Coursework Assignment Brief
Semester: Summer 2014
Module Code: PAP105
Module Title: International Corporate Reporting
Programme MSc
Level: 7
Awarding Body: University of Plymouth
Module Leader ASARE AMANING
Format: Report
Presentation: No
Any special requirements: All work should be submitted on the Student Portal along with an Turnitin Report
Word Limit: 3,000 words (with 10% plus or minus leeway) Excluding the calculations.
Deadline date for submission: 30th March 2015
Learning outcomes to be examined in this assessment The ability to understand the main accounting treatments that are embedded in the preparation of financial statements. (IFRS 2 &8).
Ability to understand current issues underpinning International Corporate Reporting.
Percentage of marks awarded for module: This assignment is worth 50% of the total marks for the module
Assessment criteria Explanatory comments on the assessment criteria Maximum marks for each section
Content, style, relevance, originality Clear demonstration of rigorous research from recognised authoritative sources. Audience focus. 90%
Format, referencing, bibliography Harvard 5 %
Constructive critical analysis, introduction, conclusion Demonstration of a clear understanding of the issues. Use of academic models. 5%
Assignment Tasks:
PART 1.
For enterprises that are engaged in different businesses with differing risks and opportunities, the usefulness of financial information concerning these enterprises is greatly enhanced if supplemented by information on individual business segments.
Required,
(i) Critically discuss how the information content of financial statement is improved by the inclusion of segmental data on individual business segments.
(25 Marks)
(ii) Xlet a public limited company operates in the global marketplace.
(a) The major revenue-earning asset is a fleet of aircraft which are registered locally. Xlet specialises in low cost flight across the Trans-Atlantic. The directors are unsure as to how to identify any business segment.
(b) The company also owns a small aircraft manufacturing plant which supplies aircraft to its domestic airline and to third parties. The preferred method for determining transfer prices for these aircraft between the group companies is market price, but where the aircraft is specialist nature with no equivalent market price, the companies negotiate a price.
(c) The company has incurred an exceptional loss on the sale of several aircraft to a foreign government. This loss occurred on a fixed price contract signed several years ago for the sale of second hand aircraft and resulted from the fluctuation of exchange rates between the two countries.
(d) During the year, the company decided to discontinue its holiday business as a result of competition in the sector. This plan had been approved by the board of directors and announced in the press.
(e) The company owns 40% of the ordinary shares of Eurocat, an unquoted company which specialises in the manufacture of aircraft engines and has operations in China. The investment is accounted for by equity method and it is proposed to exclude the company’s results from segment assets and revenue.
Required: Critically discuss the implications of each of the above points for the determination of the segmental information required to be presented and disclosed under IFRS 8 Operating segments and other relevant International Accounting Standards. (25 marks)
(iii) River made a loan of £5,000 to its subsidiary company Stream on 1st January 2013. Stream is to pay 5% interest each year and will repay the loan at nominal value in three years. Rivers considers this financial asset passes the business model test and contractual cash flow test. River is therefore choosing to use amortised cost.
Required: Critically discuss (with supporting calculations) how the situation detailed above should be accounted for in the individual company account for River (ignore the group accounts entirely). (20 marks)
PART 2.
In December 2013, the IASB issued Annual improvements 2010 -2012 which impact IFRS 2, Share based payments transactions in the financial statements. These amendments are effective annual periods on or after 1 July 2014 although EU endorsed as effective for annual periods on or after 1 February 2015. IFRS identifies three types of share-based payment transactions and sets out the measurement principles and specific requirements for each.
Required:
1. Critically discuss why accounting standard setters felt that there was a need for a standard in this area and subsequent revision. (15 marks)
2. Discuss the three main types of share-based payment recognised by IFRS 2.
(5 marks)
Total marks for assignment: 100
(10 marks for references and presentation)
Indicative Grade UK% marks Characteristics.
Distinction 70%+ Very high standard of critical analysis using appropriate conceptual frameworks.
Excellent understanding and exposition of relevant issues.
Clearly structured and logically developed arguments.
Good awareness of nuances and complexities.
Substantial evidence of well-executed independent research.
Excellent evaluation and synthesis of source material.
Relevant data and examples, all properly referenced.
Merit 69-60% High standard of critical analysis using appropriate conceptual frameworks.
Clear awareness and exposition of relevant issues.
Clearly structured and logically developed argument.
Awareness of nuances and complexities.
Evidence of independent research.
Good evaluation and synthesis of source material.
Relevant data and examples, all properly referenced.
Pass 59-50% Uses appropriate conceptual frameworks.
Attempts analysis but includes some errors and /or omissions.
Shows awareness of issues but no more than to be expected room attendance at classes.
Arguments reasonably clear but underdeveloped.
Insufficient evidence of independent research.
Insufficient evaluation of source material.
Some good use of relevant data and examples but incompletely referenced.
Pass 49-40% An understanding of appropriate conceptual frameworks.
Answer too descriptive and or any attempt at analysis is superficial containing errors and omission.
Shows limited awareness of issues but also some confusion.
Arguments not particularly clear.
Limited evidence of independent research and reliance on a superficial repeat of class notes.
Relatively superficial use of relevant data sources and examples and poorly referenced.
PASS MARK=40%
E 39-30% Weak understanding of appropriate conceptual frameworks. Weak analysis and several errors and omissions.
Establishes a few relevant points but superficial and confused exposition of issues.
No evidence of independent research and poor understanding of class notes or no use of relevant data, sources and examples and no references.