This paper consists of THREE SECTIONS. Follow the instructions at the top of EACH section.

SECTION A You must answer ALL FOUR questions in this section. Questions do not carry equal marks; the mark allocation is shown after each question. Section A is worth 67% of the total marks available for the paper.

Q1  The trial balance for OSC enterprise as at 30 September 2012 is as follows: Dr 000 Revenue Purchases Inventory 1 October 2011 Distribution expenses Salaries and wages General expenses Interest paid on loan Property at valuation Property accumulated depreciation as at 1 October 2011 Plant and equipment at cost Plant and equipment accumulated depreciation as at 1 October 2011 Motor vehicles at cost Motor vehicles accumulated depreciation as at 1 October 2011 Trade receivables Trade payables Cash Ordinary issued 1 shares Dividends paid Bank overdraft Revaluation reserve as at 1 October 2011 Retained earnings as at 1 October 2011 Share premium 3% loan redeemable 2020 (Note that figures in the above table are in 000s - thousands) The following notes are applicable: 35,322 5,623 4,564 7,234 1,786 30 65,000 9,750 9,230 2,435 450 110 4,320 3,505 780 49,000 500 619 5,000 2,242 2,500 2,000 134,839 Cr 000 57,678

134,839

1.  Inventory as at 30 September 2012 was valued at 6,230,000. 2. Tax charge for the year ended 30 September 2012 is estimated at 950,000. 3.  Loan interest has only been paid for the first 6 months of year ended 30 September 2012. 4.  Wages and salaries amounting to 250,000 are to be accrued for the year ending 30September 2012. 5. Depreciation is to be calculated for the year ended 30 September 2012 as follows: Property 2% per annum on valuation; Plant and equipment 15% per annum straight line assuming no residual value; Motor vehicles 20% per annum reducing balance.

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 Required: (a)  Prepare the Statement of Comprehensive Income (Profit and Loss Account) for the year ended 30 September 2012 for OSC enterprise in accordance with International GAAP (International Accounting Standards (IASs)). (13 marks) (b)  Prepare the Statement of Financial Position (Balance Sheet) as at 30 September 2012 for OSC enterprise in accordance with International GAAP (International Accounting Standards (IASs)). (14 marks) (Total 27 marks)

Q2  The following information is available in respect of IAM enterprise for the year ended 30September 2012 and 30 September 2011. 30 September 2012 000s 1,123 8,600 6,500 1,230 975 320 335 5,475 40 1,240 6,200 30 September 2011 000s 756 3,500 3,230 956 1,120 154 125 2,654 12 400 2,100

Profit before tax Sales Non-current assets at net book value Current assets Current liabilities Closing inventory for the year (included in current assets) Average inventory for the year Equity (share capital + reserves) Interest charged during year Long term debt Cost of sales Required:

(a)  Calculate ROCE (return on capital employed), ROOE (return on owners equity), gearing ratio and ratio of sales to capital employed for the years ended 30 September 2012 and 30 September 2011 for IAM enterprise. (4 marks) (b)  Calculate the liquidity ratio, acid test ratio and inventory turnover rate for the years ended 30 September 2012 and 30 September 2011 for IAM enterprise. (3 marks) (c)  Comment on the performance of IAM for the year ended 30 September 2012 using the information you calculated in (a) and (b) above. (7 marks) (Total 14 marks)

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Q3  On 1 January 2007 Atlas enterprise acquired a 75% share in Chase enterprise. Chase has not issued any additional ordinary shares since the acquisition by Atlas. The draft statements of financial position of Atlas and Chase as at 30 September 2012 are as follows: Atlas 000 ASSETS Non-current assets Intangible assets Tangible assets Investment in Chase Current assets Inventory Trade receivables Bank TOTAL ASSETS EQUITY AND LIABILITIES Equity Ordinary shares 1 Ordinary shares 25p Share premium account Retained earnings Liabilities Non-current liabilities Debentures Current liabilities TOTAL EQUITY AND LIABILITIES Chase 000

122 8,110 1,775 10,007 780 432 28 1,240 11,247

32 4,112 4,144 78 112 5 195 4,339

6,120 700 1,017 7,837 2,250 1,160 11,247 2,520 107 37 2,664 1,500 175 4,339

(Note that figures in the above table are in 000s - thousands)

The following information is also available: 1.  The fair value of all assets and liabilities at the acquisition date was equal to book value. 2. The retained earnings of Chase at the acquisition date were 5,000.

Required:  Prepare the Consolidated Statement of Financial Position (Consolidated Balance Sheet) for the Atlas group as at 30 September 2012. (16 marks)

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