Government Contracts – NBC Institute

CR – Nov 2018 – L3 – SC – Q7 – Segment Reporting (IFRS 8)

Guidance on segment reporting and revenue recognition for long-term contracts for Agbero Plc’s operating and contract revenue.

Question

a. Agbero plc is a public company rendering services to the Lagos State Government, primarily in public transport. Listed on the Lagos Stock Exchange, Agbero plc identified three operating segments in its annual financial statements for the year ended March 31, 2018:

Segment 1: Local bus operations
Segment 2: Inter-city bus operations
Segment 3: Road constructions

The company disclosed two reportable segments. Segments 1 and 2 were aggregated into a single reportable operating segment, based on similar business characteristics, and the nature of their products and services. In the local bus operations market, the Lagos State Transport Authority awards the contract and pays Agbero for its services. Contracts for local bus operations are awarded via a competitive tender process, and ticket prices are set and paid to the Lagos State Transport Authority. In the inter-city bus operation market, Agbero sets the ticket prices, and passengers pay Agbero directly for the service.

Required:

i. Advise Agbero plc on how the above accounting issues should be dealt with in its financial statements. (6 Marks)

ii. Although the company is satisfied with IFRS 8 – Operating Segment, it is unclear who to designate as the chief operating decision maker (CODM) under the standard. Define the chief operating decision maker in line with IFRS 8 – Operating Segment and identify who this should be in Agbero plc. (2 Marks)

b. Agbero Plc entered a contract with the Lagos State Government on April 1, 2016, to construct a new light railway line. The contract total revenue is N5 billion over a three-year period. The contract specifies that N1 billion will be paid at the start of the contract, but subsequent payments will be settled only upon completion of the project. Invoices have been sent as follows:

Year ended March 31, 2017: N2.8 billion
Year ended March 31, 2018: N1.2 billion
Remaining balance to be invoiced on March 31, 2019

To date, Agbero Plc has only recognized the initial payment in the financial statements up to March 31, 2017, as no subsequent payments are due until March 31, 2019. The invoiced amounts reflect the work completed in each period.

Required:

Agbero Plc. wishes to know how to account for the revenue on the contract in the financial statements to date. Advise Agbero Plc. Market interest rates are currently at 6%. (7 Marks)

Answer

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Tags: Chief Operating Decision Maker, Government Contracts, Long-Term Contracts, Revenue Recognition, Segment Reporting
Level: Level 3

Topic: Segment Reporting (IFRS 8)

PSAF – Nov 2023 – L2 – Q3c – Public Procurement and Contract Management

Details provisions and penalties under Financial Regulations to prevent and address delays in contract payments.

Question

i. Identify TWO provisions of Financial Regulations which guide against the delay in contract payments. (3 Marks)

ii. Enumerate TWO punishments each that can be meted out to a government official and a legal person in case of delay in payment of contracts executed. (4 Marks)

Answer

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Tags: Contract Payment Delays, Financial Regulations, Government Contracts, Penalties, Public Sector Accounting
Level: Level 2

Topic: Public Procurement and Contract Management

PSAF – Nov 2023 – L2 – Q3a – Public Procurement and Contract Management

Describes the procurement process for consultancy services, virtual library items, and branded office supplies under BPP guidelines.

Question

Describe the procurement process for each of the following three items as specified in the Procurement Act, 2007 and the subsequent guidelines issued by the Bureau of Public Procurement (BPP), given that appropriations were made in the current budget of the Federal Government of Azare:

i. Consultancy Services Worth N99 Million (3 Marks)
ii. Procurement and Installation of Sundry Items for Virtual Library in Federal Government Secondary Schools, Including Construction of Building Facilities Worth N958 Million (3 Marks)
iii. Supply of Branded Envelopes, Files, and Letterheads Worth N4.2 Million (3 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: BPP, Government Contracts, Procurement Process, Public Procurement Act 2007
Level: Level 2

Topic: Public Procurement and Contract Management

BCL – Dec2022 – Q2b – Sale of goods/hire purchase

Identify and explain issues in a contract of sale of goods involving government property.

Question

As part of efforts in catering for Ghanaians who were displaced by the Russian war on Ukraine, the Government of Ghana erected tents in Poland. These tents are no longer in use because all Ghanaians were evacuated back to Ghana. As a result, the Government set up a disposal board to sell these tents. The board agreed to sell the tents to Dominika who left an amount of GH¢10,000,000 as a security deposit for her purchases. According to the written agreement between the disposal board and Dominika, the price for the tents and the dates on which payment was to be made were to be agreed between the parties as and when the tents became available. In July 2022, a new disposal board took over and refused to sell the tents to Dominika. They stated that they no longer considered themselves bound by the contract.

Required:
Identify FOUR (4) issues in the contract of sale of goods in the above scenario. (8 marks)

Answer

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Tags: Contract Law, Government Contracts, Sale of Goods, Security Deposit
Level: Level 1

Topic: Sale of goods/hire purchase
Series: DEC 2022

CR – Nov 2018 – L3 – SC – Q7 – Segment Reporting (IFRS 8)

Guidance on segment reporting and revenue recognition for long-term contracts for Agbero Plc’s operating and contract revenue.

Question

Segment 1: Local bus operations
Segment 2: Inter-city bus operations
Segment 3: Road constructions

Required:

i. Advise Agbero plc on how the above accounting issues should be dealt with in its financial statements. (6 Marks)

Year ended March 31, 2017: N2.8 billion
Year ended March 31, 2018: N1.2 billion
Remaining balance to be invoiced on March 31, 2019

Required:

Agbero Plc. wishes to know how to account for the revenue on the contract in the financial statements to date. Advise Agbero Plc. Market interest rates are currently at 6%. (7 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Chief Operating Decision Maker, Government Contracts, Long-Term Contracts, Revenue Recognition, Segment Reporting
Level: Level 3

Topic: Segment Reporting (IFRS 8)

PSAF – Nov 2023 – L2 – Q3c – Public Procurement and Contract Management

Details provisions and penalties under Financial Regulations to prevent and address delays in contract payments.

Question

i. Identify TWO provisions of Financial Regulations which guide against the delay in contract payments. (3 Marks)

ii. Enumerate TWO punishments each that can be meted out to a government official and a legal person in case of delay in payment of contracts executed. (4 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Contract Payment Delays, Financial Regulations, Government Contracts, Penalties, Public Sector Accounting
Level: Level 2

Topic: Public Procurement and Contract Management

PSAF – Nov 2023 – L2 – Q3a – Public Procurement and Contract Management

Describes the procurement process for consultancy services, virtual library items, and branded office supplies under BPP guidelines.

Question

Answer

Find Related Questions by Tags, levels, etc.

Tags: BPP, Government Contracts, Procurement Process, Public Procurement Act 2007
Level: Level 2

Topic: Public Procurement and Contract Management

BCL – Dec2022 – Q2b – Sale of goods/hire purchase

Identify and explain issues in a contract of sale of goods involving government property.

Question

Required:
Identify FOUR (4) issues in the contract of sale of goods in the above scenario. (8 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Contract Law, Government Contracts, Sale of Goods, Security Deposit
Level: Level 1

Topic: Sale of goods/hire purchase
Series: DEC 2022

Question Tag: Government Contracts

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CR – Nov 2018 – L3 – SC – Q7 – Segment Reporting (IFRS 8)

Guidance on segment reporting and revenue recognition for long-term contracts for Agbero Plc’s operating and contract revenue.

PSAF – Nov 2023 – L2 – Q3c – Public Procurement and Contract Management

Details provisions and penalties under Financial Regulations to prevent and address delays in contract payments.

PSAF – Nov 2023 – L2 – Q3a – Public Procurement and Contract Management

Describes the procurement process for consultancy services, virtual library items, and branded office supplies under BPP guidelines.

BCL – Dec2022 – Q2b – Sale of goods/hire purchase

Identify and explain issues in a contract of sale of goods involving government property.

CR – Nov 2018 – L3 – SC – Q7 – Segment Reporting (IFRS 8)

Guidance on segment reporting and revenue recognition for long-term contracts for Agbero Plc’s operating and contract revenue.

PSAF – Nov 2023 – L2 – Q3c – Public Procurement and Contract Management

Details provisions and penalties under Financial Regulations to prevent and address delays in contract payments.

PSAF – Nov 2023 – L2 – Q3a – Public Procurement and Contract Management

Describes the procurement process for consultancy services, virtual library items, and branded office supplies under BPP guidelines.

BCL – Dec2022 – Q2b – Sale of goods/hire purchase

Identify and explain issues in a contract of sale of goods involving government property.

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CR – Nov 2018 – L3 – SC – Q7 – Segment Reporting (IFRS 8)

Guidance on segment reporting and revenue recognition for long-term contracts for Agbero Plc’s operating and contract revenue.

You're reporting an error for "CR – Nov 2018 – L3 – SC – Q7 – Segment Reporting (IFRS 8)"

PSAF – Nov 2023 – L2 – Q3c – Public Procurement and Contract Management

Details provisions and penalties under Financial Regulations to prevent and address delays in contract payments.

You're reporting an error for "PSAF – Nov 2023 – L2 – Q3c – Public Procurement and Contract Management"

PSAF – Nov 2023 – L2 – Q3a – Public Procurement and Contract Management

Describes the procurement process for consultancy services, virtual library items, and branded office supplies under BPP guidelines.

You're reporting an error for "PSAF – Nov 2023 – L2 – Q3a – Public Procurement and Contract Management"

BCL – Dec2022 – Q2b – Sale of goods/hire purchase

Identify and explain issues in a contract of sale of goods involving government property.

You're reporting an error for "BCL – Dec2022 – Q2b – Sale of goods/hire purchase"

CR – Nov 2018 – L3 – SC – Q7 – Segment Reporting (IFRS 8)

Guidance on segment reporting and revenue recognition for long-term contracts for Agbero Plc’s operating and contract revenue.

You're reporting an error for "CR – Nov 2018 – L3 – SC – Q7 – Segment Reporting (IFRS 8)"

PSAF – Nov 2023 – L2 – Q3c – Public Procurement and Contract Management

Details provisions and penalties under Financial Regulations to prevent and address delays in contract payments.

You're reporting an error for "PSAF – Nov 2023 – L2 – Q3c – Public Procurement and Contract Management"

PSAF – Nov 2023 – L2 – Q3a – Public Procurement and Contract Management

Describes the procurement process for consultancy services, virtual library items, and branded office supplies under BPP guidelines.

You're reporting an error for "PSAF – Nov 2023 – L2 – Q3a – Public Procurement and Contract Management"

BCL – Dec2022 – Q2b – Sale of goods/hire purchase

Identify and explain issues in a contract of sale of goods involving government property.

You're reporting an error for "BCL – Dec2022 – Q2b – Sale of goods/hire purchase"

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