Financial Reporting & Regulatory Frameworks
Revision
Questions
Study phase 3
Revision question 1 (Topic: MCQ’s: Financial reporting and regulatory
frameworks)
Choose the most appropriate alternative from the options provided at each of the following questions.
Write down only the letter of your choice next to the corresponding number. For example 1.1 (F)
1.1. The standard setter responsible for safeguarding the independence of the IASB is the:
A Trustees of the IFRS Foundation
B IFRS Advisory Council
C IFRS Interpretations Committee
D IFRS Foundation
1.2. Financial statements are prepared using the following two fundamental underlying
assumptions:
A Matching principle and going concern
B Accrual accounting and materiality
C Accrual accounting and going concern
D Faithful presentation and going concern
© EDGE Education (Pty) Ltd – 1
, Financial Reporting & Regulatory Frameworks Revision Questions Study Phase 3
1.3. The two models used to measure Property, Plant and Equipment after recognition are:
A The cost model and the fair value model
B The cost model and the revaluation model
C The historical model and the revaluation model
D The cost model and the present value model
1.4. An impairment loss is the amount by which:
A The recoverable amount of an asset exceeds its carrying amount
B The carrying amount of an asset exceeds its recoverable amount
C The depreciable amount of an asset exceeds its recoverable amount
D The recoverable amount of an asset exceeds its depreciable amount
1.5. The cost of an internally generated intangible asset is only recognised :
A At the research phase
B After the research and development phases
C At the research phase provided certain criteria are met
D At the development phase provided certain criteria are met
1.6. An asset should only be recognised if __________________________________________.
A an entity has the ability to direct the use of the asset and obtain economic benefits that may
arise from the asset
B the right to potential economic benefits is equally available to other parties
C an entity has no control over the use of the asset
D All of the above
1.7. Under a finance lease the depreciation of the asset is recorded in the books of the:
A Lessor
B Lessor and lessee
C Lessee
D None of the above
1.8. At the year-end where the functional currency has strengthened against the foreign currency:
A Any loan payable translated at the year-end will result in a forex gain
B Any loan payable translated at the year-end will result in a forex loss
C Any loan receivable translated at the year-end will result in a forex gain
D None of the above
© EDGE Education (Pty) Ltd – 2
Revision
Questions
Study phase 3
Revision question 1 (Topic: MCQ’s: Financial reporting and regulatory
frameworks)
Choose the most appropriate alternative from the options provided at each of the following questions.
Write down only the letter of your choice next to the corresponding number. For example 1.1 (F)
1.1. The standard setter responsible for safeguarding the independence of the IASB is the:
A Trustees of the IFRS Foundation
B IFRS Advisory Council
C IFRS Interpretations Committee
D IFRS Foundation
1.2. Financial statements are prepared using the following two fundamental underlying
assumptions:
A Matching principle and going concern
B Accrual accounting and materiality
C Accrual accounting and going concern
D Faithful presentation and going concern
© EDGE Education (Pty) Ltd – 1
, Financial Reporting & Regulatory Frameworks Revision Questions Study Phase 3
1.3. The two models used to measure Property, Plant and Equipment after recognition are:
A The cost model and the fair value model
B The cost model and the revaluation model
C The historical model and the revaluation model
D The cost model and the present value model
1.4. An impairment loss is the amount by which:
A The recoverable amount of an asset exceeds its carrying amount
B The carrying amount of an asset exceeds its recoverable amount
C The depreciable amount of an asset exceeds its recoverable amount
D The recoverable amount of an asset exceeds its depreciable amount
1.5. The cost of an internally generated intangible asset is only recognised :
A At the research phase
B After the research and development phases
C At the research phase provided certain criteria are met
D At the development phase provided certain criteria are met
1.6. An asset should only be recognised if __________________________________________.
A an entity has the ability to direct the use of the asset and obtain economic benefits that may
arise from the asset
B the right to potential economic benefits is equally available to other parties
C an entity has no control over the use of the asset
D All of the above
1.7. Under a finance lease the depreciation of the asset is recorded in the books of the:
A Lessor
B Lessor and lessee
C Lessee
D None of the above
1.8. At the year-end where the functional currency has strengthened against the foreign currency:
A Any loan payable translated at the year-end will result in a forex gain
B Any loan payable translated at the year-end will result in a forex loss
C Any loan receivable translated at the year-end will result in a forex gain
D None of the above
© EDGE Education (Pty) Ltd – 2
