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Download CPA Australia : Financial-Accounting-and-Reporting Questions & Answers as PDF & Test Software

Last Updated: Aug 02, 2026

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CPA Australia Financial-Accounting-and-Reporting Practice Q&A's

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CPA Australia Financial-Accounting-and-Reporting Exam Syllabus Topics:

SectionWeightObjectives
Topic 1: Application of specific accounting standards22%- Intangible assets and journal entries
- Current and deferred income tax accounting
- Foreign currency transactions and translation
- Revenue recognition and ledger reconciliation
Topic 2: Analysis of financial statements10%- Limitations of financial statement analysis
- Financial ratio calculation and interpretation
Topic 3: Business combinations13%- Goodwill measurement and disclosure
- Impairment and journal entries
- Consolidated financial statements
- Non-controlling interest and control concepts
- Accounting issues for business combinations
Topic 4: Financial statements15%- Statement of profit or loss and other comprehensive income
- Discrepancy detection and correction
- Statement of financial position
- Statement of cash flows
Topic 5: The financial reporting environment25%- Regulatory environment and reporting requirements
- Users and developments impacting reporting
- Accounting regulation and GAAP/IFRS
- Accounting standards and policies
- Types of business entity and structure
- Conceptual framework and elements of financial statements
- Role of International Accounting Standards Board
Topic 6: The accounting theory15%- Recognition criteria per conceptual framework
- Historical cost vs other valuation methods
- Agency and contracting theories

CPA Australia CPA Financial Accounting and Reporting Sample Questions:

1. Which one of the following practices is not considered creative accounting?

A) trading in derivatives
B) window dressing
C) profit smoothing
D) aggressive earnings management


2. Financial markets have achieved operational efficiency when

A) the price of stocks and shares are available accurately and quickly.
B) the cost of transactions is a reflection of the actual cost incurred.
C) past records are used to predict the future prices of goods.
D) the costs of financial transactions are kept as low as possible.


3. According to the IASB's Conceptual Framework, the key reason general purpose financial statements are produced is to satisfy the information needs of

A) internal users.
B) capital providers.
C) employees.
D) management.


4. Which of the following statements are correct in the context of accounting concepts and principles?
I)The going concern assumption requires that assets be carried at their cost values.
II)Prudence allows the creation of contingency reserves and more generous provisions.
III)Financial information is considered complete even if it excludes non-material information.
IV)Understandability does not require complex information to be excluded from financial reports.

A) II and III only
B) II and IV only
C) III and IV only
D) I and III only


5. Which one of these concepts suggests that stock prices react to new information almost instantly?

A) incentive substitution
B) bargaining power
C) market power
D) efficient market


Solutions:

Question # 1
Answer: A
Question # 2
Answer: D
Question # 3
Answer: B
Question # 4
Answer: C
Question # 5
Answer: D

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