ACCA AS Study Guide 2026

For individual landlords, finance costs (mortgage interest) are no longer deductible from property income but are instead given as a basic rate (20%) tax reduction. This means higher and additional rate taxpayers receive less relief than they did under the old rules. Capital repayments, extensions, and purchase costs are capital expenditure and not allowable revenue deductions.

From 1 April 2023, the main rate of corporation tax is 25% for companies with augmented profits exceeding £250,000. Companies with profits of £50,000 or less pay 19% (small profits rate), and those between £50,000 and £250,000 benefit from marginal relief.

Under IAS 16.39, a revaluation increase (where there is no previous revaluation decrease for the same asset recognised in profit or loss) is recognised in other comprehensive income (OCI) and accumulated in equity under the heading 'revaluation surplus'. It bypasses the income statement entirely unless it reverses a previous decrease.

Goal congruence exists when divisional managers, acting in their own interests, also act in the best interest of the organisation as a whole.

Detection risk is the risk that audit procedures will not detect a material misstatement that actually exists. The auditor controls detection risk by adjusting the nature, timing and extent of procedures.

Upward revaluations under IAS 16 are credited to other comprehensive income, accumulating in the revaluation reserve (a component of equity), not profit or loss.