FY13CE Accounting case studies

FY13CE Accounting · Put your knowledge to work in context.

FY13CE Accounting is a professional accounting examination whose name indicates it was issued for the fiscal year 2013 continuing-education or certification cycle. It is aimed at accounting practitioners, finance staff, and candidates building a credential in financial reporting, cost and managerial accounting, audit, tax, law and ethics, and accounting information systems. The FY13CE Accounting case studies are 5 cases and about 4,598 words.

Kestrel Cloud Systems: implementation fees, refund rights and overage options

Kestrel Cloud Systems reports under IFRS with a 31 December year-end. On 1 October FY13 it signed a 36-month contract with a logistics customer containing three priced elements: a non-refundable implementation fee of 300,000 invoiced at signing, a subscription fee of 45,000 per month, and a usage charge of 0.02 per API call above 1,000,000 calls per month.

710 words, about 4 min 2

Meridian Components: ABC versus labour-based costing and the special-order decision

Meridian Components makes two lines in one plant. Product A: 40,000 units, price 360, direct material 110, direct labour 90 (the same 90 for product B), variable overhead 40.

963 words, about 5 min 3

Halcyon Distribution: covenant breach, a post-year-end insolvency and a pressured opinion

Halcyon Distribution is a listed distributor with a 31 December year-end, revenue of 82 million, overall materiality of 1.2 million and performance materiality of 800,000. At year-end the current ratio is 1.28 against a bank covenant of 1.50 on an 18 million term loan, making the loan repayable on demand.

1,009 words, about 5 min 4

Prestwick: an uncertain R&D deduction, an enacted rate change and a loss carryforward

Prestwick Industries has an accounting profit before tax of 12,000,000 for the year ended 31 December FY13. Its tax rate is 30%.

933 words, about 5 min 5

Brightline Retail: post-go-live IT general control failures and the effect on the audit

Brightline Retail runs 140 stores and migrated to a new ERP system on 1 July; the legacy system is retained read-only. Since go-live: the three-way match was switched off for six weeks to clear an invoice backlog and invoices were posted without receipt confirmation; 12 shared generic warehouse logins are in use and one developer retains production access; a nightly price-file interface writes errors to a folder that no one has opened since go-live; 4,000 SKUs show negative on-hand quantities; a 2.6 million suspense account has not been reconciled since cutover; and 260 manual journal entries were posted by three staff, one of whom both creates and approves entries.

983 words, about 5 min