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CAF-6 Corporate Reporting · Autumn 2026

Q1: Multiple-choice questions

10 marksMCQPass rate 71%

Ten one-mark MCQs: segments (a cost-centre component and the 75% test), Companies Act schedules and size reclassification, foreign currency advances, IFRS S1 core content and scope, two ethics conflicts and functional currency.

Areas: (i) Operating segments (IFRS 8) (1) · (ii) Companies Act schedules and local requirements (1) · (iii) Companies Act schedules and local requirements (1) · (iv) Foreign currency (IAS 21) (1) · (v) Sustainability reporting (IFRS S1) (1) · (vi) Ethics in financial reporting (1) · (vii) Ethics in financial reporting (1) · (viii) Sustainability reporting (IFRS S1) (1) · (ix) Operating segments (IFRS 8) (1) · (x) Foreign currency (IAS 21) (1)

Read the question first

We don't reproduce ICAP's question. Open it in the official PDF, attempt it, then use this walkthrough.

Q1 in the official paper (p. 1) Official suggested answer Suggested answers and marking plans sit in ICAP's student area (CRN login required).Examiners' comments on Q1

How to approach it

  1. Segments: first ask whether the component is an operating segment at all (does it earn revenues from activities other than incidental ones?) before testing thresholds.
  2. Companies Act items: subsidiaries of listed companies follow the listed-company schedule; size reclassification depends on consecutive-year rules.
  3. Ethics: the Code expects escalation and consultation before resignation or external reporting.

Key rules to apply

  • IFRS 8: corporate headquarters and functions earning only incidental revenue are not operating segments.
  • IAS 21: advances paid or received for goods or services are non-monetary; they are not retranslated.
  • IFRS S1 core content: governance, strategy, risk management, metrics and targets.

Common mistakes

Drawn from the examiners' comments for this sitting (summarised in our words) and from typical errors on this topic.

  • Calling a cost centre a reportable segment because it passes the 10% asset test.
  • Retranslating customer or supplier advances at the closing rate.

Similar question with worked solution

Written by us with our own numbers; it tests the same skills as Q1 without copying it.

Original practice question

The 75% external revenue test

Total external revenue is Rs 1,000m. Segments that pass the 10% tests have external revenue of Rs 700m. The largest remaining segments have external revenue of Rs 40m (X) and Rs 30m (Y), neither passing any 10% test.

Required: What must the entity do?

Worked solution

StepExternal revenue
Identified so far700 (70%)
Required750 (75%)
Add X740 (74%)
Add Y770 (77%)

Answer: Designate X and Y as additional reportable segments until at least 75% is covered, even though neither passes the 10% tests.

Keep practising

Chapter MCQsOperating segments (IFRS 8)Chapter MCQsCompanies Act schedules and local requirementsChapter MCQsForeign currency (IAS 21)Chapter MCQsSustainability reporting (IFRS S1)Chapter MCQsEthics in financial reportingStandard summaryForeign currency (IAS 21)Topical indexCAF-6 topic × sitting matrixSitting analysisCAF-6 Autumn 2026

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