Q4 : topic foreign exchanges rate

Q5: TOPIC of mfrs 119 employee benefit

QUESTION 4 (20 MARKS) Semporna Bhd is a stand-alone entity (ie it is not part of a group). Its functional currency is CU. However, Semporna Bhd is required by law to present its financial statements in LCA, which is the local currency of the country in which it operates. Financial year end of Semporna Bhd is 31 December each year. The exchange rates: - At 31 December 2020 and 31 December 2021 are CU1 = LCA2 and CU1 = LCA2.3 respectively. - Weighted average rate for the year ended 31 December 2021 is CU1 = LCA2.2. - In 2021 entity A paid a dividend of CU3,000 when the rate of exchange was CU1= LCA2.25. - The share capital was issued when the exchange rate was CU1 = LCA1.8. Semporna Bhd records all its transactions in its functional currency. The statement of profit or loss and an extract from the statement of changes in equity for the year ended 31 December 2021 prepared in the functional currency are as follows: Statement of Profit or Loss for the year ended 31 December 2021 Extract from the statement of changes in equity as at 31 December 2021 Required: a. Prepare Statement of Profit or Loss of Semporna Bhd after translation to the presentation currency in accordance to MFRS121 The Effects of Changes in Foreign Exchange Rates. (15 marks) b. Prepare extracted Statement of Changes in Equity of Semporna Bhd after translation to the presentation currency. (5 marks) QUESTION 5 (10 MARKS) A. The employees of Axia Berhad are entitled to 25 paid leave each year. The entitlement accrues evenly over the year and unused leave may be carried forward for one year. At 31 December 2021, Axia Berhad has 800 employees and the average unused holiday entitlement is 5 days per employee. About 10% of the employees leave without taking their entitlement and there is no cash payment when an employee leaves in respect of holiday entitlement. There were 260 working days in 2021 and the total annual salary cost was RM20 million for 2021. Based on MFRS119 Employee Benefits, calculate the staff cost relating to the above case. (6 marks) B. Accounting period of Hijau Bhd. ends on 31 December each year. Even though it does not been mention in the employment contract, it has been a practice of Hijau Bhd. for the last 10 years to pay its employees, one (1) month bonus in January the following year. At the end of 2021 , its new CEO, asked the company's accountant to not to recognize the current year bonus in the company account. Required: Give your comment and advice for the matter as accordance to MFRS119 Employee Benefits. (4 marks)