Available marks requirement technical marks skills

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Available Marks Requirement Technical marks Skills marks Skills 1. A revised calculation of the corporation tax liability correcting any errors you identify 2 1 Identify that errors have been made and provide a corrected computation 2. Brief notes to explain any errors made by the internal tax department and your adjustments 7 3 Identify that impairment provides a larger tax deduction and conclude that this is potentially a preferred option Evaluate the use of group losses and conclude that further information needed to assess optimum use Link the add back for legal fees to the chargeable gain computation Identify the opportunity for rollover relief against the purchase of plant and machinery by DeliverUK 3. A note of any additional information you require to complete your review 2 1 Adopt sceptical attitude in respect of software costs and identify that further information required 4. VAT implications of acquisition of Star House by Spaceway 3 1 Assimilate information from past transaction to identify current tax liability and impact on acquisition price 5. Ethical implications of Jim’s email 5 Appreciate ethical implication for the firm with respect to need for professional sceptism and extent of reporting requirements Identify and explain the consequences of reacting inappropriately to accusations Appreciate money laundering requirements Provide clear advice on what steps the firm must take in respect of each issue Total marks 14 11 Maximum 25
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TI BR – Advanced Stage – July 2010 © The Institute of Chartered Accountants in England and Wales 2010 8 Draft email reply to: Jim Jones Date: 27 July 2010 Subject: revised adjustment of Profit Computation year ended 30 June 2010 Please find attached a revised corporation tax calculation, together with notes identifying the errors I have found, explanation of my adjustments and detail of any further information to complete the review. (Attachment 1) I also attach a note setting out the VAT implications of the acquisition of Star House by Spaceway (Attachment 2) Attachment 1 Pepper Art - Revised corporation tax calculation £’000 £’000 Profit before taxation per the accounts 802 Add back Software support Legal fees Depreciation and other disallowable 50 35 75 160 962 Less Profit on sale of Prospect House Dividend from Spaceway Tax repayment 585 55 207 (847) Less capital allowances (52) Trading profit 63 Chargeable gain (Note 3) 400 463 Group relief from Spaceway (200) Taxable profits 263 3 associated companies Therefore marginal company PCTCT @ 28% 73,640 Less 7/400 (500,000 – 263,000) (4,148) Revised corporation Tax liability 69,492 Brief notes explaining errors and adjustments Identification of errors 1. Legal fees have been correctly disallowed. However they could potentially be allowed against the disposal of the building for chargeable gains calculation.
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  • Fall '09
  • Income Statement, Wales, The Institute of Chartered Accountants

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