Acca Aa Updated Actual Questions And Correct Answers

ACCA AA UPDATED ACTUAL QUESTIONS AND
CORRECT ANSWERS
Question:
What are the substansive procedures that can be used?
Answer:
Analytical procedures
Enquiry/ external confirmation
Inspect assets/documents
O - Reperformance e.g reconcillation/ counts
U - Recalculation

Question:
What does analytical procedures mean?
Answer:
It means comparing numbers to the expected numbers, giving us a variance. We
must then corroborate the variances and investigate with management.

Question:
What are the assertions we must prove at the
recalculation stage for SPLs?
Answer:
Cut off
Occurance
Completeness
Classification
Accuracy
Presentation and disclosure

Question:
What are the assertions we must prove at the
recalculation stage for SFP?
Answer:
Cut off
Existence
Rights and obligations
Valuation
Classification
Acurracy
Presentation and disclosure

Question:
What is the exam technique for writing procedures?
Answer:
Identify an action to take (From AEIOU)
Identify the source of evidence available (3rd party, management?)

,Objective: What are we trying to prove?

Question:
Which documents are best to support a SFP in a
business?
Answer:
Bank statements. Payables, receivables can be seen through bank statements

Question:
Which documents are best to support a purchase of
goods in a business?
Answer:
Goods receives note
Purchase invoice

Question:
Which documents are best to support a sale of goods in
a business?
Answer:
Goods despatched note as it is signed once received by the customer with the
quantity and amount on it.

Question:
What are the sources of evidence for bank and cash?
Answer:
- Bank confirmation letter (best piece of evidence provided by the bank proving
cash at YE date)
- Bank reconciliation
- Bank Ledger account/cash book
- Bank Statement

Question:
What are some key procedures for bank and cash?
Answer:
- Take the bank confirmation letter and trace that into the FS to make sure that the
list of balances is complete.
- Attending the cash count
- Obtain the bank reconcilation and cast to ensure mathematical accuracy
- Trace all outstanding lodgements to the pre YE ledger account into post year-
end bank statement to prove that they are genuine reconciling items. This is to
prove valuation of closing items.
- Examine the bank confirmation letter for details of any security provided for any
loans (Presentation & Disclosure)

Question:
What are the key sources of evidence for NCL?
Answer:

, Bank confirmation letter
Loan Agreement
Loan Statement
Bank Ledger account / cash book
Bank Statement

Question:
What are the key assertions for NCL?
Answer:
Completeness
Accuracy, valuation & allocation
Classification and presentation

Question:
What are the key sources of evidence for NCA?
Answer:
Non-current asset register
Purchase invoices
Physical assets
Ownership documents
Revaluation report from independent expert
Depreciation policy and rates

Question:
What are the key assertions for NCA?
Answer:
- Existence (sample of assets from NCA and trace out)
- Accuracy, valuation and allocation (understating depreciation, recalculate
depreciation and challenge asset UEL)
- Completeness (Not everything is included, may have been incorrectly expensed
- inspect high expense codes)
- Rights and obligations (Making sure everything is owned by the business)

Question:
What are some controls over inventory count?
Answer:
- Segregation of duties by having the count performed by non-warehouse staff
- No movement of inventory whilst the count takes place
- Ensure there is a system that marks which inventory has been counted to avoid
duplication
- Ensure third party inventory is not included in the count

Question:
What is a perpetual inventory system?
Answer:
It is a continous inventory system which keeps a real time track of inventory. Lines
of inventory are counted periodically through out the year.