Professional Documents
Culture Documents
PQ MG
PQ MG
PQ MG
www.pqmagazine.co.uk / www.pqjobs.co.uk
November 2014
TAKE CONTROL
OF YOUR FUTURE
WIN!
Weve
five
limited
edition
Canon
calculators to
give
away.
Turn to
page 42
PQ TRIUMPH AT AWARDS
PQ magazine is the AIAs Accountancy Media of the Year winner for 2014.
At a ceremony in London earlier this month PQ magazine beat off the
challenges from Accountancy Age, The Accountant and AccountingWeb to
win the top prize. Richard Simms of FA Simms, which sponsored the award,
presented editor Graham Hambly with the prize.
Other winners on the night were Ian Ball, chair of CIPFA International and
former CEO of IFAC. LSBF's Hafeez Qazi was also awarded the prize for AIA
Accountant of the Year.
PQ magazine had a great night and, dont forget, you too could be a
winner as we are now looking for nominations for the PQ magazine Awards.
We have 15 PQ trophies up for grabs.
Turn to page 14 to find out how you too can get on the front cover of PQ!
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comment PQ
CONTENTS
News
08CIMA resit results P2 pass
rates plummet to just 27%
10ACCA optional papers ACCA
takes steps to tackle problems
12Boost for N Ireland Three of
the Big 4 unveil expansion plans
that will boost the local economy
Features, etc
06Mind your Ps&Qs I need help
passing ACCA; E3 woes; and our
Twitter and LinkedIn updates
14PQ Awards 2015 Make your
CV shine get yourself
(or your hero) nominated
for a PQ award
16ACCA F4 The new
challenges Corporate
and Business Law
students face
17P is for problem The ACCAs
Alan Hatfield explains how the
association is tackling the issue
of poor P paper results
18ICAEW spotlight Valuation
techniques the examiners
view; and the importance of a
proper revision timetable
21Four pages of CIMA tips A
tips bonanza for last time before
the exams go on demand
26Roundtable discussion Our
panel of experts discuss, among
other things, the move to OTs
28ACCA case studies Two real
life examples of how the AAT
qualification changes lives
November 2014
30International standards
32,361
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the fundamental accounting
principles. One CIMA qualified also
wondered if they still taught income
recognition and cost deferment in
the ACA exams. It was suggested
that the head of the
ICAEW may need to
check that the
syllabus is still fit for
purpose and special
attention had to be
paid to what PwC trainees are being
PQ Magazine Fourth floor, Central House, 142 Central Street, London EC1V 8AR | Phone: 020 7216 6444 | Email: graham@pqaccountant.com
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PQ news
ROBERT
BRUCE
Its up to all
of us to be
sceptical
EXCLUSIVE
Two papers stand out in the latest
CIMA resit results P2 and E3.
While the P2 pass rate plummeted
to an all-time low, just 27%, the E3
pass rate fell to 40% this time.
CIMAs executive director of
education, Noel Tagoe, said the
pass rate had come as a surprise.
The pass rate for March 2014 was
67%, and he admitted he thought
CIMA had turned the table in this
paper. He admits that he was
wrong. His concern is that students
are not properly prepared for the
resit. They have to put in as much
work as they would for a main
sitting, he stressed.
P1 Performance Operations
E1 Enterprise Operations
F1 Financial Operations
P2 Performance Management
E2 Enterprise Management
F2 Financial Management
P3 Performance Strategy
E3 Enterprise Strategy
F3 Financial Strategy
T4 Part B case study exam
51%
63%
61%
27%
58%
52%
58%
40%
56%
57%
SEPT 13
52%
68%
57%
45%
65%
26%
56%
56%
55%
66%
MAR 13 SEPT 12
58%
62%
71%
44%
55%
51%
56%
48%
52%
54%
42%
88%
54%
51%
59%
53%
56%
40%
55%
48%
In brief
1,000 to 1 shot
Getting a change to your
ACCA exam result through an
administrative review is currently a
1000 to 1 shot. In all,
there were 966
administrative reviews
following the June
exam. A total of four
errors were confirmed.
While three of these
remained a fail just one
resulted in a pass. The ACCA has
also confirmed that none of the 46
appeal cases were successful.
53%
69%
71%
67%
63%
52%
58%
50%
50%
65%
Chocolate heaven
CIMAs pre-seen for the
November Strategic exams has
now hit the streets. The big advice
from BPPs head of
CIMA, Steve
Malpass, is dont
spend too long
trying to find a reallife company that
mirrors the case.
This time around
Y plc looks a bit like Thorntons!
See page 32 for his full advice on
how to use the pre-seen.
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PQ news
PREM
SIKKA
OECD
proposals
are a missed
opportunity
With the EU losing around 1 trillion a
year due to tax avoidance and
evasion, the OECD has recommended
sharpening of transfer pricing rules,
possibly restricting tax relief on
intragroup royalty and interest
payments. The corporate tax system is
the outcome of some 3,000 treaties
and the OECD wants to see reforms so
firms cant manufacture transactions
purely with a view to generating tax
credits twice.
The OECD has also recommended
country-by-country reporting (CBCR).
This would require multinationals to
disclose capital, revenues, profits,
taxes and employees for each country
in which they operate, which can
highlight profit shifting. However, the
OECD limits the availability of CBCR to
tax authorities only.
These proposals do not address the
fundamental faultlines. In a world of
global monopolies, independent arms
length prices are difficult to ascertain.
So transfer pricing disputes will
remain. The tax system regards each
company subsidiary as an independent
taxable entity rather than part of an
integrated group. Thus, HSBCs 500
subsidiaries are taxed separately,
leaving plenty of room for tax
arbitrage. An alternative system,
known as unitary taxation, would base
tax on consolidated profits,
apportioned to each country according
to sales and other factors. All
intragroup profits/losses are negated
and profit shifting can be checked. But
big corporations oppose this and the
OECD has danced to their tune.
n Prem Sikka is professor
of accountancy at the
University of Essex
Gut feeling
Business
leaders are
taking major
strategic
decisions about
the future of their business based
on their gut instinct and
experience in preference to the
use of data and analytics,
according to a new report
published by PwC and written by
the Economist Intelligence Unit.
The report, Guts & Gigabytes,
explores the changing nature of
corporate decision-making and
10
Hatfield:
talking
to PQs
Partner profit up at EY
EY UK has had another good year.
Revenues are up 8.6% and the
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PQ news
CARL
LYGO
Visa fraud
does the
profession
no credit
In June, the Home Office announced a
further tightening of the rules relating
to the issue of student visas, and
suspended 57 private colleges and
three public universities from being
able to issue visas to international
students. Home Office minister James
Brokenshire said: We have already
removed some 750 bogus colleges
from the list of those entitled to bring
foreign students to Britain. Many of
the private colleges are providers of
full-time ACCA courses and so readers
of PQ magazine will have an interest
in these developments. The latest
crackdown was prompted by
undercover reporting on the BBCs
Panorama, aired in February. They
secretly filmed English language
testing for the TOEIC (Test Of English
for International Communication)
exams run by an organisation called
ETS. They appeared to find answers
being read out to students by
invigilators cheating. The Home
Office launched a detailed and wideranging investigation into actions by
organised criminals to falsify English
language tests for student visa
applicants. It found that over 30,000
TOEIC certificates have been falsified
and 19,000 others are questionable.
Colleges and universities have
admitted students relying on these
falsified TOEIC certificates and the
Home Office crackdown relates to
whether private colleges and
universities have abused their highly
trusted status. Cheating, falsifying
certificates and working in breach of
immigration rules are not compatible
with the professional ethics of
accountancy. Some colleges and
universities are now no longer
suspended but you should check with
your provider if you have any doubts.
n Professor Carl Lygo is
chief executive of BPP
Mental health
issues top list
In brief
CIFPA win
CIPFA has won
the contract with the
NHS Leadership
Academy to be the
exclusive provider of
tuition services for
the finance
management stream
of the NHS
Graduate Scheme.
12
F4 a fairer test
The new-look F4 means
the well-prepared candidates
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PQ Awards 2015
NOMINATING
We have begun the search for the winners of 16 PQ awards the best
awards around! You too can make your CV shine with a PQ shortlisting
Our 2013
College of
the Year
De Montfort
University
proudly
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CATEGORIES
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THE YEAR
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Date
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Saturday
08 November 2014
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09 November 2014
F4 Rev
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Saturday
15 November 2014
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16 November 2014
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22 November 2014
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23 November 2014
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Saturday
29 November 2014
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Sunday
30 November 2014
F8 Rev
PQ ACCA F4 paper
BE A LEGAL EAGLE
The syllabus
.
The F4 exam changes format dramatically from
November 2014. Students will have a choice as
to whether to sit a computer based exam or a
paper based exam.
Format of computer based exam
The examination consists of:
Section A
25 x 2 mark objective test questions.
20 x 1 mark objective test questions.
Section B
5 x 6 mark multi task questions.
All questions are compulsory. Duration is two
hours.
Question description
Section A: The two-mark objective questions will
give the candidate four alternative answers.
Candidates will be expected to usually give one
correct answer, although sometimes it may be
two depending upon the nature of the question
asked. Some of the questions will be simply
identifying the correct legal principle and some
will require application of a legal principle and
may be based on a well-known case.
The one-mark objective questions will give the
candidate three alternative answers. Candidates
will have to give one correct answer.
Section B: The multi task questions will usually
be scenario-based questions, and may be based
on relevant important cases. Candidates will be
expected to apply their knowledge to give the
correct answers from the different alternatives
given. A minimum of three different questions
may be asked on each scenario. Due to the
nature of the multi task questions it is unlikely
that there will be questions on the English legal
system.
Format of paper based exam
The examination is in the same format as the
computer based exam. The difference is that the
Section B multi task questions require the
candidate to write short essays as their answer.
Candidates will be asked questions on the
scenario and have to apply the law to the
scenario. There may be 2 or 3 parts to each
question.
Syllabus content
The content of the syllabus for both formats is
exactly the same. The main syllabus areas are:
16
Insider dealing.
Money laundering.
Fraudulent and wrongful trading.
Content of new syllabus v old syllabus
There are no additions to the new syllabus from
the old syllabus. The examiner has removed
corporate governance and the structure and
operation of tribunals. There is less emphasis on
human rights.
Sitting the F4 exam
.
Previously, students were required to learn a lot
of information which had to be reproduced when
answering questions. Reference was required to
the most important cases and statutes.
Candidates used to be able to do some
question spotting, which enabled them to miss
out certain areas of the syllabus.
The new format does not require rote learning
of definitions, etc, but candidates will need to
study the whole syllabus. The use of a large
number of multiple-choice questions allows the
ACCA to exam every area of the syllabus even
the most fringe areas. The scenario questions
require not only knowledge of the law, but
understanding of it to apply it correctly.
This means that there is no escaping the need
for more knowledge of the whole of the syllabus
in order to score well. Do not fall into that the
trap that as it is mainly multiple choice questions
the paper is very easy to pass.
However, a well-prepared candidate should
feel more confident about achieving the result
they deserve as the exam will be more balanced
and less of a lottery regarding which topics
appear on the paper. PQ
Sue Tuffnell is the F4 Content Specialist at
Kaplan Financial
PQ Magazine November 2014
ACCA exams PQ
HELPING PQs
TO SUCCEED
PQ MAGAZINE
GOES GLOBAL
17
PQ ICAEW spotlight
What is it worth?
the public
services experts
Our new and improved professional
accountancy qualication for 2015
The public services environment we operate within is changing, as a result
our Professional Qualication is too. It will:
Increase the focus on the wide range of commercial skills needed
by UK public nance practitioners.
Deliver greater portability between the public and privatesectors.
Provide more entry routes for holders from other qualications
andexperienced professionals.
Enhance the Practical Experience Portfolio (PEP) by placing greater
emphasis on the role of the employer.
Enable greater exibility around blended and online learningoptions.
This will put our students in the best position to build a successful
career in public nance.
To nd out more visit www.cipfa.org/newPQ
or email newPQ@cipfa.org
Find us on:
TOP
OF
THE
TIPS
This is it, our lastever exam tips pull-out supplement
for the CIMA November exams. Good luck you lot!
BPP.
P1
Working capital management
the calculation of the cycle, the
impact of decisions on the cycle,
EOQ calculation, cash flow forecast
and compound interest calculation.
Operating statement reconciling
budgeted to actual profits including
fixed overhead variances and
possibly mix and yield calculations.
NPV including tax and inflation
and/or incremental revenue and
costs.
Sensitivity calculations and yield
to maturity using the IRR.
Expected values, joint probabilities
and risk based decisions.
Decision trees requiring both
appropriate construction and
evaluation.
Activity based costing calculations
and discussion of benefits and
drawbacks.
Benefits/problems of budgeting
techniques for discursive marks.
P2
Limiting factors calculations and
discussion of shadow prices.
Pricing optimal pricing and
discussion of pricing policies.
Learning curve calculations and
impact on variances.
Budgeting impact of
participation on motivation.
Performance evaluation via
financial/non financial measures.
Transfer pricing discussion of
differing policies and their
consequences linked with NPV.
Brought forward knowledge from
P1 this can be pretty random, so
expect the unexpected.
P3
Risk management being able to
PQ Magazine November 2014
Kaplan Financial
E1
Section A:
Expect the questions to cover the
full range of the syllabus.
Sections B and C:
The global business environment:
Emerging economies with
possible link to outsourcing/
offshoring.
Culture.
Corporate political activity.
Information systems:
System testing and/ or
maintenance.
Resistance to change.
Operations management:
Capacity planning/inventory
management.
Cousins or Reck and Long.
Marketing:
Market planning process and
the 4Ps.
B2B and B2C marketing.
Managing human capital:
HR theories (e.g. McGregor).
HR planning including
learning, training and development.
E2
Strategic management:
Corporate appraisal and its
components, especially PEST and
Porters five forces.
Corporate social responsibility.
Stakeholder analysis.
Relationship management:
Corporate Governance and ethics.
Mentoring.
Communication.
Project management:
Benefits/drawbacks of a single
methodology such as PRINCE 2.
Project management tools, such
as CPA or WBS.
Managing project teams.
E3
Strategic analysis and evaluation.
Mission and objectives.
Corporate social responsibility
and ethics.
F1
Company income statement,
statement of financial position,
statement of changes in equity
examined as a section C question.
Consolidated income statement
and statement of financial position
incorporating adjustments for inter
company selling/balances,
unrealised profit, impairment, fair
value and depreciation. Likely to be
a section C question.
Statement of cash flows using the
direct method (likely to be the
section B question).
Finance lease payment in
advance.
IAS 11 Construction contracts
possibly a loss making scenario.
IAS 37 Provisions and
contingencies.
PPE note including
depreciation, disposal, revaluation
and possibly asset held for sale
could be a section B question or
part of a note in section C for a
single entity question.
Business tax:
VAT calculation and impact on
profit.
Avoidance versus evasion
explanation.
Calculation of deferred and
current tax as part of a section C
question.
F2
General interpretation plus
limitations of analysis/further
information.
Earnings per share.
Financial instruments.
Share based payment.
PQ Magazine November 2014
LSBF
E1
National cultural differences (The
Hofstede Model).
Implementation of systems with a
view to overcoming user resistance.
PQ Magazine November 2014
E1
It is important to fully utilise all
the materials provided. Basically,
this means do the recommended
reading from the course text but
also consider some wider reading,
for example the financial and
business press or articles from the
CIMA website. As the E1 paper
focuses on the operational and
strategic elements, your ability to
demonstrate your understanding
and depth of knowledge in the
application to your discursive
answers will be of benefit. Consider
the structure of your answers. For
example, for a question about
cross-cultural management the
Hofstede Model has five
dimensions, and the best approach
should be to use each dimension
as the basis for your answer.
Consider how, according to the
question or scenario, it relates to
the intended meaning of each
dimension, and what this in overall
terms might mean in terms of the
management of an entity due to
national cultural variations. To
maximise marks, can you give
specific examples such as those
from the course text or your wider
reading? The ideas of structure
could be applied to any discursive
question; there will always be a
series of points or concepts that
you need to apply in order to
demonstrate your knowledge and
understanding.
P1
There could be something on
absorption costing/variances (an
article has just gone up on CIMAs
website on this!) and possibly
modern costing methods/budgeting
techniques. Project appraisal is
usually a favourite as well. The
Managing Short Term Finance
section of the syllabus will be
removed from P1 from 2015 so
although this could be examined I
dont think there is likely to be a big
focus on it.
E2
Strategic management:
Competitor analysis.
Strategic analysis, especially
models such as Porters Five forces
or Value Chain.
Continued on page 24
23
HEALTH
WARNING
First Intuition
F1
Sections A and B:
Taxation, including deferred tax
and a tax computation.
Statement of cash flows.
Ethics.
The framework.
Section C:
Single company accounts
including revaluations, leases.
Group accounts.
F2
Groups statement of cashflows.
Interpretation of company
accounts.
Group SOCIE.
Financial instruments.
Earnings per share.
Pensions.
Discussion of whether to include
people on the SFP.
F3
Overseas project appraisal.
Financial forecasts.
Business valuations.
Cost of capital and risk.
Decisions on sources of finance.
Working capital.
P1
Section A:
Selection of short answer
questions.
Section B:
Likely to have one question on
budgeting techniques (ABB/
Incremental/ZBB).
Financial instruments (including
calculation of AER/YTM).
Modern environment (TQM/JIT/
environmental costing).
Potential calculation questions
(VOPI/NPV/profit tables/EV).
Preparation of cash budget.
Section C:
Variances (including planning v
operational/mix v yield) ABC has
come up in section C in the past
two sittings, hence is likely to get a
variance question.
NPV plus payback period/IRR.
P2
Learning curves.
Variances.
ROI and RI.
Pricing.
Multiple limiting factors.
ABC.
TQM/JIT.
Budgeting.
P3
Section A:
Identification and management of
risks for the company in the
preseen using elements of the risk
management cycle.
Evaluation of the companys
controls.
Section B:
Corporate governance internal
audit, internal controls, boards of
directors.
Financial risk currency risk:
ways of managing currency risk,
including options.
IT risks and controls, including
CAATs.
Evaluation of two projects.
E1
Corporate governance.
Human resource plan.
Marketing mix.
International trade.
Use of IT in operations
management.
E2
Project management
completion and CPA.
Corporate governance.
Ethical behaviour.
Managers and subordinates.
Organisational culture.
Contrasting models of strategic
PQ
planning.
PQ Magazine November 2014
Sage Payroll
Sage Line 50 Level 1&2
Managements Accounts
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Excel & Others
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PQ roundtable discussion
MULTIPLE CHOICE
We put six top tutors around a table and asked them about the move to OTs. Here is what they had to say
Objective test questions (OTs) are being introduced into many of
the accountancy body exams. What are the major issues here?
Malcolm Bell: Students must look at the OTs and understand the type
of exam they are sitting. They have got to start having a go at these
questions right away. There is an art in putting together OT exam
papers, you have to counter-balance the type of question and the
amount of time you give per question. If questions are long and
difficult to interpret then it could put the whole paper out of kilter. We
will know how well students have done by the outcomes! If failure
rates go up then the bodies have got their benchmarking wrong. It is
crazy that some current pass rates are just 30%.
Jan Weston: Students may think OTs are a lot easier and the worry is
that they wont give them as much attention. Understanding the way
questions are worded is going to be a key to passing these new
exams. The challenge for the bodies is to ensure consistency in their
exam processes.
Jim Hinchliffe: Students must sit exams that look like the ones they
are going to face. There are also going to be time pressure issues.
Many of these exams are just 90 minutes long, rather than the normal
three hours. Students will also have to learn all the syllabus as the
new CIMA pass rate, for example, is 70%. The consistency of exams
is important. The bank of questions is being outsourced to external
writers. Perhaps it will also change how exams are perceived some
say CIMA E1 is easier than P1. That may change
Clare Finch: There have been some major differences in some of the
CIMA pilot exam papers. The F2 exam has only four drag and droptype questions. There is a worry about the robustness of these OTs. I
think the other bodies should take more advice from the ICAEW who
have been doing this type of exam successfully for a number of years.
Danusia Wysocki: My concern is that some students will struggle with
the IT. The bodies must ensure the lecturers are trained in the
software and understand it. The exams must not become a test of a
candidates IT skills.
Do you think the introduction of OTs will change how students
study? The onus will very much be on the student to get qualified.
Malcolm Bell: The AAT and entry level of the three major accountancy
bodies all have OTs now. The big issue is progression and keeping
students motivated. Some students never feel ready for the exam. So
while they book a course it is a huge psychological step to booking
the exam.
Jim Hinchliffe: Students have to be careful. The longer it takes them
to get through the OT then the further back their knowledge becomes
when they need it for the case study. Our focus groups with students
show PQs like us to put an exam date on the timetable. That sets a
date for the revision phase and a final outcome.
Clare Finch: It can be like herding cats at times. Many PQs just dont
ever feel ready and now with a CIMA pass rate of 70% that might
become worse. Students will have more control but with this choice
comes new responsibilities for them.
Tony Mock: Good exam technique is always going to be important as
nerves can become an issue on exam day. You have to make sure
you have taken sufficient practice papers so when it comes to the real
thing you just see it as another test. It would really help if all the
bodies released the three questions that were answered most badly,
providing real examples. The examiners should then discuss in detail
where students are going wrong and what they expect to see. The key
to any successful change is decent analysis and questions.
26
Jan Weston: Some students really do know what they are doing. Others need
more help and that is when it is important to set out their own personal study
plan. It is easier for ICAEW PQs as their future is all mapped out for them.
They know what they are going to be doing in two or three years time. It would
be good if all students did the same, mapping out all the levels right through to
the end.
There has been a shift to online learning. How do you see this developing?
Malcolm Bell: It is all about your circumstances. If you know that you cant be
at every lecture and know you might miss some of the course then online is
the perfect solution. Our online students also seem to find it much easier to
ask questions. I can also see how they are performing on individual tests and
instant polls.
Jim Hinchliffe: It is true, it is easier to ask the obvious questions online.
PQ Magazine November 2014
roundtable discussion PQ
Students will ask really good questions in
private which they would never ask face-to-face.
The community boards also really help to engage
our learners.
Jan Weston: We are a face-to-face organisation.
Often our students want to get away from
technology so they can concentrate on learning
and immerse themselves in the syllabus. They
can also get away from the other distractions, no
matter how much they love them (we are talking
family here).
Are hard copy study manuals still important?
Tony Mock: We have recently had requests about
having the material on smartphones. Which is
new. But, yes, students still need and want their
manuals they work brilliantly in this market.
Malcolm Bell: Every survey we do of students
says they still want them.
Jan Weston: All our students buy one, but what
percentage ever opens them is debatable. They
are a comfort though.
Clare Finch: With the introduction of OTs I think
manuals will have a new lease of life. Students
will need to study the whole syllabus so will have
to refer to them on a much more regular basis.
The only worry is they could get bigger! PQ
During the discussion the need for students to
take control of their future became very
apparent. The good tuition companies will help
PQs manage their journey to qualification. They
will help you create your own personal study
plan. This will become more and more important
as the exams move to on demand (see page 1).
Results matter,
and were proud of ours
ICAEW
93
% pass
rates*
CIMA
100
% pass
rates**
ACCA
100%
pass
rates
* BC, BR and CS from the July 2014 sitting based on rst time students. ** E3 May 2014 Based on students attending full link courses. F&, F8 and P2 June 2014, Based on students attending full link
courses.Funding available for ACCA and CIMA fees for employees of UK charities. All prots are covenanted up to Reed Educational Trust Limited which is a registered charity. Reg. No. 328347
www.reedbusinessschool.co.uk
27
ALL INCLUSIVE
At the recent All Inclusive Training awards ceremony two students gave a real insight into how
Julie Agbowu and her team had helped change their lives. We let their stories inspire you
NEED HELP?
28
I was working at
a McDonalds
restaurant, not sure
how my life was going
to pan out as my dream
of becoming an
accountant had started
to look bleak. I had
approached
accountancy firms begging for experience with no pay or
obligations, but the answer always seemed to be the same
we do not take on trainees anymore.
I discussed my worries with a very good friend of mine
and she mentioned All Inclusive to me. The next day I
visited Julie and I asked about my options. It was the right
thing for me at the time, although another problem arose
the cost. It transpired that I would have to pay full price as
I was working, and I was heartbroken because I couldnt
afford it.
So I opted for the next best thing I chose to pay for
Sage online 50 only. But this just added sugar to my taste
buds I wanted to complete AAT, I wanted it all. After
thinking very hard about my options, I resigned from my
job at McDonalds, hoping that this would push me more to
search for a job in the accounting field. It wasnt easy, and
I was on Jobseekers Allowance for over a year no job.
The job centre kept sending me for admin or sales
assistant jobs, and I became depressed.
After telling Julie that I was willing to accept voluntary
work, within weeks she called me explaining that there
was an opportunity at Croydon Council very exciting! I
went to the interview to face three intimidating ladies;
however, they turned out to be the most beautiful,
accommodating individuals. I spent nearly three months at
Croydon Council and there was never a dull day. There was
always something new to learn. Its a wonderful feeling
when you know that as well as getting you can also give.
Actually putting what you have learnt into practice, and
being rewarded for it, the joy and satisfaction is beyond
explanation. I loved it there.
At the end of my time at Croydon Council my hard work
did pay off. The three beautiful ladies found a paid job for
me and it was one where I can gain more experience. I am
now working for Croydon Council at a Local Authority
Trading Company and it feels good!
Join your
tutor group
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PQ international standards
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.'+/!23")!'(!+/&!0123&4+!,'(&5!#$!4*,,!6787!9:;!<<:8!
PQ CIMA pre-seen
MMM CHOCOLATE!
S
Y plc
.
The pre-seen is based on a confectionery
company, Y plc. Although Y is based in
the eurozone and its financial results are
presented in euros, many of its other
characteristics appear to be similar to the
UK confectionery company Thorntons
plc. Some of the drivers affecting Y plc
that might be important in the exam are
described below.
Strategic development: Y plcs product
range has traditionally been chocolate,
but it is now diversifying into other
confectionery items. Y needs new
business ideas and needs to reduce its
costs to keep its shareholders happy.
These initiatives may be spelled out in
the unseen material in each exam, with
you being asked to respond to them and
to give advice.
Sales channels: Y plc has a number of
sales channels its own high street
stores, franchises, retail partners, online,
direct contract sales to corporate clients
and it also manufactures products on
contract for other retailers.
Demand: Y sells worldwide, but its main
market is Europe. Sales have been strong
despite the recession, as confectionery is
seen as an affordable luxury in a time
when other luxuries are out of reach.
Recent reports from the International
Cocoa Association suggests that the
European confectionery market is
declining, North America is showing
some growth, and Asia is showing
significant growth. Increased chocolate
consumption in Asia is being seen as a
significant factor in the industry.
Increasing profits: Y has decided on a
cost cutting strategy. Y may choose to cut
costs through reducing its overheads,
perhaps cutting the number of high
street shops or by driving efficiencies in
its production.
Supply chain: The basic ingredients for
chocolate are cocoa butter, cocoa liquor,
sugar, milk and vanilla. While cocoa
butter is becoming more expensive, the
price of cocoa powder, which is used in
32
Steve Malpass shares some expert advice on how to deal with the case study
element of the November CIMA Strategic exams the last one of its kind
Do not
.
Research the industry in too much
detail. Although Y bears a resemblance to
Thorntons, any exam questions will focus
on Ys issues, not those of real-life rivals.
Try to memorise the facts of the preseen. If any reference is needed to the
pre-seen in order to answer any of the
section A requirements the examiner will
provide them, e.g. discuss with reference
to the companys existing strategic
objectives (strategic pre-seen page 3)
Assume that the pre-seen sets the
boundaries of the unseen. It is likely that
other issues and topics will be brought in
to play on exam day.
Ill end with a quote from a colleague who
shared their thoughts on this: Passing
Strategic Level is not down to how much
you know about the pre-seen. Its about
having the syllabus knowledge and the
exam technique to produce businesssensible answers that focus exactly on
what is put in front of you on exam day.
And not forgetting about Section B is
important too.
I must say that last bit is pretty critical
if you want to pass. PQ
Steve Malpass is Head of CIMA at
BPP
PQ Magazine November 2014
Plustek SC8016U
Plustek PS286
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PQ CIPFA spotlight
34
performance measurement PQ
erformance measurement
remains fashionable for public
and private organisations and
consequently in exam world. So it is
essential that students understand the key
skills that examiners are trying to draw out
of them in pretty much every performance
measurement based scenario.
Financial measures are inevitable. The
modern accountant must make the
numbers talk namely, describe what the
numbers are doing and explain the
reasons why the numbers have moved as
they have, to a member of management
without a financial background. This
means being prepared (as always) to state
the obvious in understandable, nontechnical language. The scenario will act
as a guide here, giving very clear clues.
Students must, however, manage their
expectations about what can be achieved
in the time available. Be careful not to do
numerous calculations and only talk about
a few of them. It is important to have a
plan of how to attack the question, but be
aware that the time will not allow a full
analysis, as would be produced in the
office. For example, for a 15-mark financial
analysis question I would advise my
students to aim for five calculations with
written descriptions and explanations.
A balanced view of performance
measurement has to include non-financial
measures. The reason for this is that
financial measures simply measure the
Balancing act
result of performance (resultant factors).
Therefore, by the time bad performance
has manifested itself on the accounts,
there is nothing management can do
about it. Equally, financial performance
measures can encourage the cutting of
discretionary spend (such as marketing,
maintenance, training) items that have a
positive impact on the finances in the short
term but a detrimental impact upon the
long-term performance of the organisation
(namely, financial measures can create
short-termism in decision making).
Non-financial measures encourage
management to look at the reasons why
the business is performing well or badly
the causal factors. Assessing these factors
helps management understand specifically
how performance could be improved and
what specific actions/behaviours create
competitive advantage for the organisation.
These actions or behaviours are then
identified as being critical to the success of
the business critical success factors.
Once identified, these actions/behaviours
must be encouraged to continually
improve. This is done be setting relevant
targets for staff to achieve that ensure the
Matt Holden
explains how
you can
balance
performance
measures
www.bookkeepers.org.uk
The Institute of
Certied Bookkeepers
PQ careers
ICAEW Christiana Panteli, 23, is an Associate (Assurance & Advisory), based in Nicosia.
She has a degree in Public and Busines Administration Finance, and won an ICAEW
award at the Annual International Order of Merit in the Professional Stage exam 2013
In brief
Give us a smile
The picture you use on social
media could be the key to your future.
Research by the University of York
found people will look at a picture of
your face on social media and almost
immediately judge if you are friendly,
trustworthy or competent. Even though
the researchers say it is not clear how
accurate these impressions are they
can influence subsequent behaviour.
Privacy versus job security
Nearly a third of people would be
happy for their boss to have access to
their personal data, such as social
media profiles, in exchange for a better
work deal. A PwC report, The future of
work: A journey to 2022, reveals that
the type of data profiling used by
retailers and advertisers could soon
become commonplace in the office.
36
business functions.
PQs wanting to become partners should develop
their people skills throughout their career to become
a successful leader. Having a can-do attitude is rated
by partners as a top characteristic for those wanting
to climb the career ladder to partner.
Our research reveals that some accountants are
likely to reach partner level more quickly if they
trained with an independent regional firm rather than
the Big 4. However, it is important to note that while
it may take longer to make partner in a Big 4 firm,
there may be more financial rewards and
professional career development in niche areas
available in the longer term in larger firms.
General practice appears to offer a quicker route
to partnership than specialising in audit, tax or
advisory work, since 79% of participants in general
practice had between five
and 10 years PQE when
they became partner
compared with their peers
in audit, tax and advisory
where 58%, 42% and
51% respectively had up
to 10 years PQE.
Regardless of business
line, we expect to see a
faster track to partnership
for individuals with proven
business development
skills and a commercial
outlook. Aspiring partners
should focus on building a portfolio of skills in these
areas early in their career.
This insight and advice from those at the top
highlights that decisions made during the early
stages of your career have a direct impact on the
senior roles available later on. This is why it is crucial
for those aiming high to have a career map to ensure
they stay on track by gaining the relevant skills and
experience needed.
To read the Hays DNA of a Partner report visit
www.hays.co.uk/dna-of-a-partner
Karen Young is a Director at Hays Accountancy &
Finance
PQ Magazine November 2014
SUITABILITY
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www.howett-thorpe.co.uk
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Reed Accountancy
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YOUR CASUAL
SMART SUIT
Put down that cup tea and ask for a hot cup of
Joe if you want to perk up your payslip.
It appears that coffee drinkers earn on average
2,000 a year more than tea drinkers and they
tend to be in management positions! So which
survey came up with that solid fact? It was
Nestl, to mark international coffee day!
MAN WITH
CONNECTIONS
WHY ACCOUNTANCY?
WEV E
SPOT
THE BILL
International
gaming group
Sportech recently
had to find 93m
in pocket change
after HMRC won
its appeal against
an overpayment of
VAT. Five years ago
the footballpools-tohorse-race
betting firm
tried to
claim VAT
back on its
Spot the
Ball game.
Sportech
claimed it was a
game of chance
rather than skill,
so VAT was not
payable. The
Upper Tier
Tribunal disagreed
and sided with
HMRC. There is a
chance for an
appeal.
GOT THE L OT
Calculate this
Terms and conditions: One entry per giveaway please. You must send your name and address to be entered for the draw. All giveaway entries must be
received by Friday 14 November. The main draw will take place on Friday 21 November 2014.
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