Advanced Financial Accounting and Reporting (AFAR)

Study lessons

1. 1

   Partnership Accounting: Formation Through Liquidation

   How to record partner contributions at fair value, split profit through salary, interest, and bonus allowances, account for the admission or withdrawal of a partner, and wind up a partnership through lump-sum or installment liquidation using the safe payments schedule.

   15 min
2. 2

   Business Combinations, Consolidation, Construction Contracts, and Government Accounting

   How PFRS 3's acquisition method produces goodwill or a bargain purchase gain, how PFRS 10 consolidates a subsidiary at 100% with non-controlling interest shown separately, how PFRS 15 recognizes construction revenue over time, and how Philippine government agencies report under PPSAS.

   15 min
3. 3

   Construction Contracts and Government Accounting in Depth

   How PFRS 15 recognizes long-term construction revenue over time, measures progress, books immediate losses, and presents a contract asset or contract liability, and how Philippine government agencies run the appropriation flow under PPSAS, the UACS, fund clusters, and the Revised Chart of Accounts.

   15 min
4. 4

   Foreign Currency Translation and Specialized Industry Accounting

   How PAS 21 fixes the functional and presentation currencies, classifies monetary and non-monetary items, and translates a foreign operation, plus the specialized-industry rules for agriculture under PAS 41, installment sales, consignment, franchise revenue, home office and branch reconciliation, insurance, and build-operate-transfer.

   15 min
5. 5

   Corporate Liquidation and the Statement of Affairs

   How to rank an insolvent corporation's assets and creditors, build a statement of affairs, compute the estimated recovery percentage paid to unsecured creditors, and track a trustee's progress through the statement of realization and liquidation.

   14 min
6. 6

   Joint Arrangements under PFRS 11

   How to identify joint control, classify a joint arrangement as a joint operation or a joint venture, and apply the correct accounting: line-by-line recognition of assets and liabilities for a joint operation, and the equity method for a joint venture.

   13 min
7. 7

   Home Office and Branch Accounting

   How to keep the reciprocal Investment in Branch and Home Office accounts in balance, account for shipments billed above cost through the allowance for overvaluation, compute true branch net income, and prepare combined financial statements that eliminate all intracompany items.

   14 min
8. 8

   Special Revenue: Franchise, Consignment, and Installment Sales

   How PFRS 15 recognizes franchise fees for symbolic intellectual property and sales-based royalties, why a consignor books no revenue until the consignee sells, and how the installment method spreads gross profit over collections and handles defaults and repossessions.

   15 min
9. 9

   Not-for-Profit Organization Accounting

   How a non-profit classifies net assets by donor restriction, recognizes unconditional and conditional contributions and contributed services, releases restricted net assets when their purpose is met, and presents the not-for-profit set of financial statements.

   13 min
10. 10

    Business Combinations in Depth (PFRS 3)

    Work the acquisition method step by step, choose between full and partial goodwill and see exactly what the choice costs, expense acquisition costs while charging issue costs to the instrument, remeasure a previously held interest through profit or loss, and confine measurement period adjustments to facts that existed at the acquisition date.

    20 min
11. 11

    Consolidated Financial Statements (PFRS 10)

    Apply the three elements of control, run the elimination entries at and after acquisition, amortise fair value adjustments and see how they cut the subsidiary's profit, attribute profit and total comprehensive income between the parent and the non-controlling interest, build consolidated retained earnings and closing NCI, and treat a change in ownership without loss of control as an equity transaction.

    20 min
12. 12

    Intercompany Transactions and Unrealised Profit

    Separate downstream from upstream and see why only upstream touches the non-controlling interest, eliminate unrealised profit in ending inventory and release it the following year, unwind a gain on an intercompany sale of a depreciable asset through excess depreciation, and recognise the constructive gain when a group member buys an affiliate's bonds.

    19 min
13. 13

    Associates, the Equity Method (PAS 28), and Separate Financial Statements (PAS 27)

    Presume significant influence at twenty percent and rebut it with evidence, roll the investment forward through share of profit, share of other comprehensive income, and dividends, bury goodwill inside the carrying amount, stop recognising losses at nil after absorbing long-term interests, eliminate transactions only to the extent of the investor's interest, and choose a basis in the separate financial statements.

    19 min

Section practice test

5 test sets covering the whole Advanced Financial Accounting and Reporting (AFAR) section, 150 original questions with explanations. After you finish the lessons above, prove it here. Randomized every run.