DFS - Exam discussion post
Comments
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pernickety wrote: »Re:the investing or not. I sat on the fence a little... I fear... I put that the gross PM was still good and the NP acceptable, but that gearing (I did debt/equity, as easier) was bad and up near the maximum; the company were financed heavily and that they would not be able to get further finance off the banks until they improved this ratio. They were just about covering their interest, but they could not afford for profits to be reduced. Dividends would be small or non- existant to their investors, but if management could address the debt issue and improve profit margins things may turn around. I went on to say that if investment was left in the company, that it should most definitely be reviewed prior to end of next accounts.
That, to me sounds a very good answer and I wish I'd have put it in my report! :thumbup:0 -
Hey guys,
i sat DFS today and i feel that i performed strongly on the number work behind it (balance sheets balanced and cashflow was out by 597 pouns, which was because i used the wrong tax for the year!!!) and i am just wondering if anyone has every failed/believes you can fail when getting all the number work right?
I was a bit weak on the IAS Questions, but i tried to 'blag' some points out of it :crying:
any response would be great!
Thanks,
HUFC :thumbup1:0 -
Left out inter company sales in group accounts
In the consolidated accounts, I had an imbalance of £3002.
I think I missed out intercompany sales.
Any one else?
Also, in journals, you must put the whole amount in:
dr prepayments
cr administrative exp
dr admin exp
cr cash
Same thing with distribution costs
Am i right or what?0 -
I couldn't remember the impairment bit and the interest cover ratio....
first I wrote PROFIT/INTEREST PAID but then I changed to INTEREST PAID/PROFIT %, now discovered the first one was right!:ohmy: Hope I will not lose mark on this, the other ratios I did them correct and everything in Section 1 balanced!0 -
In the consolidated accounts, I had an imbalance of £3002.
I think I missed out intercompany sales.
Any one else?
Also, in journals, you must put the whole amount in:
dr prepayments
cr administrative exp
dr admin exp
cr cash
Same thing with distribution costs
Am i right or what?
-I didn't include intercompany sales, I thought you have to keep them out...
-My journal were:
dr Prepayment
cr Admin
dr Distribution
cr Accrual0 -
I think I made a stupid mistake. I made 2 months prepayment but 1 month accruals. Just now realised that it should've been 2 months. So, I had 60 for accruals and 96 for prepayment. The income statement came up as 3,717. Has anyone got the same answer?0
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In the consolidated accounts, I had an imbalance of £3002.
I think I missed out intercompany sales.
Any one else?
Firstly, if you leave them in, you'll balance but will have the wrong figures for assets & liabilities. So if there's in imbalance, that suggests you're done half the job!
That covers 3000 - the other 2 can only be a calculator error I'm afraid.0 -
Would you lose many marks if you got two journals wrong and carried you figures forward but got everything to balance etc???0
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Also, in journals, you must put the whole amount in:
dr prepayments
cr administrative exp
dr admin exp
cr cash
Same thing with distribution costs
Am i right or what?
Sorry to do this to you, but a prepayment doesn't involve the bank account - the bank account was debited earlier in the month when the invoice was paid. So, no - just the first half of what you've written.0 -
Would you lose many marks if you got two journals wrong and carried you figures forward but got everything to balance etc???
I'm sure this isn't your first AAT exam Lucy, but I'll give you the reassurance you're after!
individual errors aren't costly as long as your work generally shows
a) competence (NOT perfection)
b) understanding of what's happening.0 -
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Profit on income statement I had £3717
Balance sheet balanced I had £227770 -
Impairment - help!
Can anyone tell me how likely I am to fail when I make a complete mess of the impairment question? Think I got everything else pretty much there or thereabouts but I was lost on this question and put a right load of whatsits down! Ta :confused1:0 -
Can anyone tell me how likely I am to fail when I make a complete mess of the impairment question? Think I got everything else pretty much there or thereabouts but I was lost on this question and put a right load of whatsits down! Ta :confused1:
I did the same, didn't know what to write!:crying:0 -
Did anyone put accruals 60 (1 month) ?0
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Don't worry mate, as long as your competent overall you will pass, pass rate is somewhere between 65-75 aparatly, so if you did well overall you will be fine.
Accruals i had as 120, prepayments 96 i think!0 -
My theory was total rubbish! Though I did answer every question, but it is complete waffle.
Forgot to include the tax and int in my reconciliation for my cash flow - oops! Other than that - and the theory - think my Section 1 was OK.
Section 2 well....not many tasks, so they don't give you space to go wrong do they? (Do you have to get 70% correct per section or per task?) I'd like to pass section 2, but it seems unlikely. I never really know how well I do on the ratios question, though I did contradict myself in my report on ratios...and I got at least one wrong. But I kinda new the results weren't making sense hence the contradiction lol.
Despite that it wasn't a horrific paper or anything, though I don't expect to pass.does anyone know if they operate a negative marking scheme. I wrote a bit off rubbish along with the definitions of assets and liabilities?
Yes, so it wasn't just me then! I couldn't even define it in my own terms, never mind the IAS'. Though I think I mentioned the phrase "flow of economic benefits" somewhere. Hope I get a mark for that! But yeah, my answer to that task is quite embarassing!
mi|kshake~0 -
Thanks guys....... I know i had it wrong by putting it as 60 in accruals0
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goldandblack wrote: »SHIT! i got all those answers apart from gearing, i seriously had a mental block, and thought that the figures were as a measure of 1, basically the same as what a percentage is. so i just had 0.77 and 0.53, i still went on to describe what they meant, b******s
I did the same, don't worry about it. It's still right just shown as a decimal rather than a %0 -
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Don Juan
I worked the gearing ratio out the same as you! I just couldn't think straight and panicked!0 -
hmmm opps...oh well, i did say that the gearing is still below 50% so this shouldnt cause too much concern, and i also said revenue was on the up etc..
Also...in the journals with the advertising costs accrual..did everyone debit admin expenses or debit distribution costs? i put it to admin as it didnt say where to, but i put a note saying why. Sometimes in the past they have put advertising to distribution which is a bit weird..
I think it was distribution as advertising is to do with getting the product out into the world.0 -
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Can anyone tell me how likely I am to fail when I make a complete mess of the impairment question? Think I got everything else pretty much there or thereabouts but I was lost on this question and put a right load of whatsits down! Ta :confused1:
Wouldn't worry too much about it if the rest of A & B where correct.0 -
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Certainly can't complain about the paper; if I'd prepared properly it would have been easy.
I didn't so it wasn't, and I think I'll be resitting as my two disasters were in the same section. :blushing:
- Income statement and balance sheet were fine
- consolidated balance sheet was fine
- Messed up the first part of the cashflow badly and couldn't find the mistake, so I worked backwards from the right figure for the second with with an explanation of why I did it...
- Had no idea what to write about impairments so guessed and waffled
- Got the gearing ratio calc wrong
- Know what current assets and liabilities are so waffled and wrote stuff, but I don't know if it was anything like the definitions that would have been in the book if I remembered them
How clear cut a recommendation were we expected to make for the investment question? I left it wooly on the basis that it's not an accounting technicians job.
I concluded by pointing out that profitability was down and risk was up, and that they appeared to be dipping heavily into an overdraft and be about to run out of funds if they couldn't raise more long term finance. But I just recommended he find out the reasons why and decide if he thought company had a good future and if the risk was acceptable to him.
They could have over expanded and have been going down the pan. (The increase in distribution was confusing - were they trying to sell something big and heavy too far away from home?).
Or they could have spent a lot on advertising and new production capacity that didn't materialise into new sales until just before the end of the accounting period (which could have accounted for the disproportionate increase in receivables).0 -
Thats exactly what I did. I couldn't recall seeing a seperate section in our textbooks about 'current' assets & liabilities over ordinary ones.
I did the definition & said either will be turned into cash/paid in under one year.
i did this too... i sat rankin my brains cant remember seeing anything bout so defined assets and liabilites and expant what was mean by current and how will b turned to cash or paid in one year 2 phew! only thing i was worried bout feel pretty good about it to be fair shame i dont share the same love for the pev 0 -
I've just pulled out a paper from the Accounting Technician Feb 2008 on "Presenting IAS 1"
It States Current Assets are classified as those which are part of the business entity's operating cycle
or are held for trading purposes in the short term and expected to be revised within 12 months of the balance sheet date:
or are cash and cash equivalent.
A Current Liability should be classed as such if it is:
Expected to be discharged in the normal course of the entity's operating cycle: or
due to be paid within 12 months of the balance sheet date.
I wrote down the definitions of Assets( a resource contolled) and Liabilites (a present obligation) which hopefully I might get some credit for.0 -
Dfs
Hi,
I Agrree with the ratios calculated in section 2 which i have seen on previous posts and im happy with all of the written work and explanations i did in section 2.
I also balanced my cash flow with final movements of 476 or something like that & balanced 1.1. & 2. My journals were correct and my income statement and BS were correct i think. But one thing i didnt do was balance my consolidated BS as i ran out of time. I think i had 85 thousand and something?
However my equity did not balance!
Because of this major part of the exam can i be hopeful i have passed im just not sure as this was a large part of question 1??
If someone could offer some re-assuring advice i would be greatfull?
Thanks and good luck to everyone!!:thumbup:0
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