Question 10 When should a provision be recognised under IAS 37 Provisions, Contingent Liabilities and Contingent Assets? When an entity disputes a legal claim and its lawyers advise that it is unlikely that the entity is liable When an entity enters a long-term fixed price contract to supply goods to a customer before the year end, and due to an unexpected increase in material costs, the management of the entity estimates that the cost of meeting their obligations under the contract will be greater than any benefits received from it When the directors decide to restructure a division at a Board meeting before the year end and announce their decision shortly after the year end When the law requires an airline to overhaul the aircraft that it owns in 2 years timeQuestion 9 Which of the following is / are TRUE in relation to IAS 21 The Effects of Changes in Foreign Exchange Rates? (i) An entity incorporated in PRC cannot have a functional currency other than RMB (ii) An entity has a free choice of presentation currency (iii) At the end of the reporting period, foreign properties that are measured at fair value in a foreign currency should-be translated using the exchange rates at the date when the value is determined (iv) A foreign currency transaction should be recorded in the entity's functional currency using the exchange rate at the end of the reporting period O (i) and (ii) O (ii) and (iii) O (ii), (ii) and (iv) All of the above