ACCA Strategic Business Reporting 3

Question 1

Under IFRS 16, how does a lessee account for a lease on commencement date?

Accepted Answer

Recognize a right-of-use asset and a corresponding lease liability

Answer

IFRS 16 requires lessees to recognize a right-of-use asset and a lease liability on commencement for virtually all leases (except short-term and low-value exemptions).

Question 2

Non-controlling interests (NCI) in a consolidated statement of financial position are presented:

Accepted Answer

Within equity, separately from the parent shareholders' equity

Answer

Under IFRS 10 and IAS 1, NCI is presented within the equity section of the consolidated statement of financial position, separately from the equity of the owners of the parent.

Question 3

When calculating goodwill using the full goodwill method, which of the following is included?

Accepted Answer

The fair value of the NCI at acquisition date is included in the goodwill calculation

Answer

Under the full goodwill method, NCI is measured at fair value, which means the full goodwill attributable to both the parent and NCI is recognized.

Question 4

Under IFRS 2 Share-based Payment, how are equity-settled share-based transactions measured?

Accepted Answer

At the fair value of the equity instruments granted, measured at the grant date

Answer

For equity-settled transactions with employees, IFRS 2 requires measurement at the fair value of the equity instruments at grant date, which is not subsequently remeasured.

Question 5

In a consolidated income statement, the profit attributable to non-controlling interests is:

Accepted Answer

Shown as an allocation of group profit, below the profit for the period line

Answer

The consolidated profit for the period is allocated between owners of the parent and NCI as a split at the foot of the consolidated income statement.

ACCA - Association of Chartered Certified Accountants Practice Test

ACCA - Association of Chartered Certified Accountants Practice Test

ACCA Strategic Business Reporting 3