If you fail the test, please re-read the article before attempting the questions again Please note the following: From December 2019, the DipIFR exam changed in format to 4 x 25 marks questions. Hence you can not start it again. Assets classified as __________ in accordance with IAS 1 Presentation of Financial Statements _________ they meet the criteria to be classified as held for sale in accordance with IFRS 5. Please visit our global website instead, Can't find your location listed? It conducts DipIFR exam in every June and December months. The building will not be classified as held-for-sale as it is not available for immediate sale because, until new premises have been found, the office staff will remain in the existing building. For ACCA members whose qualifications are already based on IFRS, the Cert IFR is an opportunity to update their IFRS … However, a disposal group that is to be abandoned may meet the definition of a discontinued activity. Acowtancy. An introduction to ACCA SBR (INT) E1ef. Register; Log In; CPD IFRS 5 - Non-current Assets HFS and Discontinued Ops ... IFRS 5 — Non-current Assets for Sale or Discontinued 4 Steps ... playlist_add_check Quiz - Identification and Presentation 5 Questions ondemand_video Discontinued Operations 13m 35s playlist_add_check Quiz - Discontinued Operations 5 … Such a non-current asset will be classified as held-for-sale at the date of the acquisition only if it is anticipated that it will be sold within the one-year period, and it is highly probable that the held-for-sale criteria will be met within a short period (normally three months) of the acquisition date. If the criteria for classifying a non-current asset as held-for-sale occur after the balance sheet date, then the non-current asset should not be shown as held-for-sale but disclosure of the fact should be made. Retrospective classification as a discontinued operation where the criteria are met after the balance sheet date is prohibited by IFRS 5. Financial instruments (IFRS 9) Chapter 12. Question 1 of 2 Summary Skip. 5 steps that need to be followed in revenue recognition: 1. Any subsequent increases in fair value less cost to sell of the asset can be recognised in profit and loss to the extent that it is not in excess of the cumulative impairment loss that has been recognised. Module 5 - Topic Areas: ACCA BT F1 MA F2 FA F3 LW F4 Eng PM F5 TX F6 UK FR F7 AA F8 FM F9 SBL SBR INT SBR UK AFM P4 APM P5 … A 2 and 3 D3a. In this article, Steve Collings looks at how an entity should account for non-current assets which have been classified as held for sale. The entity will continue to use the building until another building has been found with equivalent facilities, and in a suitable location for the office staff, who will not be relocated until the new building has been found. Excluding taxation, what should the net gain/(loss) to be reported in the income statements of Walley Corp for its Plant division? Log In Sign Up. IFRS 5 deals with the accounting for non-current assets held-for-sale, and the presentation and disclosure of discontinued operations. Under IFRS, property, plant and equipment would be stated at $26m, and inventory stated at $18m. The price of the building has been fixed at $4m and a surveyor has valued the building based on market prices at $3.6m. ACCA CIMA CAT DipIFR Search. If criteria for an asset to be classified as held-for-sale are no longer met, then the asset or disposal group ceases to be held-for-sale. These papers featured in past exam sessions and should therefore be used as a guide only. Non-current assets or disposal groups classified as held-for-sale should not be depreciated. the subsidiary was acquired exclusively with a view to resale. ACCA BT F1 MA F2 FA F3 LW F4 Eng PM F5 TX F6 UK FR F7 AA F8 FM F9 SBL SBR INT SBR UK AFM P4 APM P5 … It is unlikely that the entity will sell the building for that price. It is accredited by the ACCA (Association of Chartered Certified Accountants) and is aimed at ... past exam questions to develop examination skills. Press question mark to learn the rest of the keyboard shortcuts. Acowtancy. In general terms, assets (or disposal groups) held for sale are not depreciated, are measured at the lower of carrying amount and fair value less costs to sell, and are presented separately in the statement of financial position. IFRS 5 requires detailed disclosure of revenue, expenses, pre-tax profit or loss, and the related income tax expense either in the notes or on the face of the income statement. IFRS 5 outlines how to account for non-current assets held for sale (or for distribution to owners). The conditions for a non-current asset or disposal group to be classified as held-for-sale are as follows: For the sale to be highly probable, management must be committed to selling the asset and must be actively looking for a buyer. The fair value less costs to sell of the disposal group is $47m. When non-current assets or disposal groups are classified as held-for-sale, they are measured at the lower of the carrying amount and fair value less cost to sell. Free sign up Sign In. The reduction in the carrying amount of property, plant and equipment will be dealt with in accordance with IAS 16, and that of the inventory in accordance with IAS 2. There are several other discloses required, including a description of the non-current assets of a disposal group, a description of the facts and circumstances of the sale, and the expected manner and timing of that disposal. Thus, in this case, there would be separate disclosure of the disposal group as follows. Accounting policies, changes in accounting estimate and errors (IAS 8) Chapter 10. I expected that we maintained … Revenue Recognition - IFRS 15 - 5 steps from past papers in ACCA FR (F7). This loss is allocated to goodwill in accordance with IAS 36. FREE Courses Blog. The loss will be charged against profit or loss. AAA P7 INT. IFRS 5 requires that immediately before the initial classification of the disposal group as held-for-sale, the carrying amounts of the disposal group be measured in accordance with applicable IFRS, and any profit or loss dealt with under that IFRS. Chartered Education IFRS MCQs have more than 1,100 questions like these covering all subjects. Additionally, the entity is planning to sell part of its business and has actively marketed the business at a fair price but, before the business can be sold, government approval is required and any sale requires government approval. Inventory (IAS 2) Chapter 10. Non-current assets held-for-sale and assets of disposal groups must be disclosed separately from other assets in the balance sheet. Evaluation and review. Agriculture (IAS 41) Chapter 11. IFRS 15 provides indicators rather than criteria to determine when a good or service is distinct within the context of the contract. Entities often acquire non-current assets exclusively with a view to disposal. Enrich your profile & get ready to certify your skills Now! B10a. General IFRS Discussion (129) IFRS for SMEs (5) IFRS 1 - First-time Adoption of International Financial Standards (15) IFRS 2 - Share-based Payment (9) IFRS 3 - Business Combinations (10) IFRS 4 - Insurance Contracts (6) IFRS 5 - Non-current Assets Held for Sale and Discontinued Operations (3) IFRS 6 - Exploration for and … The price of the building has been fixed at $4m and a surveyor has valued the building based on market prices at $3.6m. Non-current assets held for sale and discontinued operations (IFRS 5) Chapter 9. ACCA CIMA CAT DipIFR Search. IFRS 5 provides unconditional requirement that the sale of the non-current asset held for sale should be expected to qualify for recognition as a completed sale within one year from the date of classification. In 20X4 Plant’s net losses were €350,000 and €20,000 in 20X5 up until the date of sale. We’d love to have you as a member; simply click here to find out more. ACCA CIMA CAT DipIFR Search. There are two notable exceptions: shares issued in a business combination, which are dealt with under IFRS 3, Business Combinations; and contracts for the purchase of goods that are within the scope … The property, plant and equipment and inventory were stated at deemed cost on moving to IFRS. If this information is presented on the face of the income statement, then the information should be separately disclosed from that of continuing operations. Thus, goodwill will be reduced to zero. In the balance sheet, the major classes of assets and liabilities classified as held-for-sale should be separately disclosed on the face of the balance sheet or in the notes. Assets Held for Sale. ACCA CIMA CPD FIA (ACCA) AAT. Also, the directors have only tentatively started looking for a buyer which may indicate that the entity is not committed to the sale. This allows management to apply judgment to determine the separate performance obligations that best reflect the economic substance of a transaction. Take practice test on IFRS Basics & boost your chances to excel. ACCA BT F1 MA F2 FA F3 LW F4 Eng PM F5 TX F6 UK FR F7 AA F8 FM F9 SBL SBR INT SBR UK AFM P4 APM P5 ATX P6 UK AAA P7 INT AAA P7 UK. Terms & Conditions Earned Point(s): 0 of 0, (0) E-mail: info@charterededucation.com. ification in Financial Accounting using International Financial Reporting Standards (IFRS/IAS). IFRS 5 Non Current Assets Held for Sale and Discontinued operations give us guidelines that how entities should account for the non-current asset held for sale and discontinued operations. In February 20X4, Walley Corp decided to sell it’s entire Plant division. Results are being recorded. ACCA Financial Reporting (FR) Chapter 8 - Non-current assets held for sale and discontinued operations (IFRS 5) Questions - Free ACCA … SBR predictions. D3a. the actions required to complete the planned sale will have been made, and it is unlikely that the plan will be significantly changed or withdrawn. The liabilities must also be disclosed separately in the balance sheet. Sample exam papers for recent DipIFR exam sessions are listed below. If you’d like to keep improving your knowledge of IFRS, sign up for a subscription where you can access all our questions. The quiz goodwill in accordance with IFRS any predictions for possible standards and the presentation and of. 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