Question 1

The Cane Growers Enterprise (CGE) is a government owned enterprise which is legislated to generate its own income which it uses to cover capital and recurrent expenditures. CGE is an agent of the National Agriculture Association. The Young Famers association controls 25% of CGE.

Outside of these powers, its government also provides CGE with monthly subventions to cover its recurrent expenditures based on CGE budgetary demands and the legal allocations by the government.

CGE uses ISPAP to prepare its financial statements. You were asked by to government to assist CGE with its accounting processes, which involved the recording, generation and preparation of accounting transactions and final accounts as stipulated by the IPSASs. Collaborating with a team of qualified and experienced accountants, you were able to prepare the following accounting information of GCE for the year ended December 2022.

Details	2022	2021
	Amount $000	Amount $000
Dividends received from equity investments	14,200	7,500
Service Charge on loans to beneficiaries	70,400	60,500
Gross margin on sale of sugar canes	367,308	255,400
Interest on Loans to Members	7,400	8,400
Interest on investments	14,700	15,000
Miscellaneous Income	60	70
Membership Fees	100,020	80,000
Grants Received	50,000	60,000
Grants to farmers	350,000	0
Donations received	10,000	20,875
Penalties and Fines for breach of Association rules	330	700
Cost of Seminars for Farmers	7,000	6,000
Royalties for use of lands	4,000	3,500
Warehouse Storage	6,000	5,500
General Cleaning & Sanitation	500	1,500
Property Rates	1,000	1,000
Depreciation of Fixed Assets	700	700
Accounting and Consultation Cost	5,000	4,500
Advances to Staff	680	18406
Salaries to Staff (Gross)	200,000	125,000
Staff Contribution to Social Security & Other Statutory Contributions	1,000	750
CGEs Contribution to Social Security & Other Statutory Contributions	3500	108,625
Gain on Sale of Equipment	2,000	0
Proceed on the Sale of Equipment	12,800	0
Plant, Property and Equipment (at cost, after disposal)	450,000	480,000
Accumulated Depreciation	47,700	47,000
Short-term investments	70,000	30,000
Trade and Other Payables	5,160	6700
Cash and Cash Equivalent	2,500	1,500
Inventory at year end	181,018	102,414
Receivables	6,500	10,500
Development Bond Issued	150,000	200,000
Contribution from Other Government Entities	75,000	75,000
Contribution from Non-controlling entities	25,000	25,000

Notes

1. Dividend receivable as at 31 December 2021 was $5,000,000 and Dividend receivable as at 31 December 2022 was $2,000,000.
2. CGE receives an annual transfer of $30,000,000 from the National Agricultural Association for the operating of the industry.
3. Service Charge Outstanding as at 31 December 2022 was $500,000.
4. Interest outstanding from Loans to Members as of 31 December 2021 was $2,000,000. Interest receivable at 31 December 2022 was $6,000,000.
5. All membership fees were paid in full. In 2022, twenty (20) members prepaid their membership for eight ( 8) months at $15,000 per month.
6. Twenty percent (20%) of the grants were not received at the end of each year.
7. To secure adequate storage in 2022, payments of $3,000,000 were made in advance.
8. Bond issued in 2021 was issued for $200,000,000. There was a repayment of $50,000,000 in 2022.
9. All statutory contributions were paid at year end.

Required:

Prepare the Statement of Financial Performance, Statement of Financial Position and Cash flow for 2022 in line with ISAPS. Expenses should be classified by nature. No comparative data required for the Cashflow.

Question 1

• Statement of Financial Performance is allocated 25 marks,
• Statement Financial Position is allocated 15 marks.
• The Cashflow allocated 10 marks.

Marks will be earned for correct answers . There will be no marks deduction for incorrect answers.