Chapter 8. The disposal group, however, would be classified as held-for-sale because the delay is caused by events or circumstances beyond the entity’s control, and there is evidence that the entity is committed to selling the disposal group. In 20X4 Plant’s net losses were €350,000 and €20,000 in 20X5 up until the date of sale. IFRS 5 - Discontinued operations - ACCA Financial Reporting (FR) IFRS 5 - Discontinued operations - ACCA Financial Reporting (FR) Skip to primary navigation; ... the discontinued operations iwas adjusted for in year 2016 though the question stated that the business wound up in March 2017. Leases (IFRS 16) Chapter 13. D3a. Free IFRS 5 multiple choice quiz. Module 5 - Topic Areas: Additionally, it intends to shut down one-half of its manufacturing base. IFRS 5 Non-current Assets Held for Sale IFRS 5 Non-current Assets Held for Sale and Discontinued Operations says that a discontinued operation is a component of an entity that has been sold, or which is classified as held for sale, and which is: a separate line of business (either in terms of operations or location) part … The units to be closed constitute a major segment of its business and will close in the current financial year. Hi guys, any predictions for possible standards and the consolidation question which would be coming this December? Assume that the disposal group qualifies as held-for-sale. 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. Thus, goodwill will be reduced to zero. Which of the following must apply for the sale to be considered highly probable? 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 Non-current Assets Held for Sale and Discontinued Operations prescribes the recognition criteria for non-current assets held for sale. Quiz complete. Identify the contracts 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. If the sale is expected to occur in over a year’s time, the entity should measure the cost to sell at its present value, and any increase due to the unwinding of the discount is charged to profit or loss. ACCA Diploma in IFRS DipIFR December 2015 Exam - Questions & Answers Standard: IFRS 5 – Non-Current Assets Held for Sale and Discontinued Operations Page 1 Question (4- B) You are the financial controller of Omega, a listed company which prepares consolidated financial statements in accordance with International Financial Reporting Standards (IFRS… IFRS 5 – Non-Current Assets Held for Sale and Discontinued Operations This article is relevant for ACCA F7 and P2 plus AAT and CIMA papers. Revenue Recognition - IFRS 15 - 5 steps from past papers in ACCA FR (F7). Test yourself with questions about B10abcd. Chartered Education IFRS MCQs have more than 1,100 questions like these covering all subjects. Excluding taxation, what should the net gain/(loss) to be reported in the income statements of Walley Corp for its Plant division? It is maintaining the plant as the entity hopes that orders will pick up in future. IFRS 5 does not require the existence of a binding sales agreement in order to classify a non-current asset as held for sale but only a high probability of its … ACCA CIMA CPD FIA (ACCA) AAT. The property, plant and equipment and inventory were stated at deemed cost on moving to IFRS. Free IFRS 2 multiple choice quiz. the subsidiary was acquired exclusively with a view to resale. D3a. Are … Press question mark to learn the rest of the keyboard shortcuts. IFRS is Easy brings to you free ICAN and ACCA Pdf examination questions and solutions. Sample exam papers for recent DipIFR exam sessions are listed below. Any adjustment to the value should be shown in income from continuing operations for the period. Thus, in this case, there would be separate disclosure of the disposal group as follows. IFRS 5 Non-current Assets Held for Sale IFRS 5 Non-current Assets Held for Sale and Discontinued Operations says that a discontinued operation is a component of an entity that has been sold, or which is classified as held for sale, and which is: a separate line of business (either in terms of operations or location) part of A discontinued operation is a part of an entity that has either been disposed of or is classified as held-for-sale, and: The total of the post-tax profit or loss of the discontinued operation, and the post-tax gain or loss recognised on the measurement to fair value less cost to sell (or on the disposal), should be presented as a single figure on the face of the income statement. Non-current assets held-for-sale and assets of disposal groups must be disclosed separately from other assets in the balance sheet. Sample exam papers for recent DipIFR exam sessions are listed below. For ACCA members whose qualifications are already based on IFRS, the Cert IFR is an opportunity to update their IFRS … 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. 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. ification in Financial Accounting using International Financial Reporting Standards (IFRS/IAS). Acowtancy. Show how the disposal group would be accounted for in the financial statements for the year ended 31 December 2006. 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. Entities often acquire non-current assets exclusively with a view to disposal. Question 1 of 2 Summary Skip. Quiz: IFRS 5 Non-current assets held for sale and discontinued operations (Conceptual) The quiz tests your theoretical and conceptual understanding of accounting for Non-current assets held for sale and discontinued operations (International Financial Reporting Standard 5). Please visit our global website instead, Can't find your location listed? The global body for professional accountants, Can't find your location/region listed? 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. An entity has stopped using certain plants because of a downturn in orders. 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. Thank for trying this quiz. 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 … Chartered Education IFRS MCQs have more than 1,100 questions like these covering all subjects. Retrospective classification as a discontinued operation where the criteria are met after the balance sheet date is prohibited by IFRS 5. represents a separate major line of business or geographical area of operations, is part of a single co-ordinated plan to dispose of separate major lines of business or geographical area of operations, or. Revenue Recognition - IFRS 15 - introduction with a quick quiz in ACCA FR (F7). FREE Courses Blog. FREE Courses Blog. Acowtancy. These papers featured in past exam sessions and should therefore be used as a guide only. This loss is allocated to goodwill in accordance with IAS 36. Hence you can not start it again. ACCA CIMA CAT DipIFR Search. The fair value less costs to sell of the disposal group is $47m. 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 … Please visit our global website instead. IFRS 5 requires an entity to classify a non-current asset as held for sale if its carrying amount will be recovered principally through sale rather than through continuing use. 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. 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. If this information is presented on the face of the income statement, then the information should be separately disclosed from that of continuing operations. Notes Video Quiz Paper exam. This means that the sale time is difficult to determine and it may take longer than one year to sell the disposal group. IFRS 5 deals with the accounting for non-current assets held-for-sale, and the presentation and disclosure of discontinued operations. An introduction to ACCA SBR (INT) E1ef. An entity classifies a non-current asset as held-for-sale if its carrying amount will be recovered mainly through selling the asset rather than through usage. It is accredited by the ACCA (Association of Chartered Certified Accountants) and is aimed at ... past exam questions to develop examination skills. The equipment will not be treated as abandoned as it will subsequently be brought back into usage, and the manufacturing units will be treated as discontinued operations. However, a disposal group that is to be abandoned may meet the definition of a discontinued activity. 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 15 provides indicators rather than criteria to determine when a good or service is distinct within the context of the contract. IFRS 5 Non Current Assets Held for Sale. 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. Accounting policies, changes in accounting estimate and errors (IAS 8) Chapter 10. This is my 2nd attempt and i really wanna get … 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. You have already completed the quiz before. An entity has agreed in a directors’ meeting to sell a building, and has tentatively started looking for a buyer for the building. These goods can include inventories, property, plant and equipment, intangible assets, and other non-financial assets. The Plant division was a major part of Walley Corp’s business and the sale will result in a strategic change in direction for the company. Evaluation and review. 2 2. The price of the building has been fixed at $4m and a surveyor has valued the building based on market prices at $3.6m. Free sign up Sign In. 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. Financial instruments (IFRS 9) Chapter 12. Under IFRS, property, plant and equipment would be stated at $26m, and inventory stated at $18m. Contact information for your local office, Virtual classroom support for learning partners, Financial assets (profit of $4m recognised in equity), Amounts recognised directly in equity relating to non-current assets held-for-sale, Liabilities directory associated with non-, the assets must be available for immediate sale in their present condition and its sale must be highly probable, the asset must be currently marketed actively at a price that is reasonable in relation to its current fair value, the sale should be completed, or expected to be so, within a year from the date of the classification, and. You must sign in or sign up to start the quiz. 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