, as if the NSP or value in use is greater than the carrying amount, there is no need to estimate the other amount.

It should be possible in this case to calculate a fi gure for the recoverable amount. Cate’s view that market price cannot refl ect the fair value of signifi cant holdings of equity such as an investment in an associate is incorrect as IAS 36 prescribes the method of conducting the impairment test in such circumstances by stating that if there is no binding sale agreement but an asset is traded in an active market, fair value less costs to sell is the asset’s market price less the costs of disposal. Further, the appropriate market price is usually the current bid price.

Additionally the compliance with IAS 28, Investments in associates is in doubt in terms of the non-applicability of value in use when considering impairment. IAS 28 explains that in determining the value in use of the investments, an entity estimates:

(i) its share of the present value of the estimated future cash fl ows expected to be generated by the associate, including the cash fl ows from the operations of the associate and the proceeds on the ultimate disposal of the investment; or
(ii) the present value of the estimated future cash fl ows expected to arise from dividends to be received from the investment and from its ultimate disposal.

Estimates of future cash fl ows should be produced. These cash fl ows are then discounted to present value hence giving value in use.

It seems as though Cate wishes to avoid an impairment charge on the investment.

(c) Disposal group ‘held for sale’

IAS 27 Revised Consolidated and Separate Financial Statements moved IFRS to the use of the economic entity model. The economic entity approach treats all providers of equity capital as shareholders of the entity, even when they are not shareholders in the parent company. IFRS 5 has been amended such that if there is an intention to dispose of a controlling interest in a subsidiary which meets the defi nition of ‘held for sale’, then the net assets are classifi ed as ‘held for sale’, irrespective of whether the parent was expected to retain an interest after the disposal. A partial disposal of an interest in a subsidiary in which the parent company loses control but retains an interest as an associate or trade investment creates the recognition of a gain or loss on the entire interest. A gain or loss is recognised on the part that has been disposed of and a further holding gain or loss is recognised on the interest retained, being the difference between the fair value of the interest and the book value of the interest. The gains are recognised in the statement of comprehensive income. Any prior gains or loss recognised in other components of equity would now become realised in the statement of comprehensive income.

In this case, Cate should stop consolidating Date on a line-by-line basis from the date that control was lost. Further investigation is required into whether the holding is treated as an associate or trade investment. The agreement that Cate is no longer represented on the board or able to participate in management would suggest loss of signifi cant infl uence despite the 35% of voting rights retained. The retained interest would be recognised at fair value.

An entity classifi es a disposal group as held for sale if its carrying amount will be recovered mainly through selling the asset rather than through usage and intends to dispose of it in a single transaction.

The conditions for a non-current asset or disposal group to be classifi ed as held for sale are as follows:

(i) The assets must be available for immediate sale in their present condition and its sale must be highly probable.
(ii) The asset must be currently marketed actively at a price that is reasonable in relational to its current fair value.
(iii) The sale should be completed or expected to be so, within a year from the date of the classifi cation.
(iv) The actions required to complete the planned sale will have been made and it is unlikely that the plan will be signifi cantly changed or withdrawn.
(v) management is committed to a plan to sell.

Cate has not met all of the conditions of IFRS 5 but it could be argued that the best presentation in the fi nancial statements was that set out in IFRS 5 for the following reasons.

The issue of dilution is not addressed by IFRS and the decision not to subscribe to the issue of new shares of Date is clearly a change in the strategy of Cate. Further, by deciding not to subscribe to the issue of new shares of Date, Cate agreed to the dilution and the loss of control which could be argued is similar to a decision to sell shares while retaining a continuing interest in the entity. Also Date represents a separate line of business, which is a determining factor in IFRS 5, and information disclosed on IFRS 5 principles highlights the impact of Date on Cate’s fi nancial statements. Finally, the agreement between Date’s shareholders confi rms that Cate has lost control over its former subsidiary.

Therefore, in the absence of a specifi c Standard or Interpretation applying to this situation, IAS 8 Accounting policies, changes in accounting estimates and errors states that management should use its judgment and refer to other IFRS and the Framework.

Thus considering the requirements of IAS 27 (Para 32–37) and the above discussion, it could be concluded that the presentation based on IFRS 5 principles selected by the issuer was consistent with the accounting treatment required by IAS 27 when a parent company loses control of a subsidiary.

(d) Defi ned benefi t plan

The Plan is not a defi ned contribution plan because Cate has a legal or constructive obligation to pay further contributions if the fund does not have suffi cient assets to pay all employee benefi ts relating to employee service in the current and prior periods (IAS 19 Para 7). All other post-employment benefi t plans that do not qualify as a defi ned contribution plan are, by defi nition therefore defi ned benefi t plans. Defi ned benefi t plans may be unfunded, or they may be wholly or partly funded. Also IAS 19 (Para 26) indicates that Cate’s plan is a defi ned benefi t plan as IAS 19 provides examples where an entity’s obligation is not limited to the amount that it agrees to contribute to the fund. These examples include: (a) a plan benefi t formula that is not linked solely to the amount of contributions (which is the case in this instance); and (b) those informal practices that give rise to a constructive obligation. According to the terms of the Plan, if Cate opts to terminate, Cate is responsible for discharging the liability created by the plan. IAS 19 (Para 52) says that an entity should account not only for its legal obligation under the formal terms of a defi ned benefi t plan, but also for any constructive obligation that arises from the enterprise’s informal practices. Informal practices give rise to a constructive obligation where the enterprise has no realistic alternative but to pay employee benefi ts. Even if the Plan were not considered to be a defi ned benefi t plan under IAS 19, Cate would have a constructive obligation to provide the benefi t, having a history of paying benefi ts. The practice has created a valid expectation on the part of employees that the amounts will be paid in the future. Therefore Cate should account for the Plan as a defi ned benefi t plan in accordance with IAS 19. Cate has to recognise, at a minimum, its net present liability for the benefi ts to be paid under the Plan.

正确答案：
3 KEFFLER CO
Tutorial note: None of the issues have any bearing on revenue. Therefore any materiality calculations assessed on revenue are
inappropriate and will not be awarded marks.
(a) Landfill site
(i) Matters
■ $1·1m cost of the right represents 3·3% of total assets and is therefore material.
■ The right should be amortised over its useful life, that is just 10 years, rather than the 15-year period for which
the right has been granted.
Tutorial note: Recalculation on the stated basis (see audit evidence) shows that a 10-year amortisation has been
correctly used.
■ The amortisation charge represents 1% of profit before tax (PBT) and is not material.
■ The amortisation method used should reflect the pattern in which the future economic benefits of the right are
expected to be consumed by Keffler. If that pattern cannot be determined reliably, the straight-line method must
be used (IAS 38 ‘Intangible Assets’).
■ Using an increasing sum-of-digits will ‘end-load’ the amortisation charge (i.e. least charge in the first year, highest
charge in the last year). However, according to IAS 38 there is rarely, if ever, persuasive evidence to support an
amortisation method that results in accumulated amortisation lower than that under the straight-line method.
Tutorial note: Over the first half of the asset’s life, depreciation will be lower than under the straight-line basis
(and higher over the second half of the asset’s life).
■ On a straight line basis the annual amortisation charge would be $0·11m, an increase of $90,000. Although this
difference is just below materiality (4·5% PBT) the cumulative effect (of undercharging amortisation) will become
material.
■ Also, when account is taken of the understatement of cost (see below), the undercharging of amortisation will be
material.
■ The sum-of-digits method might be suitable as an approximation to the unit-of-production method if Keffler has
evidence to show that use of the landfill site will increase annually.
■ However, in the absence of such evidence, the audit opinion should be qualified ‘except for’ disagreement with the
amortisation method (resulting in intangible asset overstatement/amortisation expense understatement).
■ The annual restoration provision represents 5% of PBT and 0·3% of total assets. Although this is only borderline
material (in terms of profit), there will be a cumulative impact.
■ Annual provisioning is contrary to IAS 37 ‘Provisions, Contingent Liabilities and Contingent Assets’.
■ The estimate of the future restoration cost is (presumably) $1·5m (i.e. $0·1 × 15). The present value of this
amount should have been provided in full in the current year and included in the cost of the right.
■ Thus the amortisation being charged on the cost of the right (including the restoration cost) is currently understated
(on any basis).
Tutorial note: A 15-year discount factor at 10% (say) is 0·239. $1·5m × 0·239 is approximately $0·36m. The
resulting present value (of the future cost) would be added to the cost of the right. Amortisation over 10 years
on a straight-line basis would then be increased by $36,000, increasing the difference between amortisation
charged and that which should be charged. The lower the discount rate, the greater the understatement of
amortisation expense.
Total amount expensed ($120k) is less than what should have been expensed (say $146k amortisation + $36k
unwinding of discount). However, this is not material.
■ Whether Keffler will wait until the right is about to expire before restoring the land or might restore earlier (if the
site is completely filled in 10 years).
(ii) Audit evidence
■ Written agreement for purchase of right and contractual terms therein (e.g. to make restoration in 15 years’ time).
■ Cash book/bank statement entries in April 2005 for $1·1m payment.
■ Physical inspection of the landfill site to confirm Keffler’s use of it.
■ Annual dump budget/projection over next 10 years and comparison with sum-of-digits proportions.
■ Amount actually dumped in the year (per dump records) compared with budget and as a percentage/proportion of
the total available.
■ Recalculation of current year’s amortisation based on sum-of-digits. That is, $1·1m ÷ 55 = $20,000.
Tutorial note: The sum-of-digits from 1 to 10 may be calculated long-hand or using the formula n(n+1)/2 i.e.
(10 × 11)/2 = 55.
■ The basis of the calculation of the estimated restoration costs and principal assumptions made.
■ If estimated by a quantity surveyor/other expert then a copy of the expert’s report.
■ Written management representation confirming the planned timing of the restoration in 15 years (or sooner).