DAN Department of Management and Organizational Studies

Intermediate Accounting I – MOS 3360A – Fall 2024

Research Case Assignment

Introduction

This assignment will require you to research and analyze financial accounting issues using the CPA Canada Handbook. Specific Case Analysis Requirements to complete the assignment are outlined in Appendix A to this document. Please review these requirements carefully to ensure you have the best chance of success.

Students may complete this assignment individually or with one other student who is taught by the same instructor. If you choose to work with another student, only one student needs to submit the report.

Completing this assignment is a requirement to pass the course. In the case of no submission, students will not be permitted to pass the course.

The analysis and thoughts in your report must be in your own words with proper referencing to the CPA Canada Handbook. The CPA Canada Handbook is your main reference source to complete this assignment. If you take a passage from the CPA Canada Handbook, you must use proper referencing (further details on this are provided in Appendix A).

Deliverables

•    All submissions should be completed in Microsoft Word (other formats will not be accepted).

•    Your response must be in 12-point font,single spaced, and can be a maximum often (10) pages (including any appendices, but not including your title page). You are not required to use all ten pages.

•    Please include a title page with the name of the instructor, student name, student number, and section number for each student.

•    The response should be well written, complete, concise, and easy to understand. Complete sentences and

proper grammar should be used. Bullet points (as appropriate) are acceptable as long they are complete and understandable. Please DO NOT use incomplete thoughts or submit rough work.

Submissions

Students are required to submit both a hardcopy of the assignment AND an electronic copy of their final report by the due date listed below.

•    Hard copy: The report should be printed and stapled in the top left corner - no binders, plastic covers, etc.,

and must be submitted to the drop box outside the MOS office on the 4th floor of the Social Science building. The drop box is located to the left of SSC room 4304. The report submitted will not be returned.

•    Electronic copy:

•    The electronic copy of the report should be submitted in Word format. PDF formats will not be accepted.

•    Save the Word document in the following format:

MOS3360 - Assignment_Last name_First name (of the student submitting the file) (example: MOS3360 – Assignment_Smith_Jane)

•    Submit your completed assignment through the “Assignment” tab on the OWL course site.

•    E-mailed responses will NOT be accepted.

Appendix A - Case Analysis Requirements

1.   The purpose of this assignment is to present you with an opportunity to read the CPA Canada Handbook and learn how to apply the accounting guidance contained therein. The CPA Canada Handbook can be accessed

through the Western Libraries’ website at:https://edu-knotia-ca.proxy1.lib.uwo.ca/. You will need to login using your UWO credentials.

You can also do a search on the Western Libraries’ website for “CPA Canada standards” . You will betaken to the CPA Handbook collection. Select "view online", and then click on the link "CPA Canada standards & guidance collection (CPACHB)".

2.   You must base your response solely on the guidance contained within the CPA Canada Handbook. Any

reference to textbooks, websites, or any other source will not be evaluated, and no marks will be awarded to any content referenced from these sources. Students are cautioned to only use sources outside of the CPA Canada Handbook for educational purposes, and to ensure your response to this case references the

Handbook and nothing else. Relevant CPA Canada Handbook section references have been provided in the case to assist you in narrowing your focus.

3.   You are expected to fully respond to all the accounting issues you identify in the case to demonstrate your depth of knowledge. Appendix B outlines a suggested format of how to analyze accounting issues.

4.   A sample accounting issue with a solution has been provided for your review in Appendix C. You should

format your response following a similar process as demonstrated in the sample solution. The accounting issue illustrated in the sample solution is very simplistic and you should assume the accounting issues you will be responding to in the case will be much more complex and require greater analysis.

The accounting issues you will be analyzing in the case are detailed in nature. You should not assume that the in-class coverage was fully comprehensive. You will find extensive and detailed guidance in the relevant Handbook section referred to in this case. You should expect to read the entirety of the relevant Handbook section when analyzing the accounting issues. Not all sentences/paragraphs within the relevant Handbook section will apply to anyone accounting issue. You are expected to read each section in its entirety and to determine which guidance is applicable and which is not. The grade you receive on this assignment will greatly depend on the thoroughness of your response.

5.   You are not required to discuss any financial statement note disclosure for these accounting issues.

6.   You should aim to fulfill the following objectives for each accounting issue analyzed:

a. Thoroughness: you MUST aim to analyze all relevant Handbook guidance (in the relevant section) for each issue. If the relevant Handbook section you are reviewing has multiple criteria within it you should analyze EACH relevant criterion. Analyzing only “some” criteria will result in you only receiving “some” marks. For example, if you were analyzing revenue recognition, you would never analyze just  one revenue recognition criteria – you would analyze all the revenue recognition criteria.

b. Case Facts: you MUST use case facts to support EVERY part of your analysis. For example, if you are

analyzing multiple criteria for a particular accounting issue, you should have at least one relevant (and usually distinct) case fact to support your analysis of each criteria.

c. Explain Everything: when writing your response, you should pretend that the person marking it

knows absolutely nothing about the case and very little about accounting. Your response should explain everything to them. Do not assume or imply anything in your answer. If you don’t explicitly state something in your response you will not receive credit for it. For example, don’tsay, “You should take an umbrella outside when it is raining” . You didn’t explain WHY. Instead, do say, “You should take an umbrella outside when it is raining so you can hold it over your head to protect yourself from the rain” .

d. Be Concise: you have a limited number of pages to work with for this assignment. As such, make your response concise. Your analysis should be complete and thorough, but also concise. There are no

extra marks awarded for unnecessary words or fancy writing styles.

7. Handbook Referencing: you must copy and paste relevant sentences/paragraphs directly from the CPA

Canada Handbook and include them in your response as demonstrated in the sample response in Appendix C. When doing this, please remember to:

a.    State which section/paragraph you are including, and

b. Italicize anything copied and pasted from the Handbook. This will allow the person marking your assignment to know what is copied from the Handbook vs. what is your response.

You will likely find it effective to copy and paste a portion of the Handbook section that applies to the accounting issue you are writing about, and then immediately analyze the guidance using applicable case facts.

In the CPA Canada Handbook, you will see some text that is italicized and some that is not. The italicized paragraphs are the “ principles” . The text included underneath is to help provide further guidance on how to interpret and apply what is listed in the principle.

For example:

MEASUREMENT OF INVENTORIES Cost

.04 Property, plant and equipment shall be recorded at cost.

.05     The cost of an item of property, plant and equipment includes the purchase price and other acquisition costs

such as option costs when an option is exercised, brokers' commissions, installation costs including architectural, design and engineering fees, legal fees, survey costs, site preparation costs, freight charges, transportation insurance costs, duties, testing and preparation charges. It may be appropriate to group together individually insignificant items of property, plant and equipment.

It is acceptable to include information from both areas in your response if it is relevant to your discussion. It is important not to dump lengthy paragraphs from the Handbook into your response without applying the guidance to case facts. If something from the Handbook is in your response but you haven’t interpreted it in your own words afterwards as to how it applies to your case, or applied case facts against it, consider if you actually need to have that guidance in your response.

8. Conclude: you should remember to definitively conclude or make a recommendation on each accounting issue. Your conclusion / recommendation should:

a.    Summarize why you are reaching that conclusion or providing that recommendation,

b.    Discuss the required impact to the financial statements, and

c.    Include journal entries if you believe that will help illustrate your conclusion.

Before you begin, please re-read these instructions again. Then, read them again before finalizing your assignment. Comprehensive professional answers are expected that are fully explained and supported by case facts. Goodluck!

Appendix B - How to Analyze an Accounting Issue using the CPA Way

You should follow the following format for analyzing your accounting issues in accordance with “The CPA Way” .

1. Assess the situation – This should be a brief description of what you think the accounting issue is. The

purpose of this section is to highlight to your reader the key concerns in the case and explain what you hope to accomplish through your analysis. This should be 1-2 sentences to explain how the item has been accounted for using case facts and what you think the issue is (or state that it hasn’t been accounted for yet). You may pose a question at the end to make it clear what you hope to accomplish through your analysis (for example, “Does this item meet the definition of an asset under the conceptual framework?”).

2. Analyze the issue – In order to properly analyze an issue, you need to have a combination of relevant

technical guidance AND relevant case facts to achieve depth. Handbook guidance with no case facts is not enough, nor is listing case facts that aren’t linked to Handbook guidance – you need BOTH. Simply inserting guidance from the handbook into your response without applying case facts will result in very few (or no) marks being awarded. Here are some potential formats you can use:

Issue with criteria

Handbook section says that the following 3 criteria must be met in order to :

• Criteria 1 – MET/NOT MET – followed by case fact to support.

• Criteria 2 – MET/NOT MET – followed by case fact to support.

• Criteria 3 – MET/NOT MET – followed by case fact to support.

Issue with a specific technical rule

Handbook section says that ….

In this case, … … . (discussion of how the technical rule applies using case facts)

3.    Conclude and Advise - You need to make a clear conclusion or recommendation based on your analysis.

In addition, ensure you answer the question “so what” after you are done concluding. If you are given

information that allows you to quantify the impact from the accounting issue, do so here. Does this

require an adjustment in the financial statements? If so, provide the journal entry if possible. Even if you don’t have numbers to quantify, providing the journal entry helps to show you understand the related

accounting. Also, consider if the accounting issue impacts a central theme in the case, such as compliance with a debt covenant, a bonus calculation, etc.