ACF301 - OW01 07 Workshop PDF

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ACF301 - OW01 07 Workshop...

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ACF301 – Ac.F301/OW01/07 Specific areas: 1. 2. 3. 4. 5.

Accounting treatment if company accounting policies / year ends are different (3) Negative goodwill (9) Exemptions for consolidating companies (5) Joint operation (4) / joint venture (3) Fair values (3)

Topic area 1 – conceptual framework links to consolidation (5) Explain type question => Explain the key factors that determine whether an investor is required to consolidate an investee and the impact upon the financial statements. Exam standard => Evaluate the usefulness of group accounts by linking to the characteristics of financial information according to the conceptual framework.

Topic area 2 – substance over form (5) Explain type question => Explain how the concept of substance over form is applied to consolidation. Exam standard => Evaluate the importance of the concept of substance over form. As part of your answer you should provide specific examples and evaluate the extent to which these improve the usefulness of financial information

Topic area 3 – proportion of net assets vs fair value method of consolidation (5) Explain type question => Explain the key differences between the proportion of net assets and fair value methods of consolidation. Explain why these two methods exist. Exam standard => Evaluate the policy choice allowing groups to choose between the proportion of net assets and fair value methods of consolidation. As part of your answer you should specifically focus on the characteristics of financial information according to the conceptual framework

Topic area 4 – equity method of accounting (4) Explain type questions => Explain what is meant by the equity method of accounting and the impact on the financial statements. Exam standard => Evaluate the equity method of accounting. As part of your answer you should link to the characteristics of financial information according to the conceptual framework...