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i. Significant influence - This is the power to participate in tile financial and operating
policy decisions of an entity but not control over those policies.
Significant influence may be gained by an ownership interest, statute or agreement.
ii. Ways in which significant influence may be exercised.
- Participation in the policy making process.
- Material transactions between entities.
- Interchange of managerial personnel.
- Dependence on technical information.
By ownership interest, statute or agreement
marto answered the question on February 15, 2019 at 05:54
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With reference to IPSAS 9 (Revenue from Exchange Transactions), summarize five conditions that must be satisfied before revenue from the sale of goods can be recognized.
Date posted: February 15, 2019. Answers (1)
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Date posted: February 15, 2019. Answers (1)
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i) On 1 January 2009, the government purchased a software licence for Sh.350,000 for an application on its new main frame computer. The government estimated that the useful life of the software would be eight years and that it would receive benefits and service potential from the software on a straight-line basis over the useful life of the software. As at 31 December 2013, usage of the application had declined to 15% of its originally anticipated demand. A licence for a software application to replace the remaining service potential of the existing software application would cost Sh. 150,000.
Required:
Impairment loss to be recognized for the software using the depreciated replacement cost approach.
ii) On 1 January 2004, the government built an office at a cost of Sh.50 million. The building was expected to provide service for 40 years. On 31 December 2013, after 10 years of use a fire caused severe structural damage and due to safety reasons, the office building was closed for repairs that cost Sh.35.5 million. These repairs were made to restore the office building to occupiable condition. The current cost' of a new office building is Sh,100 million.
Required:
Impairment loss to be recognized for the office building using the cost restoration approach
Date posted: February 15, 2019. Answers (1)
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Date posted: February 15, 2019. Answers (1)
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Date posted: February 14, 2019. Answers (1)
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Date posted: February 14, 2019. Answers (1)
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The following financial statements relate to the Techno Group for the year ended 31 October 2012:
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The following trial balance relates to Ndovu Limited as at 31 March 2013:
Additional information:
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2. The company constructed its own plant at a total cost of Sh.240 million. The plant was brought into use on 1 October 2012 but its cost had not been capitalized. Instead, its cost had been included in the cost of sales. Plant is depreciated at 12.5% per annum using the reducing balance method (time apportioned) and charged to the cost of sales.
3. The fair value of the investments held at fair value was Sh.271 million as at 3 1 March 2013.
4. The balance of tax on the trial balance represents an overprovision of previous years" tax.
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5. The 2% loan note was issued on 1 October 2012 under the terms that require a large premium on repayment. The effective interest rate therefore is 6% per annum.
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Required:
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Date posted: February 14, 2019. Answers (1)
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The following trial balance relates to Mapema Limited, a quoted company, as at 30 April 2013:
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Date posted: February 14, 2019. Answers (1)
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Date posted: February 14, 2019. Answers (1)
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Afya pensioners is a funded, non-contributory defined benefit scheme that was established by the management of Afya Food processors Limited in 1950. The directors have always expensed the company’s contribution to the scheme in the period of contribution and also credited to the income statement of any period, any refunds made from the scheme during the period in question.
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Required:
i) Do you agree with the auditors positions? Why?
ii) State and explain three reasons why there may be variations in the regular pension costs to the employer.
iii) Briefly explain the two accounting approaches suggested by the auditor. What is their effect on the pension fund?
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Date posted: February 14, 2019. Answers (1)
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Date posted: February 14, 2019. Answers (1)
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Additional information:
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Required:
i) Actuarial gains or losses on the present value of plan obligations.
ii) Actuarial gains or losses on fair value of plan assets.
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Date posted: February 14, 2019. Answers (1)
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Date posted: February 14, 2019. Answers (1)
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Date posted: February 14, 2019. Answers (1)
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Date posted: February 14, 2019. Answers (1)