General:

This stage is meant for students who are about to start their professional training segment and as such are expected to be particular and thorough in their knowledge of the basic accounting framework and principles; precise and thoughtful in understanding the problem, and; conclusive and confident in conceptual application of such principles.

But the attempt suggests otherwise. The students lacked professional knowledge and those who know, are unable to apply it properly. The poor formatting suggests that practice, an equally important element, is also not done by the students.

Q.1

The question was of recurring nature and related to financial statements gearing the students for practical exposure of drafting accounts according to statutory requirements. In the question it was clearly mentioned not to give notes to the Accounts but surprisingly a number of the examinees gave long notes to the Accounts and wasted their time.

The formats delivered a poor reflection as many candidates resorted to casual narrations, using abbreviations  like B/S and P/L.

The calculations part was even more worse:

(a)

Long term portion of the loans was not properly worked out as few were able to really use the information given in the question.

(b)

Proper sequence of assets and liabilities was not maintained.

(c)

Stock dividend was not accounted for.

(d)

In calculating “trade debtors” credit balance of one customer was deducted instead of being added.

Q.2

This question was on application of the standard on situations of three contingent liabilities and one contingent asset. Almost all the students delivered a layman approach as even the contingent asset was dealt in the context of contingent liability. Those who were able to arrive at correct conclusion were not clear about the main conditions that formed the basis of their decision. Most students did not know whether all conditions need to be fulfilled to make a certain decision or even one was enough.

Q.3

The question contained different situations, which were required to be tested. The key principle is that expenditure is capitalized as intangible asset when it has the characteristic of being controllable, measurable, able to provide future economic benefits and identifiable. The students merely stated the accounting treatment without concrete reasoning. It has been advised frequently that the reasoning put forward by the students is more important than the conclusion itself. The students generally tend to ignore this advice.