Question 1

Which of the following statements is correct in relation to disclosure documents?

Accepted Answer

A)  The most complete disclosure document on the issue of securities is a profile statement. 
B)  Prospective investors are not entitled to receive a copy of the prospectus lodged with the ASIC. 
C)  Information in a disclosure document must be worded and presented in a clear, concise and effective manner. 
D)  Where a company offers to issue securities which will raise $10 million or less, an offer information statement cannot be issued in place of a prospectus. 
A)  The most complete disclosure document on the issue of securities is a profile statement. 
B)  Prospective investors are not entitled to receive a copy of the prospectus lodged with the ASIC. 
C)  Information in a disclosure document must be worded and presented in a clear, concise and effective manner. 
D)  Where a company offers to issue securities which will raise $10 million or less, an offer information statement cannot be issued in place of a prospectus. C

Question 2

When determining whether a proprietary company is classified as small or large, the consolidated gross assets test is determined based on the average of the opening and closing gross assets.

Accepted Answer

A) True 
 B)False  False

Question 3

Australian accounting standards are now identical to their equivalent International Financial Reporting Standards (IFRSs).

Accepted Answer

A) True 
 B)False  False

Question 4

The Australian Securities and Investments Commission (ASIC) does not determine accounting standards, but has the right to lobby for or against accounting standards as it sees fit.

Accepted Answer

A) True 
 B)False

Question 5

In 2001, the International Accounting Standards Board replaced the:

Accepted Answer

A)  International Accounting Standards Committee. 
B)  Financial Reporting Council. 
C)  Urgent Issues Group. 
D)  Australian Accounting Research Foundation. 
A)  International Accounting Standards Committee. 
B)  Financial Reporting Council. 
C)  Urgent Issues Group. 
D)  Australian Accounting Research Foundation.

Question 6

In July 2002, the Financial Reporting Council (FRC) issued a bulletin requiring that the AASB would adopt IASB standards from 1 January 2005 for:

Accepted Answer

A)  non-reporting entities. 
B)  all financial statements. 
C)  for-profit entities. 
D)  listed entities. 
A)  non-reporting entities. 
B)  all financial statements. 
C)  for-profit entities. 
D)  listed entities.

Question 7

Disclosing entities must prepare annual and half-yearly financial statements, have them audited and lodge them with the ASIC.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following statements is correct in relation to the Urgent Issues Group (UIG)?

Accepted Answer

A)  The UIG is now defunct. As a result, previously issued UIG interpretations are no longer enforceable. 
B)  The UIG has been replaced by the International Accounting Standards Board. 
C)  Prior to ceasing to exist, the UIG provided consensus views on a range of topics peculiar to the Australian political, legal and economic systems. 
D)  Prior to ceasing to exist, the UIG was a subcommittee of the IFRS Interpretations Committee. 
A)  The UIG is now defunct. As a result, previously issued UIG interpretations are no longer enforceable. 
B)  The UIG has been replaced by the International Accounting Standards Board. 
C)  Prior to ceasing to exist, the UIG provided consensus views on a range of topics peculiar to the Australian political, legal and economic systems. 
D)  Prior to ceasing to exist, the UIG was a subcommittee of the IFRS Interpretations Committee.

Question 9

Which of the following statements is not correct?

Accepted Answer

A)  Requirements for special purpose financial reports are contained in AASB accounting standards. 
B)  The IASB's Conceptual Framework identifies potential investors as a primary user group of general purpose financial reports. 
C)  All general purpose financial reports are prepared in accordance with accounting standards. 
D)  SAC 1 Definition of the Reporting Entity defines a general purpose financial report as 'a report intended to meet the information needs of users who are unable to command the preparation of reports tailored to satisfy their information needs'. 
A)  Requirements for special purpose financial reports are contained in AASB accounting standards. 
B)  The IASB's Conceptual Framework identifies potential investors as a primary user group of general purpose financial reports. 
C)  All general purpose financial reports are prepared in accordance with accounting standards. 
D)  SAC 1 Definition of the Reporting Entity defines a general purpose financial report as 'a report intended to meet the information needs of users who are unable to command the preparation of reports tailored to satisfy their information needs'.

Question 10

The content and format of general purpose financial reports are determined by the company's management and the specific user group requiring the special purpose financial report.

Accepted Answer

A) True 
 B)False

Question 11

All offers by a company to issue shares or debentures must be accompanied by a disclosure document.

Accepted Answer

A) True 
 B)False

Question 12

Shares and debentures are the most common types of securities issued by companies when raising funds.

Accepted Answer

A) True 
 B)False

Question 13

The IFRS Interpretations Committee is a subcommittee of the:

Accepted Answer

A)  Standing Interpretations Committee. 
B)  Australian Accounting Standards Board. 
C)  International Accounting Standards Board. 
D)  Financial Reporting Committee. 
A)  Standing Interpretations Committee. 
B)  Australian Accounting Standards Board. 
C)  International Accounting Standards Board. 
D)  Financial Reporting Committee.

Question 14

The Australian Securities Exchange (ASX) played a major role in influencing the Australian Government to push the AASB towards the adoption of IASB standards.

Accepted Answer

A) True 
 B)False

Question 15

AASB 1048 Interpretation and Application of Standards contains the:

Accepted Answer

A)  IFRS interpretations approved by the AASB. 
B)  UIG interpretations approved by the IASB. 
C)  IFRS interpretations approved by the IASB. 
D)  UIG interpretations approved by the AASB. 
A)  IFRS interpretations approved by the AASB. 
B)  UIG interpretations approved by the IASB. 
C)  IFRS interpretations approved by the IASB. 
D)  UIG interpretations approved by the AASB.

Question 16

A proprietary company must have at least one shareholder and cannot have more than:

Accepted Answer

A)  100 shareholders. 
B)  50 shareholders. 
C)  20 shareholders. 
D)  500 shareholders. 
A)  100 shareholders. 
B)  50 shareholders. 
C)  20 shareholders. 
D)  500 shareholders.

Question 17

Which of the following was not one of the objectives of the Corporate Law Economic Reform Program (CLERP)?

Accepted Answer

A)  To make access to capital easier for small business. 
B)  To make access to capital easier for large business. 
C)  To improve takeover legislation. 
D)  To facilitate the more widespread use of electronic commerce. 
A)  To make access to capital easier for small business. 
B)  To make access to capital easier for large business. 
C)  To improve takeover legislation. 
D)  To facilitate the more widespread use of electronic commerce.

Question 18

From March 2010, the principal objectives of the International Accounting Standards Board (IASB) include promoting the use and rigorous application of IFRSs and to bring about convergence of national accounting standards and IFRSs.

Accepted Answer

A) True 
 B)False

Question 19

In terms of the numbering of AASB accounting standards:

Accepted Answer

A)  AASB 1-99 are the AASB equivalent of the IFRSs issued by the IASB. 
B)  AASB 101-199 are the AASB equivalent of the IFRSs issued by the IASB. 
C)  AASB 1-99 address domestic issues such as director and executive disclosures and concise financial reports. 
D)  AASB 101-199 address domestic issues such as director and executive disclosures and concise financial reports. 
A)  AASB 1-99 are the AASB equivalent of the IFRSs issued by the IASB. 
B)  AASB 101-199 are the AASB equivalent of the IFRSs issued by the IASB. 
C)  AASB 1-99 address domestic issues such as director and executive disclosures and concise financial reports. 
D)  AASB 101-199 address domestic issues such as director and executive disclosures and concise financial reports.

Question 20

The definition of a reporting entity in SAC 1 requires:

Accepted Answer

A)  the existence of external users. 
B)  the existence of dependant users. 
C)  a reasonable expectation of external users. 
D)  a reasonable expectation of users reliant on the entity's general purpose financial report. 
A)  the existence of external users. 
B)  the existence of dependant users. 
C)  a reasonable expectation of external users. 
D)  a reasonable expectation of users reliant on the entity's general purpose financial report.

Which of the following statements is correct in relation to disclosure documents?

When determining whether a proprietary company is classified as small or large, the consolidated gross assets test is determined based on the average of the opening and closing gross assets.

Australian accounting standards are now identical to their equivalent International Financial Reporting Standards (IFRSs).

The Australian Securities and Investments Commission (ASIC) does not determine accounting standards, but has the right to lobby for or against accounting standards as it sees fit.

In 2001, the International Accounting Standards Board replaced the:

In July 2002, the Financial Reporting Council (FRC) issued a bulletin requiring that the AASB would adopt IASB standards from 1 January 2005 for:

Disclosing entities must prepare annual and half-yearly financial statements, have them audited and lodge them with the ASIC.

Which of the following statements is correct in relation to the Urgent Issues Group (UIG)?

Which of the following statements is not correct?

The content and format of general purpose financial reports are determined by the company's management and the specific user group requiring the special purpose financial report.

All offers by a company to issue shares or debentures must be accompanied by a disclosure document.

Shares and debentures are the most common types of securities issued by companies when raising funds.

The IFRS Interpretations Committee is a subcommittee of the:

The Australian Securities Exchange (ASX) played a major role in influencing the Australian Government to push the AASB towards the adoption of IASB standards.

AASB 1048 Interpretation and Application of Standards contains the:

A proprietary company must have at least one shareholder and cannot have more than:

Which of the following was not one of the objectives of the Corporate Law Economic Reform Program (CLERP)?

From March 2010, the principal objectives of the International Accounting Standards Board (IASB) include promoting the use and rigorous application of IFRSs and to bring about convergence of national accounting standards and IFRSs.

In terms of the numbering of AASB accounting standards:

The definition of a reporting entity in SAC 1 requires:

Financing Company Operations

Business Combinations

Disclosure: Legal Requirements and Accounting Polices

Disclosure: Presentation of Financial Statements

Disclosure: Statement of Cash Flows

Foreign Currency Transactions and Forward Exchange Contracts

Translation of Financial Statements Into a Presentation Currency

Consolidation: Controlled Entities

Consolidation: Wholly Owned Subsidiaries

Consolidation: Intragroup Transactions

Consolidation: Non-Controlling Interest

Consolidation: Other Issues

Associates and Joint Ventures

Joint Arrangements

Insolvency and Liquidation

Accounting for Company Income Tax

Property, Plant Equipment

Filters

Exam 1: Nature and Regulation of Companies

Which of the following statements is correct in relation to disclosure documents?

When determining whether a proprietary company is classified as small or large, the consolidated gross assets test is determined based on the average of the opening and closing gross assets.

Australian accounting standards are now identical to their equivalent International Financial Reporting Standards (IFRSs).

The Australian Securities and Investments Commission (ASIC) does not determine accounting standards, but has the right to lobby for or against accounting standards as it sees fit.

In 2001, the International Accounting Standards Board replaced the:

In July 2002, the Financial Reporting Council (FRC) issued a bulletin requiring that the AASB would adopt IASB standards from 1 January 2005 for:

Disclosing entities must prepare annual and half-yearly financial statements, have them audited and lodge them with the ASIC.

Which of the following statements is correct in relation to the Urgent Issues Group (UIG)?

Which of the following statements is not correct?

The content and format of general purpose financial reports are determined by the company's management and the specific user group requiring the special purpose financial report.

All offers by a company to issue shares or debentures must be accompanied by a disclosure document.

Shares and debentures are the most common types of securities issued by companies when raising funds.

The IFRS Interpretations Committee is a subcommittee of the:

The Australian Securities Exchange (ASX) played a major role in influencing the Australian Government to push the AASB towards the adoption of IASB standards.

AASB 1048 Interpretation and Application of Standards contains the:

A proprietary company must have at least one shareholder and cannot have more than:

Which of the following was not one of the objectives of the Corporate Law Economic Reform Program (CLERP)?

From March 2010, the principal objectives of the International Accounting Standards Board (IASB) include promoting the use and rigorous application of IFRSs and to bring about convergence of national accounting standards and IFRSs.

In terms of the numbering of AASB accounting standards:

The definition of a reporting entity in SAC 1 requires:

Financing Company Operations

Business Combinations

Disclosure: Legal Requirements and Accounting Polices

Disclosure: Presentation of Financial Statements

Disclosure: Statement of Cash Flows

Foreign Currency Transactions and Forward Exchange Contracts

Translation of Financial Statements Into a Presentation Currency

Consolidation: Controlled Entities

Consolidation: Wholly Owned Subsidiaries

Consolidation: Intragroup Transactions

Consolidation: Non-Controlling Interest

Consolidation: Other Issues

Associates and Joint Ventures

Joint Arrangements

Insolvency and Liquidation

Accounting for Company Income Tax

Property, Plant Equipment

Filters