Dfs 2010 =)

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  • emmap2
    emmap2 Registered Posts: 16 New contributor 🐸
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    goodyuk wrote: »
    The question did specifically say though you couldonly base your report on the 4 ratios calculated... so people quoting the change in money in the bank and the bank loan, although these points were valid you were told to disregard them and only base ur opinion on the 4 ratios caliculted... hence the decision was to invest, given that they were all ok baring the Net Profit which had declined, but was still reasonable at 10.5% (I put an aside note that costs needed to be controlled to bring Net Profit levels up) Anyone agree?

    The change in money in the bank ie going from overdraught to having money in the bank is connected to both the current and quick ratio, as they are current assets and current liabilities, so they should not be disregarded.
  • goodyuk
    goodyuk Registered Posts: 50 Regular contributor ⭐
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    lewpylew wrote: »
    I said to keep the money invested as the gross profit had increased from 45% to 52.5% although the net profit had reduced from 12% to 10.5%. The company had now paid off it's overdraft and had £582,000 in the bank. The sales had increased, but also a new long term loan had been taken out so overall I said keep it as the company is expanding and the loan could be to extend the business.

    Be nice if I passed part 2, as I did not complete part 1!
    emmap2 wrote: »
    The change in money in the bank ie going from overdraught to having money in the bank is connected to both the current and quick ratio, as they are current assets and current liabilities, so they should not be disregarded.

    good point!
  • emmap2
    emmap2 Registered Posts: 16 New contributor 🐸
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    goodyuk wrote: »
    The question did specifically say though you couldonly base your report on the 4 ratios calculated... so people quoting the change in money in the bank and the bank loan, although these points were valid you were told to disregard them and only base ur opinion on the 4 ratios caliculted... hence the decision was to invest, given that they were all ok baring the Net Profit which had declined, but was still reasonable at 10.5% (I put an aside note that costs needed to be controlled to bring Net Profit levels up) Anyone agree?
    RittyLeigh wrote: »
    Ok so after reading everything you al have wrote i feel ok about section 1 other than not explain share capital or premium

    However section 2 :( I thought i had done ok
    All my ratios were right and i commented on them fine with good reasons
    But then i went and said that she shouldnt keep her investment in the company as due to futher loans being taken out this clearly states the company could be strugling.
    I states that if the NP was decreasing then there was no benefit in her keeping her investment.
    I see now that i should of said keep them (of which i did at first then scribbled out!!)

    Does anyone think that i may fail for this? It was a ten minute question, and i did make the answer sensible.... even though it was cleary wrong....

    I thought i had done fine- then i came on here! Damn my noseyness!!

    Ritty
    exam panic wrote: »
    did you balance? your figure 186.3 I think that is impared figure

    Yes it it, i.m sure that was the impaired figure, did anyone else have 186.3?
  • flowerp1977
    flowerp1977 Registered Posts: 5 New contributor 🐸
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    dfs ias standards

    do you know how it affects your overall mark if you didnt know the ias 2 but you made up some waffle but the rest of the paper balanced ???
  • lma
    lma Registered Posts: 8 New contributor 🐸
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    I also advised not to carry on with the investment because as an investor they would expect to see less of a return on their investment regardless of liquidity improving, but after talking to people after the exam and comments on here I think that was probably wrong. Hopefully I wont fail section 2 for that.....
  • emmap2
    emmap2 Registered Posts: 16 New contributor 🐸
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    lma wrote: »
    I also advised not to carry on with the investment because as an investor they would expect to see less of a return on their investment regardless of liquidity improving, but after talking to people after the exam and comments on here I think that was probably wrong. Hopefully I wont fail section 2 for that.....

    When I done PEV in December, I made the decision not to invest in the coffee machine in section 2, everyone on Forum advised the opposite, everyone I spoke to advised the opposite, so I thought I was sure to fail.

    I passed, I think if you can justify why you have made the decision then you'll be fine. I have read on the AAT website there is no right answer, its a matter of choice as long as you can provide reasons behind choice. Be positive.
  • andybriers
    andybriers Registered Posts: 5 New contributor 🐸
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    I roundedtgd goodwill up and the retained earnings down. It balanced first ti
    e. Thought it was an excellent paper after doing several other similar papers from bbp! Many thanks to my excellent tutor. Who will also be taking me for ci
    a next year
  • andybriers
    andybriers Registered Posts: 5 New contributor 🐸
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    Impairment was 186.3
  • Andypandy
    Andypandy Registered Posts: 526 Epic contributor 🐘
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    Thank God I came back - was on a serious downer when I checked in earlier because everyone seemed to be saying 'go ahead with the investment' in section 2. I read the question 4 times & thought I'd completely over-analysed it when I checked on here. I said that the net profit was worrying as costs were not being controlled (with tonnes of other explanations alongside) & I wouldn't want to advise for investment purposes without looking at other ratios which were more concerned with investments, ROCE etc. I thought that liquidity & profitability ratios were unsuitable for this purpose, especially with the other information we had been given. My wise old boss always said I'd give myself a heart attack by looking into things too deeply. Feel much better now & able to approach PTC for tomorrow (was on the verge of not turning up). Thank you. BIG SIGH.
  • katie2620
    katie2620 Registered Posts: 5 New contributor 🐸
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    Ias 2

    Could someone please tell me the correct answers for the IAS2 question

    a) What is inventories

    b) What costs should be included

    c) What costs should not be included

    Thank you
  • Nisha
    Nisha Registered Posts: 4 New contributor 🐸
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    Andypandy wrote: »
    Thank God I came back - was on a serious downer when I checked in earlier because everyone seemed to be saying 'go ahead with the investment' in section 2. I read the question 4 times & thought I'd completely over-analysed it when I checked on here. I said that the net profit was worrying as costs were not being controlled (with tonnes of other explanations alongside) & I wouldn't want to advise for investment purposes without looking at other ratios which were more concerned with investments, ROCE etc. I thought that liquidity & profitability ratios were unsuitable for this purpose, especially with the other information we had been given. My wise old boss always said I'd give myself a heart attack by looking into things too deeply. Feel much better now & able to approach PTC for tomorrow (was on the verge of not turning up). Thank you. BIG SIGH.
    My reply was similar to yours. I said based on ratio figures she can carry on with her investment BUT my advise was to do more research such as checking Interest cover and ROCE to get full picture of company perfomance and that will help her in desicion making.
  • val0123
    val0123 Registered Posts: 42 Regular contributor ⭐
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    katie2620 wrote: »
    Could someone please tell me the correct answers for the IAS2 question

    a) What is inventories

    b) What costs should be included

    c) What costs should not be included

    Thank you

    http://www.iasplus.com/standard/ias02.htm
  • David0097
    David0097 Registered Posts: 24 New contributor 🐸
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    JoeyDavis2010 wrote: »
    You have to do the statment of changes in equity to get the revised retained profits figure for the year; retained earnings from TB plus profit less dividends. If your SoFP balanced, then you should be fine :)
    The changes in equity also includes share change as well as profit. They issued I think 2000 at £1.50 meaning a 2000 increase in share capital and 1000 share premium.
  • jewels.p
    jewels.p Registered Posts: 1,774 Beyond epic contributor 🧙‍♂️
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    Nisha wrote: »
    My reply was similar to yours. I said based on ratio figures she can carry on with her investment BUT my advise was to do more research such as checking Interest cover and ROCE to get full picture of company perfomance and that will help her in desicion making.

    I never mentioned any other ratios as the question said "Based on the above ratios advise as to whether she should continue investing or not". Therefore I thought the other ratios werent to be mentioned. Who knows!

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