Documente Academic
Documente Profesional
Documente Cultură
FAC3703
Semesters 1 and 2
Department of Financial Accounting
IMPORTANT INFORMATION:
Please activate your myUnisa profile and myLife email address and ensure you
have regular access to the myUnisa module site FAC3703 as well as to your group
site.
Note: This is an online module, and therefore your module is available on myUnisa.
CONTENTS
Page
1
INTRODUCTION ..........................................................................................................................4
2.1
2.2
Printed materials...........................................................................................................................5
3.1
Purpose ........................................................................................................................................5
3.2
Outcomes .....................................................................................................................................6
4.1
Lecturers.......................................................................................................................................7
4.2
Department ...................................................................................................................................8
4.3
University......................................................................................................................................8
5.1
5.2
5.3
6.1
6.1.1
6.1.2
6.2
6.2.1
Study groups...............................................................................................................................11
6.2.2
myUnisa......................................................................................................................................11
6.2.3
6.3
6.3.1
6.3.2
6.3.3
6.3.4
6.3.5
7.1
7.2
FAC3703/101
8
ASSESSMENT ...........................................................................................................................14
9.1
9.2
9.2.1
9.2.2
9.2.3
9.3
9.4
9.5
Plagiarism...................................................................................................................................17
10
11
EXAMINATION...........................................................................................................................18
11.1
11.2
11.3
11.4
11.5
12
13
14
CONCLUSION............................................................................................................................19
15
ANNEXURE................................................................................................................................19
INTRODUCTION
Dear Student
We are pleased to welcome you to FAC3703 Specific Financial Reporting and trust that you will find it
both interesting and rewarding. We will do our best to make your study of this module successful. You
will be well on your way to success if you start studying early in the semester and resolve to do the
assignments properly.
You will receive a number of tutorial letters during the semester. A tutorial letter is our way of
communicating with you about teaching, learning and assessment.
This tutorial letter contains important information about the module, resources and assignments. We
urge you to read it carefully and to keep it at hand when working through the study material, preparing
the assignments, preparing for the examination and addressing questions to your lecturers.
In this tutorial letter 101, you will find the compulsory assignments as well as instructions on the
preparation and submission of the compulsory assignments. It also provides all the information you need
with regard to the prescribed study material and other resources and how to obtain them. Please read
through this information carefully and make sure that you obtain the prescribed material as soon as
possible.
It is very important that you read all the tutorial letters you receive during the semester immediately
and carefully, as they always contain important information.
Please note:
This is an online module, and therefore your module is available on myUnisa. However, in
order to support you in your learning process, you will also receive study materials in
printed format.
All study material on the internet can be accessed via the UNISA website, after registering as a myUnisa
user.
Once you have registered as a myUnisa user, access can be obtained as follows:
1. Enter your student number and password.
2. Select the relevant course code (FAC3703).
3. Access study material as required.
We trust that you will enjoy this module and wish you all the best with you studies!
FORMAT OF FAC3703
2.1
Fully online
FAC3703/101
2.2
Printed materials
We want you to be successful in this online module, thus we also provide you with some of the study
material in printed format. This will allow you to read the study material, even if you are not online.
In addition to this tutorial letter you will receive printed copies of the online tutorial matter from myUnisa.
While these printed materials may appear slightly different from the online study materials, they are
exactly the same and have been duplicated from the online myUnisa website.
The printed support materials are a back-up of everything that is found online, on myUnisa. In other
words, you should NOT wait for the printed support materials to arrive to start studying. The
online material can be used to start with your studies if you have not yet received your printed copies.
Please consult the publication myStudies@Unisa for more information on the activation of your
myLife email address as well as obtaining access to the myUnisa module site.
You will receive the following tutorial letters for this module (which will also be available online):
Tutorial letter
MO 001
101
102
103
201
202
Content
Learning Units (This will be the study guide for this module)
Important information including compulsory assignments
Questions and suggested solutions
Integrated questions and suggested solutions
Suggested solution to compulsory assignment 01
Suggested solution to compulsory assignment 02
PLEASE NOTE: If any additional tutorial letters (other than those mentioned above) are posted
to you, an announcement will be made via myUnisa to let you know that there are additional
tutorial letters (other than those mentioned above) for this module. These tutorial letters will also
be uploaded on myUnisa.
3.1
Purpose
The purpose of this module is to provide learners with knowledge and skills to enable them to prepare a
set of financial statements of companies in accordance with the requirements of International Financial
Reporting Standards (IFRS) with specific reference to:
x
x
x
x
x
x
x
x
3.2
Outcomes
Learning outcome 1
Learners must be able to account for and disclose government grants and government assistance and
the tax implications thereof, in the financial statements of companies in terms of the requirements of the
Companies Act and International Financial Accounting Standards.
Learning outcome 2
Learners must be able to disclose financial liabilities measured at amortised cost (with specific reference
to the capitalisation of borrowing cost and leases) in the financial statements of companies, in terms of
the Companies Act and International Financial Reporting Standards.
Learning outcome 3
Learners must be able to calculate, account for and disclose the capitalisation of borrowing costs and the
tax implications thereof in the financial statements of companies in terms of the Companies Act and
International Financial Accounting Standards.
Learning outcome 4
Learners must be able to account for and disclose employee benefits (refer to comments on definedbenefit plans and other long-term employee benefits) and the tax implications thereof in the financial
statements of companies in terms of the Companies Act and International Financial Reporting
Standards.
Learning outcome 5
Learners must be able to calculate and disclose earnings and dividends per share in the financial
statements of companies in accordance with International Financial Reporting Standards.
Learning outcome 6
Learners should be able to account for and disclose leases, taking the tax implications into account, in
the financial statements of lessees and lessors in terms of International Financial Reporting Standards.
Learning outcome 7
Learners must be able to prepare a segment report for a company and disclose reconciliations of:
segment revenue, segment profit or loss, segment assets and segment liabilities with the relevant line
items in the financial statements in terms of International Financial Reporting Standards.
Learning outcome 8
Learners should be able to identify and disclose related parties and transactions between related parties
in the financial statements of companies in terms of International Financial Reporting Standards.
FAC3703/101
4.1
Lecturers
Office number
Mrs M de Villiers
Mr A Steyn
Mr V Booi
Mr B Khanyeza
Secretary/Administration officer
Personal appointment
Please make an appointment, in advance, with your lecturer should you wish to see them personally
with specific problem areas in your studies. Lecturers are available from 07:45 to 16:00 on weekdays.
Telephonic enquiries
You can contact your lecturers telephonically, by making use of the course contact number provided
below. An available lecturer will take your call and assist you as promptly as they can.
E-mail
You can also communicate with the lecturers via e-mail. Please make use of the following e-mail
address which is specific to the FAC3703 module to ensure a prompt reply:
Semester 1
FAC3703-15-S1@unisa.ac.za
Semester 2
FAC3703-15-S2@unisa.ac.za
It is essential that you include your name, student number and telephone number in all e-mails.
Due to the high volumes of e-mails received by lecturers from students it is not always possible to reply
to these e-mails immediately. Please be patient as your e-mails will be attended to as soon as
possible.
myUnisa
You can also communicate with the lecturers via myUnisa.
Online address: http://my.unisa.ac.za
Postal Address
Name of lecturer
University of South Africa
P O Box 392
Unisa
0003
4.2
Department
University
FAC3703/101
Students can find general Unisa contact details in the myStudies@Unisa publication which is available
on the Unisa website (http://www.unisa.ac.za) under the STUDY section.
Always have your student number at hand when contacting the University.
5.1
Prescribed books
The study material as such are not exhaustive for purposes of tuition, and it is
essential that you have at your disposal the following prescribed book:
Recommended books
Tutor assistance
A tutor is a qualified professional appointed by the university to assist and support students in their
journey to the successful completion of their qualifications.
Effective tutor assistance helps you to:
x
take responsibility for your own learning;
x
develop analytical skills;
x
develop skills in teamwork and cooperative learning; and
x
develop listening, communication, presentation and debating skills.
Types of tutor assistance
x
x
Face-to-face tutoring
E-tutor support
6.1.1
A face-to-face tutorial is an organised session where students and tutors meet regularly at a common
venue and at scheduled times to discuss and solve problems with the contents of their study material
e.g. principles, suggested solutions etc. A face-to-face tutorial has a number of advantages, namely:
x
x
x
It provides you with great opportunities to interact with your tutors and other students and get a
better understanding of the course content;
It encourages you to actively participate in the tutorial sessions; and
It helps you to build relationships with other students.
At the Unisa regional learning centre, a tutorial officer will help you to complete the Tutorial
enrolment form.
Tutorials take place weekday evenings and Saturday mornings look for the tutorials of your
modules on the timetable at the centre notice boards or on the Unisa regional website.
You will be notified through SMS about the starting date of your tutorial sessions.
Tutorials are free.
Students who are interested in tutor assistance can obtain the contact details from the learning centres.
6.1.2
E-tutor support
E-tutoring is an organised session where students and e-tutors interact regularly, online. The teaching
and learning platform is myUnisa. Tools such as online discussion forums are used to facilitate teaching
and learning.
E-tutoring has a number of advantages:
x
x
x
The use of the myUnisa platform provides you with an opportunity to interact with your e- tutor
and fellow students online, using the various tools available.
Your e-tutor is accessible for longer periods compared to face-to-face tutors, each day of the
week.
It helps to develop technical skills required for an online environment.
You will be allocated an e-tutor for each module you have registered for, provided the module has etutoring. You will then be notified by sms about the details of your e-tutor as soon as you have been
allocated one. Your e-tutor will contact you on your mylife e-mail for details of the tutorials. Most Unisa
learning centres have computer lab facilities from where you can access myUnisa. Alternatively, you will
need a device with internet connection, e.g. laptop, tablet/iPad, smartphone, etc.
10
FAC3703/101
A group of 200 students is linked to one e-tutor. Students in a group are able to interact and learn from
one another. Each group has their own separate site on myUnisa. These sites are numbered and you
will receive your group number by email and SMS. Dont be confused! You will now have two sites for
those modules with online tutoring, i.e. the main module site and the group module site.
In the main module site you will find the official study material files that you can download. You should
also submit your assignments here. The primary lecturer of the module may from time to time
communicate with the entire class through this site.
The group module site is where you can interact with your tutor and other group members. You can also
participate in discussions, post academic-related queries and receive specific tutor support.
6.2
6.2.1
Study groups
Many students have found that they benefit from joining a study group consisting of students that are
enrolled for the same module(s). It is advisable to have contact with fellow students. One way to do this
is to form study groups. The addresses of students in your area may be obtained from the following
department:
Directorate: Student Administration and Registration
PO Box 392
UNISA
0003
6.2.2
myUnisa
If you have access to a computer that is linked to the internet, you can quickly access resources and
information at the university. The myUnisa learning management system is Unisa's online campus that
will help you to communicate with your lecturers, with other students and with the administrative
departments of Unisa all through the computer and the internet.
To go to the myUnisa website, start at the main Unisa website, http://www.unisa.ac.za, and then click
on the Login to myUnisa link on the right-hand side of the screen. This should take you to the
myUnisa website. You can also go there directly by typing in http://my.unisa.ac.za.
Please consult the myStudies@Unisa publication, for more information on myUnisa.
6.2.3
Group discussions
Further communication regarding group discussions will follow in a tutorial letter during the semester
6.3
6.3.1
You will be required to provide your login details, i.e. your student number and your myUnisa password,
in order to access the librarys online resources and services. This will enable you to:
x
x
x
x
6.3.2
Students are expected to purchase their own copies of the prescribed books. A limited number of
copies are housed in the Unisa Libraries, subject to each branch librarys lending regulations. Problems
11
experienced in obtaining copies from booksellers should be directed to the Prescribed Book section at email vospresc@unisa.ac.za or telephone +27 12 429 4152.
6.3.3
The preferred way of requesting prescribed or recommended books is online via the librarys
catalogue. Go to:
y
y
y
http://oasis.unisa.ac.za, or
via myUnisa, go to http://my.unisa.ac.za > Login > Library > Library catalogue, or
for mobile access (AirPAC), go to http://oasis.unisa.ac.za/airpac.
6.3.4
This can be done by dailing +27 12 429 3133. Please supply the reservation order number (RON).
6.3.5
Books may also be requested by completing a library book request card for each book.
These should be mailed to:
The Head: Request Services
Department of Library Services
PO Box 392
Pretoria 0003
or faxed to +27 12 429 8128.
Enquiries about requested books should be addressed to bib-circ@unisa.ac.za. Note that requests
should not be sent to this email address.
Telephonic enquiries can be made at +27 12 429 3133/3134. An after-hour voicemail service is also
available at these numbers.
7.1
Study programme
Use your myStudies@Unisa publication for general time management and planning skills.
Experience has shown that students often fail to plan their studies properly so as to achieve specific
study goals at predetermined dates. This leads to a haphazard approach to their studies and the use of
ineffective study techniques.
We assume the following:
Studies should commence in January (first semester) and July (second semester) and that the full
module should be completed by approximately the end of April (first semester) and September (second
semester). This will leave sufficient time for revision.
NB:
Those of you who register late should endeavour to put in extra effort in order to make up the
lost time.
The table that follows can be used as a guideline on how to plan your studies for FAC3703.
12
FAC3703/101
SEMESTER 1
The following table is a suggested study programme for completing the syllabus for this module:
Week
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Learning unit:
1 (Government Grants)
1 (Government Grants) &
2 (Financial Instruments)
3 (Borrowing Costs)
3 (Borrowing Costs)
4 (Earning per share)
4 (Earning per share)
5 (Leases)
5 (Leases)
5 (Leases)
6 (Operating Segments)
7 (Related Parties)
Revision of all learning units
Revision of all learning units
Integrated questions
Week
commences
on:
19 January
26 January
2 February
9 February
16 February
23 February
2 March
9 March
16 March
23 March
30 March
6 April
13 April
20 April
Compulsory
assignment no:
Due date:
01
19 March 2015
02
02 April 2015
SEMESTER 2
The following table is a suggested study programme for completing the syllabus for this module:
Week
1
2
Week
commences
on:
29 June
3
4
5
6
7
8
9
Learning unit:
1 (Government Grants)
1 (Government Grants) &
2 (Financial Instruments)
3 (Borrowing Costs)
3 (Borrowing Costs)
4 (Earning per share)
4 (Earning per share)
5 (Leases)
5 (Leases)
5 (Leases)
10
6 (Operating Segments)
11
7 (Related Parties)
7 September
12
13
14
14 September
21 September
28 September
6 July
13 July
20 July
27 July
3 August
10 August
17 August
24 August
Compulsory
assignment no:
01
Due date:
18 August
2015
31 August
02
8 September
2015
Please do not fall behind with your study programme. Regaining of lost time is seldom achieved.
13
7.2
The assignment must in effect constitute your first revision of the study material which you have studied.
In other words, the assignment should not serve as a checklist of the work required to be studied for the
completion of the assignment, but should, when the assignment is attempted, serve as a test of the
knowledge that you have acquired by studying the work.
As the suggested solution for the assignments becomes available, compare your attempt to the solution
and identify the differences. In respect of every error, determine why the error was made i.e. careless
reading of the question, lack of knowledge, question not answered, carelessness in the answering of the
question, unable to complete the question due to time, calculations not shown, etc. You have now
revised the work for a second time and you have been exposed to the type of errors that you are prone
to make and can therefore work on correcting them.
If you persevere with this proposed approach to studying this module, you will reap the benefit of
sustained practice in answering questions and will enjoy success in the examination.
PRACTICAL
FAC3703
WORK
AND
WORK-INTEGRATED
LEARNING
FOR
ASSESSMENT
9.1
Assessment plan
The Management of the University has taken a decision to introduce compulsory assignments to be
submitted in all modules by set due dates. Submission of compulsory assignment 01 by its due date will
give a student admission to the examination in the particular module and the marks obtained for both
compulsory assignments 01 and 02 will contribute towards the final mark for that module.
Please note:
Compulsory Assignment 01 and Compulsory Assignment 02 will contribute 20% towards your
final mark.
The assignment questions for the first and second semester are different and the assignments
have different unique numbers.
Students require a final mark of 50% to pass a module. This final mark is calculated as follows:
(20% x mark obtained for both compulsory assignments) + (80% x mark obtained in the examination)
The 20% mark for both compulsory assignments in semester 1 and semester 2 is made up as follow:
x
x
14
FAC3703/101
Example on how to calculate your year mark:
Assignment
01
mark/result
=
A
100%
49%
100%
28%
0%
10%
Student 1
Student 2
Student 3
Student 4
Student 5
Student 6
Assignment
01
contribution
of year mark
A x 5%/20%
=
A1
25%
12%
25%
7%
0%
3%
Assignment
02
mark/result
=
B
100%
77%
33%
30%
27%
9%
Assignment
02
contribution
of year mark
B x 15%/20%
=
B1
75%
58%
25%
23%
20%
7%
Assignments
year mark
A1 + B1
=
C
100%
70%
50%
30%
20%
10%
Contribution of
assignments year
mark
C x 20%
=
C
100%
70%
50%
30%
20%
10%
=
D
20%
14%
10%
6%
4%
2%
Student 1
Student 2
Student 3
Student 4
Student 5
Student 6
Exam mark
contribution
required to pass
(50% minus
assignment mark
contribution)
50% - D
=
E
32%
36%
40%
44%
46%
48%
Minimum exam
mark required to
pass
E/80% x 100%
=
Exam mark
40%
45%
50%
55%
58%
60%
% Contribution to
final mark
5%
15%
80%
100%
5%
15%
80%
100%
15
Please ensure that the compulsory assignments reaches the University before the due date - late
submission of the assignments will result in you not being admitted to the examination.
Please refer to section 9.2.2 of this tutorial letter for the respective due dates.
Sub minimum requirements
A sub minimum of 40% in the examination is required.
Paragraph 5.4 of the Assessment Policy provides that the final mark of a student is a combination of the
year mark and the examination mark, in the ratio as explained above. In case where a student does not
obtain the required sub minimum of 40% in the examination, the year mark does not count. The final
mark then is the examination mark obtained.
Results of supplementary examination: In terms of paragraph 5.7 of the Assessment Policy the year
mark which was previously obtained (i.e the assignment marks obtained in the semester the student was
initially registered), will contribute to the final mark of students writing supplementary examinations.
9.2
Assignment
Assignment 1
Assignment 2
SEMESTER 2
Type
Unique number
MCQ
635964
Written
636194
Assignment number
Unique
number
Due date
Contribution
towards final mark
636196
636262
635964
636194
19 March 2015
2 April 2015
18 August 2015
8 September 2015
5%
15%
5%
15%
9.2.3
The receipt of assignments after the due date disrupts our marking programme and as the
uncontrolled submission of assignments furthermore creates administrative problems no
extension will be granted for the submission of assignments.
16
FAC3703/101
Submission of assignments
(a)
Students may submit written assignments and MCQ assignments either by post or Mobile phone
submission or electronically via myUnisa, but preferably via myUnisa. Assignments may not be
submitted by fax or e-mail.
(b)
(c)
Go to myUnisa.
Log in with your student number and password.
Select the module.
Click on Assignments in the menu on the left-hand side of the screen.
Click on the assignment number you wish to submit.
Follow the instructions.
9.4
Assignments, self-assessment questions and additional questions form an integral part of the tutorial
matter and must also be studied for examination purposes.
It is in your own interest to complete both assignments and additional questions as:
Please note that it is not possible to cover every aspect of the tutorial matter in the assignments.
9.5
Plagiarism
Plagiarism is the act of taking words, ideas and thoughts of others and passing them off as your own. It
is a form of theft which involves a number of dishonest academic activities.
The disciplinary code for students is given to all students at registration. Students are advised to study
the code. Kindly read the University Policy on Copyright Infringement and Plagiarism as well.
10
17
11
EXAMINATION
Use your myStudies@Unisa publication for general examination guidelines and examination
preparation guidelines.
It should be mentioned that you will write one examination paper for this module in May/June (first
semester) or October/November (second semester).
11.1
Examination admission
SUBMISSION OF ASSIGNMENT 01 IS COMPULSORY TO OBTAIN EXAMINATION
ADMISSION. ASSIGNMENT 01 AND ASSIGNMENT 02 TOGETHER WILL COUNT 20%
TOWARDS YOUR FINAL MARK FOR THIS MODULE.
ONLY STUDENTS THAT COMPLY WITH THIS REQUIREMENT WILL BE ADMITTED TO
THE EXAMINATION OF FAC3703.
Please note: The compulsory assignments (assignment 01 and 02) count 20% towards your final mark.
The mark obtained by you in the examination will determine the remaining 80% of your final mark for this
module.
11.2
Examination period
This module is offered in a semester period of fourteen weeks. This means that if you are registered for
the first semester, you will write the examination in May/June 2015 and the supplementary examination
will be written in October/November 2015. If you are registered for the second semester you will write the
examination in October/November 2015 and the supplementary examination will be written in May/June
2016.
During the module time-frame of the respective semester, the Examination Section will provide you with
information regarding the examination in general, examination venues, examination dates and
examination times.
11.3
The University Rules (paragraph 32) have been amended to specifically provide that the University will
not make previous years examination papers and memoranda and so-called model answers of
previous examination papers available to students.
11.4
To help you in your preparation for the examination you will receive an exam letter as an annexure to a
study letter. This letter will include information that will explain the format of the examination paper and
general advice the lecturers want to share with students.
11.5
Calculator policy
Candidates may only use silent, electronic, battery-driven pocket calculators subject to the following
conditions:
x Calculators must be cordless, and may not have print-out facilities or alpha keys,
x Any financial calculator will be allowed as the following table of present values will not be provided:
o Tables of present value factors for various interest rates for varying periods,
o Tables of future value factors for various interest rates for varying periods,
x The calculator function on mobile telephones or any electronic device (i.e. laptops and /or any Smart
phone) may not be used, and
x Candidates may not share a calculator with another candidate in the examination room.
18
FAC3703/101
12
The publication myStudies@Unisa contains an A-Z guide of the most relevant study information.
13
SOURCES CONSULTED
None.
14
CONCLUSION
We would like to encourage you to approach your studies with enthusiasm. Remember, success can
only be achieved by hard work and perseverance. We wish you a pleasant study period.
15
ANNEXURE
ANNEXURE A:
ANNEXURE B:
ANNEXURE C:
ANNEXURE D:
19
636196
DUE DATE:
19 MARCH 2015
PLEASE NOTE:
1. This assignment consists of 15 multiple choice questions.
2. This assignment covers learning unit 1 to 3 of tutorial letter MO 001. Work carefully through the
relevant tutorial matter before you attempt the assignment.
3. No extension will be granted for the late submission of this assignment and no correspondence or
telephone conversations will be conducted in this regard.
4. It is preferred that the assignment is submitted via myUnisa.
INSTRUCTIONS FOR SUBMISSION ON MARK-READING SHEETS:
x
x
x
x
x
20
FAC3703/101
ASSIGNMENT 01 (COMPULSORY)(FIRST SEMESTER)
MULTIPLE CHOICE QUESTIONS
Study:
PART A
The following information relates to QUESTIONS 1 to 7:
Altor Ltd is a company that manufactures specialised machinery for the government in Gauteng. During
the 2012 financial year, Altor Ltd was commissioned by Sunrise Ltd, a government road agency, to
manufacture a high-tech machine that processes registration numbers of moving vehicles. The machine
traces vehicle registration numbers on the governments databases in order to generate billing reports
for toll roads and detects stolen or wanted vehicles. Sunrise Ltd will pay Altor Ltd an annual fee for the
use of information generated by the machine. Altor Ltd will own the legal rights to the machine and will
be responsible for the maintenance of the machine.
On 1 July 2012, Altor Ltd employed an engineering team to conduct research on similar high tech
machines used by road agencies internationally. The research was conducted over a six month period
beginning 1 July 2012 (the research engineers were also employed for the same period). The salary of
the engineers for the six month period amounted to R1 200 000.
The machine was manufactured in-house by Altor Ltd and cost R5 000 000 to manufacture. The
estimated useful life of the machine is six years. The machine is depreciated over its useful life using the
straight-line method and has a residual value of Rnil. The South African Revenue Service (SARS)
allows a 20% allowance per annum on the machine (not apportioned for a period shorter than a year).
The manufacturing of the machine was funded by means of an overdraft facility from ABB Bank
amounting to R7 500 000. The overdraft facility was available from 5 January 2013 and was also used
to finance other business operations. The overdraft facility bears interest at a rate of 11% per annum
and interest is compounded monthly.
Altor Ltd received the final research report on 2 January 2013 and commenced with the manufacturing
activities on 1 May 2013. The manufacturing costs relating to the development of the high-tech machine
were incurred as follows:
Date
1 May 2013 ........................................................................................................................
1 June 2013 .......................................................................................................................
1 July 2013 ........................................................................................................................
Expenses
R
1 500 000
1 000 000
2 500 000
5 000 000
The machine was completed and available for use on 31 July 2013 and brought into use on
1 September 2013.
The machine is a qualifying asset in terms of IAS 23, Borrowing Costs.
21
Altor Ltd received the following government grants from the Department of Transport for the
manufacturing of the machine:
x 10% cash contribution towards salaries of the engineering team for the research period. The grant
was received by Altor Ltd on 1 July 2012.
x R820 000 cash contribution towards the manufacturing costs of the machine. The grant was received
by Altor Ltd on 31 July 2013.
Altor Ltds accounting policy relating to government grants is as follows:
x Asset-based government grants are deducted from the carrying amount of the asset.
x Income-based government grants are deducted from the related expense.
Altor Ltds financial year end is 30 September.
REQUIRED:
Answer the following questions by choosing the correct option out of the five options given for each
question. There is only ONE correct answer for each question.
All amounts should be rounded off to the nearest Rand.
All answers should comply with the requirements of International Financial Reporting Standards
(IFRS).
QUESTION 1
The government grant received by Altor Ltd of a 10% cash contribution for the engineering teams
salaries will be classified as:
(1)
(2)
(3)
(4)
(5)
QUESTION 2
The government grant of R820 000 will be accounted for as follows in the accounting records of Altor Ltd
for the year ended 30 September 2013:
(1)
(2)
(3)
(4)
(5)
Deduct the R820 000 from the engineering teams salary costs.
Deduct the R820 000 from the carrying amount of the machine.
Recognise the R820 000 and allocate it to the profit or loss section of the statement of profit or loss
and other comprehensive income on a systematic basis over the useful life of the machine.
Recognise the full R820 000 as other income in the profit or loss section of the statement of profit
or loss and other comprehensive income when received.
Recognise the full R820 000 as other comprehensive income in the statement of profit or loss and
other comprehensive income when received.
QUESTION 3
Assuming that the R820 000 grant is treated as an asset-based grant, the carrying amount of the
machine in the records of Altor Ltd as at 30 September 2013 is:
(1)
(2)
(3)
(4)
(5)
22
R4 180 000
R3 483 333
R4 861 111
R5 081 000
R4 063 889
FAC3703/101
QUESTION 4
Assume (only for question 4) that the grant of R820 000 is an asset-based grant and is presented as a
credit in the statement of profit or loss and other comprehensive income, the carrying amount of the
machine in the records of Altor Ltd as at 30 September 2013 is:
(1)
(2)
(3)
(4)
(5)
R4 180 000
R3 466 666
R4 861 333
R5 000 000
R4 861 111
QUESTION 5
The tax base of the machine for the year ended 30 September 2013, is:
(1)
(2)
(3)
(4)
(5)
R5 000 000
R4 833 333
R4 666 667
R4 000 000
Rnil
QUESTION 6
Assuming that the 10% government grant for the engineering teams salaries is treated as an incomebased grant, the engineering teams salaries that will be included in employee benefits in the statement
of profit or loss and other comprehensive income of Altor Ltd for the year ended 30 September 2012 is:
(1)
(2)
(3)
(4)
(5)
R1 200 000
R 540 000
R 600 000
R1 080 000
R 570 000
QUESTION 7
Assume (only for question 7) that R30 000 of the R120 000 (R1 200 000 x 10%) government grant
relating to research engineers salaries expense was recognised in profit or loss for the financial year
ended 30 September 2012. 50% of the grant received was repaid to the government on
30 September 2012. The balance of the deferred income relating to the government grant as at
30 September 2012, after the repayment of 50% of the grant is:
(1)
(2)
(3)
(4)
(5)
R 90 000
R 60 000
R1 100 000
R 30 000
Rnil
R 45 834
R 82 500
R 82 964
R 67 770
R176 578
23
QUESTION 9
Assume (only for question 9) that ABB Bank compounds the interest on the overdraft facility annually.
The amount of borrowing costs that will be capitalised as part of the cost of the machine in the records of
Altor Ltd for the year ended 30 September 2013, is:
(1)
(2)
(3)
(4)
(5)
R 82 500
R174 167
R 67 770
R 45 834
R 82 964
QUESTION 10
Assume (only for question 10) that the manufacturing expenses were incurred evenly for each period
and that ABB Bank compounds interest monthly. The amount of borrowing costs that will be capitalised
as part of the cost of the machine in the records of Altor Ltd for the year ended 30 September 2013, is:
(1)
(2)
(3)
(4)
(5)
R 59 878
R 82 500
R153 068
R 45 834
R 82 964
QUESTION 11
Assume (only for question 11), that a specific loan amounting to R5 000 000 was received on
1 May 2013 to finance only the manufacturing costs relating to the machine and that the loan bears
interest at 11% per annum, compounded monthly.
The amount of borrowing costs that will be capitalised as part of the cost of the machine in the records of
Altor Ltd for the year ended 30 September 2013, is:
(1)
(2)
(3)
(4)
(5)
R138 453
R137 500
R138 763
R 82 964
R233 407
QUESTION 12
Assume (only for question 12), that a specific loan amounting to R5 000 000 was received on
1 May 2013 to finance only the manufacturing costs relating to the machine. The loan bears interest at
11% per annum, compounded annually.
The amount of borrowing costs to be capitalised as part of the cost of the machine in the records of Altor
Ltd for the year ended 30 September 2013, amounts to:
(1)
(2)
(3)
(4)
(5)
24
R 82 500
R138 763
R137 500
R279 645
Rnil
FAC3703/101
R144 676
R 71 181
Rnil
R142 361
R138 889
QUESTION 14
The total finance costs, incurred by Altor Ltd for the year ended 30 September 2013 amounts to:
(1)
(2)
(3)
(4)
(5)
R500 000
R375 000
R125 000
R208 333
Rnil
QUESTION 15
Assume (only for question 15), that the total finance costs incurred for the year ended
31 September 2013 amounted to R300 000 and the borrowing costs capitalised to the machine
amounted to R250 000. What will the amount be that will be deductible as pre-production interest for
taxation purposes and in which period will it be deductible against the taxable income of Altor Ltd?
(1)
(2)
(3)
(4)
(5)
R50 000 (R300 000 R250 000) for the period ended 30 September 2014.
R250 000 for the period ended 30 September 2014.
R250 000 for the period ended 30 September 2013.
R300 000 for the period ended 30 September 2013.
R300 000 for the period ended 30 September 2014.
25
636262
DUE DATE:
2 APRIL 2015
PLEASE NOTE:
1. This assignment consists of only one (1) question with subsections.
2. All subsections of this question must be answered.
3. All calculations must be shown.
4. Please follow the instructions in the required part of the question carefully to ensure that you obtain
the maximum marks for the question.
5. This assignment covers learning unit 1 to 6 of the tutorial letter MO 001. Work carefully through the
relevant tutorial matter before you attempt the assignment.
6. No extension will be granted for the late submission of this assignment and no correspondence or
telephone conversations will be conducted in this regard.
7. Please follow the instructions for the submission of the written assignment carefully.
INSTRUCTIONS FOR SUBMISSION OF WRITTEN ASSIGNMENTS
Written assignments can either be submitted as follows:
x
electronically via myUnisa; or
x
placed in the assignment envelope in a UNISA assignment post box; or
x
mailed by using ordinary post using the envelope supplied.
PLEASE NOTE:
x If you electronically submit the written assignment via myUnisa the file must be converted to or
scanned in PDF format.
x The assignment must be scanned and submitted as only one PDF file. The PDF file must not be a
read only file.
x Any format other than PDF will not be accepted by myUnisa.
x Written assignments can ONLY be submitted ONCE on myUnisa. No corrections to your
assignment can be done after submission.
26
FAC3703/101
ASSIGNMENT 02 (50 marks)(60 minutes)(COMPULSORY)(FIRST SEMESTER)
WRITTEN ASSIGNMENT
Study:
R
800 000
500 000
500 000
You may assume that the expenses relating to the construction of the warehouse were incurred evenly
throughout the relevant periods. The warehouse was completed and ready for use on
31 December 2013.
Riddle Ltds gross salaries and wages amounted to R6 000 000 for the year ended on 31 July 2014. The
company contributes 7,5% of gross salaries for the year to a provident fund which is classified as a
defined contribution plan.
All Riddle Ltds employees are entitled to 12 days vacation leave every calendar year that must be taken
during the companys shut down period which is the last two weeks of every calendar year. The
company requests employees to volunteer to work during this period and as a result their leave will be
paid out to them in cash. Past experience has shown that the employees that work during the shutdown
period earn 15% of the gross salaries and wages. All employees who did not take leave and worked
during the December 2013 shutdown period received leave pay of R23 842 for their unused vacation
leave. There are 252 working days in a financial year.
The leave pay accrual for 31 July 2013 amounted to R158 222.
On 1 February 2014, Riddle Ltd sold its chemical blending machine to Shack Bank for an amount of
R9 230 000 and leased it back from the same date for a period of four years. The chemical blending
machine was originally purchased on 31 October 2010 at a cost of R10 800 000 and had a useful life of
eight years at that date. The residual value is Rnil and has remained unchanged.
27
The lease agreement provides for bi-annual instalments of R1 626 327 each, payable in arrears. The
interest rate implicit in the lease is 16,66% per annum. Ownership of the chemical blending machine will
transfer to Riddle Ltd at no cost at the end of the lease term. Riddle Ltd incurred R25 000 legal
expenses in drafting the lease agreement.
Riddle Ltd has a 31 July financial year end.
REQUIRED:
(a)
(b)
Disclose the above transactions in the statement of financial position of Riddle Ltd for the year
ended 31 July 2014. (Disclosure of the tax effect is not required).
Disclose the above transactions in the notes to the annual financial statements of Riddle Ltd for the
year ended 31 July 2014.
The following notes are not required:
Accounting policies;
Deferred tax;
Income tax expense; and
Disclosures required in terms of IFRS 7 Financial Instruments: Disclosures.
Please note
x
x
x
28
Your answers must comply with the requirements of International Financial Reporting Standards
(IFRS).
Comparative figures are not required.
Round off all amounts to the nearest Rand.
FAC3703/101
ANNEXURE C: COMPULSORY ASSIGNMENT 01 (MCQ) SECOND SEMESTER
SUBMISSION OF ASSIGNMENT 01 IS COMPULSORY TO OBTAIN EXAMINATION ADMISSION.
ASSIGNMENT 01 TOGETHER WITH ASSIGNMENT 02 COUNT 20% TOWARDS YOUR FINAL
MARK.
THIS ASSIGNMENT CONTRIBUTES 5% TOWARDS YOUR FINAL MARK FOR THIS MODULE.
SEMESTER 2
UNIQUE NUMBER:
635964
DUE DATE:
18 AUGUST 2015
PLEASE NOTE:
1.
2.
This assignment covers learning units 1 to 3 of tutorial letter MO 001. Work carefully through the
relevant tutorial matter before you attempt the assignment.
3.
No extension will be granted for the late submission of this assignment and no correspondence or
telephone conversations will be conducted in this regard.
4.
x
x
PLEASE DO NOT:
x
x
x
x
x
x
x
x
29
Answer the following questions by choosing the correct option out of the five options given for
each question. There is only ONE correct answer for each question.
All amounts should be rounded to the nearest Rand.
All answers should comply with the requirements of International Financial Reporting
Standards (IFRS).
30
FAC3703/101
QUESTION 1
The government grant received from the Department of Trade and Industry by Bright Shoes Ltd of
R800 000 will be classified as:
(1)
(2)
(3)
(4)
(5)
QUESTION 2
The carrying amount of the moulding machine in the records of Bright Shoes Ltd for the year ended
31 March 2013, is:
(1)
(2)
(3)
(4)
(5)
R6 000 000
R5 400 000
R4 800 000
R2 880 000
R3 200 000
QUESTION 3
The government grant that was repaid to the Department of Trade and Industry by Bright Shoes Ltd on
1 April 2013, amounted to:
(1)
(2)
(3)
(4)
(5)
R800 000
R116 667
Rnil
R160 000
R120 000
QUESTION 4
The repayment of 20% of the government grant to the Department of Trade and Industry will be
accounted for in the annual financial statements of Bright Shoes Ltd for the year ended 31 March 2014
as:
(1)
(2)
(3)
(4)
(5)
A correction of an error.
A change in accounting policy.
A change in accounting estimate.
An expense in the financial year that it was repaid.
An expense in the financial year that the grant was originally received.
31
QUESTION 5
Assume that the government grant amount repaid of 20% was correctly added to the carrying amount of
the moulding machine on 1 April 2013. The following adjustment must be made in profit or loss in the
accounting records of Bright Shoes Ltd for the year ended 31 March 2014, as a result of the repayment
of the grant:
(1)
(2)
(3)
(4)
(5)
QUESTION 6
The tax base of the new moulding machine for deferred tax purposes as at 31 March 2013, is:
(1)
(2)
(3)
(4)
(5)
R4 320 000
R4 800 000
R2 880 000
R3 200 000
R5 400 000
32
Rnil
R66 667
R133 333
R160 000
R800 000
FAC3703/101
QUESTION 8
The carrying amount of the moulding machine in the records of Bright Shoes Ltd for the year ended
31 March 2013, is:
(1)
(2)
(3)
(4)
(5)
R6 000 000
R5 400 000
R7 200 000
R5 333 333
Rnil
PART B
The following information relates only to QUESTIONS 9 to 12:
Automotive Ltd is a company that manufactures upholstery from leather and synthetic leather for the
automotive industry. In the beginning of the 2014 financial year Automotive Ltd decided to expand its
business by manufacturing synthetic leather and selling it to furniture manufacturers. In order to
manufacture the synthetic leather, Automotive Ltd ordered a machine on 1 August 2014 that is known for
manufacturing synthetic leather at the highest standard.
On 30 September 2014, Automotive Ltd obtained an overdraft facility of R5 000 000 from City Bank. The
facility will be used to finance the acquisition of the new machine as well as other business activities.
The overdraft facility bears interest at 10,5% per annum, compounded quarterly from
31 December 2014.
The components of the machine were delivered to Automotive Ltd on 1 October 2014 and the machine
was assembled by a team of engineers over a period of eight months on Automotive Ltds premises.
The machine is a qualifying asset in terms of IAS 23, Borrowing Costs.
The mounting of the machine commenced on 1 October 2014 and the following expenses were incurred
and paid from the overdraft facility:
Date
1 October 2014
31 December 2014
1 April 2015
Expense
Purchase price of machine
Labour costs for the mounting of machine
Labour costs for testing of machine
R
3 000 000
1 000 000
500 000
4 500 000
The machine was tested on 15 March 2015 as part of the mounting process. The machine was
completed and ready for use on 31 May 2015. The machine was brought into use on 1 July 2015.
It is the accounting policy of Automotive Ltd to depreciate the new machine using the straight-line
method over its useful life of five years. The machine has an estimated residual value of Rnil.
The SA normal income tax rate is 28%. The South African Revenue Service allows a section 12C
deduction on the machine of 40% in the first year of use and 20% for three years thereafter, not
apportioned for part of a year. In terms of section 11(bA) of the Income Tax Act, pre-production interest
incurred is deductible for tax purposes when the asset is brought into use.
Automotive Ltd has a 30 June year end.
33
QUESTION 9
The overdraft facility received to finance the new machinery (and related costs) is classified as:
(1)
(2)
(3)
(4)
(5)
A special loan.
A specific loan.
A general loan.
A combination of both a specific loan and a general loan.
A forgivable loan.
QUESTION 10
Borrowing costs to be capitalised to the qualifying asset for the year ended 30 June 2015, amounts to:
(1)
(2)
(3)
(4)
(5)
R308 820
R262 500
R301 875
R 78 750
R267 819
QUESTION 11
On which date should depreciation of the machine commence?
(1)
(2)
(3)
(4)
(5)
30 September 2014
30 June 2015
1 July 2015
1 October 2014
31 May 2015
QUESTION 12
The amount that will be allowed as a tax deduction for the machine by the South African Revenue
Service for the year ended 30 June 2015, is:
(1)
(2)
(3)
(4)
(5)
R 900 000
Rnil
R1 800 000
R 150 000
R 75 000
QUESTION 13
The same information applies as in Part B, except for the following:
Assume, (only for question 13) that:
x
the expenses incurred in each quarter were incurred evenly during that quarter, and
x
the machine was completed and ready for use on 30 June 2015.
Borrowing costs to be capitalised to the qualifying asset for the year ended 30 June 2015, amounts to:
(1)
(2)
(3)
(4)
(5)
34
R282 188
R195 879
R308 820
R247 319
R267 819 -
FAC3703/101
R305 590
R322 290
R298 300
R338 990
R363 759
QUESTION 15
Assume (only for question 15) that the borrowing costs capitalised to the qualifying asset for the year
ended 30 June 2015 amounted to R300 000. The deferred tax asset/liability relating to the machine as
at 30 June 2015, amounts to:
(1)
(2)
(3)
(4)
(5)
35
636194
DUE DATE:
8 SEPTEMBER 2015
PLEASE NOTE:
1. This assignment consists of only one (1) question with subsections.
2. All subsections of this question must be answered.
3. All calculations must be shown.
4. Please follow the instructions in the required part of the question carefully to ensure that you obtain
the maximum marks of the question.
5. This assignment covers learning units 1 to 6 of the tutorial letter MO 001. Work through the relevant
tutorial matter carefully before you attempt the assignment.
6. No extension will be granted for the late submission of this assignment and no correspondence or
telephone conversations will be conducted in this regard.
7. Please follow the instructions for the submission of the written assignment carefully.
INSTRUCTIONS FOR SUBMISSION OF WRITTEN ASSIGNMENTS
Written assignments can either be submitted as follows:
x electronically via myUnisa; or
x placed in the assignment envelope in a UNISA assignment post box; or
x mailed by using ordinary post using the envelope supplied.
PLEASE NOTE:
x If you electronically submit the written assignment via myUnisa the file must be converted to or
scanned in PDF format.
x The assignment must be scanned and submitted as only one PDF file. The PDF file must not be a
read only file.
x Any format other than PDF will not be accepted by myUnisa.
x Written assignments can ONLY be submitted ONCE on myUnisa. No corrections to your assignment
can be done after submission.
36
FAC3703/101
ASSIGNMENT 02 (50 marks)(60 minutes)(COMPULSORY)(SECOND SEMESTER)
WRITTEN ASSIGNMENT
Study:
R1 300 000
R1 700 000
4 years
R 595 451
The interest rate used to calculate the amounts relating to the lease agreement are market related.
At the end of the lease, the two Super B machines will be transferred to Doggs Ltd at no additional cost.
In order to secure the lease, Katts Ltd paid legal fees of R20 000.
As at 28 February 2015, Katts Limited had 108 employees earning an average salary of R22 500 per
month. Employees are entitled to and will receive a 10% increase on 1 March every year as agreed upon
between the employer, employees, and the unions.
On 1 January 2015 two employees resigned from Katts Limited. These two employees earned monthly
salaries of R6 000 and R15 000 respectively.
Employees of Katts Ltd are entitled to 15 days annual leave per financial year. The company only allows
five unused days to be carried forward to the following year. Based on past experience all leave carried
forward to the following year will be taken. At 28 February 2015 the leave days of the employees were as
follows:
-
The two employees who resigned on 1 January 2015 had no leave days due to them. You may assume
that there are 252 workings days in a calendar year. The leave accrual at 28 February 2014 amounted to
R310 115.
You may assume that the employer incurred no other expenses with regards to employees other than
those mentioned above.
Katts Ltd entered into an agreement with Build It Ltd on 31 October 2014 to construct a machine that
mixes, heats and cools the various metals and materials used to manufacture the Super B machine.
37
The construction of the new machine will take 12 months to complete and meets the definition of a
qualifying asset in terms of with IAS 23, Borrowing Costs.
The total cost of the machine will be R1 500 000. In order to finance the construction of the new
machine, Katts Ltd obtained a R1 500 000 loan from GEH Bank on 31 October 2014 for construction of
the machine only. Katts Ltd received the funds on the same day. The loan bears interest at 15% per
annum compounded annually from 1 November 2015. The capital and interest on the loan will only be
paid back in 2016.
Surplus funds (relating to the above mentioned loan) were temporarily invested and interest received on
these funds amounted to R3 000 for the year ended 28 February 2015.
Katts Ltd made the following payments for the construction of the new machine to Build It Ltd for the year
ended 28 February 2015:
Date
1 December 2014.....................................................................................................................
28 February 2015 .....................................................................................................................
R
100 000
350 000
450 000
The asset will be completed, ready for use and brought into use on 2 November 2015.
Profit before tax of Katts Ltd for the year ended 28 February 2015 amounted to R30 650 000 before
taking any of the above transactions (including the cost of R1 300 000 of the two Super B machines) into
account.
The company depreciates all machinery over their useful life of five years using the straight-line method.
The South African Revenue Service (SARS) allows a section 12C deduction on the machinery of 20%
per year for five years, not apportioned for part of a year.
The SA normal income tax rate is 28% and has remained unchanged since 1 March 2013. The deferred
tax asset as at 1 March 2014 amounted to R86 832 (temporary differences: R310 115). Other than those
that are apparent from the information provided, Katts Ltd has no other temporary differences and nontaxable or non-deductible items.
REQUIRED:
Disclose the above transactions in the notes to the annual financial statements of Katts Ltd for the year
ended 28 February 2015.
(50)
The movement in temporary differences in the current tax calculation must be calculated using the
statement of financial position method.
Please note
x
Your answers must comply with the requirements of International Financial Reporting Standards
(IFRS).
x
Ignore Value Added Tax (VAT).
x
The accounting policies note is not required.
x
Comparatives figures are not required.
x
Disclosure required in terms of IFRS 7, Financial Instruments: Disclosure is not required.
x
Round off all calculations to the nearest Rand.
Ref: / FAC3703_2015_TL_101_3_E.pdf
UNISA 2015
38