Reference no: EM132756933

Problem 1: According to PFRS#14, an entity presents regulatory deferral accounts in the statement of financial position

a) showing those with debit balances separately from those with credit balances.

b) showing only the net debit or the net credit balance of the accounts.

c) a or b, as a matter of accounting policy choice.

d) An entity shall not present regulatory deferral accounts in the statement of financial position, but only disclose them in the notes.

Problem 2: According to PFRS#14, rate-regulation is,

a) the balance of any expense (or income) account that would not be recognized as an asset or a liability in accordance with other Standards, but that qualifies for deferral because it is included, or is expected to be included, by the rate regulator in establishing the rate/s that can be charged to customers.

b) an authorized body that is empowered by statute or regulation to establish the rate or a range of rates that bind an entity. The rate regulator may be a third party body or a related party of the entity, including the entity's own governing board, if that body is required by statute or regulation to set rates both in the interest of the customers and to ensure the overall financial viability of the entity.

c) A framework for establishing the prices that can be charged to customers for goods or services and that framework is subject to oversight and/or approval by a rate regulator.

d) All answers are correct (A,B.C.)