F8 and P7 exams June 2011

The papers for the JUNE 2011 ACCA exams are already out for viewing - so students that have just completed the exams should probably consider re-writing the answers and getting it reviewed by their lecturer - this should allow you to gauge your expected marks.

By gauging your expected marks - you can plan your next semester better.

Overall the papers for P7 was not that bad - it did have the new format to deal with - which was addressed by the article that was written by Lisa Weaver recently. The paper tested Financial statement risk, PFI (mixed with going concern), usual ethics question, due diligence, ISA 550, ISA 510, Consolidation process, Audit report.

This paper is considered a doable paper for students that had prepared well - reviewed all previous papers and considered studying up their P2 before going in - since it tested both IAS 11 and 37 in some detail.

On the other hand, paper F8 had the following issues to be considered - Q1 - sales system test of control, internal controls to reduce fraud, substantive procedures for revenue and AR balances.

(Well designed question that covered the essential elements that should be known by all auditing students)

Q2 - Theory question that brought in ISA 210 and Narrative notes advantage and disadvantages

Q3 - Balance question asking for audit procedures AEIOU for purchases and risk based question

Q4 - Ethical question + Internal audit outsourcing question

Q5 - An excellent question that tested ISA 450 (new standard), ISA 620 Experts and ISA 705 Modification of audit reports.

Overall the paper has a better feel compared to the previous paper and should provide a more favourable pass rate. If you had failed this paper - it would indicate that you did not do your basic work sufficiently and waited to the last minute to get the work done.

THIS SEMESTER JULY 2011 I WILL BE OFFERING THE FOLLOWING CLASSES

P7 ACCA - SUNWAY JB

F8 ACCA - SUNWAY JB

F8 ACCA - J PRO - EVERY WEDNESDAY 1.30 PM TO 5.00 PM (STARTS ON 6TH JULY)

P7 ACCA - JPRO - STARTS ON SUNDAY 17 JULY 8.30 AM TO 5.30PM (8 HOURS) , NEXT ON IS ON 28/8, 3 & 4/9, 23 & 30/10 MAIN CLASSES. QUESTION PRACTICE SLOTS WILL BE DISCUSSED DURING THE CLASS.

CONTACT ME ON FACEBOOK - J@ACCAMAIL.COM OR CALL MY 012 NO. (DO INFORM THE REST ABOUT THE CLASS TIMING - MAX IS 20 ONLY)

Audit procedures

The diagram above does provide some idea about audit procedures that are done during the interim and final audit, not at the planning and review stage.

The basic idea is to understand that audit procedures are done to gather audit evidence.

Evidence that needs to be gathered can be about the reliability of the internal control system is achieved using test of control (as the audit procedure) - this means that control risk assessment is low

You will need to identify the control then write up the procedures to confirm if the control is working as designed. Good questions to look at includes Seelay and B-Star, which provides an idea about control testing and whether control testing is appropriate sufficient evidence.

Evidence that need to be gathered about the reliability of the accounting system (whether the audit assertions are being met) is achieved using substantive procedures - which includes test of detail and substantive analytical procedures.

This can be focused on the balance - Seelay part c and d + Westra part b, transaction - ASG part b + Westra part a or sometimes on a disclosure - not done yet.

The evidence can be gathered by using documentation - like Westra and ASG or it can be done using analytical procedure - like B-Star and Blake.

So far your examiner has not really asked questions that test audit procedures like the previous examiner, she focuses more on balance testing and control testing. There was a limited amount of emphasis on the transaction part in June 2010 and Dec 2010. This could indicate that either she does not like those areas or that it might hit you in June 2011. If nothing comes out this time, it would be a sign that she does not favour transaction testing (probably too easy).

She also has not asked questions for audit procedures that require a reason for the test (awarding 2 marks per point, rather than more reduce 1 mark per procedure approach)

On that note the other thing that has also been seen in the last two sitting is an over-emphasis in internal controls (some questions are more that unusual - it is good but it could be better question as seen in Bluesberry Dec 2010). I would expect that it would be possible for more unusual questions set within the context of internal controls.

Good luck in the exam