ACCA F7 financial reporting notes

ACCA F7 financial reporting notes: Founded in 1904, the Association of Chartered Certified Accountants (ACCA) is the global professional accounting body offering the Chartered Certified Accountant qualification (ACCA or FCCA). From June 2016, ACCA recorded that it has 188,000 members and 480,000 students in 178 countries. ACCA’s headquarters are in London with principal administrative office in Glasgow. ACCA works through a network of 100 offices and centres and more than 7,100 Approved Employers worldwide, who provide employee development.

The term ‘Chartered’ in ACCA qualification refers to the Royal Charter granted in 1974.

Chartered Certified Accountant is a legally protected term. Individuals who describe themselves as Chartered Certified Accountants must be members of ACCA and if they carry out public practice engagements, must comply with additional regulations such as holding a practising certificate, carrying liability insurance and submitting to inspections.

The Association of Authorised Public Accountants (AAPA), one of the British professional bodies for public accountants, has been a subsidiary of ACCA since 1996.

ACCA works in the public interest, assuring that its members are appropriately regulated. It promotes principles-based regulation. ACCA actively seeks to enhance the value of accounting in society through international research. It takes progressive stances on global issues to ensure accountancy as a profession continues to grow in reputation and influence.

ACCA F7 financial reporting notes: APPROACH  TO  EXAMINING  THE SYLLABUS

The syllabus is assessed by a three-hour  examination available in both computer-based and paper-based  formats. *

*For paper-based exams there is an extra 15 minutes to reflect the manual effort   required.

All questions are compulsory. It will contain both computational  and  discursive elements.

Some questions will adopt a scenario/case study approach.

Section A of the exam comprises 15 objective test questions of 2 marks each.

Section B of the exam comprises three 10 mark case-based questions. Each case has five objective test questions of 2 marks each.

Section C of the exam comprises two 20 mark questions.

The 20 mark questions will examine the interpretation and preparation of financial statements for either a single entity or a group. The section A questions and the other questions in section B can cover any areas of the syllabus.

An individual question may often involve elements that relate to different subject areas of the syllabus. For example the preparation of an entity’s financial statements could include matters relating to several accounting  standards.

Questions may ask candidates to comment on the appropriateness or acceptability of management’s opinion or chosen accounting treatment. An understanding of accounting principles and concepts and how these are applied to practical examples will be tested.

Questions on topic areas that are also included in Paper F3 will be examined at an appropriately greater depth in this  paper.

Candidates will be expected to have an appreciation  of the need for specified accounting standards and why they have been issued. For detailed or complex standards, candidates need to be aware of their principles  and  key elements.

ACCA F7 financial reporting notes: DETAILED SYLLABUS

• The conceptual and regulatory framework for financial reporting

1. The need for a conceptual framework and the characteristics of useful information

2. Recognition and measurement

3. Regulatory framework

4. The concepts and principles of groups and consolidated financial statements

B Accounting for transactions in financial statements

1. Tangible non-current assets

2. Intangible assets

3. Impairment of assets

4. Inventory and biological assets

5. Financial instruments

6. Leasing

7. Provisions and events after the reporting period

8. Taxation

9. Reporting financial performance

10. Revenue

11. Government grants

12. Foreign currency transactions

C Analysing and interpreting the financial statements of single entities and groups

1. Limitations of  financial statements

2. Calculation and interpretation of accounting ratios and trends to address users’ and stakeholders’ needs

3. Limitations of interpretation techniques

ACCA F7 financial reporting notes: APPROACH  TO  EXAMINING  THE SYLLABUS

The syllabus is assessed by a three-hour  examination available in both computer-based and paper-based  formats. *

*For paper-based exams there is an extra 15 minutes to reflect the manual effort   required.

All questions are compulsory. It will contain both computational  and  discursive elements.

Some questions will adopt a scenario/case study approach.

Section A of the exam comprises 15 objective test questions of 2 marks each.

Section B of the exam comprises three 10 mark case-based questions. Each case has five objective test questions of 2 marks each.

Section C of the exam comprises two 20 mark questions.

The 20 mark questions will examine the interpretation and preparation of financial statements for either a single entity or a group. The section A questions and the other questions in section B can cover any areas of the syllabus.

An individual question may often involve elements that relate to different subject areas of the syllabus. For example the preparation of an entity’s financial statements could include matters relating to several accounting  standards.

Questions may ask candidates to comment on the appropriateness or acceptability of management’s opinion or chosen accounting treatment. An understanding of accounting principles and concepts and how these are applied to practical examples will be tested.

Questions on topic areas that are also included in Paper F3 will be examined at an appropriately greater depth in this  paper.

Candidates will be expected to have an appreciation  of the need for specified accounting standards and why they have been issued. For detailed or complex standards, candidates need to be aware of their principles  and  key elements.

INTELLECTUAL LEVELS

The syllabus is designed to progressively broaden and deepen the knowledge, skills and professional values demonstrated by the student on their way through  the qualification.

The specific capabilities within the detailed syllabuses and study guides are assessed at one of three intellectual or cognitive  levels:

Level 1: Knowledge and comprehension Level 2: Application and analysis

Level 3: Synthesis and evaluation

Very broadly, these intellectual levels relate to the three cognitive levels at which the Knowledge  module, the Skills module and the Professional level are  assessed.

Each subject area in the detailed study guide included in this document is given a 1, 2,  or

3 superscript, denoting intellectual level, marked at the end of each relevant line. This gives an indication of the intellectual depth at which an area could be assessed within the examination. However, while level 1 broadly equates with the Knowledge module, level 2 equates to the Skills module and level 3 to the Professional level, some lower level skills can continue to be assessed as the student

progresses through each module and level. This reflects that at each stage of study there will be a requirement to broaden, as well as deepen capabilities. It is also possible that occasionally some higher level capabilities may be assessed at lower levels.

ACCA F7 financial reporting notes: LEARNING HOURS AND EDUCATION RECOGNITION

The ACCA qualification does not prescribe or recommend any particular number of learning hours for examinations because study and learning patterns and styles vary greatly between people and organisations. This also recognises the wide diversity of personal, professional and educational circumstances in which ACCA students find themselves.

As a member of the International Federation of Accountants, ACCA seeks to enhance the education recognition of its qualification on both national and international education frameworks, and with educational authorities and partners globally. In   doing so, ACCA aims to ensure that its qualifications are recognized and valued by governments,  regulatory authorities and employers across all sectors.  To  this  end,  ACCA  qualifications  are currently recognized on the education frameworks in several countries. Please refer to your national education framework regulator for further information.

Each syllabus contains between 23 and 35 main subject area headings depending on the nature of the subject and how these areas have been broken down.

ACCA F7 financial reporting notes: GUIDE TO EXAM STRUCTURE

The structure of examinations varies within and between modules  and levels.

The Fundamentals level examinations contain 100% compulsory questions to encourage candidates to study across the breadth of each syllabus.

The Knowledge module is assessed by equivalent two-hour paper based and computer based examinations.

ACCA F7 financial reporting notes

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