ACCOUNTING DISTANCE LEARNING
RESULTS OF TEST 2 AND EXAMINERS’ COMMENTS
In respect of the Advanced modules, the results are as follows:
FinAcc MAF Taxation Auditing Average mark 24/80 10/40 6/40 11/40 Average % 30% 25% 15% 28%
The top student in each Advanced module is as follows:
Financial Accounting Robyn Bassnet
MAF Ryall Bhugwandeen
Taxation Charlotte Haingura
Auditing Kudakwashe Muli
In respect of the Intermediate modules, the results are as follows:
FinAcc MAF Taxation Auditing Average mark 9/40 11/40 17/40 15/40 Average % 23% 28% 43% 38%
The top student in each Intermediate module is as follows:
Financial Accounting Swati Modi MAF Jeremy Venniker Taxation Sanele Dlamini Auditing Fidelis Chiwara
ADVANCED FINANCIAL ACCOUNTING
The question consisted of five parts and it was essential that each part be
attempted in order to obtain a good mark. Unfortunately, many students only
attempted parts 1 and 2, which meant that they were only answering half the
question (i.e. 40 marks). Students are urged to consider why they are running
into time difficulties. StudentS are also reminded not to write in pencil. I will
make some observations about where I noticed students were wasting time in the comments below.
This part of the question required students to draft journal entries relating to
the various transactions relating to the company. (Not all of these comments
apply to all students.)
An overall comment is that many students presented their JE‟s in an untidy
fashion. It takes less than 5 seconds to draw some lines onto your page so
that your work looks neat and tidy. Some specific comments are below.
1.1 No workings were shown for the FEC.
1.2 Students did not give the name of the account – They just wrote “Equity”
1.3 Some students tried to use complicated calculations to calculate the
interest in the second JE. Study the solution carefully to see what was
1.4 Some students omitted the JE‟s for the sale of ships – possibly as they
are more comfortable dealing with the purchase of items using a FEC.
You need to practice recording both the sale and the purchase of items.
1.5 Many students could not calculate the interest expense on the
preference shares (financial liability). (Some students wasted time trying
to split this between liability and capital.)
1.6 Some students showed journal entries for depreciation despite the fact
that this was specifically not required.
1.7 However, despite the comments above, many students did well in this
Here many students wasted time by showing a roll forward of the carrying
amounts of the assets. You only needed to know the CA at the end of the
year, and any workings to roll forward the balance were superfluous. Again, the marks were on the whole quite good. Other detailed comments are as
2.1 Do not use CV and TV – rather use CA (carrying amount) and TB (tax
base) – it‟s more up-to-date.
2.2 Students did not indicate the tax rate they used. 2.3 Students did not indicate whether the amounts were a debit or credit as
required by the question.
The marks were not good for this part mainly because students did not write
enough, nor did they link the recognition criteria to the specific information given in the question. The required asks you to DISCUSS – therefore it‟s not
enough to just list criteria and then make a general comment that the criteria
are met. What information in the question leads you to the conclusion that the
criteria are met? Write them down. Some specific comments are as follows:
3.1 This part of the question was for 15 marks – therefore you know that you
need to write down at least 15 points. It should have been easy to score
at least 10 marks here as all you needed to do was discuss what is
revenue – the rendering of services and the stage of completion method
– and then link that and the revenue recognition criteria to the
information in the question. The marks were very disappointing here as
there was little discussion.
3.2 Some students stated the criteria for the sale of goods and not for the
rendering of a service.
3.3 Some students considered each stage of the transaction as a separate
activity to be recognized. There were a numbers of hints in the question
to lead you to the conclusion that you needed to use the
percentage/stage of completion method. For example, the question
refers to “various activities/stages” – also that it was one contract.
This section was very disappointingly answered. Many students omitted this part and were unable to carry forward their workings from part 1 and 3. I
suggest that you go through this part again and make sure you understand
exactly how the calculations from part 1 and 3 affect the „Profit before tax‟
This section was very disappointingly answered. Many students omitted this
part and showed that they did not understand how to prepare the “Other
comprehensive income‟ section of the income statement. This part needs a lot
of attention and students are advised to consult their solutions and make sure
that they are familiar with this part of the income statement. Students are
reminded that there are no marks for no amounts. i.e. don‟t write XXXX –
please put in the amounts.
The results are rather disappointing, with averages of 17/40 and 10/40 for the
full-time (Westville) and distance learning students respectively.
This was not a difficult question although it was a comprehensive test of
standard costing and integrated aspects of divisional performance
measurement and CVP analysis. By now you should all realize that questions
are very likely to incorporate a number of topics.
Common mistakes and problems encountered:
1. Unable to calculate selling price for product Gamma using CVP principles.
2. Students with good exam technique did not waste a lot of time if they could
not do 1. above. Instead they assumed a price (and clearly stated that
they were making an assumption) and proceeded to answer the
question. Remember that errors carried forward but subsequently used
correctly are awarded method marks, e.g. sales price variance for Gamma
based on incorrect selling price.
3. Unable to identify controllable contribution. Note the divisional manager
had control over all revenues and costs other than the allocated head
4. Calculated Gamma‟s actual controllable contribution using material A‟s
(R799 500) rather than its usage, i.e. adjusting purchases for the change
in stock level valued at standard (see note (i) page 2 of solution).
5. Failure to account for finished goods stock of Gamma, valued at standard
cost, in determining actual controllable contribution.
6. Failure to calculate material mix and yield variances, only usage variance
shown. This does not give adequate information for management to
properly control material usage.
7. Problems in calculating variable overhead variances.
8. Delta: as the product is imported and then merely packaged and labeled,
the standard quantity is one unit purchased = one unit sold. Similarly, no
standard quantity of packing and wrapping was given hence the only