TA-270: Small and Medium Entities (SME's)
An entity that is not publicly accountable must make an explicit and unreserved statement of compliance with the PFRS for SMEs a. If the entity complies with full PFRS b. If the entity complies with all the requirement of PFRS for SMEs c. If the entity complies with the vast majority of the requirements of PFRS of SMEs d. If the entity complies with the national GAAP based on PFRS for SMEs with some specific differences.
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In preparing the financial statements, micro-business entities have the option to use: I. Full PFRS II. PFRS for SMEs III. Another acceptable basis of accounting a. I or II b. II or III c. I or III d. I, II or III
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Statement I: If a SME has no items of OCI, it may present only and Income Statement Statement II: If a SME has no items of OCI, it may present a Statement of Comprehensive Income in which the bottom line is "profit or loss" a. true, true b. true, false c. false, true d. false, false
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What is the required or default model in accounting for BASIC financial instruments of SMEs? a. Cost model b. Amortized cost model c. Revaluation model d. Fair value model
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Which is not considered as Other Comprehensive Income (OCI) for SMEs? a. Some actuarial gains and losses b. Some changes in fair value of hedging instruments c. Some foreign exchange translation gains and losses d. Some gains and losses on available-for-sale securities
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Which of the following is not considered as OTHER financial instruments for SMEs? a. Derivatives b. Hedging instruments c. Investments in convertible and puttable shares d. Investments in non-convertible and non-puttable shares
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Which of the following topics is covered by both full PFRS and PFRS for SMEs? a. Earning per Share b. Business Combinations c. Interim and segment reporting d. Non-current assets held for sale
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Micro-business entities are entities whose total assets or total liabilities are below the floor threshold of a. P 1 Million b. P 3 Million c. P 250 Million d. P 350 Million
A?
Under SEC rules, which of the following entity may qualify as a SME? a. ReSA Life, a life insurance company b. ReSA Mart, a supermarket based in Caloocan City c. ReSA Waters, a water utility company servicing Metro Manila d. ReSA Banking Corporation, a BSP-registered commercial bank.
B
Investment property os SMEs whose fair value CANNOT be measured reliably without undue cost or effort shall be accounted for as a. Investment property using revalued amounts b. Property, plant and equipment using revalued amounts c. Property, plant and equipment using cost-depreciation-impairment method d. Non-current assets held for sales using the lower of carrying amount or net selling price.
C
A subsidiary whose parent company uses full PFRS a. Cannot use full PFRS in all cases b. Cannot use PFRS for SMEs in all cases c. May use full PFRS if the subsidiary itself does not have public accountability d. May use PFRS for SMEs if the subsidiary itself does not have public accountability
D
Based on Philippine SEC rules, which of the following entities would not qualify as SMEs? a. Entities with total assets between P3M and P350M b. Entities with total liabilities between P3M and P250M c. Entities that are not in the process of filing FS for purposes of issuing any class of instrument in a public market. d. Public utility companies or holders of secondary licenses issued by a regulatory agency.
D
Entities that are holdeers of secondary licenses issued by a regulatory agency are not considered as SMEs. Which of the following entites is not considered a holder of secondary licenses? a. Public utility companies b. Insurance and pre-need companies c. Securities dealer/broker and mutual fund companies d. Commercial banks, investment houses and finance companies
D
In the statement of cash flows of SMEs, cash flows must be classified according into a. Operating and investing activities b. Operating and financing activities c. Financing and investing activities d. Operating, investing and financing activities
D
SMEs shall present; a. The statement of comprehensive income more prominently than the other statements b. The statement of financial position more prominently than the other statements c. The statement of cash flows more prominently that the other statements d. Each financial statement with equal prominence
D
Statement I: SME's are entities that have public accountability. Statement II: SME's are entities that publish general purpose financila statements for external users. a. true, true b. true, false c. false, true d. false, false
D
Under PFRS for SMEs, an entity has public accountability in all of the following situations, except: a. The entity's debt or equity instruments are traded in a public market b. The entity is in the process of issuing debt or equity instruments for trading in a public market c. The entity holds assets in a fiduciary capacity for a broad group of outsiders as one of its primary businesses. d. The entity holds assets in a fiduciary capacity for a broad group of outsider as an incidental part of its business.
D
Under certain conditions, it is permitted for SMEs to replace both Statement of Comprehensive Income and Statement of Changes in Equity with a single a. Statement of Income b. Statement of Retained Earnings c. Statement of Transaction with owners d. Statement of Income and Retained Earnings
D
Which of the following is not among the qualitative characteristics of information in the FS of SMEs? a. Prudence b. Materiality c. Consistency d. Balance between benefit and cost
D
Which of the following is not considered as a BASIC financial instrument for SMEs? a. Commercial papers and bills b. Bonds and loans payable c. Cash and bank accounts d. Options and Warrants
D
