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Under Ind AS 110, an 'investment entity' (meeting the specified criteria) measures its investments in subsidiaries at:
A
B
C
D
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2026 Statistics
Key Facts: CMA Final Paper 18 (CFR) Exam
100
Marks in the Paper
ICMAI 2022 Syllabus
3 hrs
Exam Duration
ICMAI 2022 Syllabus
6
Official Sections
ICMAI Paper 18 Syllabus
25%
Ind AS Section Weight
ICMAI Paper 18 Syllabus
40%
Minimum Per-Paper Pass
ICMAI Passing Criteria
Group IV
CMA Final Group
ICMAI 2022 Syllabus
ICMAI CMA Final Paper 18 (Corporate Financial Reporting) is a 100-mark, 3-hour Group IV paper under the 2022 syllabus. Its six sections carry official weightings of Section A Indian Accounting Standards 25%, Section B Valuation of Shares, Financial Instruments and NBFCs 15%, Section C Business Combination and Restructuring 20%, Section D Consolidated and Separate Financial Statements 20%, Section E Recent Developments in Financial Reporting 10%, and Section F Government Accounting in India 10%. The exam is written and descriptive (with an objective component), but ICMAI also publishes an official MCQ bank, so this 100-question set is MCQ knowledge prep aligned to those weights.
Sample CMA Final Paper 18 (CFR) Practice Questions
Try these sample questions to test your CMA Final Paper 18 (CFR) exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.
1Under Ind AS 1 (Presentation of Financial Statements), which statement is NOT a complete set of financial statements required to be presented by an entity?
A.Balance Sheet at the end of the period
B.Statement of Profit and Loss for the period
C.Statement of Changes in Equity for the period
D.Directors' Report on the state of the company's affairs
Explanation: Ind AS 1 requires a Balance Sheet, Statement of Profit and Loss (including OCI), Statement of Changes in Equity, Statement of Cash Flows, and notes. The Directors' Report is a governance document under the Companies Act, not part of the Ind AS financial statements.
2Under Ind AS 2 (Inventories), which of the following costs should be EXCLUDED from the cost of inventories and recognised as an expense when incurred?
A.Costs of purchase including import duties
B.Costs of conversion including direct labour
C.Abnormal amounts of wasted materials and labour
D.Fixed production overheads allocated on normal capacity
Explanation: Ind AS 2 specifies that abnormal amounts of wasted materials, labour or other production costs, storage costs (unless necessary in the production process), administrative overheads, and selling costs are excluded from inventory cost and expensed as incurred.
3Under Ind AS 16 (Property, Plant and Equipment), the cost of an item of PPE comprises all of the following EXCEPT:
A.Purchase price net of trade discounts and rebates
B.Costs of site preparation and initial delivery
C.Initial estimate of dismantling and restoration obligation
D.Costs of opening a new facility and advertising the product
Explanation: Ind AS 16 specifically lists costs of opening a new facility, introducing a new product (including advertising and promotion), and conducting business in a new location as examples of costs NOT included in the carrying amount of PPE.
4Under Ind AS 115 (Revenue from Contracts with Customers), what is the correct order of the five-step revenue recognition model?
A.Identify contract; identify performance obligations; determine transaction price; allocate price; recognise revenue
B.Determine transaction price; identify contract; allocate price; recognise revenue; identify obligations
C.Recognise revenue; identify contract; determine price; allocate price; identify obligations
D.Identify performance obligations; identify contract; recognise revenue; determine price; allocate price
Explanation: Ind AS 115 prescribes a five-step model: (1) identify the contract, (2) identify the performance obligations, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations, and (5) recognise revenue when (or as) each obligation is satisfied.
5Under Ind AS 116 (Leases), a lessee recognises a right-of-use asset and a lease liability for most leases. Which TWO recognition exemptions are available to a lessee?
A.Short-term leases and leases of low-value assets
B.Finance leases and operating leases
C.Sale-and-leaseback and sublease arrangements
D.Leases of investment property and biological assets
Explanation: Ind AS 116 eliminates the operating/finance lease distinction for lessees but permits two optional exemptions: leases with a term of 12 months or less (short-term) and leases where the underlying asset is of low value. Lease payments under these are expensed on a straight-line basis.
6An entity acquires a machine for Rs. 50,00,000 with an estimated useful life of 10 years and nil residual value, using the straight-line method. After 4 years, the recoverable amount falls to Rs. 24,00,000. What impairment loss is recognised under Ind AS 36?
A.Rs. 2,00,000
B.Rs. 6,00,000
C.Rs. 26,00,000
D.Nil, as no impairment exists
Explanation: Annual depreciation is Rs. 5,00,000. After 4 years, accumulated depreciation is Rs. 20,00,000, giving a carrying amount of Rs. 30,00,000. The recoverable amount is Rs. 24,00,000, so the impairment loss is Rs. 30,00,000 - Rs. 24,00,000 = Rs. 6,00,000.
7Under Ind AS 37 (Provisions, Contingent Liabilities and Contingent Assets), a provision is recognised only when which of the following conditions is met?
A.A present obligation exists, outflow is probable, and a reliable estimate can be made
B.A possible obligation exists and the outflow is remotely possible
C.Management intends to incur the expenditure in a future period
D.The board has approved a future restructuring not yet announced
Explanation: Ind AS 37 requires recognition of a provision only when (a) an entity has a present obligation (legal or constructive) from a past event, (b) it is probable that an outflow of resources will be required, and (c) a reliable estimate of the amount can be made.
8Under Ind AS 12 (Income Taxes), a deferred tax liability arises when:
A.The carrying amount of an asset exceeds its tax base
B.The carrying amount of an asset is less than its tax base
C.There are unused tax losses carried forward
D.There are deductible temporary differences
Explanation: Under Ind AS 12, a taxable temporary difference giving rise to a deferred tax liability occurs when the carrying amount of an asset exceeds its tax base (or a liability's carrying amount is less than its tax base), implying future taxable amounts.
9Under Ind AS 8, a change in an accounting estimate (such as a revised useful life of an asset) is accounted for:
A.Retrospectively, by restating prior period comparatives
B.Prospectively, in the period of change and future periods
C.By a prior period adjustment to opening retained earnings
D.Through other comprehensive income only
Explanation: Ind AS 8 requires changes in accounting estimates to be recognised prospectively, by including the effect in profit or loss in the period of the change and, if applicable, future periods. Only changes in accounting policy and error corrections are applied retrospectively.
10Under Ind AS 113 (Fair Value Measurement), inputs to valuation techniques are categorised into a three-level hierarchy. A quoted price in an active market for an identical asset is classified as:
A.Level 1 input
B.Level 2 input
C.Level 3 input
D.An unobservable input
Explanation: Ind AS 113 defines Level 1 inputs as quoted (unadjusted) prices in active markets for identical assets or liabilities that the entity can access at the measurement date. These provide the most reliable evidence of fair value.
About the CMA Final Paper 18 (CFR) Practice Questions
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