Deck 32: Separate Financial Statements

Question 1

IAS 27 sets out proper accounting treatment for all of the following except:

A) Associates
B) Consolidations
C) Joint ventures
D) Investments in subsidiaries

Answer 1

Consolidations

Question 2

Separate financial statements are presented by a parent, an investor, in an associate, or a venture in a jointly controlled entity, in which the investments are accounted for on the basis of

A) Direct equity interest
B) Cost
C) Fair value
D) A & B
E) A & C
F) B & C

Answer 2

A & B

Question 3

Statements that measure investments on the basis of the reported profit or loss and net assets of the investee

A) Are considered separate financial statements
B) Are not considered separate financial statements
C) Use the equity method.
D) A & B
E) A & C
F) B & C

Answer 3

B & C

Question 4

Earnest Earl Entity (EEE) intends to prepare separate financial statements in accordance with IAS 27 and has the following investments. If EEE intends to present the highest value of its investments, what is the appropriate valuation of EEE's investment portfolio? $$\begin{array} { | l | l | l | } \hline & \text { Fair Value } & \text { Cost } \\\hline \text { Investment in Subsidiary A } & 100 & 200 \\\hline \text { Investment in Associate B } & 600 & 400 \\\hline \text { Investment in Subsidiary Q } & 100 & 200 \\\hline \text { Investment in Subsidiary E } & 400 & 900 \\\hline \text { Investment in Associate F } & 300 & 100 \\\hline \text { Investment in Associate G } & 500 & 600 \\\hline\end{array}$$

A) 1900
B) 2000
C) 2400
D) 2500
E) 2700
F) None of the above.

Question 5

Separate financial statements are the financial statements of a group in which the assets, liabilities, equity, income, expenses, and cash flows of the parent and its subsidiaries are presented as a single entity.

Question 6

Financial statements in which investments are accounted for using the equity method are considered separate financial statements.

Question 7

In separate financial statements, an entity accounts for its investments in subsidiaries, joint ventures, and associates either (a) at cost; or (b) in accordance with IFRS 9.

Question 8

When ceasing to be an investment entity, an entity must continue to account for an investment in a subsidiary at fair value through profit loss in accordance with IFRS 9.

Question 9

Describe the disclosure requirements for a parent or investor with joint control of, or significant influence over an investee. Explain how these are compliant with the fundamental qualitative characteristics outlined in the Conceptual Framework.