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ACCA P1 TO P7 SEPTEMBER EXAM TIPS
14 August 2017
BPP's TOP TIPS FOR THE SEPTEMBER 'P' PAPERS...
Section A’s compulsory 50-marker uses a lengthy scenario, often based on real-life events, tests all three main syllabus areas. Typically consists of four written requirements, some of which may be broken down into smaller sub-requirements.
The 4 professional marks are available for producing some form of written communication (briefing note, press release or letter to shareholders).
Due to the typical size of the compulsory scenario BPP advise PQs that you use the notional 15 minutes (now part of the 3 hour 15 minute exam) to plan this question above all others.
Recent exams have tested content from the examiner’s technical articles (such as June 2015 on corporate social responsibility (CRS) strategy& strategic CSR) so ensure you are familiar with any new articles.
Expect to see the use of stakeholder, ethical and other CSR theories applied to scenarios, as well as the use of risk, control and governance syllabus content especially relating to board directors, remuneration and reporting.
Test yourself with past-papers, especially those focussing on dysfunctional behaviour in areas such as bribery & corruption, environmental risk or poor ethical stance.
Section A is the 50-mark compulsory case study and will include a preparation statement of financial position and/or a group statement of profit of loss and other comprehensive income or statement of cash flows which may include foreign subsidiary, discounted activities, disposals and/or acquisitions. This will include other accounting complications such as financial instruments, pensions, share-based payment and impairment.
There will also be discursive requirements on a linked accounting adjustment and social/ethical/moral aspects of corporate reporting.
Q2 & Q3: One multi-part question covering a range of topics or a theme such as fair value measurement (see exam team article), deferred tax, foreign currency transactions, financial instruments, pensions, share-based payment, non-current assets (recognition and/or impairment of tangible and intangible assets), borrowing costs, the effect of accounting treatments on earnings per share or ratios.
The other, an industry-based question testing a range of standards such as accounting policies and the framework, leases, grants, IFRS for SMEs, reorganisations, provisions, events after the reporting period and related parties.
Q4: A discussion question looking at current developments in corporate reporting and problems with existing standards, such as capital reporting (see 2 exam team articles), leasing, revision of the conceptual framework, classification in profit or loss vs OCI (see exam team article), improvements to disclosure, regulatory issues over adoption and consistent application of IFRSs, implementation issues, application of the definition of control and significant influence (equity accounting), improvement in performance measurement, integrated reporting (see exam team article), revenue recognition (see exam team articles). It will also normally include a related computational part based on figures from a case study.
One of these questions can also include elements of group accounting, especially if Q1 is a statement of cash flow question.
General advice: Don’t spend too much time on numerical parts at the expense of the written bits! It is often easier to pick up marks in written questions than in complex numerical ones. Work on the basis of 1 mark per well-explained point for written questions.
Section A will be a compulsory case study question with several requirements relating to the same scenario information. This section continues to consume time in reading and absorbing – 3 pages of text and number are becoming the norm. Don’t underestimate the importance of practising 50-mark questions not only from a knowledge perspective, but also from a time management and ‘effort’ perspective too.
Section B are more likely to examine discrete subject areas. Sorry, but you need to know all the key areas of the syllabus.
Q1: expect section A questions to be mainly based on core syllabus areas such as project appraisal (domestic or overseas) and business valuations. Both of these areas are likely to include cost of capital calculations. Rick management may also feature as an asoects of this question in a number of different ways, eg value at risk, real options, hedging, risk mapping.
Q2-4: Risk management (currency or interest rate; business reorganisation; and real options are the tips here.
In section B one question may be entirely discussion based (but this is not guaranteed from June 2013), and often involves ethical and general financing issues (eg dividend policy).
In recent exams Q1 has often required a significant level of data analysis using numerical techniques, eg KPIs, EVA. You are aiming to turn data into information NOT to produce complicated calculations. Nevertheless any numerical techniques in this paper (eg transfer pricing, ratios, analysis of quality related costs, ABC) need to be mastered.
Performance management frameworks (eg building blocks, performance pyramid or the balanced scorecard) are also commonly tested in Q1. You must understand the purpose and limitations of these models and must ensure you can apply them in a practical way.
Q2-4: In section B commonly tested areas include quality management, information reporting (eg CSFs and KPIs), the application of strategic models (such as PEST, Porter’s 5 forces, the value chain), HR frameworks (eg reward & appraisal systems), risk management, and environmental management accounting.
keep checking the ACCA website for articles in the lead up to the exam (eg recent articles on complex business structures, big data, integrated reporting and performance management models (BCG & 5 forces).
The whole syllabus is examinable, but the topics we would expect to see are:
* Groups of companies involving overseas aspects and losses.
* Unincorporated business particularly loss relief or involving a partnership, basis period rules should also be expected.
* Capital gains tax versus inheritance tax including availability of reliefs.
* Overseas aspects of income tax, CGT, IHT or corporation tax.
* Personal service company.
* Share schemes.
* Company purchase of own shares.
* Enterprise investment schemes/ Seed EIS/venture capital trusts.
* VAT – partial exemption or land and buildings or transfer of a going concern or overseas transactions.
* Transfer of trade versus sale of subsidiary.
* Disincorporation relief.
* Pension contributions.
*Patent box, research and development expenditure.
Typically Q1 will test planning, risk assessment, evidence gathering and practice management issues using a scenario where audit client details are presented, often including financial statement extracts.
Topics covered by Q2 will be more uncertain to predict – possibly a non-audit engagement such as prospective financial information (PFI) or due diligence, or a question testing specific parts of the syllabus, such as audit completion or consolidated groups.
Section B typically tests the following syllabus areas: audit evidence and financial reporting issues, practice management including ethics and quality control and reporting, including completion and communication.
Recent exams have tested fresh content from the examiner’s technical articles: for example key audit matters were examined in December 2016, while INT candidates were tested on the audit of public sector performance information in December 2015.
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