Financial Accounting and Reporting Term 2, 2022

Assessment 2: Part 2B

File note template

Task Use the template on pages 2–3 to prepare a file note detailing the information to be included in the response to be sent to HEL’s Chief Financial Officer (CFO). Use the Part 2B pre-release information, the required reading and your own research to help you complete the file note relating to the revenue recognition, ethical considerations and accounting policy note disclosure for the year ended 30 June 20X1.

Use the table below to check your word count.

Word count check (enter the results in the right-hand column).

Number of words already in this file note template using ‘Word Count’ function in the ‘Review’ tab in Microsoft Word	510 words
Number of words once you have completed the template	Once you have completed the template, go to the Review tab in Microsoft Word and select the Word Count function. Type the number of words here. XXX words
Total number of words you have written (B minus A)	Subtract the count for A from the count for B – the result is your word count. Type your word count here. XXX words

Happy Entertainment Limited

File note – Revenue recognition for 30.06.20X1
Date	23 August 20X1
To	Tiggy Swan CFO Tel: +61 400 000 000 Email: [email protected]
Pages	2

Complete the following sections of the file note.

30 June 20X1 revenue calculations

With specific reference to IFRS 15 Revenue from Contracts with Customers (IFRS 15), explain which of Tiggy’s revenue calculations for the contract with TNNZ is correct for the year ended 30 June 20X1.

[complete this block – delete this text]

With specific reference to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors (IAS 8), explain whether any adjustment is required to the revenue recognised in relation to the TNNZ contract at 30 June 20X0.

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With specific reference to IAS 8, identify what additional disclosures are required in the 30 June 20X1 financial statements with respect to revenue recognised in relation to the TNNZ contract.

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Ethical consideration

Identify and explain the key ethical consideration relevant to Tiggy’s proposal to avoid an adjustment to revenue for the year in order to maximise the net profit in the draft financial statements to be provided to Fluffy Media.

Facts and circumstances:	[complete this block – delete this text]
Decision being considered:	[complete this block – delete this text]
Key ethical principle at risk:	[complete this block – delete this text]
Reason:	[complete this block – delete this text]

Changes to IAS 1

Identify and explain two pieces of information in the current revenue recognition accounting policy note that will no longer be required once the amendments to IAS 1 Presentation of Financial Statements (IAS 1) in relation to accounting policies become effective.

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Identify and explain one paragraph that will explicitly be required to remain in the revenue recognition accounting policy note once the amendments to IAS 1 in relation to accounting policies become effective.

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Identify and explain whether any changes are required to the revenue recognition accounting policy note in the 20X1 financial statements as a result of the amendments to IAS 1 in relation to accounting policies (for the purposes of this question assume that 20X1 refers to 2021).

[complete this block – delete this text]

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