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CPA Australia CPA Financial Accounting and Reporting Sample Questions:

1. JK Ltd intentionally over-valued its closing inventories to increase profitability for the year 20X8. This would help them to better price a planned share issue in 20X9. By doing this they have breached the concept of

A) completeness.
B) understandability.
C) substance over form.
D) neutrality.

2. The Framework for the Preparation and Presentation of Financial Statements which assists the development of the International Financial Reporting Standards (IFRS) was originally approved by the

A) International Accounting Standards Committee (IASC).
B) IFRS Interpretations Committee (IFRIC).
C) International Federation of Accountants (IFAC).
D) International Accounting Standards Board (IASB).

3. An example of voluntary reporting in Australia is a

A) statement of cash flows.
B) sustainability report.
C) statement of financial position.
D) statement of comprehensive income.

4. Which one of the following statements is correct?

A) Australian accounting standards are based on the US GAAP.
B) Accounting standards are developed and maintained using a consultative process with the OECD.
C) Accounting standards provide the basic knowledge upon which the conceptual framework is developed.
D) Accounting standards prescribe the possible accounting treatments.

5. Which one of the following would be included in the statement of financial position?

A) distribution costs
B) gains on property valuations
C) depreciation
D) deferred tax

Solutions: