A Workings (All figures in GH¢’000)

1. Dividends Calculation:
   • Number of ordinary shares: 500,000
   • Dividend on 31 January 2022: 500,000 × GH¢2.2 = 1,100
   • Dividend on 30 June 2022: 500,000 × GH¢2.6 = 1,300
   • Total dividends: 1,100 + 1,300 = 2,400
   • Administrative expenses in trial balance include these dividends, so adjust administrative expenses: 8,540 – 2,400 = 6,140
2. Loan Note Interest:
   • Full year interest: 8% × 5,500 = 440
   • Paid: 110
   • Accrued: 440 – 110 = 330
3. Depreciation Calculation:
   • Building: Straight-line over 25 years = 14,000 / 25 = 560
   • Plant and equipment: 10% on cost = 10% × 13,750 = 1,375
   • Computer equipment: 25% on cost = 25% × 7,200 = 1,800
   • Motor vehicles: 20% on reducing balance; Carrying value = 1,500 – 400 = 1,100; Depreciation = 20% × 1,100 = 220
   • Total depreciation: 560 + 1,375 + 1,800 + 220 = 3,955 (allocated to administrative expenses for presentation)
4. Revaluation of Building:
   • Carrying amount before revaluation: 14,000 – 560 = 13,440
   • Revalued amount: 14,100
   • Revaluation gain: 14,100 – 13,440 = 660 (to OCI)
5. Finance Costs:
   • Loan note interest: 440
   • Bank interest: 85
   • Total: 440 + 85 = 525
6. Bank Overdraft:
   • The bank balance is a credit in the trial balance, indicating an overdraft of 910 (current liability).

a. Statement of Profit or Loss and Other Comprehensive Income for the Year Ended 30 September 2022

b. Statement of Financial Position as of 30 September 2022

| Current assets | | |
| Inventory | 3,150 | |
| Trade receivables | 17,900 | |
| | | 21,050|
| Total assets | | 48,605|

| Equity and liabilities | | |
| Equity | | |
| Ordinary shares | | 14,500 |
| Revaluation surplus (800 + 660) | | 1,460 |
| General reserve | | 1,500 |
| Retained earnings (3,600 + 14,005 – 2,400) | | 15,205 |
| Total equity | | 32,665|

| Non-current liabilities | | |
| 8% Loan notes | | 5,500 |

| Current liabilities | | |
| Trade payables | 5,700 | |
| Bank overdraft | 910 | |
| Taxation | 3,500 | |
| Accrued interest | 330 | |
| | | 10,440|
| Total liabilities | | 15,940|
| Total equity and liabilities | | 48,605|

Question 1B
I. The objective of general-purpose financial reporting is to provide financial information about the reporting entity that is useful to existing and potential investors, lenders, and other creditors in making decisions about providing resources to the entity. These decisions involve buying, selling, or holding equity and debt instruments, and providing or settling loans and other forms of credit.

II. – Relevance: Relevant financial information is capable of making a difference in the decisions made by users. Information is relevant if it has predictive value (helps users form expectations about the future), confirmatory value (confirms or changes past evaluations), or both. Materiality is an aspect of relevance, where information is material if omitting or misstating it could influence decisions. For example, in a Ghanaian bank like GCB Bank, disclosing potential losses from non-performing loans under BoG directives is relevant for investors assessing credit risk.

• Faithful Representation: Financial information faithfully represents the phenomena it purports to represent when it is complete, neutral, and free from error. Completeness means including all necessary descriptions and explanations; neutrality means without bias in selection or presentation; freedom from error means no errors or omissions in the process. For instance, in compliance with IFRS and BoG’s Corporate Governance Directive 2018, a bank’s financial statements must faithfully represent asset valuations to avoid misleading stakeholders, as seen in the 2017-2019 banking cleanup where misrepresentations led to bank collapses like UT Bank.

C
i. An intangible asset under IAS 38 is defined as an identifiable non-monetary asset without physical substance. It must be identifiable (separable or arising from contractual/legal rights), controlled by the entity, and expected to generate future economic benefits. Examples include software, patents, or customer lists in a Ghanaian bank context, such as proprietary risk management software developed by Ecobank Ghana.

ii. The recognition criteria for intangible assets under IAS 38 are:

• It is probable that the expected future economic benefits attributable to the asset will flow to the entity (e.g., through revenue generation or cost savings).
• The cost of the asset can be measured reliably.
  For internally generated intangibles, additional strict criteria apply separate research (expensed) from development (capitalized if criteria met, including technical feasibility, intention to complete, ability to use/sell, and demonstrable benefits). In practice, for a bank like Stanbic Bank Ghana investing in fintech under the Payment Systems and Services Act 2019, development costs for a new mobile banking app can be capitalized only if these criteria are satisfied to ensure compliance and accurate reporting.

iii. Five disclosure requirements for intangible assets under IAS 38 include:

• For each class of intangible assets, distinguish between internally generated and others: useful lives (finite or indefinite), amortization methods, gross carrying amount, accumulated amortization, and impairment losses.
• Reconciliation of carrying amount at beginning and end of period, showing additions, disposals, revaluations, amortization, and impairments.
• If indefinite useful life, reasons supporting that assessment and carrying amount.
• Description, carrying amount, and remaining amortization period for individually material intangibles.
• Existence and amounts of intangibles with restricted title or pledged as security.