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MGAD70H3 Lecture Notes - Transfer Pricing, Accrual

Financial Accounting
Course Code
Daga Sandra

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Jaymon Hung 998255891
Class 1 May 7th
First class started pretty nice with us getting to know each other in our groups and in the class, and us
giving Prof. Daga a bit more information about ourselves. In that class, we were introduced to the
approach of the Multi-subject question. This was much similar to the cases I took in intermediate
accounting, but with more information and requires a higher level of understanding and case writing
The most interesting part is the problem of ranking issue. This is because, during professional exams, it is
never expected that we would be able to address all issues in a case. Rather, what we would have to do
is address the major or primary indicators first and then tackle secondary issues if there was time left.
We should rank issues based on their materiality or hooks that are present in the case, and then list
them as either Primary Indicator or Secondary Indicators.
Case Taken Up: Warmth Home Comfort Limited (WHCL) GAAP / GAAS
o Issues:
Warranty Estimation / Accrual
R&D Expense
Revenue Recognition Contract
Monthly Fees / lease
Accrual Estimation
o Hooks: D/E Ratio
Class 2 May 9th
Today we took up our first Comp Case “Heart Wines Limited”. Although I have read about how to write a
comprehensive case, it was still hard to write this case as it was the first time we got such a long case.
However, after reading the comprehensive case approach, it was ok, and I was able to prepare the Heart
Wines Limited case. What really intrigued me is that the comprehensive case approach is not like our
previous cases where we can just tackle each problem on the case, and be done with. But rather we
need to assume the role provided in the case and provide solutions to the various business problems.
Of course, the first time, I did not get the approach exactly correct and did not get the “Circles” right.
What I like about this course is that Prof. Daga also explains the cases in class, and how we should
approach the cases to get the most marks possible. This is interesting as we would need to know how
much to write for each case as if we write too much in one area, we might get “HC” for that area, and
fail for the whole case as we did not address all areas of the case.
Case Taken Up: Heart Wines Limited (HWL)
o Issues:
Accounting Policies
Acquisition of PPE, biological assets
Repairs: Expense or Capitalize?
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