ACCOUNTING
SCHOOL BASED ASSESSMENT EXEMPLARS - CAPS
GRADE 12
LEARNER'S GUIDE

INTRODUCTION: NOTE TO ALL GRADE 12 ACCOUNTING LEARNERS 
You are provided with a book containing four assessment tasks. These are intended to assist you in your Grade 12  studies of Accounting and in preparing you for the National Senior Certificate (NSC) examinations in Accounting. 
The tasks reflect: 

• Selected Grade 12 Accounting topics, namely subject content and knowledge  
• The various thinking skills (cognitive levels) that questions demand, namely remembering, understanding,  applying, analysing, evaluating and creating and creative problem-solving 
• The various degrees of challenge that can be found in all Accounting tasks, namely easy, medium and difficult 

You should be aware that the final Grade 12 mark is calculated from the year-end NSC examination that you will  write (out of 300 marks) plus school-based assessment (out of 100 marks). The curriculum stipulates the following  SEVEN formal tasks that comprise school-based assessment in Accounting:  

SCHOOL-BASED ASSESSMENT TASKS: NCS AND CAPS 

The tasks provided in this BOOK are examples of: 

• A first term report (Companies and internal control) 
• A second term test (Income statement and balance sheet) # 
• A second term project (Published financial statements of a company) 
• A third term case study (Cash budget) 

Your teacher will provide you with a 1st term test, 2nd term examination and 3rd term trial examination, as well as  other formative class tasks to assist you in your development of Accounting subject knowledge. You are also  advised to use past NSC examination papers to obtain valuable practice in all topics relevant to your curriculum,  but please refer to your teacher for changes that need to be made to the past papers (with regard to shares of  companies) if you are writing the NSC papers in 2014 or later.

QP Task A 
NOTE TO TEACHERS: This task is relevant to Grade 12 learners from 2014 (i.e. relevant to CAPS). This task  comprises two parts. You may adapt the material to take the needs of your class group into account. For example,  you may require them to do Part A on their own and Part B in class. Or you may require the class to do only Part  B as a formal report and undertake Part A as an extension task in class on a weekly basis. If you choose to adapt  the material in any way, you should ensure that the task comprises 50 marks as per CAPS. 

THIS TASK CONSISTS OF TWO PARTS: 
PART A Report on a public company listed on the JSE. (26) 
PART B Internal auditor’s report on procedures and internal controls in a public company (24) 

50

PART A Report on a public company listed on the JSE [26 marks] 
For this task you will need to use the page in the Business Report in a morning newspaper which lists the public  companies that are traded on the Johannesburg Securities Exchange (JSE). You will need access to this re source on a weekly basis for a period of 5 weeks.  
A rich aunt has earmarked R200 000 of her funds for investment purposes. She wants to buy shares of a public  company listed on the JSE. She requires your advice. Choose a company that is well-known to you from the  share page to complete the following report. 
NOTE TO TEACHER: Each learner must choose a different company. 
REQUIRED 
Prepare a one-page report on the company you have chosen.  
PREPARATION AND RESEARCH FOR YOUR REPORT 

• On the starting date of this task, calculate the maximum number of shares that your aunt can buy for  R200 000 in the company that you have chosen. Ensure that she buys shares in lots of 100, that is, 100,  200, 300, etc. Also calculate how much cash she will have left on this date after the purchase of shares.  She will place this in a savings account (ignore interest).  
• For a period of five weeks, make a note of the share price on the same day each week. Calculate the value  of her investment portfolio each week, that is, the value of the shares and the cash. 
• Find out other interesting information about the company you have chosen, e.g. products sold or services  provided, community service or sponsorship activities of the company, the size of the company, where it  is situated, details of the directors or the CEO, the amount earned by the CEO, or any other news about  the company or its history.  

THE REPORT MUST INCLUDE THE FOLLOWING: 

• Draw up a table and plot a graph of the company's share price. 
• Draw up a table and plot a graph of the value of your aunt's investment portfolio in respect of the invest ment in the shares and the cash that she has on hand. Do not consider the interest she will earn on her  savings account. 
• Further interesting information on the company. 
• Recommendation on further investment in this company, with reasons. (Should you aunt consider buying  more shares in this company, or should she consider an alternative investment?)

PART B Internal auditor’s report on a public company [24 marks] 
You have been appointed as the internal auditor of Exotic Clothing Ltd, a new public company which is about to  be established. All stock will be bought on credit. They will sell for cash and they will allow customers to buy on  credit. It is expected that there will be approximately 1 000 shareholders. The CEO has asked you to prepare a  report on certain procedures that should be put in place in the company. 
The company currently has four employees in the Accounting department. The CEO is thinking of appointing  Tom to manage fixed assets, Maisy to control trading stock, Bheki to control debtors (accounts receivable) and  Shamila to control cash resources. 
Your report should include: 

1. Procedures to establish the company
2. The records that should be kept on each shareholder, together with the reasons why these are necessary
3. The procedures that should be put in place to ensure that good internal control is exercised over:
   • Fixed assets
   • Trading stock
   • Accounts receivable (debtors)
   • Cash collected 

TOTAL : 50 marks

THIS TASK CONSISTS OF TWO PARTS: 
PART A Report on a public company listed on the JSE. 
PART B Internal auditor’s report on procedures and internal controls in a public company.

PART A: REPORT ON INVESTMENT PORTFOLIO OF ________________ (name of aunt) 
1.

2.

3. 

4.

5.

6.

PART B  
Internal auditor’s report on procedures to be implemented for Exotic Clothing Ltd
1.

2.

3.

4.

5.

6.

Signed: _____________________ (Internal Auditor) Date: ______________

IMPORTANT NOTE TO TEACHERS: The test includes entries relating to the new CAPS curriculum to be  implemented in 2014, with regard to shares of no par value and the repurchase of shares. The test was adapted  from a previous Grade 12 paper (QUESTION 4 of the 2009 NSC backup paper).  

QP Task B 

FINANCIAL STATEMENTS OF A COMPANY (100 marks; 60 minutes) 
You are provided with figures from the Pre-Adjustment Trial Balance of Simphiwe Limited. They buy and sell  uniforms and also repair uniforms for their customers, for which they charge a fee. These fees are credited to  the Fee Income Account in the General Ledger. 
By the end of the previous financial year, 30 September 2011, the company had issued 400 000 ordinary shares.  These shares were all issued at different times and at different issue prices. Many of the existing shareholders  had also bought shares on the JSE at prices negotiated with the sellers of those shares. The company also  issued 100 000 new shares on 1 March 2013. 

REQUIRED 

1. Refer to Information 10 below.
   Calculate the profit or loss on the disposal of the computer. Show workings. You may prepare  an Asset Disposal Account to identify the figure. (8)
2. Income Statement for the year ended 30 September 2012. (64) 
3. The following notes to the financial statements:

3.1 Ordinary share capital (13) 
3.2 Retained income  (15)

INFORMATION 

SIMPHIWE LTD 
PRE-ADJUSTMENT TRIAL BALANCE ON 30 SEPTEMBER 2012

ADJUSTMENTS AND ADDITIONAL INFORMATION 

1. Prepaid expenses in respect of sundry expenses at the year-end, R9 600, have not been taken into  account.
2. On 30 September 2012, R1 700 was received from A Ethic, whose account had previously been written off  as irrecoverable. The amount was entered in the Debtors’ Control column in the Cash Journal.
3. The provision for bad debts must be adjusted to R5 410.
4. There were two directors at the beginning of the accounting period. Directors’ fees have been paid for the  first half of the accounting period. On 1 April 2012, a third director was appointed. All three directors earn  the same monthly fee. Provide for the outstanding fees owed to the directors.
5. Rent has been received for 14 months.
6. The following credit note was left out of the Debtors’ Allowances Journal for September in error. The mark up on goods sold was 50% on cost. 

   SIMPHIWE LTD                                                            CREDIT NOTE 4533                                                                                                  28 Sept 2012  Credit: Supaclean Ltd  PO Box 340, Westmead, 3610
   		Unit price	Total
   48	Uniforms returned	R600	R28 800
   	Reduction on fee charged for  repair of uniforms		R2 250
   			R31 050

7. The loan statement from Stay Bank showed the following: 
   

   Balance at beginning of financial year	R450 000
   Repayments during the year	R234 000
   Interest capitalised	R ?
   Balance at end of financial year	R270 000

8.  physical stock count on 30 September 2012 showed the following on hand:
   • Consumable stores on hand, R3 600
   • Stock of uniforms on hand, R1 440 000
9. The depreciation rate on vehicles is 20% p.a. on the diminishing-balance method. A new vehicle was  bought on 1 May 2012 for R165 000 and properly recorded.
10. Depreciation on equipment is calculated at 10% p.a. on cost price. Note that an item of equipment was  taken over by one of the directors, Ivor Steele, on 30 June 2012 for personal use for R2 400 cash. The  relevant page from the Fixed Assets Register is provided below. No entries have been made in respect of  the disposal of this asset.
    
    

    FIXED ASSETS REGISTER		Page 12
    Item: VYE Computer		Ledger Account: Equipment
    Data Purchased: 1 April 2006		Cost Price: R66 000
    Depreciation Policy: 10% p.a. on cost price
    Date	Depreciation Calculations	Current Depreciation	Accumulated Depreciation
    30 Sep 2009	R66 000 × 10%  × 6/12	R3 300	R3 300
    30 Sep 2010	R66 000 × 10%  × 12/12	R6 600	R9 900
    30 Sep 2011	R66 000 × 10%  × 12/12	R6 600	R16 500
    30 June 2012	?	R?	R?

11. Income tax is levied at 30% of net income before tax.
12. Details of authorised and issued share capital:
    • Authorised: 600 000 ordinary shares of no par value
    • Issued up to 30 September 2011: 400 000 ordinary shares
    • New issue on 1 April 2012: 100 000 shares at an issue price of R9,50 each. These shares did not  qualify for interim dividends.
13. Dividends:
    • Interim dividends paid on 31 March 2012, 66 cents per share
    • Final dividends declared on 30 September 2012, 82 cents per share
14. Repurchase of shares: The directors approved the repurchase of 70 000 shares from several sharehold ers at a repurchase price of R11,20 per share. A direct transfer of funds was made from the bank account  to the shareholders on 30 September 2012, but has not yet been recorded. The shares repurchased  qualify for final dividends during the current financial period.  

Total: 100 marks

 Answer Book Task B 

1.                                          

2. SIMPHIWE LTD
INCOME STATEMENT FOR THE YEAR ENDED 30 SEPTEMBER 2012 

3. NOTES TO THE FINANCIAL STATEMENTS 
3.1 

3.2 

NOTE TO TEACHERS: This task is relevant to Grade 12 learners from 2014 (i.e. relevant to CAPS). You may  adapt the material to cater for more than 50 marks, but you should ensure that the final mark is converted to 50  marks as per CAPS. Teachers may allow learners to refer to textbooks in completing this task. 

ALSO REFER TO THE SOURCE MATERIAL FOR THIS TASK 
(PAGES 25-31)  

FAMOUS BRANDS LIMITED 

REQUIRED  
Study the information provided. Answer the questions which follow. As this task is intended as a project, you may  use your textbook as a resource. 

You are also provided with the following financial indicators for the 2011 financial year:
Current ratio = 1,4 : 1                                                            Acid-test ratio = 1,1 : 1                                                           Dividend pay-out rate = 64% 
Debt-equity  ratio = 0,2 : 1                                                     Net asset value per  share = R7,44                                  % return on shareholders’ equity = 33,9% 
EPS = 242 cents                                                                    DPS = 155 cents

1. General information 

1.2    

1.3

1.4

2.

3.

4.

5.

6. 

7.

 8.

9.

10.

11.

12.

TOTAL: 50 marks

NOTE TO TEACHERS: This task is relevant to Grade 12 from 2014 (i.e. relevant to CAPS). Teachers may choose  to increase the marks on specific items and mark the case study out of 75 or 100 marks, as long as the final  weighting is as per CAPS.  

REQUIRED 

1. Bennie Bekker feels that his wife made two mistakes in compiling the budget. He says that she  incorrectly left out the following:
   • The monthly depreciation of R4 800 per month
   • The new delivery vehicle, valued at R240 000, provided as capital by Mtini
     What would you say to Bennie regarding the mistakes he thinks his wife made? (2)
2. Complete the Debtors’ Collection Schedule for December 2012 and January 2013. (4)
3. Calculate the following for January 2013:
   • Percentage increase in the budgeted salaries and wages (2)
   • Percentage decrease in the amount budgeted for commission income  (2)
4. The R9 000 per month is the monthly repayment on the purchase of the existing vehicle. This was  bought several months ago for R196 000. At the time of purchase, a deposit of R46 000 was paid.  Instalments are paid over 24 months. Calculate the total finance charges incurred in the purchase  of this vehicle. (2)
5. Bennie’s son, Bart, used the business vehicle to attend his matric farewell party and was involved  in an accident. The insurance company refused to repair the vehicle as Bart was not listed as a  designated driver and the vehicle was not being used for business purposes. Bennie authorised  payment for the repairs to the damaged vehicle and charged this to Vehicle Expenses. The business  has over-budgeted on normal vehicle expenses and spends 75% of the budgeted amount.
   • What effect did the damage caused by Bart have on the budget?  (2) 
   • Mtini has become aware of this. What is he likely to say to Bennie? State TWO points. (2)
6. Refer to the Rent in the Cash Budget. A rent increase of 10% takes effect on 1 January 2013. The  actual rent received in December was as per the budget. 
   • Calculate the rent income for December 2012.  (2)
   • Provide a suitable explanation for the actual amount of rent collected in January 2013 being  different from the budgeted amount.  (1)
7. Payments to creditors:
   • Calculate the budgeted amount to be paid to creditors in January 2013.  (2)
   • Mtini feels that the business need not buy any goods for cash, and that all goods should be  bought on credit. In your opinion, will this improve the business Cash Budget? Explain.  (2)
8. Bennie Bekker decided to repay the existing loan from Alpha Lenders in full on 31 December 2012  as the interest rate was very high. The interest of 15% p.a. on this loan was not capitalised. He then  decided to take out a new loan with Minty Bank on 1 January 2013. Interest is capitalised on this loan  and according to the agreement a monthly amount of R4 000 is to be paid to Minty Bank on the 25th day of each month.
   • Explain the difference between interest capitalised and interest not capitalised.  (1)
   • Calculate the amount of the loan to be repaid on 31 December 2012. (2)
9. Use the Cash Budget to identify the missing figures, totals and balances designated A-D. You are  NOT required to identify the other missing figures. (4)
10. Mtini is worried that the business is not controlling the debtors properly. He asks you for a short report.  Include the following in your report:
    • Calculation of average debtors’ collection period (in days) (2)
    • The percentage of debtors who are complying with the credit terms (as indicated in the Debtors  Age Analysis) (2)
    • A brief comment on the above two calculations (1)
    • Details of the main mistakes that the business is making with regard to debtors. Also provide  the names of specific debtors to illustrate these main problems and suggest a solution for each mistake.  (6)
11. Consider the actual and budgeted figures for Advertising, Telephone and Insurance. (Note that Mtini  has not drawn any funds as yet.) Comment on each item, and offer ONE point of advice in each case. (6)
12. Bennie has made two significant decisions by taking out a new loan and admitting a partner to the  business. What would you say to Bennie about these decisions and the effect on the cash flow of the  business? (3) 

INFORMATION ON NEXT TWO PAGES …

INFORMATION 
1.

Cash Budget for two months ending 31 January 2013 (actual figures in shaded columns): 
December 2012 January 2013 

2. Purchases and sales of trading stock 
Stock is replaced on a monthly basis. 
50% of stock is usually purchased on credit. 
Creditors are paid in the month after the purchases, to take advantage of a 10% discount. Goods are sold at a constant mark-up of 80% on cost. 
The budget is worked out on the following total sales figures: 

Credit sales constitute 40% of the total sales. 

3. Expected collections from debtors: 
Debtors are told that they are expected to pay in the current month or in the month following the sales  transaction month. However, the budget is compiled as follows: 

10% is collected in the transaction month. A discount of 5% is allowed for any payment received in the  transaction month. 
50% is collected in the month after the transaction month. 
35% is collected in the second month after the month of sale. 

4. Debtors Age Analysis on 31 December 2012 

5. Actual figures from financial statements for year ended 31 December 2012: 

TOTAL: 50

1.

2.Debtors’ Collection Schedule for December 2012 and January 2013  

3.

4.

5.

6.

7.

8.

9.

10.

11. Consider the actual and budgeted figures for Advertising, Telephone and Advertising.  (Note that Mtini has not drawn any funds as yet.) Comment on each item, and offer ONE  point of advice in each case. 

12.