1.

As defined by PFRS for Small and Medium Sized Entities, small and medium sized
entities are those that:
A. Do not have public accountability
B. Publish general Purpose financial statements for external users
C. Both A and B
D. Nor A and B

2. Qualitative Characteristics of Information in Financial that states that the information

in the financial statements must be complete within the bounds of materiality and
cost, to avoid misleading conclusions
A. Relevance
B. Reliability
C. Completeness
D. Comparability

3. The PFRS for SMEs identifies 2 common measurement bases:

A. Historical cost and Realizable Value
B. Present Value and Fair Value
C. Historical Cost and Fair Value
D. Amortized Cost and Realizable Value

4. The objective of general purpose financial statements prepared in accordance with the
PFRS for SMEs is:
A. To support the reporting entity’s annual tax return
B. To provide the government of the jurisdiction in which the reporting entity
operates with financial information for use in government statistics or
government planning or both
C. To provide management of the reporting entity with financial information about
the reporting entity
D. To provide information about the financial position, performance and cash flows
of the entity that is useful for economic decision-making by a broad range of
users who are not in a position to demand reports tailored to meet their particular
information needs (eg investors and creditors)

5. Items of dissimilar nature or function:

A. Must always be presented separately in financial statements.
B. Must not be presented separately in financial statements
C. Must be presented separately in financial statements if those items are material.
D. Either separately presented or aggregated depending on the accounting policy of
the entity
6. Which of the following entities is not a going concern?
A. Management intends to liquidate the entity.
B. Management intends to cease the entity’s operations.
C. Management has no realistic alternative but to cease the entity’s operations.
D. All of cases (a) to (c) above.
7. In accordance with the PFRS for SMEs, in presenting a statement of financial
position, an entity:
 A. Must make the current/non-current presentation distinction.
B. Must present assets and liabilities in order of liquidity.
C. Must choose either the current/non-current or the liquidity presentation formats.
D. Must make the current/non-current presentation distinction except when a
presentation based on liquidity provides information that is reliable and more
relevant.

Answers:

1. C
2. C
3. C
4. D
5. C
6. D
7. D