Below are the statements of financial position of three companies as at 31 December 2017. Bauble Jewel Gem Co Co Co GHS’000 GHS’000 GHS’000 Non-current assets Property, plant and equipment 720 60 75 Investments in group companies 185 100 – 905 160 75 Current assets 175 90 85 1,080 250 160 Equity Share capital – GHC1 ordinary shares 400 100 50 Retained earnings 560 90 70 960 190 115 Current liabilities 120 60 40 1,080 250 160 You are also given the following information: i. Bauble Co acquired 65% of the share capital of Jewel Co on 1st January 2010 and 15% of Gem on 1st January 2011. The cost of the combinations were GHC 140,000 and GHC 45,000 respectively. Jewel Co acquired 80% of the share capital of Gem Co on 1st January 2011. ii. The retained earnings balances of Jewel Co and Gem Co were: 1st January 2010 1st January 2011 GHC000 GHC000 Jewel Co 40 55 Gem Co 35 45 iii. The fair values of Jewel's Property, Plant and Equipment were equal to their book values with the exception of its plant, which had a fair value of GHS 12,000 in excess of its book value at the date of acquisition. The remaining life of all of Jewel's plant at the date of its acquisition was four years and this period has not changed as a result of the acquisition. Depreciation of plant is on a straight-line basis and charged to cost of sales. Jewel has not adjusted the value of its plant as a result of the fair value exercise. iv. Revenues and profits should be deemed to accrue evenly throughout the year. v. Following an impairment review, there was no impairment loss on any of the consolidated goodwill as at 31st December 2017. vi. Gem sells goods to Bauble at cost plus 30%. Bauble had GHS 12,000 of goods in its inventory included in the current assets at 31st December 2017 which had been supplied by Gem.Page 3 of 7 vii. In addition, on 28 December 2017, Gem processed the sale of GHS1,500 of goods to Bauble, which Bauble did not account for until their receipt on 2nd January 2018. The in-transit reconciliation should be achieved by assuming the transaction had been recorded in the books of Bauble before the year end. At 31st December 2017, Gem had a trade receivable balance in the current assets of GHS2,000 due from Bauble which differed to the equivalent balance in Bauble’s books due to the sale made on 28 December 2017. viii. It is the group's policy to value the non-controlling interest at acquisition at its proportionate share of the fair value of the subsidiary's identifiable net assets. Required Prepare the consolidated statement of financial position for Bauble Co and its subsidiaries as at 31st December 2017. (20 Marks)

QUESTION 2 Issah Mohammed is the director of FTG Printing Ltd. The Company that has traded 20 years in Ghana and had achieved very good levels of growth and return on capital in the past, is now changing. In recent time it has failed to introduce new product lines, relying on traditional products and little has been invested in Research or Product Development. You are a business planning consultant for a firm of Management Consultants. FTG Printing Ltd is one of your clients. In recent times the business has experienced increased turnover but a downturn in overall performance. Issah Mohammed who is the director of FTG Printing has had a meeting with your Director and he has stated that he wants to introduce tighter management control within the company by introducing a system of responsibility accounting. You receive the following memo from your Director, Rash Rooney, regarding this case. Memorandum To: Business Planning Assistant Date:18th May,2020. From: Rash Rooney, Director Subject: FTG Printing accounts information. You are aware that I met with Issah Mohammed yesterday and that he is concerned with the latest results shown in the final accounts that have recently been prepared at year end.Page 4 of 7 The file attached contains a summary of the company's abbreviated income statements and statement of financial positions for the past three years, together with additional information and performance indicators for their business sector for the period under review. Examine this information and present of a detailed financial analysis of the company over the three-year period. Signed: Rash Rooney Financial information on FTG Printing Ltd. Summary income statements GHSm GHSm GHSm 2017 2018 2019 Sales turnover 14.70 15.90 19.80 Operating costs 12.51 13.29 17.46 Operating profit before tax 2.19 2.61 2.34 Taxation 0.72 0.90 0.81 Profit after tax 1.47 1.71 1.53 Dividends 0.36 0.48 0.48 Retained profit 1.11 1.23 1.05 N.B. The firm's detailed breakdown of costs in GHSm is as follows: Years 2017 2018 2019 Labour costs 2.79 2.94 3.75 Distribution costs 1.32 1.47 1.83 Administration costs 0.57 0.66 0.81Page 5 of 7 Summary statement of financial positions GHSm GHSm GHSm 2017 2018 2019 Non-Current Assets 7.2 8.31 8.64 Current assets Inventory: Raw materials 0.27 0.36 0.45 Finished goods 1.20 1.29 1.35 Receivables 3.42 3.96 5.52 Bank 0.09 0.12 0.15 4.98 5.76 7.47 Less Current liabilities 4.05 4.68 5.7 Net current assets 0.93 1.05 1.77 8.13 9.36 10.41 Capital and reserves 1.5 2.73 4.8 Bank loans 6.63 6.63 6.63 8.13 9.36 10.41 Ghana Printers Association Average ratios for Association members 2019 % Return on capital employed 26.0% Asset turnover 1.79 times Net profit margin 14.5% Current ratio 1.5:1 Acid test ratio 1.03:1 Debtors collection period 83 days Gearing ratio 32.0% Labour cost % of sales 18.1% Operating cost % of sales 85.5% Distribution costs % of sales 9.5%Page 6 of 7 Admin costs % of sales 4.5% Required: In your role of Planning Assistant, you are to prepare an analysis of the company's figures over the three-year period using the performance criteria listed in the inter-firm comparison table. a) Calculate all the ratios given in the average ratios for Association members for 2017, 2018 and 2019. (6 Marks) b) Prepare a detailed report on the company's performance in terms of profitability and liquidity compared with the average of the sector over the period. (14 Marks) (Total 20 Marks)

QUESTION 3 a) On 1 January 2017, Gyamera Limited granted 100 share options to each of its 300 employees, with each of the share options being conditional upon the employee working for Gyamera Limited until 31 December 2019. At the grant date, the FV of each share option was GHC15.00. During 2017, 15 employees left Gyamera Limited and the company’s directors estimated that a total of 20% of the 300 employees would leave during the three-year period 2017-2019. At the beginning of 2018, Gyamera Limited modified the terms and conditions of the share option by reducing the exercise price. This had the effect of increasing the FV of a share option at the beginning of 2018 by GHC9.00. During 2018, a further six employees left the company and the directors revised their estimate of the total number of the 300 employees to 15% that would leave the company during the three-year period 2017-2019. During 2019, a further five employees left the company. Required; Calculate the remuneration expense that should be recognised in Gyamera Limited’s financial statements in respect of the share-based payment agreement for each of the three years 2017,2018 and 2019. (6 Marks) b) IAS 32 makes it clear that the following items are not financial instruments. i. Physical assets, eg inventories, property, plant and equipment, leased assets and intangible assets (patents, trademarks etc)Page 7 of 7 ii. Prepaid expenses, deferred revenue and most warranty obligations iii. Liabilities or assets that are not contractual in nature (Deferred revenue, warranty obligations Required Write a Memo to your CEO, Mr Francis Tagoe explaining with reasons why the items listed above do not qualify as financial instruments. (6 Marks) c) Your managing director, Mr Nicholas Adoboe-Mensah is not convinced why your company should give something back to the society, Explain with examples to him in a form of a memo the links between corporate performance, and corporate social responsibility. (5 Marks) d) Global Reporting Initiatives structures key performance indicators according to a hierarchy category, aspect and indicator. Indicators are grouped in terms of the three dimensions of the conventional definition of sustainability – economic, environment, and social. 

Required Write a memo to your Chief Executive officer Mr Baba Ahmed explaining to him the meaning of Global Reporting Initiatives and state two examples each of the aspect of each of the dimensions