CPA Advanced Financial Accounting study guide
CPA Advanced Financial Accounting · Work through your exam, one topic at a time.
CPA Ireland's Professional 2 Advanced Financial Accounting (commonly shortened to AFA or P2 AFA) is a higher-level paper in the CPA Ireland professional qualification, the Irish route to the CPA designation. It suits trainees who have already cleared the earlier financial accounting levels and who now prepare, audit or analyse IFRS financial statements - typically people in practice, in group finance teams, or in industry roles carrying consolidation or external reporting responsibility. The CPA Advanced Financial Accounting study guide has 6 sections and about 2,002 words.
01Preparation of single-entity financial statements under IFRS
Single-entity reporting underpins group work: IAS 1 presentation, IAS 7 cash flows, IAS 8 changes and errors, IAS 10 events after the reporting period, and measurement standards (IAS 16, IAS 38, IAS 36, IAS 2, IAS 23). Questions usually combine a measurement adjustment with a presentation or disclosure consequence.
403 words, about 2 min02Group financial statements and business combinations
Control under IFRS 10, acquisition accounting under IFRS 3, consolidation adjustments, non-controlling interests (NCI), goodwill, associates under IAS 28 and joint arrangements under IFRS 11. IFRS 10 control: power over relevant activities, exposure to variable returns, and ability to use power to affect returns.
330 words, about 2 min03Financial instruments and share-based payment
IFRS 9 classification and measurement, expected credit losses (ECL), modification and derecognition, hedge accounting basics, and IFRS 2 equity- and cash-settled awards. IFRS 9 classifies debt at amortised cost if the business model is hold to collect and cash flows are solely payments of principal and interest (SPPI); FVOCI if hold to collect and sell and SPPI; otherwise FVTPL.
321 words, about 2 min04Specialised measurement and disclosure issues (revenue, leases, deferred tax, provisions, impairment, foreign currency)
IFRS 15: five steps - contract, performance obligations, transaction price, allocation, recognition. Variable consideration is estimated and constrained; revenue is recognised over time only if a criterion is met, otherwise at a point in time.
362 words, about 2 min05Conceptual framework
The 2018 Conceptual Framework: objective, qualitative characteristics, elements, recognition, measurement, derecognition, and how it is used to fill gaps and interpret standards. Objective: financial information useful to existing and potential investors, lenders and other creditors in making decisions about providing resources.
287 words, about 1 min06Regulatory environment and analysis of financial statements
IFRS standard-setting and adoption, enforcement, and techniques for analysing financial statements, including ratio decomposition, segment and related-party disclosures, and the limitations of reported numbers. The IFRS Foundation has Trustees and a Monitoring Board; the IASB sets standards through due process (research, exposure draft, comment period, redeliberation, ballot).
299 words, about 1 min