Question 22. Y Co used some but not all IFRSs in its financial statements to 31 December 20X4. In the year to 31 December 20X5, Y Co is to adopt all IFRSs. Which of the following statements is true under IFRS 1, First time Adoption of International Financial Reporting Standards?

In the year to 31 December 20X4, Y is considered to be a first time adopter

In the year to 31 December 20X5, Y is not considered to be a first time adopter

In the year to 31 December 20X5, Y is considered to be a first time adopter

Y is not a first time adopter in 20X4 or 20X5.

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Question 23. IAS 7 explains the movement of cash and cash equivalents from the start to the end of a period. How does IAS 7 define cash equivalents?

Investments that can be converted to cash within 3 months and carry an insignificant risk of changes in value.

Investments that can be converted to cash within 3 months and have a fixed value.

Short-term highly liquid investments that are readily convertible to cash and have a fixed value.

Short-term highly liquid investments that are readily convertible to cash and carry an insignificant risk of changes in value.

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Question 24. IAS 1 Presentation of Financial Statements envisages that an entity's financial statements should be presented at least every 12 months. Which of the following statements is correct according to IAS 1?

A reporting period can exceed 12 months but the reason must be disclosed.

A reporting period can be less than 12 months; no disclosure of reason is required.

A reporting period can be more or less than 12 months but the reason must be disclosed.

A reporting period can exceed 12 months but not 18 months; no disclosure of reason is required.

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Question 25. Under IFRS 9 Financial Instruments which of the following should be held at fair value? 1. An interest rate swap 2. 7% 2020 bonds acquired with the intention to hold to maturity 3. An investment in the ordinary shares of Milk Plc 4. An investment in a convertible loan note

1 only

2 only

All of the above

1, 3 and 4