This paper is intended to equip the candidate with knowledge, skills and attitudes that will enable him/her account for complex accounting transactions and prepare advanced financial reports.


A candidate who passes this paper should be able to:

  • Prepare financial statements for subsidiaries, associates and jointly controlled entities in compliance with International Financial Reporting Standards (IFRSs) and International Public Sector Accounting Standards (IPSASs) as applicable
  • Analyse financial statements for public and private sector entities
  • Account for complex accounting transactions
  • Apply ethical standards in accountancy work and practice


18.1        Framework for preparation and presentation of financial statement

  • Importance of the accounting framework
  • – Steps in developing international financial reporting interpretations IFRIC (excluding detailed IFRICS)
  • Ethical and legal issues in financial reporting

18.2      Assets and liabilities of financial statement

  • Inventories
  • Non-current assets held for sale and discontinued operations
  • Impairment of assets
  • Exploration for and evaluation of mineral resources
  • Income taxes – including group aspects
  • Share based payments
  • Employee benefits with emphasis on post-employment benefits

18.3      Preparing financial statements and other reports

  • Published financial statements (including group statement of cash flows where a subsidiary is acquired or sold during the year)
  • Interim financial statements
  • Financial statements of pension schemes/retirement benefit plans
  • Operating segment reports
  • Earnings per share
  • IFRS for small and medium sized entities
  • Related parties disclosures
  • Effects of inflation and hyper inflationary economies (exclude inflation adjusted financial statements)
  • Business combinations and corporate restructuring
  • Management commentary (management discussion and analysis)
  • Integrated reporting

18.4        Accounting and reporting of financial instruments

  • Nature and scope of financial instruments
  • Equity and financial liabilities
  • Recognition and de-recognition of financial instruments
  • Hedge accounting
  • Other disclosures

18.5      Consolidated and separate financial statements

  • Accounting for subsidiaries including piece-meal acquisitions, several subsidiaries and sub-subsidiaries
  • Investments in associates and jointly controlled arrangements
  • Foreign entities (subsidiary, associate and jointly controlled entities)
  • Disposal of investment in subsidiary (partial and full disposal)

18.6      Public sector accounting

  • Provisions of the following IPSASs (emphasis on distinctions with equivalent IASs/IFRSs)
  • Effects of changes in foreign exchange rates
  • Revenue from exchange and non-exchange transactions
  • Hyperinflationary economies (ignore inflation adjusted financial statements)
  • Segment reports
  • Related party disclosures
  • Impairment of cash generating and non–cash generating assets
  • Disclosure of information about the general government sector

18.7      Current trends

  • Reporting on corporate social responsibility
  • Reporting on environmental matters
  • Corporate governance reports (Directors reports and Chairman’s statements contents only)
  • Sustainability reporting

18.8      Emerging issues and trends

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