Pass Your Financial-Accounting-and-Reporting Exam Easily - Real Financial-Accounting-and-Reporting Practice Dump Updated Feb 02, 2024
2024 Realistic Verified Free CPA Australia Financial-Accounting-and-Reporting Exam Questions
NEW QUESTION # 33
Which one of the following parties provides information to ensure that the financial statements show a true and fair view?
- A. shareholders
- B. directors of the company
- C. tax consultants
- D. financial Institutions
Answer: B
NEW QUESTION # 34
Which one of the following is an advantage of current purchasing power accounting?
- A. It supposes that value of net assets clearly reflects general goods and services are bought once assets were released.
- B. It provides a stable monetary unit that values profit and capital.
- C. It enables raw data to be just easily verifiable but not auditable.
- D. It provides a clear use of indices which approximates the measurement of value.
Answer: B
NEW QUESTION # 35
Historical cost accounting provides financial information that is
- A. reliable but may not be relevant for decision making.
- B. relevant for decision making.
- C. relevant but may not be reliable for decision making.
- D. relevant and reliable for decision making.
Answer: A
NEW QUESTION # 36
The body that is part of the international standard-setting framework reporting to the International Financial Reporting Standards Foundation (IFRS Foundation) is the
- A. Centre on Transnational Corporations.
- B. International Accounting Standards Board.
- C. International Accounting Standards Committee.
- D. International Accounting Board.
Answer: B
NEW QUESTION # 37
Which one of the following examples would not represent an agency cost?
- A. the cost of engaging an external auditor
- B. the cost of preparing a cost-benefit report for a new project
- C. the cost of employing an internal auditor
- D. the cost of preparing a financial report for shareholders
Answer: B
NEW QUESTION # 38
Which one of the following statements is correct?
- A. Accounting standards provide the basic knowledge upon which the conceptual framework is developed.
- B. Australian accounting standards are based on the US GAAP.
- C. Accounting standards are developed and maintained using a consultative process with the OECD.
- D. Accounting standards prescribe the possible accounting treatments.
Answer: D
NEW QUESTION # 39
Which one of the following is not a function of the trustees of the International Financial Reporting Standards Foundation (IFRS Foundation)?
- A. appointing the members of the International Accounting Standards Board (IASB)
- B. ensuring the financing of the International Accounting Standards Board (IASB)
- C. providing suggestions on technical matters relating to accounting standards
- D. promoting the application of International Financial Reporting Standards (IFRSs)
Answer: C
NEW QUESTION # 40
Which one of the following countries has the view that Generally Accepted Accounting Principles (GAAP) refers to accounting practices which are regarded as permissible by the accounting profession?
- A. United Kingdom
- B. United States of America
- C. Australia
- D. Canada
Answer: A
NEW QUESTION # 41
Venturer Ltd has received fees from venture capital activities and has engaged you as the accountant to prepare the financial report for 31 December 20X0. Unable to find a specific reference to venture capital fees in either the conceptual framework or the accounting standards, you establish the appropriate accounting treatment by
- A. consulting with the International Accounting Standards Board.
- B. using your professional judgment and referring to generally accepted accounting principles and practice.
- C. referring to the fundamental accounting assumptions and conventions.
- D. using your professional judgment and referring to the conceptual framework's definitions and recognition criteria.
Answer: D
NEW QUESTION # 42
Financial markets have achieved operational efficiency when
- A. the price of stocks and shares are available accurately and quickly.
- B. the cost of transactions is a reflection of the actual cost incurred.
- C. past records are used to predict the future prices of goods.
- D. the costs of financial transactions are kept as low as possible.
Answer: D
NEW QUESTION # 43
Which one of the following includes social reporting guidelines?
- A. Generally Accepted Accounting Principles (GAAP)
- B. International Financial Reporting Standards (IFRS)
- C. International Accounting Standards (IAS)
- D. Global Reporting Initiative (GRI)
Answer: D
NEW QUESTION # 44
The use of the principle of substance over form is found in which one of the following accounting treatments?
- A. accounting for finance leases
- B. accounting for non-current assets
- C. accounting for property, plant and equipment
- D. accounting for inventories
Answer: A
NEW QUESTION # 45
The International Accounting Standards Board's Conceptual Framework for Financial Reporting for the preparation and presentation of financial statements is concerned with the information needs of most users, but not for each possible user.
Which one of the following stakeholders would not be one of the users that the Conceptual Framework is concerned about?
- A. governments and regulatory bodies
- B. a company's executive management
- C. members of the public who have small investment holdings in the company
- D. potential investors in the company
Answer: B
NEW QUESTION # 46
A company purchased a machine 10 years ago for $143 890. It is expected that the machine will generate future revenues of $108 495. The machine could be scrapped for $81 232. An equivalent machine in the same condition would cost $94 950 to buy now. What is the deprival value of the asset?
- A. $94 950
- B. $108 495
- C. $81 232
- D. $35 395
Answer: A
NEW QUESTION # 47
Variations in the regulatory regime over financial reporting in different countries is attributable to a range of differences including
- A. the extent to which the country has adopted international financial reporting standards and the requirements of local securities exchange.
- B. the needs of investors, creditors, employees, lending institutions and taxation authorities.
- C. company structures, ownership, local culture and the level of development of the country.
- D. consumer laws, taxation requirements and the extent to which the country has adopted international financial reporting standards.
Answer: C
NEW QUESTION # 48
Which one of these is a disadvantage of a conceptual framework?
- A. It increases the chances of political interference in the development of accounting standards.
- B. It mandates the formats of various financial statements.
- C. A single framework is not suitable for all users of financial statements.
- D. It replaces the established principles.
Answer: C
NEW QUESTION # 49
X was influenced by G Co's audit report and dividend declaration, and decided to invest in the securities of the company. What should X be cautious about before investing in the shares of the company?
X should be aware that
- A. the declaration of dividends assures high earnings per share.
- B. the auditor's report is influenced by the directors.
- C. a declaration of dividend is the ultimate measure of a company's profitability.
- D. the auditor's report refers to the company's prior year financials.
Answer: D
NEW QUESTION # 50
A multinational company is converting the methodology of reporting by its subsidiaries in various countries to make it uniform with the requirements of the International Financial Reporting Standards (IFRS). While changing the reporting methodologies, accountants have to apply certain judgments.
Which one of the following is not a valid motivation for decision making on reporting methodologies?
- A. to be consistent with the methodologies followed in the home country of the company
- B. to present the financial statements in a manner that is understood by most users
- C. to present the company's financial performance in the most favourable way
- D. to comply with the information demands of government bodies in home country
Answer: C
NEW QUESTION # 51
In an efficient market, normally if interest rates rise, share prices will
- A. rise since banks invest their increased profits.
- B. rise due to the overall positive sentiment.
- C. fall in anticipation of a reversal in the interest rate cycle.
- D. fall since investors expect a higher return.
Answer: D
NEW QUESTION # 52
Which of the following represents a principal-agent relationship?
I.
shareholders-auditors
II.
shareholders-management
III.
security exchange-company
IV.
board of directors-employees
- A. I, II and IV only
- B. I, II, III and IV
- C. I, II and III only
- D. II, III and IV only
Answer: A
NEW QUESTION # 53
Which one of the following statements regarding the IASB's Conceptual Framework for Financial Reporting is correct?
- A. It specifies the concepts that underlie the preparation and presentation of special purpose financial statements.
- B. It overrides any local or international accounting standard.
- C. It specifies the concepts that underlie the preparation and presentation of only consolidated financial statements.
- D. It specifies the concepts that underlie the preparation and presentation of general purpose financial statements.
Answer: D
NEW QUESTION # 54
In the context of a regulatory framework, a principles-based system
- A. provides a theoretical basis with broad terms of reference.
- B. attempts to cover specific eventualities.
- C. is a rule-driven approach.
- D. removes any element of judgement by providing clear requirements.
Answer: A
NEW QUESTION # 55
Published financial statements are regulated by
- A. accounting and legal rules to ensure the provision of relevant and reliable financial information to shareholders.
- B. rules to ensure the provision of consistent financial information to investors.
- C. shareholders who specify the framework for the provision of consistent and comparable financial information for decision-making.
- D. International Financial Reporting Standards to ensure the provision of useful financial information to shareholders.
Answer: A
NEW QUESTION # 56
Which one of the following bodies makes accounting standards in Australia?
- A. AASB
- B. IASB
- C. ASIC
- D. FRC
Answer: A
NEW QUESTION # 57
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CPA Australia Financial-Accounting-and-Reporting (CPA Financial Accounting and Reporting) Certification Exam is an internationally recognized certification that measures the competency of accounting professionals in the field of financial accounting and reporting. CPA Australia is a professional accounting organization that represents more than 166,000 members in over 100 countries. The CPA Financial Accounting and Reporting certification exam is one of the core professional qualifications offered by CPA Australia.
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