Name: _____________________________
SID: ______________
University of New South Wales
School of Accounting
ACCT2542 - Corporate Financial Reporting and Analysis
Mid-ssion Examination
Session 2, 2007
Time allowed: 90 minutes (inclusive of reading time) Total number of questions: 30 multiple choice questions
1.For all multiple choice questions the best answer must be indicated in pencil on
the generalid answer sheet provided. If the student fails to properly indicate his/her answer on the generalid answer sheet provided, all requests for special consideration to remark the examination pa
per will be denied.
2.There is no negative marking for the questions.
3.Questions 1-30 are of equal marks.
4.Electronic calculators may be ud.
5.This exam paper and the answer sheet must be submitted at the end of the
examination.
Multiple Choice Questions (30 Marks)
Choo the best answer and indicate this on the generalid answer sheet provided.
Introduction to Corporate Financial Reporting
1. A taskforce of the Institute of Chartered Accountants in Australia suggested
that directors be permitted, as they were some years ago, to elect not to comply with Accounting Sta
ndards if they considered compliance with the Standards was not in the interests of prenting true-and-fair financial statements (that is, to reintroduce the ‘true-and-fair over-ride system’).
Disadvantages of this initiative include:小叶黄杨树
not particularly suited to particular transactions or circumstances;
II.allows management to lect its own accounting methods, which may enable it to prepare financial statements which more efficiently reflect
the financial performance and financial position of the entity;
III.allows too much discretion for managers and therefore would tend to provide some scope for opportunism;
V.increas the objectivity of financial statements.
A.I, II and III
分享英语B.I, III and IV
C.II, III and IV
D.III and IV
E.All of the above
2. The Financial Reporting Panel established under the auspices of the Australian
Securities and Investments Commission intends to provide:
A.A timely, efficient and cost-effective way of resolving disputes concerning五年级西游记读后感
accounting treatments in financial reports.
B.The opportunity to be heard by persons with relevant experti.
C. A mechanism to alleviate some concerns regarding the u of the courts for
adjudication on technical accounting issues.
D.All of the above.
E.None of the above.
3. A recent noteworthy development in relation to Australian Stock Exchange
required disclosures is the establishment of the ASX Corporate Governance
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Council, and the issue of Principles of Good Corporate Governance and Best
Practice Recommendations. In relation to the principles:
A.All companies governed by the Corporations Act 2001 must abide by the
principles and recommendations.
B.The Australian Accounting Standards Board (AASB) has incorporated the
滔滔不绝意思principles and recommendations into the Accounting Framework.
C.All ASX-listed companies are compelled by law to comply in entirety with
the principles and recommendations.
D.All ASX-listed companies are compelled to change their corporate governance
systems to ensure total compliance with the principles and
recommendations.
E.All ASX-listed companies must follow the principles and recommendations,
and where they have not, they must identify the fact that they have not and
give reasons for not following them.
4. In accordance with Corporations Act, which of the following companies are
required to prepare financial reports?
I.Proprietary Company with revenues of $12 million, total asts of $4
million and number of employees totalling 80.
II.Proprietary Company with revenues of $25.5 million, total asts of $13 million and number of employees totalling 40.
III.Company listed on the stock exchange.
IV.Company that issued a public debt
V.Reporting entities
A.All of the above
B.I, II, III, and IV only
C.II, III, IV and V only
D.II, III and IV only
E.III, IV and V only
5. Bowen Pty Ltd is a small proprietary company with ven directors. Four of
the ven directors own 75% of the ordinary shares and the remaining shares
are owned by family members of the directors. The company also has 15 trade creditors and an open line of credit with one state bank. Is Bowen Pty Ltd a
reporting entity and hence required to prepare general-purpo financial
reports?
A.Yes, becau dependent urs exist.
B.Yes, becau there are trade creditors who are external urs.
C.No, becau it is a small proprietary firm.
D.No, becau there are no obvious urs who are unable to command the
preparation of information from the entity.
E.None of the above
6. Ms Marple is an accounting cadet for one of the big accounting firms. She is a
bit confud as to which of the following references should be applied first in
dealing with an accounting issue.
I. Industry Practice
II. Accounting Standards
III. Conceptual Framework
IV. International Financial Reporting Interpretations Committee
Which ordering would you recommend?
A.I, II, III, IV;
B.II, IV, III, I;
C.II, I, IV, III;
D.III, II, I, IV;
E.IV, III, II, I.
Principles of Disclosure
7. Which of the following material after balance day events are considered adjusting events?
A: Settlement after reporting date of a court ca that confirms that the entity has a prent obligation on reporting date.
B: An announcement of a plan to discontinue a business operation after balance date. C: Decline in market value of investments between reporting date and the date when the financial report is authorid for issue.
D: All of the above.
E: A and C.
8. To conform with AASB 101 “Prentation of Financial Statements”, which statements are required to be included in a general purpo financial report?
A: Statement of financial position, Statement of financial performance, Statement of cash flows and notes to the accounts.
B: Statement of financial position, Statement of financial performance, Statement of cash flows, Statement of changes in owners’ equity and notes to the accounts.
C: Balance sheet, Income statement, Cash flow Statement, Statement of changes in owners’ equity and notes to the accounts.
D: Balance sheet, Income statement, Cash flow Statement and notes to the accounts. E: C or D.
9. Birong Ltd. issued $200 million preference shares after reporting date. What is the classification of this subquent event and what is the accounting treatment prescribed in AASB 110?
A: adjusting event; no disclosure necessary.
B: adjusting event; with appropriate disclosure.
C: non-adjusting event; no disclosure necessary.
D: non-adjusting event; with appropriate disclosure.
E: None of the above
10: If it becomes apparent to an entity that new events or conditions have resulted that indicate that the entity is no longer a going concern, the entity must:
A: treat this as a non-adjusting event and disclo the reason for the breach of the going concern assumption.
B: treat this as an adjusting event and adjust the affected accounts in the financial report.
C: prepare its financial report on a going concern basis and ask the auditor to indicate in the opinion the breach of the going concern basis.
D: prepare the financial reports adopting a fundamental change in the basis of accounting, say u of liquidation values instead of modified historical cost basis. E: None of the above.
11. The new accounting standard on intangible asts AASB 138 applies to all financial reports issued after 1 January 2005. The company accountant of Knapp Ltd was unaware that this standard was applicable to rearch and development (R&D) expens. In brief, the new standard requires all expenditures in the rearch pha be recognid as expen when incurred. On the other hand,
development pha expenditures may be capitalid if future economic benefits are expected to exceed the costs incurred. The company is preparing the accounts for the year ended 30 June 2007. But after careful analysis of the R&D ast account, the company accountant noted that the following rearch pha expenditures have been capitalid:
Period spent
Year ending 2007 $60,000
购货合同Year ending 2006 $80,000
Total $140.000
To comply with AASB 108, Accounting Policies, Changes in Accounting Estimates and Errors, the accountant should: (assume amounts are material)
A: Write-off R&D ast balance of $140,000 to retained earnings in 2007.
B: Write-off R&D ast balance of $60,000 to profit and loss in 2007 and write-off R&D ast balance of $80,000 to profit and loss of 2006 (comparative amount).
天安门手抄报
C: Write-off R&D ast balance by $70,000 (half of the write down) to profit and loss and half the balance to $70,000 to profit and loss of 2006 (comparative amount);
D: Write-off R&D ast of $140,000 to profit and loss in 2007.
E: Make no changes to the amounts, i.e. apply the change prospectively in 2008.
12. The accountant realid that he had ud the incorrect depreciation rates to calculate the carrying amount of veral buildings when preparing the 2006 statements. The accountant is preparing the financial statement for the year ended 30 June 2007. The difference between using the different rates amounts to a difference of $300,000. To comply with AASB 108, Accounting Policies, Changes in Accounting Estimates and Errors, the accountant should:
A: Make a prospective change to the 2007 figures, on the basis that he has made an error in 2006;
B: Make a prospective change to the 2007 figures, on the basis that he is making a change to an estimate in 2006;
C: Make a retrospective change to the 2006 figures, on the basis that there has been a change in accounting policy;
D: Make a retrospective change to the 2006 figures, on the basis that he is making a change to an estimate in 2007
婚礼仪式E: Make a retrospective change to the 2006 figures, on the basis that he has made an error in 2006
