Deck 23: Presentation of Financial Statements

Question 1

The correct heading on a statement of profit or loss and other comprehensive income made up for a twelve month period to 30 June 2014 is:

A)As at 30 June 2014
B)For the year ended 30 June 2014
C)For the period ended 30 June 2014
D)30^th June 2014

Answer 1

B

Question 2

How many of these statements concerning concise financial reports are true?
.There is a charge to the shareholder for requesting a full financial report but the concise report is free
.If a shareholder accepts a concise financial report they cannot also request a full report
.The financial statements in the concise report need not comply with all the accounting standards

A)0
B)1
C)2
D)3

Answer 2

0

Question 3

Under the Corporations Act 2001 the financial statements included in the annual report are specified as:

A)those required by the accounting standards
B)a balance sheet,profit and loss statement and statement of cash flows
C)a balance sheet,profit and loss statement,statement of cash flows and a director's report
D)a balance sheet,profit and loss statement,statement of cash flows,director's report and an audit report

Answer 3

A

Question 4

An interim report required to be prepared by a disclosing entity under IAS 34/AASB 134 'Interim Financial Reporting' is defined as a report for:

A)each three months
B)each half-year
C)a period shorter than a full reporting period
D)nine months.

Question 5

As set out in IAS 1/AASB 101,all of these are general requirements that apply to annual reports except:

A)There must be a description of the entity's operations and its principal activities
B)Comparative figures for the previous reporting period must be disclosed
C)The reporting date or period covered by each financial statement must be included
D)A list of all the accounting standards followed must be included

Question 6

Under the accounting standards which of these is included in the calculation of a company's profit or loss not including other comprehensive income in the definition of profit)?
.Downward revaluations of non-current assets,not requiring adjustment to a revaluation surplus
.Upward revaluations of non-current assets requiring adjustment to a revaluation surplus
.Gains or losses on remeasuring investments in equity instruments
.Adjustments from translation of the financial statements of a foreign operation

A)1
B)2
C)3
D)4

Question 7

Under the Corporations Act it is not true that for the presentation of general purpose financial statements the annual financial report:

A)must include a concise report
B)must include a set of financial statements
C)must include a directors' report
D)must include a directors' declaration

Question 8

The accounting standards listed below that are specific to the nature and disclosure of income are:

A)IAS 1/AASB 101/IAS 7/AASB 107
B)IAS 16/AASB 116/IAS 7/AASB 107
C)IAS 7/AASB 107/ IAS 18/AASB 118
D)IAS 1/AASB 101/IAS 18/AASB 118

Question 9

Under AASB 1039 and the Corporations Act which of these does not have to be included in a concise financial report?

A)Notes to the financial statements
B)Directors report
C)Statement of cash flows
D)Statement of changes in equity

Question 10

An entity defined as a 'disclosing entity' under the Corporations Act must prepare interim financial reports.The content of an interim financial report,under IAS 34/ AASB 134,must include,as a minimum:

A)A condensed,statement of financial position and condensed statement of comprehensive income,selected notes
B)A condensed,statement of financial position,a condensed statement of profit or loss and other comprehensive income,a condensed statement of changes in equity
C)A condensed,statement of financial position,a condensed statement of profit or loss and other comprehensive income,a condensed statement of changes in equity,a condensed statement of cash flows,selected notes
D)A condensed,statement of financial position,a condensed statement of profit or loss,a condensed statement of cash flows,selected notes

Question 11

The approach contained in IAS 1/AASB 101 to the determination of a company's profit or loss is:

A)The reporting method approach
B)The all-inclusive profit approach
C)The operating profit approach
D)The equity approach

Question 12

According to AASB 1039,in order to provide clear information to shareholders the concise financial report must disclose how many of the following?
.Details of any events occurring after the end of the reporting period
.That the report is an extract only from the full financial report
.The amount of dividends paid and dividends proposed
.Graphs of profits for the last five years

A)1
B)2
C)3
D)4

Question 13

The accounting standard that contains the specific requirements for concise financial reports is:

A)AASB 1001
B)AASB 1039
C)IAS 1/AASB 101
D)IAS 34/AASB 134

Question 14

IAS 1/AASB 101 is titled:

A)The Income Statement
B)Information to be Disclosed in Financial Reports
C)Presentation of Financial Statements
D)Disclosure of Operating Income

Question 15

The statement that is true about concise financial reports is:

A)A full report must be sent to the shareholder unless they request a concise report
B)The company must apply to ASIC if they want the right to issue concise reports rather than full reports
C)The company has the right to send a concise report to the shareholder unless they request a full report
D)Concise reports do not have to include a statement of changes in equity

Question 16

IAS 1/AASB 101 defines a complete set of financial statements as comprising:

A)A balance sheet,a profit and loss report,a statement of cash flows,a director's report
B)A statement,of financial position,a statement of profit or loss and other comprehensive income for the period,a statement of changes in equity,a statement of cash flows ,notes comprising a summary of accounting policies and other explanatory information
C)A statement,of financial position,a statement of profit or loss and other comprehensive income for the period,a statement of changes in equity,a statement of cash flows
D)A statement,of financial position,a statement of profit or loss and other comprehensive income for the period,a statement of cash flows

Question 17

It is not

A)AASB 1039 'Concise Financial Reports' has an equivalent international standard
B)Shareholders who receive a concise report can request a full report
C)The concise report must comply with the accounting standards
D)Except for concise reports prepared for listed companies each financial statement must be accompanied by some discussion and analysis.

Question 18

The overall criteria for financial reporting contained in the Corporations Act is:

A)Beyond a reasonable doubt
B)True and fair
C)Materiality
D)The operating test

Question 19

Under the Corporations Act which of these is not necessarily a disclosing entity?

A)A stock exchange listed company
B)A public company
C)A borrowing corporation
D)A corporation that raises funds via a prospectus

Question 20

According to AASB 1039,in order to provide clear information to shareholders the concise financial report must disclose how many of the following?
.Gross profit
.Dividends per share
.Earnings per share
.Sales revenue
.Changes in accounting policies

A)2
B)3
C)4
D)5

Question 21

There is no equivalent international accounting standard to AASB ______ 'Concise Financial Reports'.

Question 22

Under IAS 1/AASB 101 which format is subscribed for the statement of financial position?

A)Assets - Liabilities = Equity
B)Assets = Equity + Liabilities
C)Equity = Assets - Liabilities
D)No one format is prescribed

Question 23

An alternative name for the balance sheet is:

A)Statement of financial performance
B)Statement of changes in equity
C)Statement of financial position
D)Statement of equity

Question 24

How many of these expenses that would normally appear in an internally prepared income statement are required to be separately disclosed in an external statement prepared to conform to the requirements of the accounting standards?
.Freight outwards
.Printing and stationery expenses
.Utilities expenses

A)0
B)1
C)2
D)3

Question 25

In the 2011 version of IAS 1/AASB 101 the recommended title for the income statement is:

A)Statement of profit and loss and other comprehensive income
B)Profit and loss statement and other comprehensive income
C)Statement of profit or loss and other comprehensive income
D)Statement of financial performance

Question 26

A summarised set of financial reports sent to a shareholder as an alternative to the full annual financial report,is called a c___________ report.

Question 27

How many of these expenses that would normally appear in an internally prepared profit and loss statement are required to be separately disclosed in an external statement prepared to conform to the requirements of the accounting standards?
.Salaries and wages
.Internet service provider fees
.Cleaning
.Security fees

A)1
B)2
C)3
D)4

Question 28

Under the Corporations Act an overriding requirement is that the financial statements must present a t_________ and f________ view of performance and financial position.

Question 29

Which of these is not an expense item that requires separate disclosure under the accounting standards in the statement of profit or loss and other comprehensive income or in the notes attached to the statement?

A)Impairment expenses of non-current assets
B)Bad and doubtful debts
C)Office expenses
D)Interest paid

Question 30

If expenses are classified into the groups,cost of sales,selling expenses,administrative expenses and finance expenses,under IAS 1/AASB 101 they are classified by:

A)Nature
B)Function
C)Liquidity
D)Tangibility

Question 31

Which category of revenue listed does not require separate disclosure under IAS 18/ AASB 118?

A)Revenue from the rendering of services
B)Rents received
C)Dividends received
D)Interest received

Question 32

The untrue statement concerning AASB 1053 is:

A)Its publication is meant to lessens the reporting burden on the majority of disclosing Australian entities
B)Entities classed as Tier 1 will have their financial disclosure requirements increased
C)Entities classed as Tier 2 will have their financial disclosure requirements in relation to the accounting standards reduced
D)In effect only publicly accountable entities will be required to report using full Australian accounting standards

Question 33

When might borrowing costs not appear in a statement of profit or loss and other comprehensive income?

A)If they result from a negatively geared project
B)If they are less than five percent of total expenses
C)If borrowing costs are directly attributable to the acquisition,construction or production of a qualifying asset
D)If they are not incurred in the ordinary course of business

Question 34

As set out in IAS 1/AASB 101,there is a general requirement that the financial statements must provide comparative and corresponding financial disclosures for:

A)the previous twelve month period
B)the previous reporting period
C)the previous three years
D)the previous five years

Question 35

Under IAS 1/AASB 101 the statement of changes in equity must disclose how many of the following?
.Total comprehensive income for the period.
.A reconciliation between carrying amount at the beginning and end of the period for each item of equity
.Contributions by and distributions to owners,disclosed separately

A)0
B)1
C)2
D)3

Question 36

The term that is currently the most commonly preferred for owner's equity in a company balance sheet is:

A)Shareholder's equity
B)Equity
C)Shareholder's funds
D)Share capital and reserves

Question 37

It is true under IAS 1/AASB 101 that:

A)For the balance sheet all assets and liabilities must be classified as current or non-current unless a liquidity presentation is more appropriate)
B)There is a prescribed format set out for the balance sheet
C)Movements in reserves must be shown on the face of the balance sheet
D)The balance sheet must begin with the assets section

Question 38

The correct heading on a statement of financial position made up to 30 June 2014 is:

A)As at 30 June 2014
B)For the year ended 30 June 2014
C)For the period ended 30 June 2014
D)30^th June 2014

Question 39

IAS 1/AASB 101 requires an entity to adopt either a current/_______________ presentation or a liquidity presentation in the statement of financial position.

Question 40

For all entities,apart from small proprietary companies,the financial statements included in the annual report must comply with all the accounting s___________ as well as the Corporations Act.

Question 41

The 'all-inclusive' profit approach to determining profit means,in principle,that all income and all e ___________ must be included in the calculation of profit.

Question 42

An income statement prepared for external use would normally contain more/fewer)specific expenses and income items than one prepared for internal use.

Question 43

Companies listed on the Australian Stock Exchange ASX)are required to keep the stock market informed of events and developments as they occur.This is known as c____________ disclosure

Question 44

Under the Corporations Act a 'd______________ entity' must prepare a half-yearly financial report in addition to an annual report.

Question 45

The statement in the annual report that shows detailed movements in all equity accounts is the statement of ________ in equity.