[jeff]

Welcome to the Q4 2017 CPA Exam Study Group for FAR. 🙂

Introduce yourselves and let your fellow NINJAs know when you plan to take your FAR exam.

The Five Steps (NINJA Framework): https://www.another71.com/pass-the-cpa-exam/

Jeff Elliott, CPA (KS) | Another71 | NINJA CPA | NINJA CMA | NINJA CPE

[Ana]

question 1+2
the penalty from the health agency is disclosed and accrued, check the feedback tab again.

the LOC is disclosed but not accrued maybe bc as of 12/31/17 the LOC has not been used just issued/available, no liability is incurred. I wouldn't consider a LOC as a gain contingency at all from real life experience. It's dr cash cr liability at the time of use.

I don't understand why nothing is accrued for the property damage : /

[Ana]

question 3: I understand why you have that question, it seems that the straight line answer is more correct bc it actually dictates how to ultimately recognize the deferral of revenue. whereas the 31-20-25-15 only says to defer it…defer it for how long??…see 310-20-35-5 for further guidance and the answer.

[Lentilcounter]

Question 3: Got it! Thanks.

For the LOC, it wouldn't be a liability until actually used? If so, got it now.

Why is the penalty accrued? I thought the followup letter in February year 4 said that when they did a check in mid-December and everything was resolved. I see that the penalty amount changed from $175K to $150K though. What am I missing here?

For the property damage question, I agree with you. It says that losses appear to be covered by the insurance policy. Not understanding why the $125K deductible is not accrued.

BEC = 72 (6/08/16)
FAR = ?
REG = ?
AUD = ?

[Ana]

the LOC is my take on it form a real world perspective and how I would book it as an auditor/Controller. not a book answer.

I'm thinking that the health penalty is accrued because although they solved the issue but haven't paid the penalty lol.

I'd get the property damage one wrong time and time again, I also think the 125k would get accrued (at a minimum) maybe even the whole amount until the insurer agrees to pay the the costs minus the deductible.

I did this practice exam really well the first time, this time maybe bc I was rushing to answer you I didn't do as well (just on this contingency sim). Now I'm crapping my pants.

Would it kill them to provide the answers to the practice exam, seriously would it?

[Wannafree]

@Lentil , in health agency letter ,it has not said that penalty is waived or settled for full.It says no violation on 3rd December so no more further penalty. LOL.
LOC is disclosed in general as additional loan with bank available for $X under LOC .

[Lentilcounter]

“The LOC is my take on it form a real world perspective and how I would book it as an auditor/controller. not a book answer.” – It makes sense.

I'm thinking that the health penalty is accrued because although they solved the issue but haven't paid the penalty lol. – I guess this makes sense. The penalty sticks despite fixing everything.

I'd get the property damage one wrong time and time again, I also think the 125k would get accrued (at a minimum) maybe even the whole amount until the insurer agrees to pay the the costs minus the deductible. – I'm going to look around for an answer to this.

I did this practice exam really well the first time, this time maybe bc I was rushing to answer you I didn't do as well (just on this contingency sim). Now I'm crapping my pants. – I'm sorry. My score went up from the first time but I feel like I got this easy stuff wrong.

Would it kill them to provide the answers to the practice exam, seriously would it? Agreed.

BEC = 72 (6/08/16)
FAR = ?
REG = ?
AUD = ?

[gguzman]

I am giving myself 3 weeks to review everything. I should be finishing up F10 this week. my exam is November 28th.

I only barley touched on SIMS so far. When I took the test for REG the SIMS were all very different, the only thing that was consistent were the concepts tested. I feel I can cover a lot of material in a shorter period of time with MCQ's. I don't really see the value of spending several hours of my time on 1 concept, unless I really need to work on that concept.

Anyone have a reason not to study this way?

I appreciate the tips and tricks on here, good stuff!

[Ana]

@lentil isn't it late by you? you should rest for tomorrow no?

[IwannabeaCPA2017]

@Lentil good luck to you!! and @Ana, good luck to you as well!!

On the side note: how do you guys make derivative and foreign transaction stuff stick? I have issue with these areas every time but honestly it's rarely tested I feel like..

[Lentilcounter]

@Ana Not super late. 9pm but you are right. I'm done for the night. Just reviewing notes tomorrow morning.

Time to waste time on YouTube, Facebook, and Instagram until I get sleepy.

BEC = 72 (6/08/16)
FAR = ?
REG = ?
AUD = ?

[Ana]

@iwanna thanks, I'm getting so nervous.
I feel like derivatives and foreign is pretty simple. always know that transLATION goes to OCI, transaction and remeasurement goes to G/L on IS.
effective cash flow hedge goes to OCI all others goes to G/L on IS, like ineffective and derivatives.
generally if you remember PUFER you'll know the only 2 that go to OCI (F & E), everything else is IS G/L.
the other area I try to remember is that for derivatives you use the forward rate for calcs and for transactions the spot rate.
Does that help at all? I actually like the charts Becker has in that module, they're clean cut and useful.

btw IS = Income statement

[Jen-J]

3 days out and I'm cursing this study schedule – I had added a week to it because of a business trip (and because I can't take Audit any sooner than 1/2/18 anyway), but I finished my big review on Saturday on my original schedule. I feel like after 12 weeks of studying I just don't have it in me to do a 13th week on FAR, and I'm wishing I had gone with an exam earlier this week. I'm answering SIMS and multiple choice questions still, but I'm sort of feeling like I either know it or I don't at this point. I do need to be more careful (like the bond amortization problem I did tonight where I transferred $532,635 as $532,625 and then did the entire chart after that wrong!).

[Ana]

I'm curious who here finds re-writing notes is useful? as opposed to do more mcq, sims, or reading notes.

@guzman pre Q2 I wouldn't advise anyone to practice SIMS but the new format is not your mother's cpa. There's another thread called far blueprint that I'd highly advise working through. for reference last time, I got strong on mcq, weak on sims and got a 73. don't be like me

[gguzman]

@Ana Noted, and thank you.

[Recked]

Lentil, trying to find the answer as far as the insured loss contingency but striking out.
I have reviewed my book as well as the 2017 2016 and 2015 AICPA released questions to try and find an answer.

All the materials seem to only reference uninsured losses being disclosed and accrued as a contingency.
No mentions of insured losses.

I am going to venture a guess that the loss is probable, but not estimable as there is no certainty that the insurer will pay all but the deductible or not?

The example also does not indicate the book value vs the fair value of the damages/losses incurred in the flood.
There is a chance that there would be a resulting gain even after factoring in the deductible amount? Just a possibility.
Good luck today!!!

[Author]

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