Icaew

ACA Syllabus
Handbook
Contents
THE ACA QUALIFICATION: FRAMEWORK 3
ACA syllabus 7
Skills progression through the ACA qualification 9
CERTIFICATE LEVEL 13
Accounting14
Assurance16
Business, Technology and Finance 19
Law22
Management Information 25
Principles of Taxation 28
PROFESSIONAL LEVEL 31
Audit and Assurance 32

Business Strategy and Technology 39
Financial Accounting and Reporting 45
Financial Accounting and Reporting: IFRS 45
Financial Accounting and Reporting: UK GAAP 50
Financial Management 55
Tax Compliance 61
Business Planning 68
Business Planning: Taxation 68
Business Planning: Banking 74
Business Planning: Insurance 81
ADVANCED LEVEL 89
Corporate Reporting 90
Strategic Business Management 100
Case Study 113
TECHNICAL KNOWLEDGE 119
Assurance and Audit 120

Business Analysis 122
Ethics Codes and Standards 126
Financial Reporting – IFRS 127
Financial Reporting – UK GAAP 129
Taxation131
Business Planning: Banking 137
Business Planning: Insurance 139
The ACA qualification: framework
The ICAEW chartered accountancy qualification, The components are:
the ACA, is one of the most advanced learning
• Professional development
and professional development programmes
available. Its integrated components • Ethics and professional scepticism
provide an in-depth understanding across • Three to five years' practical work experience
accountancy, finance and business. Combined, • 15 accountancy, finance and business exams
these components help build the technical ICAEW constantly reviews the content of the
knowledge, professional skills and practical ACA qualification to reflect real life trends and
experience needed to become an ICAEW advances in technology. We work closely with
Chartered Accountant. employers, tuition providers, academics and
Each component is designed to complement examiners to ensure that the updates equip the
each other, which means that students can put chartered accountants of the future with the
theory into practice and can understand and skills and knowledge they need to be successful.
apply what they learn to their day-to-day work.
THE ACA QUALIFICATION AND TECHNOLOGY

Rapid growth in technology has automated many compliance elements of accountancy. But, with
technology also comes complexity and risk. Accountants need to adapt and develop new skills to
manage these technological changes such as data analytics, automation and cyber security.
DATA ANALYTICS AUTOMATION CYBER SECURITY
Recent advances in the way As technology continues to Cyber threats are a growing
that data is captured, develop, the automation of risk to businesses, and cyber
processed, stored and many traditional elements security is now part of the
communicated have of accountancy has day job for accountant.
fundamentally transformed fundamentally changed the Accountants and other
not just business processes, way in which business is financial institutions are
but also the ways in which done. But, while technology particularly attractive to
companies do business. can provide information cyber criminals. Cybercrime
Technology can provide more quickly and often more presents a fundamental
information more quickly and accurately than humans, it threat to the integrity of
often more accurately than cannot replicate human financial information and the
humans, but it cannot intelligence and quality requirement of chartered
replicate human intelligence decision making. Together, accountants to safeguard
and quality decision making. this provides even greater assets. The ACA syllabus
Therefore, chartered opportunities for chartered continues to evolve to
accountants hold a key role accountants to use their reflect changes in
in data analytics, in validating professional skills to add cybercrime and cyber
the source of the data, value to their clients and/or security as cyber criminals
interpreting and analysing the businesses in which and technology become
the outputs. they work. more sophisticated.
The continuing evolution of the ACA qualification will embrace change in technology to equip future
professionals with these key skills.
© ICAEW 2019 3
PROFESSIONAL DEVELOPMENT ETHICS AND PROFESSIONAL
The ICAEW chartered accountancy qualification, SCEPTICISM
the ACA, is one of the most advanced learning Ethics is more than just knowing the rules
and professional development programmes around integrity, objectivity, professional
available. Its integrated components provide competence and due care, confidentiality and
an in-depth understanding across accountancy, professional behaviour. It’s about identifying
finance and business. Combined, they help ethical dilemmas, understanding the
build the technical knowledge and professional implications, making judgements and behaving
skills and practical experience needed to appropriately as well as using professional
become an ICAEW Chartered Accountant. scepticism to build business trust. We integrate
ICAEW Chartered Accountants are known for ethics throughout the ACA qualification to
their professionalism and expertise. Professional develop students’ ethical capabilities to make
development prepares students to successfully suitable decisions.
handle a variety of different situations that they THREE TO FIVE YEARS’ PRACTICAL
encounter throughout their career. The ACA WORK EXPERIENCE
qualification improves students’ ability and
performance in seven key areas: Practical work experience is done as part
of a training agreement with an authorised
1. adding value training employer or principal. Students need
2. communication to complete 450 days, which normally takes
3. decision making between three and five years. The knowledge,
4. ethics and professionalism skills and experience they gain as part of their
training agreement are invaluable, giving them
5. problem solving the opportunity to put what they’re learning into
6. teamwork practice. Experience can be completed in at
7. technical competence. least one of the following six categories:
1. Accounting
2. Audit and assurance (audit is not
compulsory)
3. Financial management
4. Information technology
5. Insolvency
6. Taxation
15 ACCOUNTANCY, FINANCE AND

BUSINESS EXAMS
Students gain in-depth knowledge across a
broad range of topics in accountancy, finance
and business. The exams are designed to
complement their practical work experience,
so they constantly progress through the
qualification.
There are 15 exams over three levels –
Certificate, Professional and Advanced. They
can be taken in any order with the exception
of the Case Study which has to be attempted
last, within the final year of an ACA training
agreement and once all other exams have been
taken or received credit.
4 THE ACA QUALIFICATION: FRAMEWORK © ICAEW 2019

Case Study
Advanced
Level
Strategic Business
Corporate Reporting
Management
Financial Accounting Business Strategy

Business Planning
and Reporting and Technology
Professional
Level
Audit and Assurance Tax Compliance Financial Management
Accounting Management Information Principles of Taxation

Certificate
Level
Business, Technology
Assurance Law
and Finance
CERTIFICATE LEVEL day-to-day work. The Business Planning and

There are six exams at this level that introduce Business Strategy and Technology exams in
the fundamentals of accountancy, finance and particular help students to progress to the
business. Students may be eligible for credit for Advanced Level.
some exams if they have studied a qualification Alternative exams are available for the Business
we recognise. Find out more at icaew.com/cpl. Planning and Financial Accounting and
These six exams are also available as a stand- Reporting modules.
alone certificate, the ICAEW Certificate in The Business Planning exams provide students
Finance, Accounting and Business (ICAEW with the opportunity to gain subject- and
CFAB) and as part of the ICAEW Level 4 sector-specific knowledge while studying for
Trailblazer in Accountancy. ICAEW CFAB and our the ACA. The suite of Business Planning exams
apprenticeship can serve as stepping stones to is based on the same syllabus structure and
the ACA qualification. skills frameworks, and will give students the
opportunity to demonstrate their learning and
PROFESSIONAL LEVEL use this in the context of taxation, banking or
The next six exams build on the fundamentals insurance. There are three to choose from –
and test students’ understanding and ability Business Planning: Taxation, Business Planning:
to use technical knowledge in real-life Banking, and Business Planning: Insurance.
scenarios. The exams can be taken in March, Students will need to sit one of the Business
June, September and December. Please note, Planning exams.
the Business Planning alternative exams for Alternative financial reporting exams are
banking and insurance are available at the June, also available for Financial Accounting and
September and December sittings. Reporting. Students can choose between two
Prescribed texts are permitted for Audit and different contexts, either UK GAAP or IFRS. This
Assurance, Finance Accounting and Reporting means that students can study the financial
and Tax Compliance, with open books permitted reporting framework most beneficial to their
for the Business Planning exams. employer and clients. Students will need to sit
one version of the Financial Accounting and
The Professional Level exams are flexible and Reporting exam.
can be taken in any order to fit with a student’s
© ICAEW 2019 5
ADVANCED LEVEL
The Corporate Reporting and Strategic Business
Management exams test students’ understanding
and strategic decision-making at a senior level.
They present real-life scenarios, with increased
complexity and implications from the Professional
Level exams.
The Case Study tests all the knowledge, skills and
experience gained so far. It presents a complex
business issue which challenges students’ ability
to problem solve, identify the ethical implications
and provide an effective solution.
The Advanced Level exams can be taken in July
and November. They are fully open book, so
they replicate a real-life scenario where all the
resources are at their fingertips.
An authorised training employer or principal
will guide their students on the exams which are
right for them. If a student is studying the ACA
independently, they should consider their future
ambitions when selecting which exams to sit.

ACA syllabus
This document presents the learning outcomes for each of the ACA exams. The learning outcomes
in each exam should be read in conjunction with the relevant technical knowledge grids and, where
applicable, the skills development grid.
UNDERSTANDING THE SYLLABUS FOR EACH MODULE

Each module has the following syllabus components
Module These are a series of abilities which trainees will possess once they complete
aims the learning and assessment for this particular module.
Each module aim creates a syllabus area of technical and skills-based

Specification learning. The specification grid assigns an assessment weighting to each
grid syllabus area, which indicates the proportion of learning represented by each
syllabus area in the exam.
Learning outcomes are detailed statements which identify what the learner
Learning will know and be able to do by the end of the module, and which will be
outcomes demonstrable on passing the exam.
The Technical Knowledge Grid shows the technical knowledge in the

disciplines of financial reporting, audit and assurance, business analysis, ethics
and taxation covered in the ACA syllabus by module. For each technical area,
Technical the level of knowledge required is indicated by a letter from A to D, as follows.
knowledge
• Level D – awareness of the scope of the standard
grid
• Level C – general knowledge with a basic understanding
• Level B – working knowledge with a broad understanding
• Level A – thorough knowledge with a solid understanding
ACA ASSESSMENT FLEXIBILITY

The six Certificate Level exams each have a There are no regulations stipulating the
1.5-hour exam, a 55% pass mark, and can be sat order in which students must attempt the
throughout the year at an ICAEW-approved test exams, allowing employers to design training
centre. programmes according to business needs. The
exception to this rule is the Case Study, which
The Professional Level module exams are
must be the last exam attempted and when a
2.5 hours long, except for Financial Accounting
student has entered their final year of training.
and Reporting which is 3 hours long. Each exam
has a 55% pass mark. Students will be permitted a maximum of four
attempts at each Certificate and Professional
There are three Advanced Level modules
Level exam, and unlimited attempts at the
examined. The Corporate Reporting and
Advanced Level exams.
Strategic Business Management exams are
3.5 hours long. The Case Study exam is 4 hours
long. Each has a 50% pass mark.
For more information, guidance and support on
computer-based exams, visit the exam resources
area on our website at icaew.com/cbe
© ICAEW 2019 7
CREDIT FOR PRIOR LEARNING (CPL) OPEN BOOK POLICY
Students with previous professional or academic For some Professional Level exams, students
qualifications may be eligible to apply for CPL are permitted to take certain publications into
for up to 12 modules at the Certificate and the exam. Details of these publications and our
Professional Levels. CPL is not available at the open book policy can be found at icaew.com/
Advanced Level. For more information, visit permitted texts
icaew.com/cpl
For the Professional Level Business Planning
alternative exams, and at the Advanced Level,
students are permitted to take any material into
the exam, subject to practical space restrictions.
SKILLS REQUIRED BY THE ACA QUALIFICATION

The following skills areas are present throughout the qualification.
SKILL OVERALL
Understand a business or accounting situation, prioritise by

Assimilating and
determining key drivers, issues and requirements and identify
using information
and relevant information.
Structuring Structure information from various sources into suitable formats for
problems and analysis and provide creative and pragmatic solutions in a business
solutions environment.
Apply professional scepticism and critical thinking to identify faults,

Applying
gaps, inconsistencies and interactions from a range of relevant
judgement
information sources and relate issues to a business environment.
Concluding, Apply technical knowledge, skills and experience to support

recommending reasoning and conclusion and formulate opinions, advice, plans,
and solutions, options and reservations based on valid evidence and
communicating communicate clearer in a manner suitable for the recipient.

Skills progression through the ACA
qualification
The level of skill required to pass each exam increases as ACA trainees progress upwards through each
Level of the ACA qualification. The skills progression embedded throughout the ACA qualification
ensures ACA trainees develop the knowledge and skills can successfully operate in the modern
workplace and which are expected by today’s forward thinking employers.
Certificate Level Professional Level Advanced Level
Financial
Accounting
Principles & Reporting, Business
Skills Assurance, Corporate
of Taxation, Audit & Planning
Business, Reporting and
Management Assurance, and Business Case Study
Technology & Strategic Business
Information, Financial Strategy &
Finance, Law Management
Accounting Management, Technology
Tax
Compliance
Assimilating and using information
Understanding Objective Objective Scenarios Complex scenarios Unstructured

the situation testing testing complex business
and the and simple scenarios
requirements scenarios
Identifying and Information as provided Single Several Multiple information Multiple

using relevant information information sources provided information
information source sources sources including
provided provided own research
Identifying and Issues given Issues included in scenarios Issues included in Issues included
prioritising key complex scenarios in unstructured
issues complex scenarios
Structuring problems and solutions
Structuring data Specified techniques Specified Techniques Techniques inferred Unspecified

techniques inferred by by nature of techniques
nature of problem
problem
Developing Highly Specified Specified problems Specified and Defined output

solutions specified problems implicit problems but unspecified
tasks problems
Applying judgement
Applying Objective testing Specified Specified Specified Underlying

professional requirement requirement requirement in requirement
scepticism and in simple in scenario complex scenario within complex
critical thinking scenario scenario
Relating issues Objective Objective Issues in scenarios Issues in complex Issues in complex,
to the broader testing testing scenarios unstructured
business and Issues scenarios
environment, in simple
including ethical scenarios
issues
© ICAEW 2019 9
Certificate Level Professional Level Advanced Level
Financial
Accounting
Principles & Reporting, Business
Skills Assurance, Corporate
of Taxation, Audit & Planning
Business, Reporting and
Management Assurance, and Business Case Study
Technology & Strategic Business
Information, Financial Strategy &
Finance, Law Management
Accounting Management, Technology
Tax
Compliance
Concluding, recommending and communicating
Concluding and Objective Not assessed Specified conclusions and Specified Conclusions and
recommending testing recommendations in simple conclusions recommendations
scenarios and reasoned supported by own
recommendations evidence
in complex
scenarios
Communicating Prescribed exam format Exam requirements, Professional Professional report

including some professional presentations with appendices
presentation including reasoned
recommendations
PROFESSIONAL SKILLS ASSESSED IN THE ACA EXAMS
ASSIMILATING AND USING INFORMATION
Understand the situation and Identify and use relevant Identify and prioritise key
the requirements information issues and stay on task
• Demonstrate understanding • Interpret information • Identify business and

of the business context provided in various formats financial issues from a
• Recognise new and complex • Evaluate the relevance of scenario
ideas within a scenario information provided • Prioritise key issues
• Identify the needs of • Use multiple information • Work effectively within time
customers and clients sources constraints
• Explain different stakeholder • Filter information provided • Operate to a brief in a given
perspectives and interests to identify critical facts scenario
• Identify risks within a
scenario
• Identify elements of
uncertainty within a scenario
• Identify ethical issues
including public interest and
sustainability issues within a
scenario

STRUCTURING PROBLEMS AND SOLUTIONS
Structure data Develop solutions
• Structure information from various sources • Identify and apply relevant technical
into suitable formats for analysis knowledge and skills to analyse a specific
• Identify any information gaps problem
• Frame questions to clarify information • Use structured information to identify
evidence-based solutions
• Use a range of data types and sources to
inform analysis and decision-making • Identify creative and pragmatic solutions in a
business environment
• Structure and analyse financial and non-
financial data to enhance understanding of • Identify opportunities to add value
business issues and their underlying causes • Identify and anticipate problems that may
• Present analysis in accordance with result from a decision
instructions and criteria • Identify a range of possible solutions based
on analysis
• Identify ethical dimensions of possible
solutions
• Select appropriate courses of action using an
ethical framework
• Identify the solution which is the best fit with
acceptance criteria and objectives
• Define objectives and acceptance criteria for
solutions
APPLYING JUDGEMENT
Apply professional scepticism

Relate issues to the environment
and critical thinking
• Recognise bias and varying quality in data • Appreciate when more expert help is required
and evidence • Identify related issues in scenarios
• Identify assumptions or faults in arguments • Assess different stakeholder perspectives
• Identify gaps in evidence when evaluating options
• Identify inconsistencies and contradictory • Retain an overview of the business issue or
information scenario
• Assess interaction of information from • Appraise corporate responsibility and
different sources sustainability issues
• Exercise ethical judgement • Appraise the effects of alternative future
scenarios
• Appraise ethical, public interest and
regulatory issues
© ICAEW 2019 11
CONCLUDING, RECOMMENDING AND COMMUNICATING
Conclusions Recommendations Communication
• Apply technical knowledge • Present recommendations in • Present a basic or routine

to support reasoning and accordance with instructions memorandum or briefing
conclusions and defined criteria note in writing in a clear and
• Apply professional • Make recommendations in concise style
experience and evidence to situations where risks and • Present analysis and
support reasoning uncertainty exist recommendations in
• Use valid and different • Formulate opinions, advice, accordance with instructions
technical skills to formulate recommendations, plans, • Communicate clearly to a
opinions, advice, plans, solutions, options and specialist or non-specialist
solutions, options and reservations based on valid audience in a manner
reservations evidence suitable for the recipient
• Make evidence-based • Prepare the advice, report, or
recommendations which can notes required in a clear and
be justified by reference to concise style
supporting data and other
information
• Develop recommendations
which combine different
technical skills in a practical
situation

Certificate Level
Accounting
MODULE AIM METHOD OF ASSESSMENT
To ensure that students have a sound The Accounting module exam is 1.5 hours
understanding of the techniques of double long. 40% of the marks are allocated from
entry accounting and can apply its principles the preparation of single company financial
in recording transactions, adjusting financial statements; either a statement of profit or
records and preparing non-complex financial loss and statement of financial position or a
statements. statement of cash flows, using a pro-forma
template. The remaining 60% of the marks are
On completion of this module, students will be:
from 24 multiple-choice, multi-part multiple
• proficient in the use of double entry choice or multiple-response questions. These
accounting techniques and the maintenance questions will cover the areas of the syllabus in
of accounting records; accordance with the weightings set out in the
• able to identify and correct omissions and specification grid.
errors in accounting records and financial
statements; and ETHICS
• able to specify the components of financial Ethics is an overarching requirement for the
statements and prepare and present professional accountant and students will be
non-complex financial statements for expected to recognise that the exercise of
sole traders, partnerships and limited judgement is required in applying fundamental
companies. accounting concepts. Students will learn about the
IESBA Code of Ethics for Professional Accountants
– fundamental principles and the ICAEW Code
of Ethics and consider the merits of a principles-
based code. Specific questions on this area are
included within the ‘Maintaining financial records’
weighting in the Specification Grid.
SPECIFICATION GRID
This grid shows the relative weightings of subjects within this module and should guide the relative
study time spent on each. Over time the marks available in the assessment will equate to the
weightings below, while slight variations may occur in individual assessments to enable suitably
rigorous questions to be set.
SYLLABUS AREA WEIGHTING
1 Maintaining financial records 30%

2 Adjustments to accounting records and financial statements 25%
3 Preparing financial statements 45%
The following learning outcomes should be read in conjunction with the relevant sections of the
technical knowledge grids at the end of this document.
14 CERTIFICATE LEVEL © ICAEW 2019

1 MAINTAINING FINANCIAL RECORDS b. specify the key aspects of the accrual
Students will be proficient in the use of basis of accounting and the cash basis of
double entry accounting techniques and the accounting; and
maintenance of accounting records. c. prepare and present a statement of
In the assessment, students may be required to: financial position, statement of profit or
loss, statement of changes in equity and
a. specify why an entity maintains financial statement of cash flows (or extracts) from
records and prepares financial statements; the accounting records and trial balance
b. specify the ethical considerations for in a format which satisfies the information
preparers of financial statements; requirements of the entity.
c. identify the sources of information for the
preparation of accounting records and
financial statements;
d. record and account for transactions and
events resulting in income, expenses, assets,
liabilities and equity in accordance with the
appropriate basis of accounting and the
laws, regulations and accounting standards
applicable to the financial statements;
e. record and account for changes in the
ownership structure and ownership interests
inan entity; and
f. prepare a trial balance from accounting
records and identify the uses of the trial
balance.
2 ADJUSTMENTS TO ACCOUNTING RECORDS

AND FINANCIAL STATEMENTS
Students will be able to identify and correct
omissions and errors in accounting records and
financial statements.
In the assessment, students may be required to:
a. identify omissions and errors in accounting
records and financial statements and
demonstrate how the required adjustments
will affect profits and/or losses;
b. correct omissions and errors in accounting
records and financial statements; and
c. prepare journals for nominal ledger entry
and to correct errors in draft financial
statements.
3 PREPARING FINANCIAL STATEMENTS

Students will be able to specify the components
of financial statements, and prepare and
present non-complex accounts for sole traders,
partnerships and limited companies.
a. identify the main components of a set
of financial statements and specify their
purpose and interrelationship;
© ICAEW 2019 15
Assurance
To ensure that students understand the The Assurance module exam is 1.5 hours long.
assurance process and fundamental principles The exam consists of 50 questions worth two
of ethics, and are able to contribute to the marks each, covering the areas of the syllabus
assessment of internal controls and gathering of in accordance with the weightings set out in the
evidence on an assurance engagement. specification grid. The questions are presented
in the form of multiple choice, multi-part
On completion of this module, students will be
multiple choice, or multiple response.
able to:
• explain the concept of assurance, why ETHICS AND PROFESSIONAL
assurance is required and the reasons for SCEPTICISM
assurance engagements being carried out
by appropriately qualified professionals with The importance of ethics both as a knowledge
an attitude of professional scepticism and area and as a behaviour to be demonstrated is
the exercise of professional judgement; reflected in the syllabus area below ‘Professional
ethics’. The learning outcomes cover a range of
• explain the nature of internal controls and threats and dilemmas to be identified as well
why they are important, document an as safeguards and solutions to be resolved.
organisation’s internal controls and identify Professional scepticism is included in the
weaknesses in internal control systems; requirement for the syllabus area ‘The concept,
• select sufficient and appropriate methods of process and need for assurance’ where students
obtaining assurance evidence and recognise are also required to recognise the need for the
when conclusions can be drawn from exercise of professional judgement.
evidence obtained or where issues need to
be referred to a senior colleague; and
• understand the importance of ethical
behaviour to a professional and identify issues
relating to integrity, objectivity, professional
competence and due care, confidentiality,
professional behaviour and independence.
SPECIFICATION GRID
1 The concept, process and need for assurance 20%

2 Internal controls 25%
3 Gathering evidence on an assurance engagement 35%
4 Professional ethics 20%

1 THE CONCEPT, PROCESS AND NEED FOR 2 INTERNAL CONTROLS
ASSURANCE Students will be able to explain the nature of
Students will be able to explain the concept of internal controls and why they are important,
assurance, why assurance is required and the document an organisation’s internal controls and
reasons for assurance engagements being carried identify weaknesses in internal control systems.
out by appropriately qualified professionals.
a. state the reasons for organisations having
a. define the concept of assurance; effective systems of control;
b. state why users desire assurance reports and b. identify the fundamental principles of
provide examples of the benefits gained effective control systems;
from them such as to assure the quality of an c. identify the main areas of a business that
entity’s published corporate responsibility or need effective control systems;
sustainability report;
d. identify the components of internal control
c. compare the functions and responsibilities of in both manual and IT environments,
the different parties involved in an assurance including:
engagement;
• the overall control environment
d. compare the purposes and characteristics
• preventative and detective controls
of, and levels of assurance obtained from,
different assurance engagements; • internal audit;
e. identify the issues which can lead to gaps e. define and classify different types of internal
between the outcomes delivered by the control, with particular emphasis upon those
assurance engagement and the expectations which impact upon the quality of financial
of users of the assurance reports, and information;
suggest how these can be overcome; f. show how specified internal controls
f. define the assurance process, including: mitigate risk, including cyber risks, and state
their limitations;
• obtaining the engagement
g. identify internal controls for an organisation
• continuous risk assessment
in a given scenario;
• engagement acceptance
h. identify internal control deficiencies in a
• the scope of the engagement given scenario; and
• planning the engagement i. identify, for a specified organisation, the
• performing the engagement sources of information which will enable a
• obtaining evidence sufficient record to be made of accounting
• evaluation of results of assurance work or other systems and internal controls.
• concluding and reporting on the 3 GATHERING EVIDENCE ON AN ASSURANCE
engagement ENGAGEMENT
• reporting to the engaging party Students will be able to select sufficient and
• keeping records of the work performed; appropriate methods of obtaining assurance
g. recognise the need to plan and perform evidence and recognise when conclusions can
assurance engagements with an attitude of be drawn from evidence obtained or where
professional scepticism and the exercise of issues need to be referred to a senior colleague.
professional judgement; In the assessment, students may be required to:
h. define the concept of reasonable assurance; a. state the reasons for preparing and keeping
and documentation relating to an assurance
i. recognise the characteristics of fraud and engagement;
distinguish between fraud and error. b. identify the different methods of obtaining
evidence from the use of tests of control,
substantive procedures, including analytical
procedures and data analytics;
c. recognise the strengths and weaknesses of
the different methods of obtaining evidence;
© ICAEW 2019 17
d. identify the situations within which the h. respond appropriately to the request of
different methods of obtaining evidence an employer to undertake work outside
should and should not be used; the confines of an individual’s expertise or
e. compare the reliability of different types of experience;
assurance evidence; i. recognise the importance of confidentiality,
f. select appropriate methods of obtaining including compliance with GDPR, and
evidence from tests of control and from identify the sources of risks of accidental
substantive procedures for a given business disclosure of information;
scenario; j. identify steps to comply with GDPR and
g. recognise when the quantity (including prevent the disclosure of information;
factors affecting sample design) and quality k. identify situations in which confidential
of evidence gathered is of a sufficient and information may be disclosed;
appropriate level, after taking account of l. define independence and recognise
sampling risk, to draw conclusions on which why those undertaking an assurance
to base a report; engagement are required to be
h. identify the circumstances in which written independent of their clients;
confirmation of representations from m. identify the following threats to the
management should be sought and the fundamental ethical principles and the
reliability of such confirmation as a form of independence of assurance providers:
assurance evidence; and
• self-interest threat
i. recognise issues arising while gathering
• self-review threat
assurance evidence that should be referred
to a senior colleague. • management threat
• advocacy threat
4 PROFESSIONAL ETHICS • familiarity threat
Students will be able to understand the • intimidation threat;
importance of ethical behaviour to a
n. identify safeguards to eliminate or reduce
professional and identify issues relating to
threats to the fundamental ethical principles
integrity, objectivity, professional competence
and the independence of assurance
and due care, confidentiality, professional
providers; and
behaviour and independence.
o. suggest how a conflict of loyalty between the
In the assessment, students may be required to: duty a professional accountant has to their
a. state the role of ethical codes and their employer and the duty to their profession
importance to the profession; could be resolved.
b. recognise the differences between a rules-
based ethical code and one based upon a
set of principles;
c. recognise how the principles of professional
behaviour protect the public and fellow
professionals;
d. identify the key features of the system of
professional ethics adopted by IESBA and
ICAEW;
e. identify the fundamental principles
underlying the IESBA and the ICAEW Code
of Ethics;
f. recognise the importance of integrity and
objectivity to professional accountants,
identifying situations that may impair or
threaten integrity and objectivity;
g. suggest courses of action to resolve ethical
conflicts relating to integrity and objectivity;

Business, Technology and Finance
MODULE AIM • specify the impact on a business of the
To provide students with an understanding external environment in which it operates;
of how businesses operate and how finance and
functions help businesses to achieve their • identify key features, benefits and risks of
objectives. different technologies.
METHOD OF ASSESSMENT
able to:
The Business, Technology and Finance module
• identify the general objectives of businesses exam is 1.5 hours long. The exam consists of
and the functions and tasks that businesses 50 questions worth two marks each, covering
perform in order to meet their objectives; the areas of the syllabus in accordance with the
• specify the nature, characteristics, weightings set out in the specification grid. The
advantages and disadvantages of different questions are presented in the form of multiple
forms of business and organisational choice, or multiple response.
structure;
• identify the purpose of financial information ETHICS AND PROFESSIONAL
produced by businesses, specify how finance SCEPTICISM
functions support business operations, and Ethical thinking will be required across all areas
identify sources and methods of financing of the syllabus. A specific weighting is given in
for businesses; the syllabus areas ‘Governance, sustainability,
• specify the role of the accountancy corporate responsibility and ethics’ in the table
profession and why the work of the below. The policies and procedures necessary to
profession is important; promote an ethical culture will be emphasized.
• identify the role that governance plays in Additionally, under the syllabus area ‘External
the management of a business and specify environment’, students must demonstrate
how a business can promote corporate an awareness of the needs of different
governance, sustainability, corporate stakeholders. Students will be expected to apply
responsibility and an ethical culture; professional scepticism and critical thinking.
SPECIFICATION GRID
1 Business objectives and functions 15%

2 Business and organisational structures 10%
3 The role of finance 20%
4 The role of the accountancy profession 10%
5 Governance, sustainability, corporate responsibility and ethics 15%
6 External environment 15%
7 Technology 15%
© ICAEW 2019 19
1 BUSINESS OBJECTIVES AND FUNCTIONS 3 THE ROLE OF FINANCE
Students will be able to identify the general Students will be able to identify the purpose of
objectives of businesses and the functions and financial information produced by businesses,
tasks that businesses perform in order to meet specify how finance functions support business
their objectives. operations, and identify sources and methods of
finances for businesses.
a. state the general objectives of businesses;
b. state the general objectives of strategic a. specify the role of financial information
management and specify the strategic prepared by businesses in:
management process and interrelationship • providing for accountability of
between a business’s vision, mission and management to shareholders and
strategic objectives; other stakeholders, including business
c. identify the functional areas within partnering
businesses (marketing, operations/ • reflecting business position and
production, procurement, HR, IT and finance) performance
and show how the functions help the • supporting users in making decisions;
achievement of business objectives;
b. specify how finance functions support
d. identify the nature and functions of businesses in pursuit of their objectives,
management, and show how this is including business partnering;
influenced by human behaviour;
c. identify the main considerations in
e. identify the relationship between a establishing and maintaining accounting and
business’s overall strategy and its functional financial reporting functions and financial
strategies; control processes;
f. identify the nature and purpose of strategic d. identify, in the context of accounting and
plans, business plans and operational plans; other systems, key aspects of:
g. specify how a strategic plan is converted into • information processing
fully-integrated business and operational
• information security
plans;
• information management;
h. identify the main components of the risk
management process and show how they e. specify why the management of a business
operate; and require information about performance
measurement including an entity’s
i. identify the key issues in relation to risk and
sustainability management and natural
crisis management, business resilience,
capital;
business continuity planning and disaster
recovery. f. identify the accountant’s role in preparing
and presenting information for the
2 BUSINESS AND ORGANISATIONAL management of a business;
STRUCTURES g. specify the relationship between a business
Students will be able to specify the nature, and its bankers and other providers of
characteristics, advantages and disadvantages financial products;
of different forms of business and organisational h. identify the characteristics, terms and
structure. conditions and role of alternative short,
In the assessment, students may be required to: medium and long-term sources of finance
available to different businesses;
a. identify the differences between businesses
i. identify the processes by which businesses
carried out by sole traders, partnerships,
raise equity, capital and other long-term
limited liability partnerships, companies,
finance; and
alliances and groups, and show the
advantages and disadvantages of each of j. identify appropriate methods of financing
these business structures; and exports, including:
b. identify different organisational structures and • bills of exchange
specify their advantages and disadvantages. • letters of credit
• export credit insurance.

4 THE ROLE OF THE ACCOUNTANCY g. specify the nature of ethics, business ethics,
PROFESSION sustainability and corporate responsibility; and
Students will be able to specify the role of the h. specify the policies and procedures a
accountancy profession and why the work of the business should implement in order to
profession is important. promote an ethical culture.
6 EXTERNAL ENVIRONMENT
a. identify the importance to the public interest Students will be able to specify the impact on a
of high quality, accurate financial reporting business of the environment in which it operates
and assurance; including the potential effects of sustainability
b. specify the rationale for key parts of the issues.
profession’s work and the links between
the public interest, technical competence
and professional responsibility, including a. specify the signalling, rewarding and
accounting principles, accounting standards allocating effects of the price mechanism
and sound business management; and on business (including the concept of price
c. specify the key features of the structure of elasticity);
the accountancy profession, the regulatory b. specify the potential types of failure of the
framework within which professional market mechanism and their effects on
accountants work and the ways in which the business;
accountancy profession interacts with other c. identify the key macro-economic factors that
professions. affect businesses;
d. specify the principal effects of national and
5 GOVERNANCE, SUSTAINABILITY,
CORPORATE RESPONSIBILITY AND ETHICS international regulation upon businesses;
and
Students will be able to identify the role that
governance plays in the management of a e. show how the needs of different
business and specify how a business can stakeholders in a business (eg, shareholders,
promote corporate governance, sustainability, the local community, employees, suppliers,
corporate responsibility and an ethical culture. customers) impact upon it.
In the assessment, students may be required to: 7 TECHNOLOGY

a. state the reasons why governance is needed Students will be able to identify key features,
and identify the role that governance plays benefits and risks of different technologies.
in the management of a business; In the assessment, students may be required to:
b. identify the key stakeholders and their
a. identify the characteristics of big data and
governance needs for a particular business;
the different types and sources of data;
c. identify and show the distinction between the
b. specify uses of data science and data
roles and responsibilities of those charged
analytics by organisations;
with corporate governance and those charged
with management, including the basics of the c. specify different types of cyber risk and
UK’s corporate governance code; attack and the steps organisations can take
to improve cyber security;
d. specify how differences in legal systems
and in national and business cultures affect d. specify the features and uses of cloud
corporate governance; accounting, the internet of things, digital
assets and distributed ledger technology;
e. identify the roles and responsibilities of
and
the members of the executive board, any
supervisory board, the audit committee and e. identify the effect of technology
others charged with corporate governance, developments, including those relating to
internal audit and external audit; automation and intelligent systems, on the
accountancy profession.
f. identify the roles and responsibilities of those
responsible within a business for internal
audit and for the external audit relationship;
© ICAEW 2019 21
Law
To provide students with an understanding of The Law module exam is 1.5 hours long. The
the principles of English law. exam consists of 50 questions worth two marks
each, covering the areas of the syllabus in
accordance with the weightings set out in the
able to:
specification grid. The questions are presented
• explain the nature of contractual in the form of multiple choice or multi-part
agreements, the agency relationship and the multiple choice.
consequences of negligence;
• understand the legal implications of ETHICS AND PROFESSIONAL
incorporation, including the roles of SCEPTICISM
shareholders and directors, and the main The consideration of ethical decision-making
implications of insolvency law; is intrinsic to the study of law. In this module,
• identify instances of criminal behaviour students will examine the impact of criminal law
that may be encountered by professional on business and professional services, focussing
accountants; and on fraud, bribery and money laundering.
• identify other key areas in which the law They will also explore the relationships and
affects the role and work of the professional interaction between legal principles, legislation,
accountant. case law, ethics and ethical codes.
SPECIFICATION GRID
1 The impact of civil law on business and professional services 35%

2 Company and insolvency law 40%
3 The impact of criminal law on business and professional services 10%
4 The impact of law in the professional context 15%

1 THE IMPACT OF CIVIL LAW ON BUSINESS c. identify the administrative consequences of
AND PROFESSIONAL SERVICES incorporation or the formation of a limited
Students will be able to explain the nature of liability partnership including requirements
contractual agreements, the agency relationship regarding statutory books, accounts, meetings
and the consequences of negligence. and the role of the company secretary;
In the assessment, students may be required to: d. identify the procedures for the issue of
shares, including issues at a premium and
CONTRACT pre-emption rights;
a. recognise when a legally binding contract e. identify the requirements of the Companies
exists between two parties and how a Act 2006 in respect of companies’
contract may be enforced; statutory accounts and audit, including the
exemptions for small and medium-sized
b. identify the circumstances under which a
companies and micro-entities;
contract can be terminated and possible
remedies for breach of contract; f. identify aspects of capital maintenance
including:
AGENCY • reduction of capital
c. identify the role of agents, their duties and • redemption and purchase of a
rights, and their authority to enter contracts company’s own shares
on behalf of principal; • financial assistance for the purchase of a
d. identify the nature of a partnership and the company’s own shares
authority given to partners; • distribution of profits;
NEGLIGENCE AND LIABILITY g. identify share transfer requirements and
e. identify instances and consequences disclosure requirements;
of negligence (particularly negligent h. recognise how a shareholder can influence
misstatement) in a given scenario; and the management of a company through
f. identify instances and consequences of meetings and resolutions, including
vicarious liability in a given scenario. shareholders’ rights to requisition a meeting;
i. identify the various statutory rights of
2 COMPANY AND INSOLVENCY LAW shareholders to challenge the management
Students will be able to understand the of the company under the Companies Act
implications of incorporation, including the roles 2006 and the Insolvency Act 1986;
of shareholders and directors, and the main j. identify the rights and duties which a member
implications of insolvency law. of a limited liability partnership possesses;
In the assessment, students may be required to: k. identify the ways in which a director may be
appointed and removed;
a. identify the differences between
unincorporated businesses (sole l. identify directors’ duties, explaining the
traderships and partnerships), limited consequences of any major breach;
liability partnerships and companies, m. identify the powers of directors and in what
show the advantages and disadvantages circumstances they will bind the company in
of incorporation and recognise the a contract with third parties;
circumstances when the veil of incorporation n. identify the nature of fixed and floating
can be lifted; charges and the procedures for registering
b. identify the procedures required to them;
form a registered company or a limited o. identify the nature and function of:
liability partnership, including any • company voluntary arrangements
practical considerations, and the nature
• administration orders
and contractual force of a company’s
memorandum and articles of association and • receivership
identify the advantages and disadvantages • compulsory and voluntary liquidation
of off-the-shelf companies; (including relevance of secured debt);
and
© ICAEW 2019 23
p. identify the main implications of insolvency b. recognise the requirements of protecting
law, including: intellectual property, including digital
• the principal means of termination of contexts;
companies or other business entities
EMPLOYMENT LAW AND SOCIAL SECURITY LAW
• the priorities on a liquidation of the
c. identify who is an employee and the main
distribution of assets including rights
legal consequences of employment status;
of creditors and employees (including
secured assets) d. identify the key features of employment
contracts and recognise circumstances in
• bankruptcy and other responses to
which an employment contract may be
personal insolvency.
terminated and the consequences arising;
3 THE IMPACT OF CRIMINAL LAW ON e. identify when dismissal constitutes:
BUSINESS AND PROFESSIONAL SERVICES • a wrongful dismissal
Students will be able to identify instances of • an unfair dismissal;
criminal behaviour that may be encountered by
f. identify the circumstances where an
professional accountants.
employee can claim a statutory redundancy
In the assessment, students may be required to: payment; and
a. identify circumstances where accountants g. identify employers’ obligations under social
will be protected from dismissal and security law.
victimisation if they raise concerns about
malpractice in the workplace;
b. identify instances and consequences of
fraud in a given scenario;
c. identify instances and consequences of
bribery;
d. identify instances and consequences of
money laundering and select appropriate
courses of action for a professional
accountant in accordance with international
and national regulations and law;
e. recognise the relationships and interaction
between legal principles, legislation, case
law, ethics and ethical codes;
f. identify the offences created under the
Computer Misuse Act 1990; and
g. identify how the Fraud Act (2006) relates to
cybercrime.
4 THE IMPACT OF LAW IN THE PROFESSIONAL

CONTEXT
Students will be able to identify other key areas
in which the law affects the role and work of the
professional accountant.
INFORMATION AND ITS LEGAL ENVIRONMENT

a. identify the key requirements of the Data
Protection Act 2018, on the use of personal
information and how the Act can affect the
manner in which information systems are
used by businesses;

Management Information
To enable students to prepare essential financial The Management Information module exam is
information for the management of a business. 1.5 hours long. 20% of the marks are allocated
in one scenario-based question. This will cover a
single syllabus area, either: costing and pricing;
able to:
budgeting and forecasting; performance
• establish the costs associated with the management; or management decision-making.
production of products and provision of The remaining 80% of the marks are from 32
services and use them to determine prices; multiple choice, multi-part multiple choice or
• select appropriate budgeting approaches multiple response questions. The 33 questions
and methods and prepare budgets; cover the areas of the syllabus in accordance with
• identify key features of effective performance the weightings set out in the specification grid.
management systems, select appropriate
performance measures and calculate ETHICS
differences between actual performance Ethics is fundamental to the sound provision
and standards or budgets; and identify the of management information upon which basis
key features, risks and benefits of a range sustainable business decisions can be made.
of approaches to management information This will form a backdrop to an overall culture
operations; and of business trust as well as business efficiency. It
• identify and calculate relevant data for use in is treated as ingrained across the syllabus with
management decision making. a weighting of marks being given within the
‘Costing and Pricing’ syllabus area.
SPECIFICATION GRID
1 Costing and pricing + 5 Ethics 25%

2 Budgeting and forecasting 25%
3 Performance management and management information operations 25%
4 Management decision-making 25%
© ICAEW 2019 25
1 COSTING AND PRICING f. calculate the cash cycle for a business and
Students will be able to establish the costs recognise its significance;
associated with the production of products and g. identify the constituent elements of working
provision of services and use them to determine capital and treasury and specify the methods
prices. by which each element can be managed to
In the assessment, students may be required to: optimise working capital and cash flows; and
h. recognise how a business manages
a. recognise the use of cost information for surpluses and deficits predicted in cash
different purposes; budgets.
b. classify costs as fixed, variable, direct or
indirect; 3 PERFORMANCE MANAGEMENT AND
c. calculate overhead absorption rates, unit MANAGEMENT INFORMATION OPERATIONS
costs and profits/losses from information Students will be able to identify key features of
provided, using: effective performance management systems,
• marginal costing select appropriate performance measures
and calculate differences between actual
• absorption costing and reconcile the
performance and standards or budgets, and
differences between the costs and
identify the key features, risks and benefits
profits/losses obtained;
of a range of approaches to management
d. select the most appropriate method of information operations.
costing for a given product or service;
e. calculate the sales price for a given product
or service using cost based pricing; and a. identify the reasons for, and key features of,
f. calculate transfer prices for specified sales effective performance management systems;
to internal customers which take account of b. select appropriate financial and non-financial
appropriate costs. performance measures which effectively
encourage the business as a whole to meet
2 BUDGETING AND FORECASTING its objectives;
Students will be able to select appropriate c. calculate differences between actual
budgeting approaches and methods and performance and standards or budgets
prepare budgets. in terms of price and volume effects
In the assessment, students may be required to: and identify possible reasons for those
differences;
a. apply forecasting techniques to help
d. identify the features of cloud accounting and
management in performance measurement
its associated risks and benefits; and
and planning;
e. identify the features of shared service
b. identify how data analytics can be used in
centres and their relative merits for the
budgeting and forecasting;
provision of management information.
c. prepare budgets, or budget extracts from
information supplied; 4 MANAGEMENT DECISION MAKING
d. select the most appropriate of the following Students will be able to identify and calculate
budgeting approaches and methods, relevant data for use in management decision
taking into account their advantages and making.
disadvantages for planning, control and
motivation:
• bottom-up and top-down approaches to a. calculate the breakeven point, contribution
generating and managing budgets and margin of safety for a given product or
service;
• activity-based, responsibility-based and
product-based budget structures b. allocate scarce resource to those products
or services with the highest contribution per
• zero-based and incremental budgeting;
limiting factor;
e. prepare a cash budget for a business which
c. calculate the net present value, internal rate
highlights the quantity and timing of cash
of return, payback period or accounting rate
surpluses and deficits;
of return for a given project; and

d. identify the advantages and disadvantages
of the investment appraisal techniques
specified in 4(c) above.
5 ETHICS
a. identify and explain ethical issues relating
to the preparation, presentation and
interpretation of financial information for the
management of a business.
© ICAEW 2019 27
Principles of Taxation
To enable students to understand the general The Principles of Taxation module exam is
objectives of taxation and to calculate 1.5 hours long. 20% of the marks are allocated
income tax, national insurance contributions, to two scenario-based questions. These will each
capital gains tax, corporation tax and VAT in cover a single syllabus area: income tax and
straightforward scenarios. NIC, and corporation tax. The remaining 80% of
the marks are from 40 multiple choice, multi-part
multiple choice, multiple response or numeric
able to:
entry questions. These questions will cover the
• explain the general objectives of taxation, remaining areas of the syllabus in accordance
the influences upon the UK system of with the weightings set out in the specification
taxation, the different types of tax in the UK; grid.
• recognise the ethical issues arising in the The tax tables included in the ICAEW learning
course of performing tax work; materials are provided to students on-screen in
• identify the obligations the UK system of the exam.
taxation imposes on taxpayers and the
implications of non-compliance; ETHICS
• calculate the amount of income tax owed by The importance of ethics is fundamental to
or owed to individuals and the amount of professional accountants working in the area of
national insurance payable; taxation. Learning outcomes relating to ethics
• calculate the amount of capital gains tax and integrity are included within the syllabus
payable by individuals and the chargeable area ‘Objectives, types of tax and ethics’ as
gains subject to corporation tax; shown in the table below. Students are required
• calculate the amount of corporation tax to identify the objectives of taxation; ethical
payable by companies; and principles, along with threats and safeguards as
• calculate the amount of VAT owed by or well as issues such as conflicts of interest, money
owed to businesses. laundering, tax avoidance and tax evasion.
SPECIFICATION GRID
study time spent on each. In each assessment, the marks available will equate to the weightings below.
1 Objectives, types of tax and ethics 10%

2 Administration of taxation 20%
3 Income tax and national insurance contributions 26%
4 Capital gains tax and chargeable gains for companies 10%
5 Corporation tax 14%
6 VAT 20%

1 OBJECTIVES, TYPES OF TAX AND ETHICS 2 ADMINISTRATION OF TAXATION
Students will be able to explain the general Students will be able to identify the obligations the
objectives of taxation, the influences upon the UK system of taxation imposes on taxpayers and
UK system of taxation, the different types of the implications for taxpayers of non-compliance.
tax in the UK, and will be able to recognise the
ethical issues arising in the course of performing
tax work. a. identify the records which companies and
individuals must retain for tax purposes and
state the periods for which the records must
a. identify the objectives of digitalisation of tax; be retained;
b. identify the objectives of taxation in b. identify the key features of the PAYE and
general terms of economic, social justice national insurance system and calculate
and environmental issues, the range of tax PAYE tax codes for employees;
opportunities open to the government and c. identify the key features of the self-
the relative advantages of different types of assessment system for both companies and
tax in meeting the government’s objectives; individuals;
c. recognise the impact of relevant external d. determine, in straightforward cases, due
influences on UK tax objectives and policies; dates for:
d. classify entities as individuals, partnerships, • companies’, sole traders’, partnerships’
or companies for tax purposes and state how and individuals’ tax returns, tax payments
they are taxed; and payments on account
e. identify who is liable for the following • businesses’ VAT returns and payments
taxes, how the taxes apply to income and
• employers’ PAYE and national insurance
transactions, identify the government bodies
returns and payments;
responsible for the taxes, and determine
when an individual or entity comes within e. identify and calculate the interest and
the scope of the taxes: penalties due for:
• capital gains tax • late submissions of and/or incorrect
returns;
• corporation tax
• late and/or incorrect payments of tax;
• income tax
and
• national insurance
f. identify the periods within which HMRC can
• VAT; enquire into a taxpayer’s returns or other
f. recognise the importance of the budget information and tax liabilities and recognise
cycle, tax year and the following sources of the taxpayer’s right of appeal and the
UK tax law and practice: process for dealing with disputes.
• legislation
3 INCOME TAX AND NATIONAL INSURANCE
• case law CONTRIBUTIONS
• HMRC manuals, statements of practice, Students will be able to calculate the amount of
extra-statutory concessions and press income tax owed by or owed to individuals and
releases; the amount of national insurance payable.
g. identify the five fundamental principles given
in the IESBA Code of Ethics for Professional
Accountants and ICAEW Code of Ethics, and a. recognise the main sources of taxable and
the guidance in relation to a tax practice with non-taxable income;
regard to: b. calculate the personal allowance available
• the threats and safeguards framework to an individual according to personal
• ethical conflict resolution; and circumstances including the marriage
allowance;
h. identify the following:
c. calculate assessable employment income for
• conflicts of interest
an employee or director, including taxable
• money laundering and exempt benefits;
• tax avoidance and tax evasion.
© ICAEW 2019 29
d. recognise the badges of trade; b. recognise the interaction of having one or
e. allocate given items of business expenditure more related 51% group companies with
as allowable or disallowable for tax purposes corporation tax payment dates;
and calculate the adjusted trading profits c. allocate given items of business expenditure
after capital allowances on plant and as allowable or disallowable for tax purposes
machinery of a sole trader or partnership and calculate the adjusted trading profits
using either the accruals basis or cash basis after capital allowances on plant and
of accounting; machinery; and
f. allocate the tax adjusted profits of a d. calculate the taxable total profits and the
partnership to each partner and calculate corporation tax payable for a company
the tax assessable profits for each partner for resident in the UK which has a period of
any given tax year; account of 12 months or less.
g. calculate the assessable trading profits for a
6 VAT
new unincorporated business and identify
the overlap profits on the commencement of Students will be able to calculate the amount of
trade; VAT owed by or owed to businesses.
h. calculate the assessable trading profits for a In the assessment, students may be required to:
continuing business; a. classify supplies in given straightforward
i. calculate the final assessable trading profits situations as exempt, zero-rated, standard-
for an unincorporated business ceasing to rated, subject to a reduced rate of 5%, or
trade; outside the scope of VAT;
j. calculate total taxable income and the b. recognise the implications of supplies being
income tax payable or repayable for classified as reduced-rated, standard-rated,
individuals; and zero-rated or exempt;
k. calculate the total national insurance c. identify when a business could or should
contributions payable by employees, register or deregister for VAT and state the
employers and self-employed individuals. time limits;
4 CAPITAL GAINS TAX AND CHARGEABLE d. determine the tax point for a supply of
GAINS FOR COMPANIES goods or services;
Students will be able to calculate the amount of e. state the principles of VAT payable or
capital gains tax payable by individuals and the repayable on the supply of goods or services
chargeable gains subject to corporation tax. by a taxable person and calculate the
monthly, quarterly or annual VAT payable or
In the assessment, students may be required to: repayable by a business; and
a. classify persons, assets and disposals as f. state the alternative schemes for payment
either chargeable or exempt for capital gains of VAT by businesses and calculate the VAT
purposes; payable or repayable for a business using
b. calculate the chargeable gains and losses on these.
the disposal of assets, including indexation
where appropriate;
c. calculate total taxable gains for both
individuals and companies; and
d. calculate the capital gains tax payable by
individuals.
5 CORPORATION TAX
Students will be able to calculate the amount of
corporation tax payable by companies.
a. identify accounting periods for a company;

Professional Level
Audit and Assurance
To develop students’ understanding of the The Audit and Assurance module exam is 2.5
critical aspects of managing an assurance hours long. The exam will consist of six short-
engagement (including audit engagements): form questions and three longer questions. The
acceptance, planning, managing, concluding exam will test each of the three syllabus areas
and reporting. in accordance with the weightings set out in
the specification grid and students may use
the permitted text(s) as detailed on the ICAEW
able to:
website; icaew.com/permittedtexts.
• understand and advise on the regulatory,
professional and ethical issues relevant ETHICS AND PROFESSIONAL
to those carrying out an assurance SCEPTICISM
engagement;
Ethical thinking is fundamental to the conduct
• understand the processes involved in of a sound audit. A specific weighting given to
accepting and managing assurance legal and other professional regulations, ethics,
engagements; accepting and managing engagements and
• understand how quality assurance processes current issues is shown in the table below. In
mitigate risks; addition to this a separate learning outcome
• plan assurance engagements in accordance covers planning and performing engagements
with the terms of the engagements and and the potential risks involved. Students will
appropriate standards; and also be required to demonstrate the crucial role
• conclude and report on assurance of professional scepticism in the judgement they
engagements in accordance with the terms apply.
of the engagements and appropriate
standards.
SPECIFICATION GRID
1 Legal and other professional regulations, ethics, accepting and managing 35%
engagements and current issues
2 Planning and performing engagements 40%
3 Concluding and reporting on engagements 25%
For clarity, learning outcomes applicable to all types of assurance engagements (including audit) are
separated from those that are relevant only to audit engagements.
32 PROFESSIONAL LEVEL © ICAEW 2019

1 LEGAL AND OTHER PROFESSIONAL l. explain the standard-setting process used
REGULATIONS, ETHICS, ACCEPTING AND by national and international (IAASB)
MANAGING ENGAGEMENTS AND CURRENT bodies and the authority of the national and
ISSUES international standards;
Students will be able to understand and advise m. explain, in non-technical language,
on the regulatory, professional and ethical issues significant current assurance issues being
relevant to those accepting, managing and dealt with by government bodies, the
carrying out assurance engagements. Students national standard-setting body and the
will be able to understand the processes IAASB including developments in the use of
involved in accepting and managing assurance data analytics;
engagements and how quality assurance
n. explain, using appropriate examples, the
processes mitigate the risks to those conducting
main ways in which national legislation,
the engagement.
including GDPR, affects assurance;
AUDIT ENGAGEMENTS
ALL ASSURANCE ENGAGEMENTS o. explain the main ways in which national
a. identify and advise upon the legal, legislation and other regulations affect
professional and ethical issues that may the scope and nature of the audit and
arise before accepting or during a specified the appointment and removal of auditors
assurance engagement; (including the relationship between the law
b. discuss the issues which underlie the and auditing standards);
agreement of the scope and terms of an p. describe how national and international
assurance engagement (new or continuing); bodies are working to harmonise auditing
c. recognise the professional and ethical requirements, including requirements to
issues that may arise during an assurance report on internal controls; and
engagement, explain the relevance and q. describe the principal causes of audit failure
importance of these issues and evaluate the and their effects and the gap between
relative merits of different standpoints taken outcomes delivered by audit engagements
in debate; and the expectations of users of auditor’s
d. identify the sources of liability (including reports.
professional negligence) arising from an
2 PLANNING AND PERFORMING
assurance engagement and their impact ENGAGEMENTS
upon the conduct of the engagement;
Students will be able to plan assurance
e. judge when to raise legal and ethical matters engagements in accordance with the terms of
arising from assurance work with senior the engagements and appropriate standards.
colleagues for review and possible referral
to external parties; In the assessment, students may be required to:
f. formulate the approach suitable for
ALL ASSURANCE ENGAGEMENTS
management of the assurance engagement;
a. explain, in the context of a given scenario,
g. explain the principles and purposes of
why it is important to have an understanding
quality control of assurance engagements;
of the business when planning an
h. demonstrate how the assurance function engagement;
within an organisation can be monitored;
b. identify ways of gaining an understanding of
i. demonstrate how quality control processes a client’s business;
improve the quality of assurance work;
c. recognise the circumstances under which
j. describe how quality can be monitored and it may be necessary to bring in expertise
controlled through procedures external to (including expertise in technology)
the organisation; from other parties to support assurance
k. discuss the purposes and consequences of processes;
UK laws and other regulatory requirements
surrounding assurance work;
© ICAEW 2019 33
d. identify the risks arising from, or affecting, a • the assurance of entities’ published
given set of business processes (including sustainability and corporate
risks associated with an entity’s use of responsibility report;
emerging technology, cyber security and
GDPR) and circumstances and assess their AUDIT ENGAGEMENTS
implications for the engagement; k. identify the components of audit risk for a
e. identify the risks arising from error, fraud specified audit engagement, including the
and non-compliance with law and other breakdown of audit risk into inherent risk,
regulations, including GDPR, and assess control risk and detection risk;
their implications for the engagement; l. outline the aspects of employment and
f. assess significant business risks (including social security law which are relevant to
risks associated with technological advances, statutory audit;
cyber security and GDPR) identified for m. discuss the differences between the audit
their potential impact upon an organisation, of a non-specialised profit oriented entity
in particular their potential impact on and the audit of a given specialised profit
performance measurement; oriented entity;
g. identify the components of risk for a n. discuss the differences between the audit of
specified assurance engagement; a non-specialised profit oriented entity and
h. assess the impact of risk and materiality on the audit of a given not-for-profit entity;
the engagement plan, including the nature, o. specify and explain the steps necessary
timing and extent of assurance procedures, to plan, perform, conclude and report on
for a given organisation; the audit of the financial statements of
i. discuss the benefits and limitations of a non-specialised profit oriented entity
analytical procedures (including data in accordance with the terms of the
analytics) at the planning stage; engagement including appropriate auditing
j. determine an approach appropriate for an standards; and
engagement for a specified organisation p. evaluate the impact of risk and materiality
which addresses: in preparing the audit plan, including
• possible reliance on controls (including the nature, timing and extent of audit
those within IT systems) procedures.
• use of technology during an assurance
3 CONCLUDING AND REPORTING ON
engagement (including data analytics
ENGAGEMENTS
and results of data analytics routines,
data visualisations generated by audit Students will be able to conclude and report
software, AI and automated tools) on assurance engagements in accordance with
the terms of the engagements and appropriate
• the organisation’s adoption of
standards.
technological advances, including cloud
computing In the assessment, students may be required to:
• using the work of internal audit
ALL ASSURANCE ENGAGEMENTS
• using the work of other experts
• using the work of another auditor a. describe the nature and timing of specific
procedures designed to identify subsequent
• probable extent of tests of controls and events that may require adjustment or
of substantive procedures, including disclosure in relation to the matters being
analytical procedures and data analytics
reported on;
• the nature and extent of client-generated
b. describe the nature and timing of specific
information, including reliability of
procedures designed to identify the
clients’ reports and underlying system-
appropriateness of the going concern
generated data
assumption, including compliance with
• the probable number, timing, staffing relevant legal and regulatory requirements;
and location of assurance visits
c. evaluate quantitatively and qualitatively,
the results and conclusions obtained from
assurance procedures including analytical

procedures and data analytics where
appropriate;
d. draw conclusions on the ability to report
on an assurance engagement which are
consistent with the results of the assurance
work;
e. draft suitable extracts for an assurance report
(including any report to the management
issued as part of the engagement) in relation
to a specified organisation on the basis of
given information, including in the extracts
(where appropriate) statements of facts, their
potential effects, and recommendations for
action relevant to the needs and nature of
the organisation being reported upon;
f. advise on reports to be issued to those
responsible for governance in accordance
with International Standards on Auditing,
legislation, regulation and codes of
corporate governance;
g. judge when to refer reporting matters for
specialist help;
AUDIT ENGAGEMENTS
h. draw conclusions on the ability to report on
an audit engagement, including the opinion
for a statutory audit, which are consistent
with the results of the audit work;
i. explain the elements (both explicit and
implicit) of the auditor’s report issued in
accordance with the International Standards
on Auditing and statutory requirements and
recommend the nature of an audit opinion
to be given in such a report; and
j. draft suitable extracts for an auditor’s report
(and any report to the management issued
as part of the engagement) in relation to
a specified organisation on the basis of
given information, including in the extracts
(where appropriate) statements of facts, their
potential effects, and recommendations for
action relevant to the needs and nature of
the organisation being reported upon.
© ICAEW 2019 35
SKILLS ASSESSED
• Identify the needs of • Interpret information • Identify business and

customers and clients provided in various formats financial issues from a
• Explain different stakeholder • Evaluate the relevance of scenario
perspectives and interests information provided • Work effectively within time
• Identify risks within a scenario • Filter information provided constraints
• Identify elements of to identify critical facts • Operate to a brief in a given
uncertainty within a scenario scenario
scenario
HOW SKILLS ARE ASSESSED:

students may be required to demonstrate:
• the regulatory, professional and ethical issues relevant to accepting, carrying out and managing
assurance engagements; and
• how quality assurance processes mitigate risks.
• Identify any information gaps • Identify and apply relevant technical

• Frame questions to clarify information knowledge and skills to analyse a specific
problem
• Use a range of data types and sources to
inform analysis and decision making • Use structured information to identify
evidence-based solutions
• Structure and analyse financial and
non-financial data to enhance understanding • Identify creative and pragmatic solutions in a
of business issues and their underlying business environment
causes • Identify opportunities to add value
• Present analysis in accordance with • Identify ethical dimensions of possible
instructions and criteria solutions
• Select appropriate courses of action using an
ethical framework

requirements will include planning assurance engagements in accordance with the terms of
engagement and appropriate standards, taking account of:
• managing audit and other assurance engagements;
• reliance on controls;
• reliance on the work of internal audit or other experts;

• reliance on the work of another auditor;
• extent of tests of control and of substantive procedures, including analytical procedures;
• use of analytical procedures including data analytic routines to identify the risk of misstatement; and
• number, timing, staffing and location of assurance visits.
APPLYING JUDGEMENT

• Recognise bias and varying quality in data and • Appreciate when more expert help is required
evidence • Identify related issues in scenarios
• Assess interaction of information from • Appraise the effects of alternative future
different sources scenarios
• Exercise ethical judgement • Appraise ethical, public interest and
regulatory issues

students may be required to:
• identify significant business or audit risks from a given scenario, explain their impact on the financial
statements, and recommend audit procedures to mitigate the risk of a material error. Requirements
will test the ability of students to filter those issues which are more relevant than others in a given
scenario.
• distinguish the quality of data or evidence to be tested in two potential ways. (i) Students will
need to distinguish between data generated from within an organisation and that generated by
a third party, the latter being less susceptible to management bias; and (ii) students will need to
appreciate the effect on the quality of evidence that bias caused by specific factors can have eg,
where profits are used to determine a bonus payment to be made to the company’s management.
• identify the impact of specific economic and political factors on a set of financial statements eg,
in the context of dealing with customers or suppliers from overseas that (i) political instability
may cause problems which prevent the customer or supplier from trading, ultimately leading to
going concern issues for the audited entity; and (ii) economic factors may cause exchange rate
fluctuations leading to the risk of misstated balances in the financial statements.
• evaluate the effect of uncertain future events when describing the procedures to be performed in
carrying out an examination of a company’s financial forecasts.
• assess the materiality of a particular matter (eg, an unadjusted error) in the context of a set of
financial statements or other financial information. This assessment should then inform the students
judgement as to whether or not to modify the opinion given in a statutory auditor’s report or
modify the conclusion in a non-audit assurance report.
• judge the potential independence risks involved in accepting or continuing an audit or other
assurance engagement, and the procedures to mitigate those risks; and consideration of the
required steps upon the discovery of fraud/money laundering.
• display the ability to present a structured argument to a client eg, in situations where management
is questioning the extent of audit work performed.
© ICAEW 2019 37

reservations. evidence suitable for the recipient
information
situation

• advise on the regulatory, professional and ethical issues in carrying out an assurance engagement;
• conclude and report on assurance engagements, including determining whether to modify a report
with or without a modified opinion/conclusion; and
• identify deficiencies in financial information systems, their potential consequences and
recommendations for improvement.

Business Strategy and Technology
To provide students with an understanding of The Business Strategy and Technology module
how an organisation develops and implements exam is 2.5 hours long. The exam will consist
strategy, including any ethical implications. of three scenario-based questions, covering
a range of different industries and types of
organisation. Each question will cover one or
able to:
more syllabus areas.
• identify and analyse the consequences of
an organisation’s current strategic direction ETHICS AND PROFESSIONAL
including objectives, market position and SCEPTICISM
technology developments;
Ethics must be an underpinning of sound
• use data to evaluate the likely consequences strategic and technological development for
of strategic choices and technology a business. Sustainability and the interests of
developments, and recommend strategies to all stakeholder groups are key considerations.
meet the objectives of an organisation; and Related learning outcomes are interwoven
• recommend appropriate methods for an through the syllabus areas of Strategic analysis,
organisation to implement and monitor Strategic choice and Implementation and
strategies including responses to technology monitoring of strategy. Students are expected to
developments, and demonstrate how data develop their skills to ensure business trust and
can be used subsequently to measure and professional scepticism are paramount.
monitor strategic performance.
SPECIFICATION GRID
1 Strategic analysis 30–40%

2 Strategic choice 30–40%
3 Implementation and monitoring of strategy 25–35%
© ICAEW 2019 39
1 STRATEGIC ANALYSIS existing business processes, human
Students will be able to identify and analyse capital and workforce flexibility)
the consequences of an organisation’s current • use of developing technology (including
strategic direction including objectives, market digital assets, cryptocurrencies, big
position and technology developments. data, internet of things, automation and
In the assessment, students may be required to: intelligent systems);
e. analyse the governance structure of an
a. evaluate an organisation’s purpose, in
organisation, identifying strengths and
terms of its stated mission, objectives
weaknesses;
and critical success factors, highlighting
omissions, inconsistencies and weaknesses, f. identify the risk attached to an organisation’s
and considering the different objectives of present position, using all relevant
stakeholders; qualitative and quantitative data, and
considering attitudes to risk, security and
b. analyse for a given situation the external
cyber security;
factors which may impact upon an
organisation’s performance and position, g. analyse an organisation’s current position
identifying significant issues in areas such as: and performance from both financial
and non-financial perspectives, using
• sustainability, including natural capital
management information and data
• macroeconomic forces presented in different formats; and
• international trade, financial systems and h. explain the ethical factors to be considered
global economic factors in determining the scope and nature of an
• government policies organisation’s objectives and its strategic
• its industry and markets, including analysis, having regard to the legitimate
competition interests of all stakeholder groups.
• cultural environment 2 STRATEGIC CHOICE
• stakeholder impact Students will be able to use data to evaluate the
• markets for finance, labour and other likely consequences of strategic choices and
resources technology developments, and recommend
• supply chain factors strategies to meet the objectives of an
• technology developments, including organisation.
those relating to automation and In the assessment, students may be required to:
intelligent systems;
a. identify, describe and evaluate in a given
c. analyse an organisation’s current markets scenario the alternative strategies available
and competitive strategy in sufficient to an organisation;
detail for decisions to be made, drawing
b. explain and demonstrate how an
conclusions consistent with the qualitative
organisation can capture and analyse
and quantitative data available and
qualitative and quantitative data, presented
highlighting relevant issues in terms of
in different formats, to provide relevant
their likely impact on the strategy of the
information for decision making at an
organisation;
appropriate level within the organisation,
d. identify the significance and effect of the including the role of the finance function as a
internal factors in a given situation which business partner;
affect or may influence an organisation’s
c. identify the implications for stakeholders,
ability to achieve its chosen strategy,
including shareholder value, of choice
including its:
between strategies;
• current resources
d. identify the risks attached to proposed
• product/service portfolio courses of action in a given situation,
• value chain considering all relevant factors, stating all
• organisational and operational assumptions made and identifying strategies
capabilities (including core competencies, for managing risk;

e. show, in a given scenario, how an support the organisation’s achievement of its
organisation chooses from competing overall strategy;
strategies in order to maximise the c. evaluate and recommend an appropriate
achievement of its key objectives, including organisational structure for a given strategy,
those relating to technology, corporate taking into account the impact of changing
responsibility and sustainability; technology and other factors;
f. evaluate the ethical implications of an d. identify the steps needed for a given
organisation’s strategies and operations organisation to develop its corporate
for the organisation and for individuals governance to meet the needs of its
(including the accountant in business and stakeholders, its strategic objectives and its
others), including ethical considerations in compliance requirements;
the use of data;
e. identify and evaluate methods of further
g. choose, for a given scenario, a strategy or developing an organisation which adjust
combination of strategies which will best existing strategies or implement new
achieve the organisation’s objectives, taking strategies to take account of changing
account of known constraints, including position and risk;
stakeholder risk preferences and developing
f. draft a simple business plan, or extracts,
technologies;
which will achieve given or implied
h. explain, in a given scenario, how products objectives;
and services must evolve in the face of
g. evaluate the form and content of an
changing technologies, consumer demand
organisation’s business plan;
and industry competition;
h. explain and demonstrate how qualitative
i. explain how to position particular products
and quantitative data, including forecasts,
and services in the market place to maximise
budgets and other management information
competitive advantage and develop a
presented in a range of formats, can be
marketing strategy by extracting and
analysed to monitor the performance of an
analysing relevant data; and
organisation’s projects, divisions and other
j. explain and demonstrate how an strategic units;
organisation can use management
i. explain and demonstrate how an
accounting approaches to evaluate its
organisation can capture, analyse and
proposed strategies, while considering the
interpret data, including big data, to provide
value of information and the risk associated
management with information that enables
with forecasts.
it to implement, monitor and modify a
3 IMPLEMENTATION AND MONITORING OF strategy and to create or sustain competitive
STRATEGY advantage;
Students will be able to recommend appropriate j. identify, in a given situation the key
methods for an organisation to implement issues which should be addressed by the
and monitor strategies including responses to management of an organisation during the
technology developments, and demonstrate planning and implementation of change; and
how data can be used subsequently to measure k. evaluate the ethical implications of how an
and monitor strategic performance. organisation chooses to implement and
modify its strategies, suggesting appropriate
courses of action to resolve ethical dilemmas
a. evaluate how an organisation’s overall that may arise.
strategy can be achieved by implementing
appropriate functional strategies, including
the role of the finance function as business
partner;
b. evaluate how strategies for technology
and innovation, including digital assets,
automation, intelligent systems, workforce
flexibility and shared service centres, can
© ICAEW 2019 41
SKILLS ASSESSED

• Identify the needs of • Filter information provided • Work effectively within time
customers and clients to identify critical facts constraints
• Explain different stakeholder • Operate to a brief in a given
perspectives and interests scenario
• Identify risks within a scenario
scenario

• understand key information from the scenario provided;
• understand the context of the scenario in terms of type of business, industry and wider context;
• recognise key ethical issues for an accountant undertaking work in accounting and reporting; and
• recognise specific issues that may arise in the context of the situation described.
• Structure information from • Identify and apply relevant technical knowledge and skills to
various sources into suitable analyse a specific problem
formats for analysis • Use structured information to identify evidence-based solutions
• Identify any information gaps • Identify creative and pragmatic solutions in a business
• Frame questions to clarify environment
information • Identify opportunities to add value
• Use a range of data types • Identify and anticipate problems that may result from a
and sources to inform decision
analysis and decision making
• Identify a range of possible solutions based on analysis
• Structure and analyse financial
• Identify ethical dimensions of possible solutions
and non-financial data to
enhance understanding of • Select appropriate courses of action using an ethical framework
business issues and their • Identify the solution which is the best fit with acceptance
underlying causes criteria and objectives
• Present analysis in accordance • Define objectives and acceptance criteria for solutions
with instructions and criteria

• identify and use information to define key business issues;
• demonstrate understanding of the business, its strategy, industry and wider context;
• demonstrate the impact of ethics on the objectives and methods of an organisation;
• identify the ethical implications of strategic proposals;
• demonstrate relevant technical knowledge;
• perform appropriate analysis of numerical data and demonstrate an understanding of what is
relevant; and
• use data analysis to develop and illustrate an answer.
APPLYING JUDGEMENT

scenarios
regulatory issues

• evaluate the impact of a business proposal on an entity;
• assess the reliability, accuracy and limitations of any analysis performed;
• be able to produce arguments integrating numerical and descriptive analysis;
• prioritise the issues facing an entity;
• identify links and relationships between different issues affecting an entity and use these to
establish priorities;
• evaluate options for an organisation, taking into account its stakeholders, objectives, priorities,
available resources and ethical obligations; and
• provide reasons for the rejection of alternatives.
© ICAEW 2019 43

information
situation

• draw realistic conclusions from an analysis of data and the information provided;
• prepare a report or memorandum structured according to the requirements of the scenario, with
appropriate context;
• provide reasoned advice based on an understanding of the business and the relevant scenario,
including an assessment of possible alternatives;
• recommend suitable courses of action in a given situation; and
• identify risks and outline reservations about the advice.

Financial Accounting and Reporting
From March 2017, alternative financial reporting modules were introduced to the Financial Accounting
and Reporting module. Students can now choose between two different frameworks, either IFRS or UK
GAAP. This means that students can study the financial reporting framework most beneficial to their
employer and clients.
Financial Accounting and

Reporting: IFRS
To enable students to prepare complete single The Financial Accounting and Reporting: IFRS
entity and consolidated financial statements, module exam is 3 hours long. The exam contains
and extracts from those financial statements, four written test questions. Students may use
covering a wide range of International Financial the permitted text(s) as detailed on the ICAEW
Reporting Standards (IFRS). website; icaew.com/permittedtexts.
Students will also be required to explain The module will include questions on:
accounting and reporting concepts and ethical
a. preparation of single entity financial
issues, and the application of IFRS to specified
statements (excluding statement of cash
single entity or group scenarios.
flows) from trial balance;
On completion of this module, students will be b. preparation of consolidated financial
able to: statements (excluding consolidated
• explain the contribution and inherent statement of cash flows) from single entity
limitations of financial statements, apply the financial statements; and
International Accounting Standards Board’s c. explanation of the application of IFRS
(IASB) conceptual framework for financial to specified scenarios, with supporting
reporting and identify and explain key calculations.
ethical issues; Other question types could include:
• prepare and present financial statements
a. preparation of a full consolidated statement
from accounting data for single entities
of cash flows, or extracts from consolidated
in conformity with IFRS and explain the
financial statements, or preparation of
application of IFRS to specified single entity
revised extracts from a draft consolidated
scenarios;
statement of cash flows; and
• identify the circumstances in which entities
b. mixed or single topic questions requiring
are required to present consolidated
extracts from single entity or consolidated
financial statements, prepare and present
financial statements (including from
them in conformity with IFRS and explain
statement of cash flows) and/or explanation
the application of IFRS to specified group
of financial reporting treatment with
scenarios; and
supporting calculations and/or calculations
• Describe the principal differences between of specified figures.
IFRS and UK GAAP and prepare simple
Concepts, ethics and UK GAAP will be tested in
extracts from financial statements in
any of the questions.
accordance with UK GAAP, for both single
entity and consolidated financial statements.
Learning outcomes apply to non-specialised
profit-oriented entities unless otherwise
specified.
© ICAEW 2019 45
ETHICS AND PROFESSIONAL
SCEPTICISM
Ethical thinking must be the mainstay for honest,
true, fair and prudent financial accounting and
reporting. The ability to identify and explain
ethical issues is examined specifically under
the syllabus area ‘Accounting and reporting
concepts and ethics’. Over and above this
ethical thinking and professional scepticism will
be required to be applied in the exercise of all
judgements.
SPECIFICATION GRID
1 Accounting and reporting concepts and ethics 10%

2 Single entity financial statements 60%
3 Consolidated financial statements 30%
1 ACCOUNTING AND REPORTING CONCEPTS e. discuss the concepts of ‘fair presentation’

AND ETHICS and ‘true and fair view’ and the
Students will be able to explain the contribution circumstances in which these concepts
and inherent limitations of financial statements, may override the detailed provisions of
apply the International Accounting Standards legislation or of accounting standards;
Board’s conceptual framework for financial f. explain the differences between financial
reporting and identify and explain key ethical statements produced using the accrual basis
issues. and those produced using the bases of cash
In the assessment, students may be required to: accounting and break-up, performing simple
calculations to illustrate the differences;
a. explain the standard-setting process used
g. explain, in non-technical language, the
by UK and international bodies and the
different bases of measurement of the
authority of UK and international standards,
elements of the financial statements,
using appropriate examples as illustration;
illustrating the explanation with simple
b. explain the objectives and inherent calculations and examples;
limitations of financial statements, giving
h. explain and demonstrate the concepts and
appropriate examples;
principles surrounding the consolidation of
c. explain the qualitative characteristics of financial statements; and
financial information and the constraints
i. identify and explain the ethical and
on such information, using appropriate
professional issues for a professional
examples to illustrate the explanation;
accountant undertaking work in financial
d. identify the effects of transactions in accounting and reporting and identify
accordance with the IASB Conceptual appropriate action.
Framework;

2 SINGLE ENTITY FINANCIAL STATEMENTS d. calculate from financial and other data
Students will be able to prepare and present the amounts to be included in an entity’s
financial statements from accounting data consolidated financial statements in respect
for single entities in conformity with IFRS of its new, continuing and discontinued
requirements and explain the application of IFRS interests in subsidiaries, associates and joint
to specified single entity scenarios. ventures (excluding partial disposals of
subsidiaries and disposals of associates or
In the assessment, students may be required to: joint ventures) according to the international
a. identify the laws and regulations, financial reporting framework;
and accounting standards and other e. prepare and present the consolidated
requirements applicable to the statutory financial statements, or extracts, of an entity
financial statements of an entity; in accordance with its accounting policies
b. calculate from financial and other data and appropriate international financial
the amounts to be included in an entity’s reporting standards;
financial statements according to the f. explain the application of IFRS to specified
international financial reporting framework; group scenarios; and
c. prepare and present the financial g. describe the principal differences between
statements, or extracts, of an entity in IFRS and UK GAAP (FRS 102) and prepare
accordance with its accounting policies and simple extracts from consolidated financial
appropriate international financial reporting statements in accordance with UK GAAP
standards; (FRS 102).
d. explain the application of IFRS to specified
single entity scenarios;
e. describe the principal differences between
IFRS and UK GAAP (FRS 102 and Companies
Act 2006) and prepare simple extracts
from single entity financial statements in
accordance with UK GAAP; and
f. define and calculate from information
provided the distributable profits of an
entity.
3 CONSOLIDATED FINANCIAL STATEMENTS

Students will be able to identify the
circumstances in which entities are required
to present consolidated financial statements,
prepare and present them from single entity
financial statements in conformity with IFRS
requirements and explain the application of IFRS
to specified group scenarios.
a. identify and describe the circumstances in
which an entity is required to prepare and
present consolidated financial statements;
b. identify the laws and regulations, and
accounting standards and other requirements
applicable to the legal entity and
consolidated financial statements of an entity;
c. identify from financial and other data any
subsidiary, associate or joint venture of an
entity according to the international financial
reporting framework;
© ICAEW 2019 47
SKILLS ASSESSED

• Explain different stakeholder • Filter information provided • Work effectively within time
perspectives and interests to identify critical facts constraints
• Explain ethical issues with • Operate to a brief in a given
given scenarios scenario

• explain the inherent limitations of financial statements;
• apply elements of the IASB conceptual framework;
• recognise key ethical issues for an accountant undertaking work in accounting and reporting;
• identify international financial reporting standards and other requirements applicable to the
financial statements (both single entity and consolidated); and
• Select appropriate courses of action using an ethical framework
• Identify the solution which is the best fit with acceptance
criteria and objectives

• apply the IASB conceptual framework to identify the financial effects of transactions;
• apply knowledge of international financial reporting standards through explanation and
calculation;
• prepare and present financial statements, or extracts (both single entity and consolidated) in
conformity with international financial reporting standards;
• explain the principal differences between IFRS and UK GAAP; and
• identify ethical issues and use ethical codes to formulate solutions and provide advice.

APPLYING JUDGEMENT

• Recognise bias and varying quality in data and • Identify related issues in scenarios
evidence • Appraise ethical, public interest and
• Identify faults in arguments regulatory issues
• Exercise ethical judgement

• use judgement to assess the appropriate accounting treatment for transactions described in the
scenarios in respect of both single entity and consolidated financial statements; and
Conclusions Communication
• Apply technical knowledge to support • Present a basic or routine memorandum or

reasoning and conclusions briefing note in writing in a clear and concise
• Use valid and different technical skills to style
formulate opinions, advice, plans, solutions, • Communicate clearly to a specialist or non-
options and reservations specialist audience in a manner suitable for
the recipient
• Prepare the advice, report, or notes required
in a clear and concise style

• explain accounting and reporting concepts in non-technical language;
• explain, with supporting calculations, the appropriate accounting treatment for transactions
described in the scenario (both single entity and consolidated financial statements);
• prepare and present financial statements, or extracts (both single entity and consolidated financial
statements) in conformity with international financial reporting standards;
• explain the principal differences between IFRS and UK GAAP; and
• explain ethical issues and provide possible solutions.
© ICAEW 2019 49
Financial Accounting and
Reporting: UK GAAP
To enable students to prepare complete single The Financial Accounting and Reporting: UK
entity and consolidated financial statements, GAAP module exam is 3 hours long. The exam
and extracts from those financial statements, contains four written test questions. Students
in accordance with FRS 102 The Financial may use the permitted text(s) as detailed on the
Reporting Standard applicable in the UK and ICAEW website; icaew.com/permittedtexts.
Republic of Ireland, and the Companies Act
The module will include questions on:
2006. In addition, students will have a working
knowledge of FRS 105 and The Financial a. preparation of single entity financial
Reporting Standard applicable to the Micro- statements (excluding statement of cash
Entities Regime. flows) from trial balance;
Students will also be required to explain b. preparation of consolidated financial
accounting and reporting concepts and ethical statements (excluding consolidated
issues, and the application of UK GAAP to statement of cash flows) from single entity
specified single entity or group scenarios. financial statements; and
c. explanation of the application of UK GAAP
to specified scenarios, with supporting
able to:
calculations.
• explain the contribution and inherent Other question types could include:
limitations of financial statements, apply
FRS 102 Section 2 Concepts and Pervasive a. preparation of a full consolidated statement
Principles and identify and explain key of cash flow, or extracts, from consolidated
ethical issues; financial statements, or preparation of
revised extracts from a draft consolidated
• prepare and present financial statements
statement of cash flows; and
from accounting data for single entities,
whether organised in corporate or in other b. mixed or single topic questions requiring
forms, in conformity with FRS 102, and/ extracts from single entity or consolidated
or FRS 105 and Companies Act 2006 and financial statements (including from
explain the application of FRS 102, and/or statement of cash flows) and/or explanation
FRS 105, to specified single entity scenarios; of financial reporting treatment with
supporting calculations and/or calculation of
• identify the circumstances in which entities
specified figures.
are required to present consolidated
financial statements, prepare and present Concepts, ethics and IFRS will be tested in any
them in conformity with FRS 102 and of the questions.
Companies Act 2006 and explain the
application of FRS 102 to specified group ETHICS AND PROFESSIONAL
scenarios; and SCEPTICISM
• describe the principal differences between Ethical thinking must be the mainstay for honest,
UK GAAP and IFRS and prepare simple true, fair and prudent financial accounting and
extracts from financial statements in reporting. The ability to identify and explain
accordance with IFRS, for both single entity ethical issues is examined specifically under
and consolidated financial statements. the syllabus area ‘Accounting and reporting
Learning outcomes apply to non-specialised concepts and ethics’. Over and above this
profit-oriented entities unless otherwise ethical thinking and professional scepticism will
specified. be required to be applied in the exercise of all
judgements.

SPECIFICATION GRID
1 Accounting and reporting concepts and ethics 10%

2 Single entity financial statements 60%
3 Consolidated financial statements 30%
1 ACCOUNTING AND REPORTING CONCEPTS h. explain and demonstrate the concepts and
AND ETHICS principles surrounding the consolidation of
Students will be able to explain the contribution financial statements; and
and inherent limitations of financial statements, i. identify and explain the ethical and
apply FRS 102 Section 2 Concepts and Pervasive professional issues for a professional
Principles and identify and explain key ethical accountant undertaking work in financial
issues. accounting and reporting and identify
In the assessment, students may be required to: appropriate action.
a. explain the standard-setting process used by 2 SINGLE ENTITY FINANCIAL STATEMENT

UK and the authority of UK standards, using Students will be able to prepare and present
appropriate examples as illustration, as well financial statements from accounting data for
as the regulatory framework in respect of single entities, whether organised in corporate
IFRS; or in other forms, in conformity with FRS 102 and
b. explain the objectives and inherent Companies Act 2006 requirements and prepare
limitations of financial statements, giving and present extracts from financial statements
appropriate examples; from accounting data for single entities in
c. explain the qualitative characteristics of conformity with FRS 105 and Companies Act
financial information and the constraints 2006. In addition, students will be able to
on such information, using appropriate explain the application of FRS 102 and FRS 105
examples to illustrate the explanation; to specified single entity scenarios.
d. identify the effects of transactions in In the assessment, students may be required to:
accordance with FRS 102 Section 2
a. identify the laws and regulations,
Concepts and Pervasive Principles;
and accounting standards and other
e. discuss the concept of true and fair view requirements applicable to the statutory
and the circumstances in which this concept financial statements of an entity;
may override the detailed provisions of
b. calculate from financial and other data
legislation or of accounting standards;
the amounts to be included in an entity’s
f. explain the differences between financial financial statements according to FRS 102
statements produced using the accrual basis Section 2 Concepts and Pervasive Principles;
and those produced using the bases of cash
c. prepare and present the financial
accounting and break-up, performing simple
statements, or extracts of an entity in
calculations to illustrate the differences;
accordance with its accounting policies, FRS
g. explain, in non-technical language, the 102, and/or FRS 105 and Companies Act
different bases of measurement of assets, 2006;
liabilities, income and expenses;
d. explain the application of FRS 102, and/
or FRS 105, and/or make comparisons, to
specified single entity scenarios;
© ICAEW 2019 51
e. describe the principal differences between
UK GAAP (FRS 102 and Companies Act
2006) and IFRS and prepare simple extracts
from single entity financial statements in
accordance with IFRS; and
f. define and calculate from information
provided the distributable profits of an
entity.
3 CONSOLIDATED FINANCIAL STATEMENTS

Students will be able to identify the
circumstances in which entities are required
to present consolidated financial statements,
prepare and present them from single entity
financial statements in conformity with FRS
102 and Companies Act 2006 and explain
the application of FRS 102 to specified group
scenarios.
a. identify and describe the circumstances in
which an entity is required to prepare and
present consolidated financial statements;
b. identify the laws and regulations,
and accounting standards and other
requirements applicable to the legal entity
and consolidated financial statements of an
entity;
c. identify from financial and other data any
subsidiary, associate or joint venture of an
entity according to FRS 102;
d. calculate from financial and other data
the amounts to be included in an entity’s
consolidated financial statements in respect
of its new, continuing and discontinued
interests in subsidiaries, associates and joint
ventures (excluding partial disposals of
subsidiaries and disposals of associates or
joint ventures) according to FRS 102;
e. prepare and present the consolidated
financial statements, or extracts, of an entity
in accordance with its accounting policies,
FRS 102 and Companies Act 2006;
f. explain the application of FRS 102 to
specified group scenarios; and
g. describe the principal differences between
UK GAAP (FRS 102) and IFRS and prepare
simple extracts from consolidated financial
statements in accordance with IFRS.

SKILLS ASSESSED

ideas within a scenario information provided • Work effectively within time
• Explain different stakeholder • Filter information provided constraints
perspectives and interests to identify critical facts • Operate to a brief in a given
• Explain ethical issues within scenario
given scenarios

• explain the inherent limitations of financial statements;
• apply elements of the concepts and pervasive principles of FRS 102;
• recognise key ethical issues for an accountant undertaking work in accounting and reporting;
• identify the relevant UK GAAP standards and other requirements applicable to the financial
statements (both single entity and consolidated); and
• Identify the solution which is the best fit with acceptance

• apply FRS 102 Section 2 Concepts and Pervasive Principles to identify the financial effects of
transactions;
• apply knowledge of UK GAAP through explanation and calculation;
• prepare and present financial statements, or extracts (both single entity and consolidated) in
conformity with UK GAAP;
• explain the principal differences between UK GAAP and IFRS; and
© ICAEW 2019 53
APPLYING JUDGEMENT

• Recognise bias and varying quality in data and • Identify related issues in scenarios
evidence • Appraise ethical, public interest and
• Identify faults in arguments regulatory issues

• use judgement to assess the appropriate accounting treatment for transactions described in the
scenarios in respect of both single entity and consolidated financial statements; and
• Apply technical knowledge to support • Present a basic or routine memorandum or

reasoning and conclusions briefing note in writing in a clear and concise
• Use valid and different technical skills to style
formulate opinions, advice, plans, solutions, • Communicate clearly to a specialist or non-
options and reservations specialist audience in a manner suitable for
the recipient
• Prepare the advice, report, or notes required
in a clear and concise style

• explain accounting and reporting concepts in non-technical language;
• explain, with supporting calculations, the appropriate accounting treatment for transactions
described in the scenario (both single entity and consolidated financial statements);
• prepare and present financial statements, or extracts (both single entity and consolidated financial
statements) in conformity with UK GAAP;
• explain the principal differences between UK GAAP and IFRS; and
• explain ethical issues and provide possible solutions.

Financial Management
To enable students to recommend relevant The Financial Management module exam is
options for financing a business, recognise and 2.5 hours long. The exam consists of three
manage financial risks and make appropriate questions. Managing financial risk will be
investment decisions. assessed as a discrete topic. The other two
questions will assess financing options and
investment decisions and valuation either as
able to:
discrete or integrated topics.
• identify capital requirements of businesses,
assess financing options and recommend ETHICS AND PROFESSIONAL
relevant methods of financing; SCEPTICISM
• identify the financial risks facing a business In identifying financing options, managing
and the principal methods of managing financial risk and arriving at appropriate
those risks; and investment decisions, underlying ethical thinking
• apply appropriate investment appraisal is a requirement. The implications of financial
techniques taking into account other factors strategy for all stakeholders must be evaluated
affecting investment decisions. and any ethical dilemmas resolved. Students
will also be expected to apply professional
scepticism and critical thinking when making all
judgements.
SPECIFICATION GRID
1 Financing options 35%

2 Managing financial risk 30%
3 Investment decisions and valuation 35%
© ICAEW 2019 55
1 FINANCING OPTIONS meet those requirements, comparing the
Students will be able to identify capital financing costs and benefits, referring to
requirements of businesses and assess financing levels of uncertainty and making reasonable
options. assumptions which are consistent with the
situation; and
k. draft a straightforward investment and
a. explain the general objectives of financial financing plan for a given business scenario.
management, understand and apply
the fundamental principles of financial 2 MANAGING FINANCIAL RISK
economics and describe the financial Students will be able to identify the main price
strategy process for a business; and overseas trading risks facing a business and
b. explain the roles played by different the principal methods of managing those risks.
stakeholders, advisors and financial In the assessment, students may be required to:
institutions in the financial strategy selected
by a business and identify possible conflicts a. identify and describe the key price risks
of objectives; facing a business in a given scenario;
c. evaluate the ethical implications of an b. explain how financial instruments (eg,
entity’s financial strategy (including those derivatives, hedging instruments) can be
for the organisation, individuals and other used to manage price risks and describe the
stakeholders) and suggest appropriate characteristics of those instruments;
courses of action to resolve any ethical c. explain different methods of managing
dilemmas that may arise; interest rate risk appropriate to a given
d. describe the impact of financial markets situation and perform non-complex
(including their efficiency) and other external calculations to determine the cost of
factors on a business’s financial strategy, hedging that risk;
using appropriate examples to illustrate the d. explain different methods of managing
impacts; currency risks appropriate to a given
e. describe the implications of terms included situation and perform non-complex
in loan agreements in a given scenario (eg, calculations to determine the cost of
representations and warranties; covenants; hedging that risk;
guarantees); e. explain different methods of managing
f. calculate and interpret the costs of different share price risk and perform non-complex
sources of finance (before and after tax) and calculations to determine the cost of
the weighted average cost of capital; hedging that risk; and
g. explain, in non-technical terms and using f. explain the additional risks of trading abroad
appropriate examples, the effect of capital and outline the methods available for
gearing both on investors’ perception of risk reducing those risks.
and reward and the weighted average cost
3 INVESTMENT DECISIONS AND VALUATION
of capital;
h. calculate and justify an appropriate discount Students will be able to apply investment
rate for use in an investment appraisal taking appraisal techniques and calculate the value of
account of both the risk of the investment shares and businesses.
and its financing; In the assessment, students may be required to:
i. compare the features of different means a. outline the investment decision making
of making returns to lenders and owners process and explain how investment
(including dividend policy), explain their decisions are linked to shareholder value;
effects on the business and its stakeholders,
b. select appropriate values to be used in
and recommend appropriate options in a
an investment appraisal from information
given scenario;
supplied, taking account of relevant cash
j. forecast the capital requirements for flows, inflation and tax;
a business taking into account current
c. calculate and discuss the sensitivity of an
and planned activities and/or assess the
investment decision to changes in the input
suitability of different financing options to
factors;

d. discuss how the interpretation of results from
an investment appraisal can be influenced
by an assessment of risk;
e. recognise how the results of the appraisal of
projects are affected by the accuracy of the
data on which they are based and strategic
factors (such as real options) which could not
be included in the computational analysis;
f. identify in the business and financial
environment factors that may affect
investment in a different country;
g. calculate the optimal investment plan when
capital is restricted;
h. recommend and justify a course of action
which is based upon the results of an
investment appraisal and consideration
of relevant non-financial factors such as
sustainability and which takes account of the
limitations of the techniques being used;
and
i. describe options for reconstruction eg,
merger, takeover, spin-off, purchase of own
shares and value shares and businesses
using income and asset based approaches.
© ICAEW 2019 57
SKILLS ASSESSED

• Explain different stakeholder • Operate to a brief in a given
perspectives and interests scenario
scenario
• Explain ethical issues within
given scenarios

• absorb and understand both structured and unstructured material;
• give recommendations based on their understanding and interpretation of the information
provided, supported by explanation of the reasoning behind and implications of their
recommendations.
formats for analysis • Identify creative and pragmatic solutions in a business
• Identify any information gaps environment
• Structure and analyse • Identify opportunities to add value
financial and non- • Identify and anticipate problems that may result from a
financial data to enhance decision
understanding of business
issues and their underlying
causes • Identify ethical dimensions of possible solutions
• Present analysis in • Select appropriate courses of action using an ethical framework
accordance with instructions • Identify the solution which is the best fit with acceptance
and criteria criteria and objectives
• Define objectives and acceptance criteria for solutions

• assimilate significant amounts of information, to analyse it (including quantitative analysis) in a way
that demonstrates relevant technical knowledge and to draw and support appropriate conclusions.
APPLYING JUDGEMENT

• Identify faults in arguments • Identify related issues in scenarios

• Identify gaps in evidence • Assess different stakeholder perspectives when evaluating
• Identify inconsistencies and options
contradictory information • Retain an overview of the business issue or scenario
• Exercise ethical judgement • Appraise corporate responsibility and sustainability issues
• Appraise the effects of alternative future scenarios
• Appraise ethical, public interest and regulatory issues

• make sense of relatively large volumes of data, making judgments on the relevance of data for use
in subsequent calculations and discussions;
• reflect on their calculations and the methodology employed and to identify and discuss the
implications of calculations;
• make and justify judgements based on earlier calculations.

• Use valid and different • Make recommendations in concise style
technical skills to formulate situations where risks and • Present analysis and
opinions, advice, plans, uncertainty exist recommendations in
solutions, options and • Formulate opinions, advice, accordance with instructions
reservations recommendations, plans, • Communicate clearly to a
solutions, options and specialist or non-specialist
reservations based on valid audience in a manner
evidence suitable for the recipient
• Develop recommendations • Prepare the advice, report, or
which combine different notes required in a clear and
technical skills in a practical concise style
situation
© ICAEW 2019 59
• recommend suitable courses of action in a given situation (financing decisions, dividend decisions,
investment appraisal decisions);
• incorporate advice within a ‘business report’ format, addressing both the strengths and weaknesses
of any recommendations and/or reasons for the rejection of alternatives.

Tax Compliance
MODULE AIM TAXES COVERED IN THIS MODULE
To enable students in straightforward scenarios to: Capital gains tax
• prepare tax computations for individuals and Corporation tax
companies; Income tax
• understand the tax implications of a course Inheritance tax
of action; and
National insurance
• explain potential tax treatments of
transactions. Stamp taxes
On completion of this module, students will be VAT
able to:
• recognise the ethical issues arising in the
course of performing tax work and identify The Tax Compliance module exam is 2.5 hours
the obligations the UK system of taxation long. The exam will consist of five questions.
imposes on taxpayers and the implications The exam will test each of the taxes on the
for taxpayers of non-compliance; syllabus as a discrete topic. Students may use
the permitted text(s) as detailed on the ICAEW
• calculate the amount of VAT owed by or
website; icaew.com/permittedtexts.
owed to businesses;
• calculate the amount of stamp taxes due in In the exam, students will generally be expected
straightforward transactions; to assume that any beneficial election, claim or
deduction has been made, unless otherwise
• calculate the capital gains tax payable by
directed in the exam.
individuals;
• calculate the amounts of inheritance tax due
ETHICS AND PROFESSIONAL
on lifetime transfers and transfers on death
SCEPTICISM
by individuals, personal representatives and
trustees; Ethical behaviour in tax compliance is
paramount. Students will be expected to apply
• calculate the corporation tax liabilities of
the ICAEW Code of Ethics and Professional
companies;
Conduct in Relation to Taxation. Appropriate
• calculate the amounts of income tax owed and trustworthy calculations, explanations and
by or owed to individuals; and tax planning must be provided, being mindful
• calculate the amounts of national insurance of tax avoidance and tax evasion. Professional
payable by individuals, businesses and scepticism will be critical in recognising bias and
companies. exercising judgement.
© ICAEW 2019 61
SPECIFICATION GRID
1 Ethics and law 5–10%

2 Indirect taxes 10–15%
3 Capital taxes 20–30%
4 Corporation tax 15–25%
5 Income tax and NIC 30–40%
This grid provides guidance on the relative weighting between knowledge and skills:
WEIGHTING
Knowledge 65–75%
Skills 25–35%
1 ETHICS AND LAW • money laundering

Students will be able to recognise ethical issues • tax planning, tax avoidance and tax
arising in the course of performing tax work and evasion;
identify the obligations the UK system of tax c. identify legal and ethical issues arising
imposes on taxpayers and the implications for from tax work undertaken and explain the
taxpayers of non-compliance. significance of these issues and suggest
In the assessment, students may be required to: appropriate actions or responses; and
a. identify the five fundamental principles and d. identify and explain to all stakeholders the
guidance given in the IESBA Code of Ethics implications of digital tax accounts on UK
for Professional Accountants and the ICAEW taxpayers.
Code of Ethics as well as other relevant 2 INDIRECT TAXES
guidance, including Professional Conduct in
Relation to Taxation (PCRT), in relation to a Students will be able to calculate the amount
tax practice with regard to: of VAT owed by or owed to businesses and
calculate the amount of stamp taxes due in
• the threats and safeguards framework straightforward transactions including when
• disclosure of information these amounts must be reported and paid.
• conflicts of interest In the assessment, students may be required to:
• confidentiality;
a. explain the VAT consequences of property
b. identify the law and the guidance in the transactions;
ICAEW Code of Ethics as well as other
relevant guidance, including Professional b. explain the VAT consequences of group
Conduct in Relation to Taxation (PCRT), with registration for VAT;
regard to: c. explain the VAT consequences of the option
• new client procedures to tax;
• regulatory requirements for tax practices d. explain and calculate the VAT consequences
of the capital goods scheme;
• HMRC errors

e. calculate the VAT due to or from HMRC for e. explain the principles of inheritance tax and
both wholly taxable and partially exempt identify the different classes of taxpayer
traders; liable to pay inheritance tax;
f. explain the VAT consequences of imports f. explain the impact of an individual’s domicile
and exports of goods and services to and and deemed domicile on their inheritance
from VAT registered and non-VAT registered tax liability;
persons within and outside the UK; g. explain when the lifetime transfer of an
g. explain the classification of supplies and the asset gives rise to an inheritance tax
distinction between goods and services; liability, calculate the inheritance tax
h. identify and explain the differing VAT payable on chargeable lifetime transfers in
treatment of single and multiple supplies; straightforward scenarios and state the due
date for payment;
i. identify common situations in which a
liability to UK land and stamp taxes, Stamp h. calculate the death tax due on lifetime
Duty Reserve Tax, and Stamp Duty arises; transfers and state the due date for payment;
j. identify situations where there is an i. calculate the value of an individual’s estate at
exemption from stamp taxes; death and the inheritance tax due and state
the due date for payment;
k. calculate the amount of stamp taxes due in
straightforward transactions; j. describe the circumstances in which the
following inheritance tax reliefs apply and
l. determine due dates for stamp taxes returns;
calculate the amount of relief available in a
and
given situation:
m. calculate the interest and penalties due in
• fall in value relief
respect of late payment of stamp taxes.
• agricultural property relief
3 CAPITAL TAXES • business property relief
Students will be able to calculate the capital • quick succession relief
gains tax payable by individuals. Students
• taper relief;
will also be able to calculate the amounts of
inheritance tax due on lifetime transfers and k. determine, in straightforward cases, due
transfers on death by individuals, personal dates for inheritance tax returns; and
representatives and trustees, including when l. calculate the interest and penalties due in
these amounts must be reported and paid. respect of late payment of inheritance tax.
In the assessment, students may be required to: 4 CORPORATION TAX
a. calculate the chargeable gains and losses Students will be able to calculate the
on assets, including chattels, and shares and corporation tax liabilities of companies,
securities; including when these liabilities must be
b. describe the circumstances in which the reported and paid.
following reliefs apply and calculate the In the assessment, students may be required to:
effect of full or partial relief available in a
given situation: a. explain the relevance of the distinction
between revenue and capital for both
• letting relief
receipts and expenses and apply the
• principal private residence relief distinction in a given scenario;
• gift relief b. recognise the effect on trading profits of the
• rollover relief treatment of:
• entrepreneurs’ relief; • provisions
c. explain the impact of an individual’s • capitalised revenue expenditure
residence, domicile and deemed domicile • intangible assets;
on their capital gains tax liability;
c. calculate trading profits or losses after
d. calculate total taxable gains and tax payable adjustments and allowable deductions
thereon, using available reliefs and losses to (including capital allowances on plant and
reduce the liability, including the computation machinery);
of double tax relief where appropriate;
© ICAEW 2019 63
d. calculate the chargeable gains and losses UNINCORPORATED BUSINESSES
on assets, including chattels and shares and d. calculate the assessable trading profits or
securities; losses of a partnership including after a
e. describe the circumstances in which rollover change in the profit sharing ratio or change
relief applies and calculate the effect of full in partners, and allocate the profits or losses
or partial relief available in a given situation; to each partner including the allocation of
f. recognise the effect of the following issues notional profits and losses;
on corporation tax payable: e. calculate the assessable trading profits or
• having a period of account less than or losses for a new unincorporated business
more than 12 months in length and identify the overlap profits on the
commencement of trade;
• having one or more related 51% group
f. calculate the assessable trading profits or
companies
losses for a continuing business;
• being a member of a group;
g. calculate the final assessable trading profits
g. explain and illustrate how losses may be or losses for an unincorporated business
used effectively by a company or group; ceasing to trade;
h. calculate the taxable total profit and the h. calculate the assessable trading profits or
tax payable or repayable for companies losses of a continuing business following a
including using losses to reduce the tax change in accounting date;
liability and the computation of double tax
i. explain and illustrate the possible uses
relief where appropriate; and
of trading losses in a new or continuing
i. identify the key features of the self- business or a business ceasing to trade;
assessment system for companies,
determine due dates for returns, payments TAXATION OF INCOME
and payments on account, and calculate j. calculate assessable employment income
the interest and penalties due for late for an employee or director, taking into
submissions of returns, incorrect returns and account expenses, allowable deductions and
late or incorrect payments of tax. assessable benefits;
k. calculate taxable savings, income from
5 INCOME TAX AND NIC
property, dividend income, taxed income
Students will be able to calculate the amounts and investment income;
of income tax owed by or owed to individuals l. describe and calculate the principal aspects
as well as the amounts of national insurance of the taxation of property income, including
payable by employers, the self-employed and interest relief, rent-a-room relief, and the
employees, including when these amounts must application of the cash basis;
be reported.
m. explain the alternative ways in which an
In the assessment, students may be required to: individual can provide for retirement and
calculate the tax relief available;
TRADING PROFITS n. explain the impact of an individual’s
a. explain the relevance of the distinction residence, domicile and deemed domicile;
between revenue and capital for both o. calculate total taxable income and the
receipts and expenses and apply the income tax payable or repayable for
distinction in a given scenario; employees, company directors, partners
b. recognise the effect on trading profits of the and self-employed individuals including
treatment of: the computation of double tax relief where
• provisions appropriate and payments under the self-
assessment system; and
• capitalised revenue expenditure
• intangible assets;
c. calculate trading profits or losses after
adjustments and allowable deductions
(including capital allowances on plant and
machinery) using either the accruals basis or
cash basis of accounting;

p. identify the key features of the self-
assessment system for individuals,
determine due dates for returns, payments,
and payments on account, and calculate
the interest and penalties due for late
submissions of returns, incorrect returns and
late or incorrect payments of tax.
NATIONAL INSURANCE CONTRIBUTIONS

Students will be able to calculate the amounts
of national insurance payable by individuals,
businesses and companies.
q. identify the different classes of national
insurance contributions;
r. calculate the national insurance due on
employment income and the assessable
trading profits of the self-employed;
s. recognise when the annual maxima rules
for the payment of national insurance
contributions apply; and
t. calculate the total national insurance
contributions payable by employees,
employers and self-employed individuals.
© ICAEW 2019 65
SKILLS ASSESSED
• Identify ethical issues in a • Interpret information • Work effectively within time

given scenario provided in various formats constraints
• Evaluate the relevance and • Operate to a brief in a given
accuracy of information scenario
provided
• Filter information provided
to identify critical facts

• explain the implications of proposed transactions in any of the following ways:
–– calculation of tax liabilities and reliefs available;
–– written description of tax treatments;
–– explanation of tax treatments in light of unstructured information relating to individuals,
partnerships or companies;
–– description of the availability and values of tax reliefs within the context of numerical questions;
–– explanation of alternative tax treatments; and
–– explanation of ethical issues within given scenarios.
• Present analysis in • Identify and apply relevant technical knowledge and skills to
accordance with instructions analyse a specific problem
and criteria • Use structured information to identify evidence-based solutions

• calculate tax liabilities from a given scenario;
• demonstrate relevant technical knowledge;
• perform relevant, accurate calculations in a logically structured way;
• identify different business entities and their tax status (eg, company, sole trader, partnership), and
understand the tax implications thereof;
• integrate verbal descriptions with calculations;
• use calculations to illustrate an answer; and
• provide relevant legal and ethical information in the context of a tax scenario.

APPLYING JUDGEMENT
Apply professional scepticism and critical thinking
• Recognise bias and varying quality in data and evidence

• Identify faults in computations and arguments

• critically evaluate the quality, completeness and integrity of information put forward by tax payers;
• assess the legality of options and the consequences of various courses of action with regard to:
–– new client procedures;
–– HMRC errors;
–– money laundering;
–– tax planning, tax avoidance and tax evasion.
CONCLUDING RECOMMENDING AND COMMUNICATING
• Apply technical knowledge • Present analysis and recommendations in accordance with

to support reasoning and instructions
conclusions • Prepare the advice, report, or notes required in a clear and
concise style

• analyse the implications of various courses of action out of a limited set of prescribed options;
• determine the tax implications of scenarios and proposals to provide alternative tax implications;
• take a given set of circumstances and reach a reasoned conclusion;
• justify a conclusion made using knowledge of the existing tax regime;
• show an illustrative example of possible VAT treatments eg with regard to transactions involving
land and buildings;
• show an illustrative example of inheritance tax implications of a proposed lifetime transfer or a
transfer on death;
• show an illustrative example of the impact of residency status on income tax, capital gains tax or
corporation tax; or
• show an illustrative example of whether an individual is trading by applying the badges of trade to
reach a reasoned conclusion.
© ICAEW 2019 67
Business Planning
The Business Planning modules provide students with the opportunity to gain subject- and sector-
specific knowledge while studying for the ACA. Students will sit one of the Business Planning modules.
There are three to choose from – Business Planning: Taxation, Business Planning: Banking, and Business
Planning: Insurance.
Business Planning: Taxation

To enable students to apply technical The Business Planning: Taxation module exam is
knowledge and professional skills to identify 2.5 hours long. The exam will contain questions
and resolve taxation issues that arise in the requiring the use of communication, judgement
context of preparing tax computations and to and evaluation skills as well as an ability to
advise on tax-efficient strategies for businesses understand the interaction of different taxes.
and individuals.
The exam will consist of three questions. One
Students will be required to use technical question will be an integrated scenario of
knowledge and professional judgement to approximately 40 marks which will cover a
identify, explain and evaluate alternative tax range of taxes as well as including tax planning.
treatments and to determine the appropriate Ethics and law may be tested in any of the three
solutions to taxation issues, giving due questions.
consideration to the needs of clients and the
The exam will be open book and will permit
interaction between taxes. The commercial
students to take any written or printed material
context and impact of recommendations
into the exam, subject to practical space
will need to be considered in making such
restrictions. To see the recommended text(s) for
judgements, as will ethical and legal issues.
this exam, go to icaew.com/permittedtexts.
PRIOR KNOWLEDGE ETHICS AND PROFESSIONAL

There are no regulations stipulating the order SCEPTICISM
in which students must attempt this module.
It is imperative that ethical issues are prioritised
However, students are strongly advised to
in the planning of business taxation. Students
complete both the Principles of Taxation
will be expected to apply the ICAEW Code of
module and the Tax Compliance module before
Ethics and Professional Conduct in Relation
attempting this module, as the ability to prepare
to Taxation across all of the questions in the
tax computations is required to be successful at
exam. Students will be required to recognise
this module.
and explain key ethical issues, identify ethical
Although technical topics by necessity flow dimensions of possible scenarios, make
through the three tax exams, a technical topic appropriate judgements being mindful of
will not usually be retested in this module in a professional scepticism and recommend in a
comprehensive computational question if it has sound and trustworthy manner.
already been tested in detail in either of the
other two tax exams.

SPECIFICATION GRID
This grid provides a general guide as to the subject matter within this module and assessment
coverage over a period of time.
Ethics and law 5–10%

Taxation of corporate entities 35–45%
Taxation of owner-managed businesses 20–30%
Personal taxation 15–25%
This grid provides guidance on the relative weighting between knowledge and skills:
WEIGHTING
Knowledge 25–35%
Skills 65–75%
1 ADVANCED TAXATION TAXATION OF BUSINESS AND CORPORATE

Students will be able to analyse, evaluate and ENTITIES
calculate the tax consequences of actions for g. determine, explain and calculate the tax
individuals and companies and evaluate the liabilities for individuals and corporate
interaction of taxes in given scenarios. This will entities, including income tax, national
involve advising and assisting clients in adhering insurance, corporation tax, diverted profits
to tax regulations. tax, stamp taxes, VAT, and annual tax on
enveloped dwellings (ATED);
In the assessment students may be required to
consider: h. evaluate the tax implications of the choice
of business structures, including provision of
COMMUNICATION SKILLS services through a company;
a. communicate in a format appropriate to the i. explain the taxation issues relating to
recipient who may be an external client, a business start-ups;
fellow professional, or an internal colleague; j. identify and evaluate the impact of close
b. prepare suitable advice to explain tax companies on the taxation of companies
liabilities with supporting calculations; and individuals;
c. recommend appropriate tax-planning k. explain and evaluate the tax implications of
advice; group structures;
d. identify further information required to l. apply, explain and evaluate issues relating to
complete tax computations and finalise tax transfer pricing;
advice; m. explain and evaluate the tax implications of
e. identify the role of data analytics in reducing business transformations and change;
the tax gap; n. explain and calculate the tax implications
f. give advice which is appropriate, technically involved in the cessation of trade;
correct, and within the law and the ICAEW
INTERNATIONAL ASPECTS OF CORPORATE
Code of Ethics as well as other relevant TAXATION
guidance, including the Professional
Conduct in Relation to Taxation (PCRT); o. calculate the impact of international
expansion on UK tax liabilities;
© ICAEW 2019 69
p. explain the tax implications of inward 2 TAX PLANNING
investment in the UK; Students will be able to advise on alternative tax
q. recognise the implications of double tax treatments to defer or minimise tax liabilities.
treaties, the OECD Model Tax Convention, Students will also be able to understand the
and the OECD BEPS Project; interaction of taxes in given scenarios and to
r. apply and advise on double taxation relief; identify and discriminate between tax evasion
and tax avoidance.
FINANCING AND INVESTING
In the assessment students may be required to:
s. evaluate the taxation implications of
financing existing and new businesses; a. identify legitimate tax planning measures to
minimise tax liabilities;
t. evaluate the taxation implications of returns
to investors; b. evaluate and advise on tax strategies to meet
business objectives;
u. advise and calculate the impact of tax
efficient schemes including ISAs, enterprise c. evaluate and advise on alternative
investment schemes, seed enterprise tax strategies relating to corporate
investment schemes and venture capital transformations;
trusts; d. changes in an individual’s circumstances
such as marriage, divorce and death;
EMPLOYMENT INCOME AND REMUNERATION e. recognise, explain and communicate
PACKAGES opportunities to use alternative tax
v. advise on the tax implications of treatments arising from past transactions;
remuneration packages including share and
schemes, termination payments, and f. identify and communicate ethical and
allowable deductions; professional issues in giving tax planning
PERSONAL TAXATION AND OVERSEAS
advice.
TAXATION
3 ETHICS AND LAW
w. calculate tax liabilities for individuals
Students will be able to recognise and explain
including income and capital gains tax,
ethical and legal issues arising in taxation
national insurance contributions and
scenarios. Where ethical dilemmas arise,
inheritance tax;
students will be required to apply the five
x. advise on the taxation of foreign assets, fundamental principles and guidance in the
income and gains; IESBA and ICAEW codes as well as other
y. evaluate and advise on the impact of relevant guidance, including the Professional
residence, non-residence, deemed domicile Conduct in Relation to Taxation (PCRT), to
and domicile on an individual’s tax liabilities; recommend and justify appropriate, legal
z. analyse and explain the implications of actions.
individuals leaving and coming to the UK as In the assessment, students may be required to,
well as the special tax position for non-UK in the context of taxation:
domiciled individuals;
a. recognise and explain the relevance,
aa. explain the implications of domicile for
importance and consequences of ethical
inheritance tax;
and legal issues;
TRUSTS b. recommend and justify appropriate actions
bb. identify the need for and advise on the use where ethical dilemmas arise in a given
of trusts in tax planning; and scenario;
cc. appreciate and calculate, in straight forward c. design and evaluate appropriate ethical
scenarios, the tax implications of creating safeguards; and
and using trusts and the tax implications of d. recognise and advise when a tax-avoidance
assets entering or leaving trusts. scheme is notifiable to HMRC and
distinguish between planning, avoidance
and evasion and their consequences.

SKILLS ASSESSED

• Identify risks within a • Operate to a brief in a given
scenario scenario
scenario

• assimilate information provided by internal and external sources;
• identify and evaluate inconsistencies in information provided from multiple sources; and
• recognise and explain key ethical issues for an accountant undertaking work in taxation.
analysis and decision-
making
• Present analysis in
accordance with instructions • Select appropriate courses of action using an ethical framework
and criteria • Identify the solution which is the best fit with acceptance
© ICAEW 2019 71
• consider and calculate a range of appropriate tax treatments;
• provide descriptive analysis and explanations;
• integrate different taxes and jurisdictions;
• evaluate taxation impact of a transaction;
• integrate descriptions with calculations in a form appropriate for the user;
• apply technical knowledge to perform relevant, accurate calculations in a logically structured way;
• identify further information or clarifying existing arrangements with a client;
• consider the impact of delaying or modifying future decisions; and
• identify and explain ethical and legal issues.
APPLYING JUDGEMENT

• Identify faults in arguments • Assess different stakeholder perspectives
• Identify inconsistencies and contradictory • Appraise the effects of alternative future
information scenarios
• Assess interaction of information from • Appraise ethical, public interest and
different sources regulatory issues

• apply scepticism to the integrity of information provided in the scenario having regard to its source;
• select between appropriate options;
• identify omissions in the information;
• evaluate inconsistencies in information;
• evaluate the effects of future events;
• identify key linkages between information provided in a scenario and possible tax treatments;
• compare the effects of a range of estimates, outcomes or tax treatments; and
• exercise own ethical judgement in assessing the consequences of various courses of action.


• Apply technical knowledge, • Make recommendations in concise style
professional experience situations where risks and • Present analysis and
and evidence to support uncertainty exist recommendations in
reasoning • Formulate opinions, advice, accordance with instructions
• Use valid and different recommendations, plans, • Communicate clearly to a
technical skills to formulate solutions, options and specialist or non-specialist
opinions, advice, plans, reservations based on valid audience in a manner
solutions, options and evidence suitable for the recipient
reservations • Make evidence-based • Prepare the advice, report, or
information
situation

• determine the tax implications of scenarios and proposals to provide alternative recommendations
to meet a given individual or corporate objective or goal;
• formulate and recommend a reasoned conclusion from structured calculations;
• justify a conclusion made using knowledge of the existing tax regime;
• advise on the ethical considerations;
• explain the limitations of conclusions or recommendations;
• present a report/memorandum in response to a specific technical or ethical issue and in
accordance with client requirements;
• present a review of advice or proposed tax strategies making recommendations supported by
calculations or analysis of tax issues identified; and
• present a justification of a specific recommended action when a variety of options are available.
© ICAEW 2019 73
Business Planning: Banking
To enable students to apply technical The Business Planning: Banking module exam is
knowledge and professional skills to identify and 2.5 hours long. The exam will contain questions
resolve technical compliance and ethical issues requiring the use of communication, judgement
that arise in the context of the preparation and and evaluation skills.
evaluation of financial and regulatory reporting
and from providing audit and assurance services
question will be an integrated scenario of
in the banking sector.
approximately 40 marks. Ethics and law may be
tested in any of the three questions.
PRIOR KNOWLEDGE
There are no regulations stipulating the order
complete the Financial Accounting and
Reporting module and the Audit and Assurance
module before attempting this module, as
an understanding of financial reporting and ETHICS AND PROFESSIONAL
auditing is required to be successful at this SCEPTICISM
module. It is imperative that ethical issues are prioritised
in business planning in the banking sector.
Students will be expected to apply the ICAEW
Code of Ethics across all of the questions,
recognising and explaining ethical dilemmas
and evaluating suitable safeguards. Judgement
will be required to recognise when regulators
should be notified and in identifying the ethical
implications of providing audit and assurance
services to a Public Interest Entity. Professional
scepticism must be applied in making
judgements.
SPECIFICATION GRID
Risk management and financial services products 20–25%

Financial and regulatory reporting for banks 35–40%
Audit and assurance of banks 30–35%
Ethics 5–10%

1 FINANCIAL SERVICES: INSTITUTIONS, i. identify key aspects of credit risk and
MARKETS AND PRODUCTS appraise the operations of the credit risk
Students will be able to demonstrate an function including: corporate loans, bonds,
understanding of the nature, functions and asset finance, trade finance, debt factoring
role of the banking sector and of the financial and securitisation;
markets relevant to this industry. They will be j. recognise and explain the nature and
able to appraise financial products, evaluate the functions of securities products and markets;
risks and returns associated with such products k. explain and evaluate key securities issues
and evaluate financial product strategies within for banks including: valuations, reserves,
the banking sector of the financial services levelling, confirmations, nostro and vostro
industry. accounts, and stock reconciliations;
In the assessment, students may be required to: l. explain and evaluate alternative financial
assets and the markets in which they operate
COMMUNICATION SKILLS (eg, property, commodities); and
a. communicate in a format appropriate to the m. demonstrate an understanding of the
recipient who may be an external client of opportunities and threats to traditional
a bank, a fellow professional, or an internal banking models created by digital
colleague; technologies, including data analytics,
b. prepare suitable advice to explain issues and distributed ledger technology eg,
relevant to banks, with supporting blockchain, and peer-to-peer arrangements.
calculations where appropriate;
2 RISK MANAGEMENT
c. identify further information required to
finalise preliminary recommendations; Students will be able to identify the regulatory,
operational and financial risks in relation to
d. give advice only where it is appropriate,
the banking sector and explain the principal
technically correct, and within the relevant
methods and frameworks for managing those
regulations and is in accordance with the
risks.
ICAEW Code of Ethics;
INSTITUTIONS, MARKETS AND PRODUCTS
a. assess the nature of corporate governance
e. demonstrate an understanding of the nature, in the banking sector and explain how good
structure and roles of different types of governance can set a framework to manage
banks (eg, commercial banks, retail banks, risks in the banking sector in a variety of
investment banks, private banks, finance scenarios and for a range of stakeholders;
houses, mutuals, Islamic banks); explain the role of the audit and risk
f. explain the nature and roles of the financial committees;
markets (eg, credit, debt, equity, derivatives b. explain the functions and purposes of
and money markets) within which banks the asset-liability committee (ALCO) as
operate and the functions that banks the primary risk management committee
have within these markets (eg, financial within a bank and perform analysis for risk
intermediation, securitisation, providing identification and management;
liquidity, clearing, relationship with central
banks); c. identify and explain the key operational risks
experienced by a bank in a given scenario,
g. explain the nature of derivatives (eg, options, for example IT failure, cybercrime and
futures, swaps) and how they are traded. In a fraud, and provide advice in the context of
given scenario demonstrate how derivatives uncertainty;
may be utilised (eg, for foreign exchange,
interest rates and commodities); d. explain the concept of risk appetite, identify
the factors that influence a bank’s risk
h. demonstrate an understanding of financial appetite and advise on how an appropriate
market instruments including those relating level of risk taking might be determined by a
to foreign exchange; money markets and bank, including the use of data analytics;
trade finance;
© ICAEW 2019 75
e. explain how a bank might manage credit accordance with IAS 39 and IFRS 9, including
risk and make reasoned recommendations, appropriate calculations;
supported by analysis, in the context of a f. demonstrate an understanding of the
given scenario; financial reporting treatment of financial
f. explain and demonstrate, using appropriate asset impairments for banks identifying
analysis, how financial instruments (eg, relevant risks and preparing calculations of
derivatives, hedging instruments) can impairment allowances;
be utilised to manage different types of g. identify and explain the circumstances
financial risks by clients and in the context of where it is appropriate to use fair value
proprietary trading by banks; measurement for financial instruments in
g. explain how a bank might manage its accordance with IFRS 13 and evaluate the
own liquidity and capital risk (including factors which may impact upon fair values,
assessing the impact of collateral and asset including trading cycles, market risk, credit
encumbrance issues and funding sources); risk, liquidity risk and associated controls
h. explain how a bank might manage risks (but not including technical valuation);
arising from automated data processing; h. perform financial statement analysis to
i. explain in outline how the increased appraise the potential credit risk from a
awareness and use of cryptocurrencies, company seeking finance, to identify risks
distributed ledger technology eg, blockchain facing a financial institution or to evaluate a
and artificial intelligence affects banks; and potential acquisition target;
j. explain how a bank might manage risks i. demonstrate an understanding of disclosure
arising from FinTech. and presentation in financial reporting for
financial instruments in accordance with
3 FINANCIAL AND REGULATORY REPORTING IAS 32 and IFRS 7;
Students will be able to demonstrate an j. demonstrate an understanding of the
understanding of how banks prepare financial proposals of the Task Force on Climate-
reports for their annual financial statements and related Financial Disclosures (TCFD) and
other regulatory requirements. This includes explain the fundamental principles of its
demonstrating knowledge of the accounting requirements for banks;
treatment of key transactions and balances, k. describe the principal differences between
including financial instruments, and also IFRS and UK GAAP and prepare simple
demonstrating the ability to analyse the financial extracts from financial statements in
statements of banks. accordance with UK GAAP; and
In the assessment, students may be required to: l. demonstrate an understanding of the
a. explain and analyse a bank’s statement of regulatory reporting requirements for banks
profit or loss, including its major sources of including:
income; • Regulatory framework (Basel Committee,
b. explain and analyse a bank’s statement Financial Stability Board, European
of financial position, including its major Commission, European Banking
components and priorities: liquidity, capital, Authority, Bank of England/Financial
leverage ratio; Conduct Authority/Prudential Regulation
Authority)
c. determine and calculate how different bases
for recognising, measuring, disclosing and • Fundamentals of regulatory capital, and
classifying financial assets and financial capital management (Basel framework,
liabilities can impact upon reported CRD IV and CRR, capital ratio, risk-
performance and financial position in weighted assets, definition of capital,
accordance with IAS 32, IFRS 7, IFRS 9; leverage ratio, liquidity coverage ratio)
d. demonstrate an understanding of the • Comparison to previous Basel regulation
financial reporting treatment of derivatives, – lessons from the financial crisis
including appropriate calculations; • Basel 3 Pillar 3 disclosures, and bank
e. show, explain and appraise hedge regulatory returns
accounting principles and procedures in • Conduct regulation and accounting for
regulatory penalties.

4 AUDIT AND ASSURANCE g. demonstrate an understanding of the role of
Students will be able to demonstrate an a Skilled Person with reference to a
understanding of issues relating to audit and Section 166 report and the application of
assurance assignments for banks and be able ICAEW guidance (TECH01/18FSF); and
to explain the risks, regulations and compliance h. demonstrate an understanding of the role
procedures that are relevant to the banking of assurance and the nature of assurance
sector. Students should be able to recognise procedures in the banking industry,
and appraise the special considerations relating including internal audit and due diligence.
to the audit of banks and design appropriate
audit procedures. 5 ETHICS
In the assessment, students may be required to: Students will be able to recognise and
explain ethical issues arising in banking
a. demonstrate an understanding of the related scenarios. Where ethical dilemmas
application of auditing standards to banks arise, students will be required to apply the
and be able to apply, in given scenarios, the fundamental principles and guidance in the
provisions of Practice Note 19, The Audit of IESBA and ICAEW codes to identify, recommend
Banks and Building Societies in the United and justify appropriate actions.
Kingdom;
In the assessment, students may be required to,
b. explain, evaluate and apply the provisions in the context of banking related scenarios:
of IAPN 1000/Practice Note 23, Special
Considerations in Auditing Financial a. recognise and explain the relevance,
Instruments and apply the audit procedures importance and consequences of ethical
necessary in providing assurance over the and legal issues;
completeness, accuracy, existence and b. recommend and justify appropriate actions
valuation of financial instruments; where ethical dilemmas arise in a given
c. explain and apply appropriate audit scenario;
procedures with respect to impairment c. design and evaluate appropriate ethical
allowances; appraising the risk of safeguards;
impairment and providing assurance in d. recognise and advise when, how and
respect of the financial reporting treatment; to whom an issue should be notified to
d. explain the duty and right to disclose regulators; and
information to FCA, PRA and BoE and e. recognise the ethical implications of
dialogue between bank auditors and providing audit and assurance services to a
supervisors; Public Interest Entity.
e. demonstrate an understanding of the FCA’s
requirement for holding or controlling
client assets as set out in The Client Assets
Sourcebook (CASS) and explain:
• common failings in CASS compliance
• recent changes to CASS rules
• the rules, guidance and approach to
be followed when completing audit
procedures (as laid down by the
Financial Conduct Authority) with respect
to client money, custody assets and
mandates
• the essential elements of the FRC’s
Standard on ‘Providing Assurance on
Client Assets to the Financial Conduct
Authority’;
f. identify, explain and apply appropriate
assurance procedures with respect to a
credit review;
© ICAEW 2019 77
SKILLS ASSESSED

scenario scenario
scenario

• recognise specific issues that may arise in the context of the situation described;
• recognise and explain key ethical issues for an accountant undertaking work in banking.
making

• formulate, evaluate and implement accounting and reporting policies;
• identify regulatory issues and requirements and consider appropriate responses where necessary;
• integrate requirements of various international regulatory bodies and jurisdictions;
• identify audit issues for a banking client and suggest appropriate responses;
• identify further information needed;
• provide descriptive analysis and explanations; and
APPLYING JUDGEMENT


• exercise own ethical judgement in assessing the consequences of various courses of action;
• assess the materiality of errors; and
• select between appropriate options.
© ICAEW 2019 79

information
situation

• formulate and recommend a reasoned conclusion from data, facts, calculations, judgements and
own analysis;
• draw conclusions from data, facts, calculations, judgements and own analysis;
• identify key linkages;
• compare the effects of a range of estimates, and outcomes or financial treatments;
• present reasoned, practicable advice that is clear and concise, supported by calculations or analysis
of issues identified; and

Business Planning: Insurance
To enable students to apply technical The Business Planning: Insurance module
knowledge and professional skills to identify and exam is 2.5 hours long. The exam will contain
resolve technical compliance and ethical issues questions requiring the use of communication,
that arise in the context of the preparation and judgement and evaluation skills.
evaluation of financial and regulatory reporting
and from the provision of audit and assurance
question will be an integrated scenario of
services in the insurance sector.
approximately 40 marks. Ethics, regulation,
and law may be tested in any or all of the three
PRIOR KNOWLEDGE questions.
There are no regulations stipulating the order
complete the Financial Accounting and
Reporting module and the Audit and Assurance
module before attempting this module, as
an understanding of financial reporting and
auditing is required to be successful at this ETHICS AND PROFESSIONAL
module. SCEPTICISM
It is imperative that ethical issues are prioritised
in business planning in the insurance sector.
Students will be expected to apply the ICAEW
Code of Ethics across all of the questions,
recognising and explaining ethical dilemmas
and evaluating suitable safeguards. Judgement
will be required to recognise when regulators
should be notified and in identifying the ethical
implications of providing audit and assurance
services to a Public Interest Entity. Professional
scepticism must be applied in making
judgements.
SPECIFICATION GRID
Risk management and insurance products 20–25%

Financial and regulatory reporting for insurance companies 35–40%
Audit and assurance of insurance companies 30–35%
Ethics 5–10%
© ICAEW 2019 81
1 INSURANCE: MARKETS, SERVICES AND i. explain the nature, principles and purposes
PRODUCTS of the various types of reinsurance contracts,
Students will be able to demonstrate an including evaluating the costs and benefits
understanding of the principles, services and of risk sharing between the ceding and
products applying in the insurance sector and reinsurer companies;
the markets relevant to this industry. They will j. identify and explain common investment
be able to appraise insurance related financial classes; evaluate the risks attached to each
products, evaluate the risks and returns class of investment and advise on asset
associated with such products and evaluate management strategies in a given scenario;
asset and liability management strategies within k. explain and evaluate the liabilities of
the insurance sector. insurance companies including utilising
Throughout this syllabus, “insurance” means industry methods and models for estimating
direct insurance, whether general or long-term the total cost of claims, including claims
business, and also reinsurance. It includes notified, claims incurred but not reported
business in the Lloyd’s insurance market. (IBNR) and claims incurred but not enough
Reinsurance includes reinsurance ceded and reported (IBNER);
reinsurance risks accepted from other insurance l. demonstrate a basic understanding of
companies by a reinsurer. actuarial modelling in the context of
In the assessment, students may be required to: insurance, including the use of data,
the nature of the assumptions and their
COMMUNICATION SKILLS implications for estimating liabilities;
a. communicate in a format appropriate to the m. demonstrate an understanding of the
recipient who may be an external client of an different distribution routes used by
insurance company, a fellow professional, or insurers; and
an internal colleague; n. demonstrate an understanding of the
b. prepare suitable advice to explain issues opportunities and threats to traditional
relevant to insurance, with supporting insurance models created by digital
calculations where appropriate; technologies, including data analytics,
peer-to-peer risk sharing arrangements,
c. recommend appropriate strategic planning
and distributed ledger technology eg,
advice;
blockchain.
d. identify further information required to
finalise preliminary recommendations; 2 RISK MANAGEMENT
e. give advice only where it is appropriate, Students will be able to identify the regulatory,
technically correct, and within the relevant operational and financial risks in relation to
regulations and is in accordance with the the insurance sector and explain the principal
ICAEW Code of Ethics; methods and frameworks for managing those
risks including data analytics.
PRINCIPLES, SERVICES AND PRODUCTS
f. demonstrate an understanding of the
principles, practices and functions of the a. explain the nature and consequences of
insurance sector and its related markets; corporate governance requirements relating
g. explain the nature of general (non- to insurance companies, including those
life) insurance and demonstrate an arising from the UK Corporate Governance
understanding of the issues and practices Code and Solvency II, and demonstrate an
for different classes of insurance, including understanding of how good governance can
but not limited to: property, motor, health, contribute to the management of risk and
catastrophe and casualty; creation of value in a variety of scenarios;
h. explain the nature of life insurance and b. identify and explain the key operational
demonstrate an understanding of the issues risks experienced by an insurance company
and practices relating to savings products, in a given scenario, for example IT failure,
annuities, pensions and other long-term cybercrime and fraud, and provide advice in
insurance products; the context of uncertainty;

c. explain the concept of risk appetite, identify b. explain and analyse an insurance company’s
the factors that influence an insurer’s risk statement of financial position, demonstrate
appetite, and advise on how an appropriate an understanding of each of its major
level of risk taking might be determined by components;
an insurer; c. explain, appraise and apply the provisions of
d. explain conduct risk and the customer IFRS 4, Insurance Contracts;
centric perspective; recognising the role of d. explain, appraise and apply IFRS 17,
regulators and evaluating how an insurance Insurance Contracts including:
company might manage conduct risk in
• initial and subsequent measurement
the context of a given scenario, making
of insurance contracts using both the
reasoned recommendations;
premium allocation approach and the
e. identify and evaluate asset and liability general measurement method
matching strategies in the context of a given
• the presentation of insurance contracts
scenario, providing reasoned advice;
and profits and losses therefrom in the
f. explain and demonstrate, using appropriate financial statements
analysis, how financial instruments (including
• the impact of changes in measurement
derivatives, contingent convertible bonds,
assumption and estimates on the
catastrophe bonds and mortality bonds)
financial statements;
can be utilised to manage different types of
financial risks; e. determine and calculate how different
bases for recognising, measuring, disclosing
g. demonstrate an understanding of the factors
and presenting investment assets and
that impact upon an insurer’s enterprise risk
financial liabilities can impact upon reported
management, including culture, controls,
performance and financial position in
risk models, data analytics and strategy, and
accordance with IAS 32, IAS 39, IFRS 7,
provide reasoned advice in the context of a
IFRS 9, IFRS 40 and FRS 103;
given scenario;
f. determine the impact on reported
h. identify and explain risks specific to life
performance and financial position of the
insurance and non-life insurance in the
recoverability of reinsurance receivables,
context of a given scenario and advise
allowing for insolvency of reinsurers,
on appropriate measures to mitigate and
exhaustion of reinsurance, obligations
manage them; and
arising from “financial reinsurance” and gaps
i. explain how an insurance company might in reinsurance cover;
manage risks using digital technologies,
g. demonstrate an understanding of the
including big data, data analytics and
financial reporting treatment of derivatives,
artificial intelligence.
including the basic principles of hedge
3 FINANCIAL AND REGULATORY REPORTING accounting in accordance with IFRS 9 and
IAS 39;
Students will be able to demonstrate an
understanding of how insurance companies h. show and appraise the IAS 39 and
prepare financial reports for their annual IFRS 9 treatments of the impairment of
financial statements and other regulatory financial instruments, demonstrating an
requirements. This includes demonstrating understanding of the relevant principles;
knowledge of the accounting treatment of key i. identify and explain the circumstances
transactions and balances, including financial where it is appropriate to use fair value
instruments, and also demonstrating the ability measurement in accordance with IFRS 13
to analyse the financial statements of insurance and evaluate the factors which may impact
companies. upon fair values, including trading cycles,
credit risk, market risk and associated
controls (but not including technical
a. explain and analyse an insurance valuation);
company’s statement of profit or loss j. demonstrate an understanding of disclosure
(income statement), and demonstrate an and presentation in financial reporting for
understanding of each type of income and financial instruments in accordance with
expense; IAS 32 and IFRS 7;
© ICAEW 2019 83
k. describe the principal differences between c. appraise and apply appropriate audit
IFRS and UK GAAP and prepare simple procedures to the assumptions underlying
extracts from financial statements in actuarial models in accordance with ISA 540;
accordance with UK GAAP; and d. demonstrate an understanding of the role of
l. demonstrate an understanding of the the review actuary and explain the principles
regulations and regulatory reporting and issues that determine the relationship
requirements for insurance companies between the assurance provider and the
arising from each of the following: review actuary;
• regulatory framework (Bank of England/ e. apply assurance procedures for an insurer’s
Prudential Regulation Authority, regulatory returns in accordance with the
Financial Conduct Authority, European terms of the specific engagement;
Commission, European Insurance & f. demonstrate an understanding of the
Occupational Pensions Authority) auditor’s responsibilities in relation to the
• introduction to regulatory capital, capital audit of an insurance company’s Solvency
management and Solvency II and Financial Condition Report;
• solvency II Pillar 3 disclosures, the g. identify and explain the audit risks and audit
Solvency & Financial Condition Report procedures in respect of market consistent
• capital and regulatory reporting embedded values (MCEV), including related
requirements for non-Solvency II firms disclosures;
• pension Protection Fund requirements h. demonstrate a basic understanding of
the regulatory and audit Client Asset
• economic capital models, including
requirements in accordance with CASS 5
Market Consistent Embedded Value
and the essential elements of the FRC’s
principles
Standard on ‘Providing Assurance on Client
• conduct regulation and accounting for Assets to the Financial Conduct Authority’;
regulatory penalties.
i. demonstrate an understanding of the role
4 AUDIT AND ASSURANCE of a Skilled Person with reference to a
Students will be able to demonstrate an Section 166 report and the application of the
understanding of issues relating to audit and essential elements relevant ICAEW guidance
assurance assignments for insurers and be able (TECH01/18FSF);
to explain the risks, regulations and compliance j. demonstrate an understanding of the role
procedures that are relevant to assurance of assurance and the nature of assurance
assignments in the insurance sector. Students procedures in the insurance industry,
should be able to recognise and appraise the including internal audit and due diligence;
special considerations relating to assurance for and
insurance companies and design appropriate k. explain the importance of critically assessing
assurance procedures. an insurance company’s strategic report
In the assessment, students may be required to: in addition to its financial statements
for consistency and for the purpose of
a. demonstrate an understanding of the understanding the entity.
application of auditing standards to
insurance companies and be able to apply, 5 ETHICS
in given scenarios, the provisions of Practice Students will be able to recognise and explain
Note 20, The Audit of Insurers in the United ethical issues arising for stakeholders in the
Kingdom; insurance sector. Where ethical issues and
b. explain, evaluate and apply the provisions dilemmas arise, students will be required to
of IAPN 1000/Practice Note 23, Special apply the fundamental principles and guidance
Considerations in Auditing Financial in the IESBA and ICAEW codes to identify,
Instruments and apply the audit procedures recommend and justify appropriate actions.
necessary in providing assurance over the
completeness, accuracy, existence and
valuation of financial instruments;

In the assessment, students may be required to,
in the context of insurance related scenarios:
a. recognise and explain the relevance,
importance and consequences of ethical
and legal issues;
b. recommend and justify appropriate actions
where ethical issues arise in a given scenario
c. design and evaluate appropriate ethical
safeguards;
d. recognise and advise when, how and to
whom an issue should be notified; and
e. recognise the ethical implications of
providing audit and assurance services to a
Public Interest Entity.
© ICAEW 2019 85
SKILLS ASSESSED

scenario scenario
scenario

• recognise specific issues that may arise in the context of the situation described;
• recognise and explain key ethical issues for an accountant undertaking work in insurance.
making

• identify regulatory issues and requirements and consider appropriate responses where necessary;
• integrate requirements of various regulatory bodies applicable to UK entities;
• identify audit issues for an insurance client and suggest appropriate responses;
• identify further information needed;
• provide descriptive analysis and explanations; and
APPLYING JUDGEMENT


• exercise own ethical judgement in assessing the consequences of various courses of action;
• assess the materiality of errors; and
• select between appropriate options.
© ICAEW 2019 87

information
situation

• formulate and recommend a reasoned conclusion from data, facts, calculations, judgements and
own analysis;
• identify key linkages;
• compare the effects of a range of estimates, and outcomes or financial treatments;
• present a reasoned, practicable advice that is clear and concise, supported by calculations or
analysis of issues identified; and

Advanced Level
Corporate Reporting
MODULE AIM • evaluate corporate reporting policies,
To enable students to apply technical estimates and disclosures in a scenario in
knowledge, analytical techniques and order to be able to assess whether they are
professional skills to resolve compliance and in compliance with accounting standards
business issues that arise in the context of the and are appropriate in the context of audit
preparation and evaluation of corporate reports objectives.
and from providing audit services. • identify and explain ethical issues. Where
ethical dilemmas arise, students will be able
Students will be required to use technical
to recommend and justify and determine
knowledge and professional judgement to
appropriate actions and ethical safeguards
identify, explain and evaluate alternatives and
to mitigate threats.
to determine the appropriate solutions to
compliance issues, giving due consideration
PRIOR KNOWLEDGE
to the needs of clients and other stakeholders.
The commercial context and impact of This module assumes and develops the
recommendations and ethical issues will knowledge and skills acquired in the Financial
also need to be considered in making such Accounting and Reporting module and in the
judgements. Audit and Assurance module.
On completion of this module, students will be Background knowledge based upon the
able to: strategic elements of the Business Planning
modules, Business Strategy and Technology
• formulate, implement and evaluate and Financial Management modules will also be
corporate reporting policies for single required in evaluating the business and financial
entities and groups of varying sizes and risks of reporting entities.
in a variety of industries. They will be able
to discern and formulate the appropriate REGULATION
financial reporting treatment for complex
transactions and complex scenarios. The regulations relating to auditing and
Students will be able to evaluate and corporate reporting will have international
apply technical knowledge from individual application and are therefore based upon IFRSs
accounting standards and apply professional and ISAs (UK). Knowledge of specific national
skills to integrate knowledge where several standards will not be tested.
accounting standards are simultaneously
applicable and interact. METHOD OF ASSESSMENT
• analyse, interpret, evaluate and compare The Corporate Reporting module exam is
financial statements of entities both over 3.5 hours long. Each exam will contain questions
time and across a range of industries. requiring integration of knowledge and skills,
including ethics. The exam will consist of three
• explain the processes involved in planning
questions. Ethical issues and problems could
an audit, evaluating internal controls,
appear in any of the three questions.
appraising risk including analysing
quantitative and qualitative data and using The exam will be open book and will permit
data analytics, gathering evidence and students to take any written or printed material
drawing conclusions in accordance with the into the exam, subject to practical space
terms of the engagement. In addition, they restrictions. To see the recommended text(s) for
will be able to perform a range of assurance this exam, go to icaew.com/permittedtexts.
engagements and related tasks.
90 ADVANCED LEVEL © ICAEW 2019

ETHICS AND PROFESSIONAL is reflected in ethics being covered in its own
SCEPTICISM specific syllabus area as well as featuring heavily
At the Advanced Level students will be in the integrated learning outcomes. Social
expected to demonstrate the higher skills of responsibility, sustainability and environmental
sound, discerning business judgement and matters, identifying earnings manipulation and
critical evaluation. The ethical implications creative accounting are included. The ethical
will be both at the organisational level and for codes referenced will be those issued by IESBA
individuals. This must be paramount whether and ICAEW. The use of professional scepticism
the accountant be in public practice or in in a complex scenario is a necessary skill for the
business. The importance of ethical practice trusted business professional.
SPECIFICATION GRID
study time spent on each. Over time the marks available in the assessment will be within the ranges of
weightings below, but slight variations may occur in individual examinations to enable suitably rigorous
questions to be set.
Corporate Reporting – Compliance

55–65%
Corporate Reporting – Financial statement analysis
Audit and Assurance 30–40%
Ethics 5–10%
technical knowledge grids from at the end of this document.
CORPORATE REPORTING – c. explain and appraise accounting standards

COMPLIANCE that relate to the impact of changes in
accounting policies and estimates;
Students will be able to formulate, implement
and evaluate accounting and reporting policies d. explain and evaluate the impact of
for single entities and groups of varying sizes underlying assumptions on financial
and in a variety of industries. They will be able to statements; and
discern and formulate the appropriate financial e. identify and explain current and emerging
reporting treatment for complex transactions issues in corporate reporting.
and complex scenarios. Students will be able
2 REPORTING PERFORMANCE
to evaluate and apply technical knowledge
from individual accounting standards and apply a. explain how different methods of
professional skills to integrate knowledge where recognising and measuring assets and
several accounting standards are simultaneously liabilities can affect reported financial
applicable and interact. performance;
In the assessment, students may be required to: b. explain and appraise accounting standards
that relate to reporting performance:
1 PRINCIPLES in respect of presentation of financial
statements; revenue; operating segments;
a. explain the impact of accounting
continuing and discontinued operations;
principles and bases of measurement in
EPS; interim reporting;
corporate reporting, for example fair value
measurement; c. formulate and evaluate accounting and
reporting policies for single entities and
b. appraise corporate reporting regulations,
groups of varying sizes and in a variety of
and related legal requirements, with respect
industries; and
to presentation, disclosure, recognition and
measurement;
© ICAEW 2019 91
d. calculate and disclose, from financial and b. calculate and disclose, from financial and
other qualitative data, the amounts to be other data, the amounts to be included
included in an entity’s financial statements in an entity’s consolidated financial
according to legal requirements, applicable statements in respect of its new, continuing
financial reporting standards and accounting and discontinued interests (which include
and reporting policies. situations when acquisitions occur in stages
and in partial disposals) in subsidiaries,
3 ASSETS AND NON-FINANCIAL LIABILITIES associates and joint ventures.
a. explain how different methods of
recognising and measuring assets and 7 REPORTING TRANSACTIONS AND BALANCES
liabilities can affect reported financial IN FOREIGN CURRENCIES AND OPERATIONS
position, and explain the role of data a. determine and calculate how exchange rate
analytics in financial asset and liability variations are recognised and measured
valuation; and and how they can impact on reported
b. explain and appraise accounting standards performance, position and cash flows of
that relate to assets and non-financial single entities and groups; and
liabilities for example: property, plant and b. demonstrate, explain and appraise how
equipment; intangible assets, held-for-sales foreign exchange transactions are measured
assets; inventories; investment properties; and how the financial statements of foreign
provisions and contingencies. operations are translated.
4 FINANCING 8 TAXATION
a. determine and calculate how different bases a. explain, determine and calculate how
for recognising, measuring and classifying current and deferred tax is recognised and
financial assets and financial liabilities can appraise accounting standards that relate to
impact upon reported performance and current tax and deferred tax.
position;
b. appraise and evaluate cash flow measures CORPORATE REPORTING – FINANCIAL
and disclosures in single entities and groups; STATEMENT ANALYSIS
c. evaluate the impact of accounting policies Students will be able to analyse, interpret,
and choice in respect of financing decisions evaluate and compare financial statements of
for example hedge accounting and fair entities both over time and across a range of
values; and industries.
d. explain and appraise accounting standards In the assessment, students may be required to:
that relate to an entity’s financing activities
which include: financial instruments; 9 FINANCIAL STATEMENT ANALYSIS
leasing; cash flows; borrowing costs; and a. comment on and critically appraise the
government grants. nature and validity of items included in
published financial statements including
5 EMPLOYEE REMUNERATION
how these correlate with an understanding
a. explain how different methods of providing of the entity;
remuneration for employees may impact upon b. comment on and critically appraise the
reported performance and position; and nature and validity of information disclosed
b. explain and appraise accounting standards in annual reports, including integrated
that relate to employee remuneration which reporting and other voluntary disclosures,
include different forms of short-term and including those relating to natural capital;
long-term employee compensation; c. appraise the limitations of financial analysis;
retirement benefits; and share-based payment.
d. analyse and evaluate the performance,
6 GROUPS position, liquidity, efficiency and solvency
a. identify and show the criteria used to of an entity through the use of ratios and
determine whether and how different types similar forms of analysis including using
of investment are recognised and measured quantitative and qualitative data;
as business combinations; and

e. interpret the potentially complex economic 11 PLANNING
environment in which an entity operates a. identify the components of risk and how
and its strategy based upon financial and these components may interrelate;
operational information contained within b. appraise the entity and the, potentially
the annual report (for example: financial complex, economic environment within
and business reviews; reports on operations which it operates as a means of identifying
by management, corporate governance and evaluating the risk of material
disclosures, financial summaries and highlights misstatement;
and an understanding of the entity);
c. identify the risks, including analysing
f. appraise the significance of inconsistencies quantitative and qualitative data, arising
and omissions in reported information in from, or affecting, a potentially complex set
evaluating performance; of business processes and circumstances
g. compare the performance and position of and assess their implications for the
different entities allowing for inconsistencies engagement;
in the recognition and measurement criteria in d. identify significant business risks (including
the financial statement information provided; those arising from cyber security and
h. make adjustments to reported earnings in technological advances including cloud
order to determine underlying earnings and computing, cryptocurrencies and robotic
compare the performance of an entity over process automations) and assess their
time; potential impact upon the financial
i. analyse and evaluate business risks and assess statements and the audit engagement;
their implications for corporate reporting; e. evaluate the impact of risk and materiality
j. analyse and evaluate financial risks (for in preparing the audit plan, for example
example financing, currency and interest the nature, timing and extent of audit
rate risks) and assess their implications for procedures;
corporate reporting; and f. determine analytical procedures, where
k. compare and appraise the significance of appropriate, at the planning stage using
accruals basis and cash flow reporting. technical knowledge of corporate reporting,
data analytics and skills of financial
AUDIT AND ASSURANCE statement analysis;
Students will be able to explain the processes g. evaluate the components of audit risk
involved in planning an audit, evaluating for a specified scenario, for example
internal controls, appraising risk including the interactions of inherent risk, control
analysing quantitative and qualitative data, risk and detection risk, considering their
gathering evidence and drawing conclusions in complementary and compensatory nature;
accordance with the terms of the engagement. h. show professional scepticism in assessing
In addition, they will be able to perform a range the risk of material misstatement, having
of assurance engagements and related tasks. regard to the reliability of management;
In the assessment, students may be required to: i. evaluate, where appropriate, the need
for, and extent of reliance to be placed on
10 PROFESSIONAL PRACTICE expertise from other parties to support audit
a. appraise and explain the role and context of processes including when to challenge
auditing; the extent and working practices of other
parties; and
b. explain the nature and purpose of quality
assurance (both at the level of the firm and j. prepare, based upon planning procedures,
the individual audit) and assess how it can an appropriate audit strategy and detailed
contribute to risk management; and audit plan or extracts.
c. evaluate and explain current and emerging 12 INTERNAL CONTROL SYSTEMS
issues in auditing including developments
a. analyse and evaluate the control
in the use of technology (eg, big data, data
environment for an entity based on an
analytics and artificial intelligence).
understanding of the entity, its operations
and its processes;
© ICAEW 2019 93
b. evaluate an entity’s processes for identifying, g. explain the respective responsibilities of those
assessing and responding to business charged with governance and auditors for
and operating risks as they impact on the corporate risk management and risk reporting;
financial statements; h. explain the respective responsibilities of
c. appraise an entity’s accounting information those charged with governance and auditors
systems and related business processes in respect of internal control systems;
relevant to corporate reporting and i. explain and evaluate the role and
communication including virtual requirement for effective two-way
arrangements and cloud computing; communication between those charged with
d. analyse and evaluate strengths and governance and auditors; and
weaknesses of preventative and detective j. describe and explain the roles and purposes
control mechanisms and processes, of meetings of boards and of shareholders.
highlighting control weaknesses; including
weaknesses related to cyber security and 14 AUDIT EVIDENCE
corporate data controls; a. explain and evaluate the relationship
e. evaluate controls relating to information between audit risk and audit evidence;
technology and e-commerce; including b. determine audit objectives for each financial
controls associated with cyber security and statement assertion;
corporate data security; c. determine for a particular scenario what
f. explain and appraise the entity’s system for comprises sufficient, appropriate audit
monitoring and modifying internal control evidence;
systems; and d. design and determine audit procedures in
g. devise, explain and evaluate tests of controls. a range of circumstances and scenarios, for
example identifying an appropriate mix of
13 CORPORATE GOVERNANCE
tests of controls, analytical procedures and
a. describe and explain the nature and tests of details;
consequences of corporate governance and
e. demonstrate how professional scepticism
accountability mechanisms in controlling the
should be applied to the process of
operating and financial activities of entities
gathering audit evidence and evaluating
of differing sizes, structures and industries;
its reliability including the use of client-
b. explain the rights and responsibilities of the generated information and external market
board, board committees (eg, audit and risk information in data analytics;
committees), those charged with governance
f. demonstrate and explain, in the application
and individual executive and non-executive
of audit procedures, how relevant ISAs affect
directors, with respect to the preparation and
audit risk and the evaluation of audit evidence;
audit of financial statements;
g. evaluate, applying professional judgement,
c. describe and explain the rights and
whether the quantity and quality of evidence
responsibilities of stakeholder groups (eg,
gathered from various audit procedures,
executive management, bondholders,
including analytical procedures and data
government, securities exchanges,
analytics, is sufficient to draw reasonable
employees, public interest groups, financial
conclusions;
and other regulators, institutional and
individual shareholders) with respect to the h. prepare appropriate audit documentation;
preparation and audit of financial statements; and
d. evaluate and appraise appropriate corporate i. recognise issues arising whilst gathering
governance mechanisms; assurance evidence that should be referred
to a senior colleague.
e. explain and evaluate the nature and
consequence of relevant corporate 15 REPORTING AND CONCLUDING
governance codes and set out the required a. review the appropriateness of the going
compliance disclosures; concern basis of accounting and describe
f. explain the principles, practices and relevant going concern disclosures;
disclosures of corporate governance; b. review events after the reporting period;

c. review and evaluate, quantitatively and AUDIT AND CORPORATE REPORTING —
qualitatively, for example using analytical INTEGRATED LEARNING OUTCOMES
procedures and data analytics and artificial Students will be able to evaluate corporate
intelligence, the results and conclusions reporting policies, estimates and disclosures
obtained from audit procedures; in a scenario in order to be able to assess
d. draw conclusions on the nature of the report whether they are in compliance with accounting
on an audit engagement, and formulate standards and are appropriate in the context of
an opinion for a statutory audit, which are audit objectives.
consistent with the results of the audit
evidence gathered; and
e. draft suitable extracts for reports (for 18 INTEGRATED LEARNING OUTCOMES
example any report to the management or
a. identify and explain corporate reporting
those charged with governance issued as
and assurance issues in respect of
part of the engagement).
social responsibility, sustainability and
16 ASSURANCE ENGAGEMENTS environmental matters for a range of
stakeholders;
a. explain the nature of a range of different
assurance engagements; b. critically evaluate accounting policies
choices and estimates, identifying issues
b. evaluate the evidence necessary to report at
of earnings manipulation and creative
the appropriate level of assurance;
accounting; and
c. evaluate risk in relation to the nature of the
c. critically appraise corporate reporting
assurance engagement and the entity or
policies, estimates and measurements for
process for a given scenario; and
single entities and groups in the context of
d. design and determine procedures necessary an audit.
to attain the relevant assurance objectives in
a potentially complex scenario. ETHICS
17 OTHER ENGAGEMENTS Students will be able to identify and explain
ethical issues. Where ethical dilemmas arise,
a. evaluate the role of internal audit and design
they will be able to recommend, justify and
appropriate procedures to achieve the
determine appropriate actions and ethical
planned objectives;
safeguards to mitigate threats.
b. appraise and explain the nature and
purposes of forensic audit and prepare and In the assessment, students may be required, in
plan procedures required to achieve a range the context of corporate reporting and auditing,
of differing objectives; to:
c. explain the roles and responsibilities that
19 ETHICS
auditors may have with respect to a variety
of different types of information and design a. identify and explain ethical issues in
procedures sufficient to achieve agreed reporting, assurance and business scenarios;
objectives; and b. explain the relevance, importance and
d. explain the nature and purposes of due consequences of ethical issues;
diligence procedures (for example: financial, c. evaluate the impact of ethics on a reporting
commercial, operational, legal, tax, human entity, relating to the actions of stakeholders;
resources) and plan procedures required d. recommend and justify appropriate
to achieve a range of differing financial actions where ethical issues arise in a given
objectives. scenario; and
e. design and evaluate appropriate safeguards
to mitigate threats and provide resolutions
to ethical problems.
© ICAEW 2019 95
SKILLS ASSESSED

• Identify and understand the • Evaluate the relevance of scenario
requirements information provided • Prioritise key issues
• Recognise new and complex • Use multiple information • Work effectively within time
ideas within a scenario sources constraints
• Identify the needs of • Filter information provided • Operate to a brief in a given
customers and clients to identify critical facts scenario
• Explain different stakeholder
perspectives and interests
scenario
scenario

• have a detailed knowledge and understanding of relevant regulations in financial reporting,
auditing and ethics, which will need to be related to practical business scenarios and applied to any
data provided. The data provided will focus on technical compliance and understanding;
• respond to instructions from a line manager, a client request or from other senior personnel. The
requests may be specific, or they may be more general requiring interpretation and judgement to
be applied by the student;
• evaluate the quality and relevance of information provided in the context of a particular
assignment;
• evaluate inconsistencies in information provided from multiple sources;
• use different sources and types of evidence to confirm, or question, financial statement assertions
applying professional scepticism; and
• evaluate the ethical implications of making information available including confidentiality and
transparency.

• Structure and analyse
financial and non-
financial data to enhance • Select appropriate courses of action using an ethical framework
understanding of business • Identify the solution which is the best fit with acceptance
issues and their underlying criteria and objectives
causes • Define objectives and acceptance criteria for solutions
accordance with instructions
and criteria

• apply technical knowledge, analytical techniques and professional skills to resolve compliance and
business issues that arise in the context of the preparation and evaluation of corporate reports and
from providing audit services;
• structure problems and solutions in scenario based questions which may be presented in the
following forms:
–– Mini case – in the context of auditing but with significant corporate reporting emphasis. This may
be technical, compliance or interpretive (for example including analytical procedures).
–– Financial statement analysis – including technical aspects of corporate reporting.
–– Technical question on aspects of audit and corporate reporting (which may include assurance,
internal audit).
• consider ethical problems in reporting, assurance and business scenarios;
• measure and recognise assets and obligations on reported financial performance;
• consider the impact and interaction of applicable accounting principles, bases and standards;
• consider the appraisal of remuneration policies on reported performance;
• evaluate reporting issues in relation to group scenarios and overseas activities.
© ICAEW 2019 97
APPLYING JUDGEMENT

evidence and always appropriately challenge and
• Identify faults in arguments critically review the expert’s work
• Identify gaps in evidence • Identify related issues in scenarios
• Identify inconsistencies and contradictory • Assess different stakeholder perspectives
information when evaluating options
scenarios
regulatory issues

• use technical knowledge and professional judgement to identify, explain and evaluate alternatives
and to determine the appropriate solutions to compliance issues, giving due consideration to the
needs of clients and other stakeholders. The commercial context and impact of recommendations
and ethical issues will also need to be considered in making such judgements.
• Demonstrate judgement in the following ways:
–– selecting between technical choices;
–– filtering data to identify critical elements;
–– prioritising information, issues or tasks;
–– identifying omissions in the information;
–– evaluating inconsistencies in information;
–– distinguishing between the various qualities of the data provided;
–– evaluating the impact of economic and political factors;
–– evaluating the effects of known events;
–– evaluating the appropriateness of accounting policy choice and estimation selection;
–– evaluating options;
–– comparing the effects of a range of estimates, outcomes or financial treatments;
–– assessing the materiality of errors;
–– exercising ethical judgement;
–– identifying key linkages; and
–– drawing appropriate conclusions from data provided to satisfy specified objectives and
assessing the materiality of errors and omissions.


reservations. evidence suitable for the recipient
information
situation

• draw conclusions from data, facts, calculations, judgments and own analysis;
• draw conclusions from complex assurance engagements;
• identify weaknesses in financial information systems and their potential consequences;
• distinguish between the qualities of data provided or other evidence generated;
• develop risk management solutions in an audit and corporate reporting environment;
• create report/memorandum in response to a specific technical issue and in accordance with client
requirements;
• draft reasoned, practicable advice that is clear and concise, supported by calculations or analysis of
technical/business issues identified;
• use judgement to select the most appropriate audit procedures in the context of risks identified;
• justify a specific recommended action when a variety of options are available;
• explain the limitations of their conclusions or recommendations.
© ICAEW 2019 99
Strategic Business Management
MODULE AIM demonstrating an understanding of the
To enable students to demonstrate quantitative usefulness and limitations of accounting
and qualitative skills, in order to make realistic information in this context.
business recommendations in complex • appraise and explain the role of assurance in
scenarios. Business awareness will need to raising new equity and debt funding and in
be demonstrated at strategic, operating and the subsequent monitoring of such funding
transactional levels. arrangements; understand, explain and
evaluate the role of assurance in selecting
To achieve this aim, students will be required
and implementing key business decisions
to use technical knowledge and professional
including acquisitions and strategic
judgement to apply appropriate models and to
alliances; understand and explain the role
analyse quantitative and qualitative data from
of assurance in financial and business risk
multiple sources, including corporate reports,
management.
in order to evaluate alternatives and determine
appropriate solutions.
PRIOR KNOWLEDGE
On completion of this module, in a national This module assumes and develops the
or global context, and for a range of different knowledge and skills acquired in the Financial
business structures and industry scenarios, Accounting and Reporting module, the Business
students will be able to: Strategy and Technology module and the
• analyse and identify the external Financial Management module.
environment and internal strategic capability Background knowledge based upon the
of an entity; evaluate the consequences of strategic elements of the Business Planning:
strategic choices; recommend strategies to Taxation and the Audit and Assurance module
achieve stakeholder objectives, recommend will also be required in evaluating the business
appropriate methods of implementing and financial risks of reporting entities.
strategies and monitoring strategic
performance; manage business risks; and ETHICS
advise on corporate governance.
Ethical codes will be those issued by IESBA and
• identify and advise upon appropriate finance the ICAEW. The ethical implications will be at
requirements; evaluate financial risks facing both the organisational level and for individuals,
a business and advise upon appropriate particularly with respect to the accountant in
methods of measuring and managing those business.
risks; provide valuations for businesses and
securities; and advise upon investment and
distribution decisions.
The Strategic Business Management module
• identify and explain ethical issues. Where
exam is 3.5 hours long. The exam will contain
ethical dilemmas arise, students will be able
questions requiring integration of knowledge
to recommend and justify and determine
and skills, including ethics. The exam will
appropriate actions and ethical safeguards
consist of two questions, and ethical issues and
to mitigate threats.
problems could appear in either question.
• interpret and apply corporate reporting
information in evaluating business The exam will be open book and will permit
and financial performance; recognise students to take any written or printed material
and explain the corporate reporting into the exam, subject to practical space
consequences of business and financial restrictions. To see the recommended text(s) for
decisions; apply corporate reporting this exam, go to icaew.com/permittedtexts
information in appropriate models to
determine asset, equity and entity valuations,

ETHICS AND PROFESSIONAL the syllabus will only by definition be valid if
SCEPTICISM they fulfil fundamental requirements of being
Ethical thinking must be at the forefront of the fair and just. This is guided by specific focus
strategic business awareness that students will across a range of considerations from social
be demonstrating. Students will be considering responsibility and sustainability to transparency.
notions of stakeholder impact and scope Professional scepticism will need to be
as well as appropriate safeguards within a evidenced in complex scenarios, recognising
specific learning outcome. Over and above bias and gaps in evidence.
this, recommendations relating throughout
SPECIFICATION GRID
The grid below shows the relative weightings of subjects within this module and should guide the
study time spent on each. Over time the marks available in the assessment will be within the ranges
of weightings below, while slight variations may occur in individual assessments to enable suitably
Business Strategy and Management 30–40%

Financial Strategy
Financial Structure and Financial Reconstruction 25–35%
Financial Instruments and Financial Markets
Corporate Reporting 10–15%
Assurance 10%
Ethics 5–10%
BUSINESS CONTEXTS
The learning outcomes may all be assessed within an integrated business scenario.
The following are examples of possible scenarios:
• developing management information strategies
• developing management and corporate governance mechanisms
• business and financial risk management
• business start-up planning
• business and security valuations
• developing policies for sustainability and corporate responsibility
• raising, structuring and restructuring of finance
• resource management issues
• developing performance management strategies
• developing remuneration and reward packages
• reorganisation and restructuring of entities, and the management of change
• financial distress and business recovery
• developing global financial and business strategies and operations
• developing global divisional and transfer pricing strategies for tax and performance management
• appraisal methods for businesses undertaking major projects and/or organisational or process
transformation
• issues arising from use of complex financial instruments in business finance in the context of risk
and treasury management
• ethical issues arising in business and finance
© ICAEW 2019 101

INTEGRATED LEARNING OUTCOMES big data, internet of things, digital assets,

automation, intelligent systems, distributed
BUSINESS STRATEGY AND ledger technology eg, blockchained
MANAGEMENT cryptocurrencies.
Students will be able to analyse and identify
2 STRATEGIC CHOICE
the external environment and internal strategic
capability of an entity; evaluate the consequences a. assess, advise on and propose appropriate
of strategic choices; recommend strategies to business strategies to meet stated
achieve stakeholder objectives, recommend objectives;
appropriate methods of implementing strategies b. identify and evaluate business unit strategies
and monitoring strategic performance; measure to achieve sustainable competitive
and manage business risks; and advise on advantage;
corporate governance. Students will also be c. explain and demonstrate how financial
able to apply corporate reporting and assurance and non-financial data can be analysed in
principles and practices in the context of key order to select an optimal business strategy,
business decisions and events. including the impact of big data on business
In the assessment, students may be required to: models;
d. explain and demonstrate how strategic
1 STRATEGIC ANALYSIS business models can be used in a given
a. describe and explain the strategic objectives scenario, to identify factors that a business
of an entity considering the interests of can consider in choosing between
stakeholders; competing strategies;
b. analyse and evaluate, for a given scenario, e. explain international strategies; appraise
the external economic, market and industry international value chains and markets;
environment which may impact upon a including the concepts of globalisation
business’s performance and position; and the borderless business; and show the
impact on individual and group financial
c. identify and evaluate the significance of
statements of changes in foreign exchange
the internal organisational and operational
rates; and
capabilities in a given scenario which may
influence an entity’s ability to achieve its f. evaluate digital strategies, including the
chosen strategic objectives, (including core use of digital assets, automation, artificial
competencies, existing business processes, intelligence, cloud accounting and machine
human capital and workforce flexibility); learning.
d. analyse and evaluate an entity’s current 3 STRATEGIC IMPLEMENTATION
position and performance, from both a
a. demonstrate and explain the impact of
financial perspective and a non-financial
acquisitions and strategic alliances in
perspective, using a variety of internal and
implementing corporate strategy and
external information sources;
evaluate the nature and role of assurance
e. demonstrate how strategic analysis tools can procedures in selecting and monitoring such
be used in a complex scenario; strategies;
f. demonstrate how business strategy and b. evaluate and explain the relationship
financial strategy can interrelate in a complex between business strategy and
scenario; organisational structure;
g. evaluate and advise upon the strategic c. explain and evaluate the nature and
capability of an entity; methods of change management and advise
h. evaluate strategy at corporate, business unit on the implementation of change in complex
and operational levels; and scenarios;
i. analyse and evaluate current technology d. demonstrate and explain the techniques that
developments including those relating to may be used in implementing a strategy

to reduce costs, for example supply 5 STRATEGIC MARKETING AND BRAND
chain management, business process MANAGEMENT
re-engineering and outsourcing; a. assess strategic marketing issues and
e. evaluate, in a given scenario, the functional demonstrate the application of quantitative
strategies necessary to achieve a business’s and qualitative marketing techniques in
overall strategy; complex scenarios;
f. develop business plans and proposals b. evaluate and analyse markets and the
and advise on technical issues relating to marketing environment and develop a
business and organisational plans, assessing marketing strategy consistent with the
the impact on historic and projected overall business strategy;
corporate reporting information; c. explain, using information provided, how to
g. demonstrate an understanding of, and position particular products and services in
provide advice on, data security issues, the market place (domestic or international)
including cyber security issues, arising from to maximise competitive advantage, and
communications, shared systems and data assess the corporate reporting impact
sharing throughout the supply chain and arising from revenue and profit recognition
with strategy partners; and in accordance;
h. identify and explain barriers to implementation d. demonstrate, across a range of industries,
of digital strategy and make recommendations how elements of the marketing mix can be
as to how they may be overcome. used to promote competitive advantage;
e. develop and explain marketing strategies
4 STRATEGIC PERFORMANCE MANAGEMENT using databases, big data and information
a. advise on, and develop, appropriate technology applications such as social media
performance management approaches for and other internet sources;
businesses and business units, including the f. develop and explain the strategies for
use of data analytics; managing and sustaining existing brands;
b. explain and demonstrate how a business g. prepare marketing strategies and show how
can analyse complex, quantitative and they can be used to develop brands; and
qualitative data from multiple sources to
h. demonstrate how appraisal techniques
provide strategic management accounting
can be used for valuing brands, patents,
information to implement, monitor and
R&D projects and intellectual property
modify a strategy at an appropriate
and evaluate relevant corporate reporting
organisational level in order to create
recognition and measurement for Intangible
competitive advantage;
Assets.
c. use financial and non-financial performance
data from a variety of sources, including 6 BUSINESS RISK MANAGEMENT
integrated reporting disclosures, to measure a. analyse and evaluate the key types of
multiple aspects of performance at a variety business risks using relevant quantitative and
of organisational levels; qualitative data and assess their implications
d. advise on, and develop, appropriate within a given scenario, for business strategy
remuneration and reward packages for and corporate reporting disclosures;
staff and executives linked to performance, b. advise on the risks involved in business
considering agency relationship issues; and and organisational plans and show how
evaluate the impact on corporate reports these risks can be managed by assurance
arising from employee remuneration, procedures and other forms of risk
including pensions and share-based mitigation;
payment; and
c. explain the responsibility of those charged
e. develop measures to evaluate performance with governance for managing risk
in the context of social responsibility, and assess the role of assurance in risk
sustainability, environmental matters and mitigation;
natural capital.
d. assess the impact of risk on a variety of
stakeholders;
© ICAEW 2019 103

e. explain and assess the various steps involved 8 DATA ANALYSIS
in constructing a business risk management a. undertake appropriate quantitative and
plan, by establishing context, identifying qualitative data analysis, business analysis
risks and the assessment and quantification and financial statement analysis;
of risk; b. explain financial and operational data and
f. evaluate and explain the limitations of other management information, drawing
business risk management; inferences relating to its completeness,
g. assess and explain enterprise risk accuracy and credibility, as a basis for a
management, evaluating its framework and meaningful analysis of the position, future
its benefits; and prospects and risks for a business;
h. using data provided, analyse quantitatively c. demonstrate how suitable financial, strategic
and qualitatively, business risks under a and operational analysis techniques
range of complex scenarios. can be used to analyse financial and
operational data and to evaluate business
7 CORPORATE GOVERNANCE position, prospects and risks, including the
a. assess the nature of governance and the analysis and benefits of ‘Big Data’, artificial
explain the characteristics and principles of intelligence and machine learning; and
good governance in a variety of scenarios; d. communicate an explanation (stating
b. assess the interests and impact of any reservations regarding transparency
organisational stakeholders in determining and objectivity of data and information)
strategy and the consequences for of the position, prospects and risks of a
stakeholders of strategic choices; business, based on analysis of financial and
c. evaluate the impact of governance operational data and information, including
mechanisms on a range of stakeholders; data analytics and assess the extent to which
limited assurance and reasonable assurance
d. assess and advise on appropriate corporate
engagements can identify and mitigate
governance mechanisms, and evaluate
information risks in this context.
stakeholder management;
e. analyse and evaluate the strengths and 9 INFORMATION STRATEGY
weaknesses of corporate governance a. outline proposals and advise on outline
mechanisms and processes; requirements for information technology
f. explain the role of boards in determining applications to support business strategy,
and evaluating an entity’s policy for for example in the context of e-commerce,
social responsibility, sustainability and e-business, virtual arrangements, artificial
environmental matters and advise on intelligence, digital assets and cloud
corporate reporting disclosures relating to computing, including assurance issues in
these policies; relation to data security;
g. evaluate the suitability of corporate b. use management accounting information
governance and organisational structures for (for example, costs, prices, budgets, transfer
implementing strategy; prices) and management accounting tools
h. explain the role of boards in monitoring (for example, break-even, variances, limiting
corporate performance and risk, and assess factors, expected values, ABC, balanced
the role of assurance procedures in this scorecard) to evaluate short and long-term
context; and aspects of strategy;
i. explain the nature, and assess the c. explain and appraise how management
consequences, of the legal framework information systems can provide relevant
within which businesses, assurance and quantitative and qualitative data to analyse
governance systems operate (with particular markets, industry and performance,
reference to company law, fraud, money including the capture and analysis of big
laundering, civil liabilities, social security data;
law, employment law, contract law, tort and d. demonstrate and explain methods for
environmental law). determining the value of information in
the context of developing an information
strategy;

e. assess financial and operational data and 11 FINANCE AWARENESS
information from management information a. demonstrate and explain the financing
systems, drawing inferences relating to its alternatives available for projects and
completeness, accuracy and credibility, assets, and make informed choices as to
and provide an evaluation of assurance which alternative is the most compatible
procedures in evaluating information risks, with the overall financial strategy of the
including those relating to cyber security; entity, showing the corporate reporting
f. demonstrate and explain how businesses consequences relating to presentation,
capture, analyse and utilise information to disclosure, recognition and measurement of
develop competitive advantage; projects and their financing;
g. evaluate the impact of cloud computing and b. assess and explain current and emerging
the borderless business on the provision issues in finance;
of strategic management information, c. identify social responsibility, sustainability
including the use of cryptocurrencies; and environmental factors for a range
h. explain and appraise corporate strategies for of financial stakeholders, including UN
ensuring security of data and preventions of sustainable development goals and natural
attacks against data in the context of cyber capital, and assess assurance and corporate
security; and reporting issues relating to such factors;
i. explain the impact of regulations relating to d. explain how financial crises, which have
data security (eg GDPR) including the issues occurred in the past over a long time period,
incurred in complying with such regulation. may impact on approaches and attitudes
to financial risk and may inform corporate
10 HUMAN RESOURCE MANAGEMENT reporting practice; and
a. assess, explain and advise on the role e. explain the role and impact of the finance
of human resource management in function as a business partner.
implementing strategy;
b. demonstrate and explain how human 12 BUSINESS AND SECURITIES VALUATION
resource management can contribute a. explain, advise on and demonstrate
to business strategy, including flexible appropriate valuation methods for
workforce management; businesses and equity securities using:
c. identify the impact of remuneration asset-based; adjusted earnings-based; and
structures on organisational behaviour cash-based methods (for example SVA,
and other aspects of human resource EVAR, VBM, MVA and other appropriate
management, and show the corporate techniques);
reporting consequences; and b. critically appraise business and securities
d. demonstrate and explain the role and impact valuation methods in the context of
of human resource management in change specified complex scenarios, including the
management. consideration of natural capital;
c. explain and demonstrate appropriate
FINANCIAL STRATEGY valuation techniques in the context of
Students will be able to identify and advise upon acquisitions and mergers; assess the
appropriate finance requirements; evaluate contribution of due diligence procedures;
financial risks facing a business and advise and show the impact on corporate reports
upon appropriate methods of managing and arising from acquisitions for groups in
quantifying those risks; provide valuations for consolidated financial statements;
businesses and securities; and advise upon d. explain and demonstrate appropriate
investment and distribution decisions. Students valuation techniques in the context of
will also be able to apply corporate reporting demergers and for disposal of entities
and assurance principles and practices in the and business units, and show the impact
context of key financing decisions and events. on corporate reporting issues relating to
discontinued operations; and
e. determine the value of debt and explain the
techniques used.
© ICAEW 2019 105

FINANCIAL STRUCTURE AND medium-sized companies in raising such
FINANCIAL RECONSTRUCTION finance; and
c. assess and explain the characteristics of
13 CAPITAL STRUCTURE sources of equity for smaller companies and
a. appraise and evaluate the sources of finance the financial institutions operating in these
and the process for raising finance; markets (for example, venture capital and
b. advise on and develop proposals for private equity).
determining the appropriate financing mix
for new businesses and projects; FINANCIAL INSTRUMENTS AND
c. explain and advise on issues relating to the FINANCIAL MARKETS
cost of capital;
16 EQUITY INSTRUMENTS
d. show and explain how dividend policy
a. assess and explain the types of equity
impacts upon equity value and upon
securities, and evaluate the implications for
financing and investment decisions; and
disclosure, presentation, recognition and
e. appraise and explain how the choice of measurement in financial statements;
financing impacts on reported corporate
b. appraise and explain the characteristics of
performance, and on the recognition
equity markets and the financial institutions
and measurement of financial assets and
operating in these markets; and
financial liabilities.
c. analyse and evaluate the cost of equity,
14 FINANCIAL RECONSTRUCTION portfolio theory and the use of appropriate
a. show and explain how financial asset pricing models, applying principles of
reconstruction takes place and explain the financial economics.
consequences of such reconstructions for
17 FIXED INTEREST
corporate reporting;
a. explain the types of fixed interest securities
b. appraise and evaluate financial
and evaluate the implications for disclosure,
reconstruction proposals in a given scenario,
presentation, recognition and measurement
and determine the nature and role of
in financial statements;
assurance procedures in this context;
b. appraise and explain the characteristics of
c. explain the different reasons for refinancing,
bond markets and the financial institutions
and demonstrate how companies in financial
operating in these markets;
distress can be managed, having regard to
insolvency law; c. appraise and evaluate the use of bonds/
loans as a method of finance, and explain
d. explain and appraise the workings of, and
the implications of terms included in loan
reasons for, securitisation, showing the
agreements in a given scenario (for example,
impact on financial statement information;
covenants and guarantees) and the explain
e. explain and appraise the nature and the procedures by which monitoring and
consequences of leveraged buy outs; and assurance can be provided in respect of
f. appraise and evaluate various forms of such agreements;
reconstruction (for example, spin-off, d. explain and appraise bond valuation
MBO, divestment, demergers, purchase of techniques and assess flat and gross
own shares, use of distributable profits), redemption yields;
explaining the corporate reporting impact.
e. explain and appraise yield curves, sensitivity
15 SMALL AND MEDIUM COMPANY to yield and components of the yield;
FINANCING f. evaluate and explain interest rate risk; and
a. appraise and explain the small and g. appraise and evaluate credit risk and credit
medium-sized enterprise financing problem; spread.
b. appraise and evaluate the various methods
18 DERIVATIVES
of financing available to small and
medium-sized enterprises, and explain the a. explain the types of derivative securities
nature and role of assurance for small and and evaluate the implications for disclosure,

presentation, recognition and measurement which these risks can be managed, and
in financial statements; assess the nature and role of assurance
b. assess and explain the characteristics procedures in mitigating risk and the
of derivative markets and the financial financial reporting consequences of
institutions operating in these markets; and currency hedging;
c. appraise and evaluate the characteristics f. appraise and evaluate the different methods
of forwards, futures, options, swaps, credit open to multinationals wishing to set
derivatives. up foreign operations and the choices
of finance available, identifying tax and
19 FINANCIAL RISK MANAGEMENT corporate reporting consequences;
a. analyse and evaluate financial risks and their g. assess and explain the impact of exchange
implications (for example financing, currency controls and how companies can overcome
and interest rate risks) and show the the effects of these controls;
application of qualitative and quantitative h. appraise and evaluate the management of
risk disclosures for financial instruments dividends in multinational organisations; and
and other corporate reporting disclosures
i. appraise and evaluate the management of
relevant to risk assessment;
transfer prices in multinational organisations
b. appraise and advise on appropriate and the implications for reported profit and
methods to assess, manage and quantify tax.
financial risk in specific business scenarios;
c. explain and appraise financial instruments 21 INVESTMENT APPRAISAL
available for hedging against interest rate a. select and advise on investment appraisal
and foreign exchange rate risk, for example, techniques which are appropriate to the
swaps, collars and floors; objectives and circumstances of a given
d. demonstrate and explain the nature business;
and operation of financial instruments b. appraise and advise on appropriate
underlying the disclosure, recognition and measures of return and risk for assessing
measurement requirements in financial business projects;
statements; and c. demonstrate and evaluate investment
e. demonstrate and explain how interest rate appraisal techniques for international
hedging strategies and foreign currency risk projects, identifying the impact of tax and
management strategies can be formulated, the effects on corporate reporting;
both at the level of the individual transaction d. explain and appraise real options and
and for macro hedging arrangements. determine the impact of options to abandon,
expand, delay and redeploy;
20 INTERNATIONAL FINANCIAL MANAGEMENT
e. appraise and evaluate the quantitative and
a. explain and appraise the various methods of
qualitative issues surrounding international
financing available for foreign investments
investment appraisal;
and evaluate the implications for disclosure,
presentation, recognition and measurement f. evaluate the impact of externalities when
of changes in foreign exchange rates in making investment appraisal decisions; and
financial statements; g. identify social responsibility, sustainability
b. appraise and explain global treasury and environmental consequences of
organisation and international liquidity investment decisions, explaining corporate
management; reporting issues in relation to such policies.
c. appraise and evaluate the factors affecting 22 TREASURY AND WORKING CAPITAL
the capital structure of a multinational MANAGEMENT
company; a. demonstrate and explain the role and
d. explain and appraise the advantages responsibilities of the treasury management
and risks associated with international function;
borrowing; b. demonstrate and explain the role of treasury
e. demonstrate and explain the risks associated management in short-term finance, short-
with international trade and the ways in term investment and liquidity risk;
© ICAEW 2019 107

c. appraise and evaluate the contribution of
working capital management to short term
and long term financing;
d. evaluate the risks arising from working
capital management and how these may be
mitigated;
e. evaluate and explain working capital
requirements for a range of different
organisations and circumstances;
f. demonstrate and explain the nature and
role of working capital management within
financial management; and
g. appraise, evaluate and advise with respect to
working capital management techniques.
23 ETHICS
a. recognise and explain ethical issues;
b. explain the relevance, importance and
consequences of ethical issues;
c. evaluate the impact of ethics on an entity, its
stakeholders and the scope of its strategies
and operations;
d. recommend and justify appropriate actions
where ethical dilemmas arise in a given
scenario; and
e. design and evaluate appropriate ethical
safeguards.

SKILLS ASSESSED

• Recognise new and complex • Filter information provided • Work effectively within time
ideas within a scenario to identify critical facts constraints
• Identify the needs of • Operate to a brief in a given
customers and clients scenario
• Identify risks within a scenario
scenario

• draw conclusions in the following ways:
–– from data, facts, calculations, judgments and own analysis;
–– on complex assurance engagements;
–– by identifying weaknesses in financial information systems and their potential consequences;
–– by distinguishing between the qualities of data provided or other evidence generated; and
–– by developing risk management solutions in an audit and corporate reporting environment.
• present and communicate their recommendations in the following ways:
–– from using a report/memorandum in response to a specific technical issue and in accordance
with client requirements;
–– by using reasoned, practicable advice that is clear and concise, supported by calculations or
analysis of technical/business issues identified;
–– by using judgement to select the most appropriate audit procedures in the context of risks
identified; and
–– by justifying a specific recommended action when a variety of options are available.
• explain the limitations of their conclusions or recommendations.
© ICAEW 2019 109

financial and non-
understanding of business • Identify the solution which is the best fit with acceptance
issues and their underlying criteria and objectives
causes • Define objectives and acceptance criteria for solutions
and criteria

• Business management
–– Undertake a critical assessment of key business issues.
–– Structure market data and industry data from various sources.
–– Explain and evaluating the strengths and weaknesses of an organisation or segments of an
organisation.
–– Evaluate the impact of decisions on business strategy.
–– Evaluate the impact of financial strategy on business strategy.
• Finance
–– Undertake valuations, where the information is incomplete, suspect or unsuitable.
–– Undertake financial risk analysis and considering the management of financial risks.
–– Evaluate the impact of business strategy on financial strategy.
• Corporate reporting
–– Consider relevance and reliability of unstructured information.
–– Evaluate the impact and legitimacy of a range of financial reporting treatments.
–– Deal with complex financial reporting information.
–– Impact of future events on financial statements.
–– Impact on financial statements of delaying or modifying business and financial decisions.
–– Evaluate business position, prospects and risks.
• Assurance
–– Understand business and inherent risks in complex scenarios.
–– Evaluate the control environment.
–– Undertake selective financial analysis.

–– Evaluate risk and control evaluation in the context of IT.
–– Undertake assurance to support specific transactions (eg, due diligence).
–– Apply professional scepticism.
• Ethics
–– Identify ethical problems in complex scenarios and structuring appropriate actions.
APPLYING JUDGEMENT

• Recognise bias and varying quality in data and • Recognise bias and varying quality in data and
evidence evidence
• Identify faults in arguments • Identify faults in arguments
• Identify gaps in evidence • Identify gaps in evidence
• Identify inconsistencies and contradictory • Identify inconsistencies and contradictory
information information
• Assess interaction of information from • Assess interaction of information from
different sources different sources
• Exercise ethical judgement • Exercise ethical judgement

• drawing of inferences and conclusions from prior qualitative and quantitative analysis, and other
information, in order to solve problems and developing a solution, or alternative solutions;
• select between technical choices;
• filter data to identify critical elements;
• prioritise information, issues or tasks;
• identify omissions in the information provided;
• distinguish between the various qualities of the data provided;
• evaluate the impact of business, financial and economic factors;
• evaluate the appropriateness of accounting policy and estimation selection;
• compare the effects of a range of estimates, outcomes or financial treatments;
• exercise ethical judgement;
• identify key linkages; and
• draw appropriate conclusions from data provided to satisfy specified objectives and assessing the
materiality of errors and omissions.
© ICAEW 2019 111


information
situation

• draw conclusions on complex assurance engagements;
• draw conclusions by identify weaknesses in financial information systems and their potential
consequences;
• draw conclusions by distinguishing between the qualities of data provided or other evidence
generated;
• draw conclusions by developing risk management solutions;
• draw conclusions by making strategic decisions;
• draw conclusions by valuing a company or a financial instrument;
• present a report/memorandum in response to a specific technical or business issue and in
• present reasoned, practicable advice that is clear and concise, supported by calculations or analysis
of technical or business issues identified; and
• justify a specific recommended action when a variety of options are available.

Case Study
MODULE AIM rigour and principles. Professional scepticism
To ensure that students can provide advice on will be an underlying requirement within the
complex business issues in the form of a written complex scenarios that the Case Study presents.
report. It must be applied being mindful of provenance
and recognising the potential for bias.
The objective of the Case Study is to assess
students’ understanding of complex business
PREPARATION AND APPROACH TO
issues and the ability to analyse financial and
non-financial data, exercise professional and
THE CASE
ethical judgement, and develop conclusions and The Case Study is designed to reproduce a
recommendations. typical situation in which ICAEW Chartered
Accountants find themselves. This will involve
CASE STUDY FORMAT using information arising from meetings and
communicated in memoranda, letters or reports
The Case Study scenario may be based on from a variety of business and professional
any one of a variety of different organisational advisors and stakeholders. The situation will
structures or operations. Students will be generally relate to a business plan or transaction
provided with background details (‘Advance and will require preparation for the submission
Information’) on the organisation and its of a report.
business environment ahead of the exam.
The reality of such situations is that in drafting a
This information will not give specific indication report you would:
of the eventual requirements of the Case
Study. Students will be expected to familiarise • receive some materials in advance;
themselves with the information provided about • carry out some work beforehand and make
the organisation and the industry in which it use of it in the report;
operates, by undertaking details analysis of • include additional analysis in appendices to
that Advance Information and some additional the report;
analysis and research where necessary. Students
• develop additional lines of enquiry as you
may take the results of their work into the exam.
assemble the report; and
• expect to discuss and advise on relevant
matters.
The Case Study module exam is 4 hours long.
The limited class time available with a tutor, even
The Case Study will not require the detailed
when supplemented by extensive home study,
computations needed for the Certificate,
is insufficient for success in the Case Study.
Professional and Advanced Levels; but students
Students must bring work experience into their
will be required to undertake financial and
preparation and development programme.
business analysis.
Success at the Case Study requires an
Requirements will be open in that there will be
integration of the technical knowledge and skills
no predetermined correct answers to the Case
acquired from all of the ACA modules, namely:
Study. All areas of the syllabus may be tested
over time. • the core technical knowledge and skills
and practical application acquired at the
ETHICS AND PROFESSIONAL Certificate and Professional levels;
SCEPTICISM • the technical, analytical, evaluative and
Ethics and business trust is ingrained throughout integration skills from Corporate Reporting
the Case Study material. Analysis of the skills and Strategic Business Management; and
assessed that follows shows that candidates are • the advisory, judgemental and
required both to identify and evaluate ethical communication skills acquired through
issues and dimensions. Recommendations will practical work experience undertaken during
necessarily only be valid if they satisfy the same the training agreement.
© ICAEW 2019 113

SKILLS ASSESSED

• Recognise new and complex • Use multiple information • Work effectively within time
ideas within a scenario sources constraints
• Identify the needs of • Filter information provided • Operate to a brief in a given
customers and clients to identify critical facts scenario
scenario
scenario

• use the Advance Information, exam paper, knowledge of ethical codes and professional experience
to define the specific issue/situation;
• identify and use the key financial figures from the Advance Information and exam paper;
• use their own understanding of context and relevant findings from their own research;
• describe the wider context in which the business operates;
• identify relevant business issues showing:
–– understanding of a business entity
–– understanding of its position in the industry sector;
• recognise where a business is in its life cycle;
• identify any important parameters affecting an issue (eg, competitors, loss of clients); and
• demonstrate an awareness of ethical and business trust issues and situations.

financial and non-
understanding of business • Define objectives and acceptance criteria for solutions
issues and their underlying • Identify the solution which is the best fit with acceptance
causes criteria and objectives
and criteria

• identify and use key information;
• demonstrate technical knowledge;
• use professional experience;
• use relevant strategic analytical tools (SWOT, PESTLE, Porter’s five forces);
• perform relevant analysis;
• produce quality analysis showing:
–– depth
–– breadth
–– logic
–– reasonableness;
• use knowledge of ethical codes and professional experience to perform relevant analysis; and
• assess issues of business trust.
Financial statement analysis:

• use appropriate analytical tools on information and data provided in the Advance Information and
exam paper to measure financial performance, identify trends and make comparisons;
• perform relevant analysis on:
–– financial statements;
–– other information;
• make specific adjustments to align equivalent financial information for different factors;
• assess the causes and effects of both financial and non-financial factors on the business;
• assess the effect of external factors on business activities and financial results; and
• integrate numbers and words.
© ICAEW 2019 115

Financial data analysis:
• prepare and explain relevant calculations based on financial information provided in the Advance
Information and exam paper;
• use appropriate analytical tools (eg, valuation methodologies);
• perform relevant analysis on:
–– numerical data
–– other information;
• determine specific outcomes from financial and non-financial information provided;
• comment on assumptions provided;
• consider and calculate possible alternative outcomes (flexing numbers, sensitivity analysis); and
• integrate numbers and words.
APPLYING JUDGEMENT

• Recognise bias and varying quality in data and • Appreciate when more expert help is
evidence required, but reviewing and challenging their
• Identify faults in arguments work where appropriate
• Identify gaps in evidence • Identify related issues in scenarios
• Identify inconsistencies and contradictory • Assess different stakeholder perspectives
information when evaluating options
• Assess interaction of information from • Retain an overview of the business issue or
different sources scenario
• Exercise ethical judgement • Appraise corporate responsibility and
sustainability issues
• Appraise the effects of alternative future
scenarios
regulatory issues

• evaluate and build on implications of financial or strategic analysis or calculations;
• identify and use key financial information;
• recognise linkages;
• recognise gaps or shortcomings in the information provided;
• select and evaluate key points, such as strengths and weaknesses of a business proposal;
• question and evaluate the adequacy of any assumptions and quality of information provided;
• explain own assumptions;
• discuss output, such as pros/cons;
• demonstrate professional scepticism;
• demonstrate objectivity/balance;
• demonstrate an appreciation of more than one side/bias;
• evaluate and balance options;

• prioritise key points;
• assess weaknesses in decisions;
• reflect on the underlying analysis performed and what it means for the organisation;
• use knowledge of ethical codes and professional experience;
• identify risks and ethical issues within, and derived from, the scenario;
• identify key ethical issues for an accountant undertaking work in accounting, finance and assurance; and
• evaluate any specific business trust points relating to the issue under review.
• Apply technical knowledge • Present recommendations in • Present analysis and

to support reasoning and accordance with instructions recommendations in
conclusions and defined criteria accordance with instructions
• Apply professional • Make recommendations in • Communicate clearly to a
experience and evidence to situations where risks and specialist or non-specialist
support reasoning uncertainty exist audience in a manner
• Use valid and different • Formulate opinions, advice, suitable for the recipient
technical skills to formulate recommendations, plans, • Prepare the advice, report, or
opinions, advice, plans, solutions, options and notes required in a clear and
solutions, options and reservations based on valid concise style
reservations evidence
• Make evidence-based
recommendations which can
be justified by reference to
information
situation

• draw conclusions, make recommendations and reach decisions based on their foregoing work and
relevant to the organisation as described in the business scenario;
• draw conclusions that:
–– are realistic;
–– flow from the analytical work and evaluation previously conducted;
–– include the impact of any assumptions and any sensitivity analysis;
–– form an opinion on the validity of information sources; and
–– conclude on ethical issues.
• offer clear, practical, and commercial advice and recommendations that:
–– follow logically from the analytical work, evaluations and conclusions;
–– are backed up by reasoned argument;
–– are realistic;
© ICAEW 2019 117

–– help to improve the situation or mitigate any problems or uncertainties identified within the
context of the business scenario and wider context;
–– lie within the range of current business activity;
–– identify any significant positive points or areas of concern relating to any decision(s) reached;
–– identify any financial implications of action (or no action);
–– identify additional work needed to support the decision(s);
–– identify the next steps that the client should take to progress or reject an issue;
–– identify where any specific additional advice may be required; and
–– resolve any identified ethical dilemmas or issues of business trust.

Technical knowledge
The tables contained in this section show the technical knowledge in the disciplines of financial
reporting, audit and assurance, business analysis, ethics and taxation covered in the ACA syllabus by
module.
For each individual standard the level of knowledge required in the relevant Certificate and
Professional Level module and at the Advanced Level is shown.
The knowledge levels are defined as follows:
LEVEL D
An awareness of the scope of the standard.
LEVEL C
A general knowledge with a basic understanding of the subject matter and training in its application
thereof sufficient to identify significant issues and evaluate their potential implications or impact.
LEVEL B
A working knowledge with a broad understanding of the subject matter and a level of experience in
the application thereof sufficient to apply the subject matter in straightforward circumstances.
LEVEL A
A thorough knowledge with a solid understanding of the subject matter and experience in the
application thereof sufficient to exercise reasonable professional judgement in the application of the
subject matter in those circumstances generally encountered by chartered accountants.
KEY TO OTHER SYMBOLS:

→ The knowledge level reached is assumed to be continued
© ICAEW 2019 119

Assurance and Audit
AUDIT AND ADVANCED
TOPIC ASSURANCE
ASSURANCE LEVEL
The International Auditing and Assurance Standards Board D C

The Authority Attaching to Standards Issued by the International Auditing and
C A
Assurance Standards Board
The Authority Attaching to Practice Statements Issued by the International
A
Auditing and Assurance Standards Board
Discussion Papers C
Working Procedures C
International Standards on Auditing (UK)
200 (Revised June 2016) Overall Objectives of the Independent Auditor
and the Conduct of an Audit in Accordance with International Standards on B A →
Auditing (UK)
210 (Revised June 2016) (Updated July 2017) Agreeing the Terms of Audit
B →
Engagements
220 (Revised June 2016) (Updated July 2017) Quality Control for an Audit of
B →
Financial Statements
230 (Revised June 2016) Audit Documentation C B A
240 (Revised June 2016) (Updated July 2017) The Auditor’s Responsibilities
C B A
Relating to Fraud in an Audit of Financial Statements
250 A (Revised December 2017) Consideration of Laws and Regulations in an
B A
Audit of Financial Statements
250 B (Revised June 2016) The Auditor’s Statutory Right and Duty to Report
to Regulators of Public Interest Entities and Regulators of Other Entities in the C
Financial Sector
260 (Revised June 2016) (Updated July 2017) Communication with Those
B A
Charged with Governance
265 Communicating Deficiencies in Internal Control to Those Charged with
B A
Governance and Management
300 (Revised June 2016) Planning an Audit of Financial Statements B A →
315 (Revised June 2016) Identifying and Assessing the Risks of Material
C A →
Misstatement Through Understanding of the Entity and its Environment
320 (Revised June 2016) Materiality in Planning and Performing an Audit C A →
330 (Revised July 2017) The Auditor’s Responses to Assessed Risks C B A
402 Audit Considerations Relating to an Entity Using a Service Organisation C B
450 (Revised June 2016) (Updated July 2017) Evaluation of Misstatements
C A
Identified during the Audit
500 (Updated July 2017) Audit Evidence B A →
501 Audit Evidence – Specific Considerations for Selected Items B A
505 (Updated July 2017) External Confirmations B B A
510 (Revised June 2016) Initial Audit Engagements - Opening Balances C B A
520 Analytical Procedures B A A
530 Audit Sampling B B A
540 (Revised December 2018) Auditing Accounting Estimates, Including Fair
C B A
Value Accounting Estimates and Related Disclosures
550 Related Parties C B A
560 Subsequent Events B A
570 (Revised June 2016) Going Concern A →
580 Written Representations C B A
600 (Revised June 2016) Special Considerations – Audits of Group Financial
C A
Statements (including the Work of Component Auditors)
120 TECHNICAL KNOWLEDGE © ICAEW 2019

AUDIT AND ADVANCED
TOPIC ASSURANCE
ASSURANCE LEVEL
610 (Revised June 2013) Using the Work of Internal Auditors C B A

620 (Revised June 2016) Using the Work of an Auditor’s Expert B A
700 (Revised June 2016) Forming an Opinion and Reporting on Financial
B A →
Statements
701 Communicating Key Audit Matters in the Independent Auditor’s Report B A
705 (Revised June 2016) Modifications to the Opinion in the Independent
A →
Auditor’s Report
706 (Revised June 2016) Emphasis of Matter Paragraphs and Other Matter
A →
Paragraphs in the Independent Auditor’s Report
710 Comparative Information – Corresponding Figures and Comparative
B A
Financial Statements
720 (Revised June 2016) The Auditor’s Responsibility Relating to Other
B A
Information
800 (Revised) Special Considerations – Audits of Financial Statements
B A
prepared in Accordance with Special Purpose Frameworks
805 (Revised) Special Considerations – Audits of Single Financial Statements
B A
and Specific Elements, Accounts or items of a Financial Statement
International Standards on Auditing
810 (Revised) Engagements to Report on Summary Financial Statements B
International Auditing Practice Note (IAPN)
1000 Special Considerations in Auditing Financial Instruments B
International Standards on Review Engagements (ISREs)
2400 (Revised) Engagements to Review Historical Financial Statements C B
International Standards on Review Engagements (UK & Ireland)
2410 Review of Interim Financial Information Performed by the Independent
C B
Auditor of the Entity
International Standards on Assurance Engagements (ISAEs)
3000 (Revised) Assurance Engagements Other than Audits or Reviews of
C B
Historical Financial Information
3400 The Examination of Prospective Financial Information C A
3402 Assurance Reports on Controls at a Service Organisation C B
3410 Assurance Engagements on Greenhouse Gas Statements C →
International Standards on Related Services (ISRSs)
4400 Engagements to Perform Agreed-upon Procedures Regarding Financial
B
Information
4410 (Revised) Compilation Engagements B
Other Standards
ISQC (UK)1 (Revised June 2016) (Updated July 2017) Quality Control for Firms
that Perform Audits and Reviews of Financial Statements, and Other Assurance C B
and Related Services Engagements
Other Guidance
Bulletin (October 2016): Compendium of Illustrative Auditor’s Reports on
United Kingdom Private Sector Financial Statements for periods commencing B B
on or after 17 June 2016
FRC Briefing Paper
Professional Scepticism – establishing a common understanding and B B
reaffirming its central role in delivering audit quality
© ICAEW 2019 121

Business Analysis
CERTIFICATE AND PROFESSIONAL LEVELS
BUSINESS ADVANCED
TOPIC BUSINESS, LEVEL
MANAGEMENT FINANCIAL STRATEGY
TECHNOLOGY
INFORMATION MANAGEMENT AND
AND FINANCE
TECHNOLOGY
STRATEGIC ANALYSIS
Environmental and market analysis tools
PESTEL analysis C A →
Porter’s five forces C A →
Product life cycle C A →
Boston consulting group matrix C A →
Prices and markets C A →
Competitor analysis C A →
Positional and other analysis tools
Resource audit C A →
Resource-based strategy C A →
Value chain analysis C A →
SWOT analysis C A →
Gap analysis C A →
Marketing analysis C A →
Competitive advantage C A →
Benchmarking C A →
Directional policy matrix B
Business process analysis B A
Strategic risk analysis A →
Balanced scorecard C A →
STRATEGIC CHOICE
Strategy formulation, evaluation and
C A →
choice
Business risk management C A →
Financial analysis and data analysis A →
Stakeholder analysis C A →
Objectives and stakeholders’
C A →
preferences
Corporate responsibility and
C B A
sustainability
STRATEGIC IMPLEMENTATION
Business plans C A →
Organisational structure C A →
Information management C B A
Change management A →
Project management A
BUSINESS MANAGEMENT
Performance management C A
Strategic marketing and brand
B A
management
Corporate governance C B A
Information strategy B A
Human resource management C B

BUSINESS ADVANCED
TECHNOLOGY
AND FINANCE
TECHNOLOGY
COST ANALYSIS FOR DECISION MAKING

Costing
Cost classification A → →
Costing systems – direct, marginal,
B → →
absorption
Activity based costing (ABC) C → B
Break even analysis B → A
Multi-product break even analysis B
Budgeting and performance
B → A
management
Pricing
Pricing decisions B A →
Transfer pricing B A →
Decision making techniques
Expected values B A
Relevant cash flows B A
Sensitivity analysis B A
BUSINESS AND SHAREHOLDER VALUE
Valuation Techniques
Income – dividend yield B A
Income – P/E B A
Income – discounted cash flow B A
Asset based measures B A
Options approach B
Shareholder value
Value based management (VBM) B
Value drivers B A
Shareholder value analysis (SVA) B A
Short and long term growth rates and
A
terminal values
Economic profit A
Cash flow return on investment (CFROI) A
Total shareholder return (TSR) A
Market value added (MVA) A
INVESTMENT APPRAISAL AND RISK ANALYSIS
Project appraisal
NPV B A →
IRR B A →
Payback B A →
Relevant cash flows A →
Tax and inflation A →
Replacement analysis A →
Capital rationing A →
Adjusted present value (APV) A →
© ICAEW 2019 123

BUSINESS ADVANCED
TECHNOLOGY
AND FINANCE
TECHNOLOGY
Assessing risk
Project appraisal and sensitivity analysis B A
Project appraisal and simulation B A
Expected values B A
Scenario planning A
Gap analysis B →
Continuous vs event risk B →
FINANCIAL ANALYSIS
Cost of capital
Cost of equity B A
Cost of debt B A
Cost of preference shares B A
Cost of bank loans B A
Weighted average cost of capital
B A
(WACC)
Effective interest rates A
Splitting convertibles into equity and
A
debt elements
Equity instruments A
Portfolio theory and CAPM
Portfolio theory B A
CAPM B A
APT and MCPM A
CAPM and cost of capital B A
International cost of capital A
Bonds and fixed interest securities
Bond pricing using NPV A
Yields to maturity A
Duration and price volatility A
Convexity A
Term structure of interest rates A
Corporate borrowing and default risk A
SOURCES OF FINANCE AND FINANCING ARRANGEMENTS
Short, medium and long term sources
C A
of finance
Loan agreement conditions (warranties;
B A
covenants; guarantees)
Raising capital C A
Gearing and capital structure A →
Loan agreements and covenants A →
Dividend policy A →
Financing reconstructions (eg, group
reconstruction, spin off, purchase of B A
own shares, use of distributable profits)
Treasury and working capital
C A
management

BUSINESS ADVANCED
TECHNOLOGY
AND FINANCE
TECHNOLOGY
Small and medium company financing B

History of finance C
FINANCIAL ENGINEERING
Futures, options and swaps
Options B A
Interest rate futures B A
Interest rate options B A
Interest forward rate agreements (FRAs) B A
Interest rate swaps B A
Foreign exchange
Currency forward contracts B A
Currency money market cover B A
Currency options B A
Currency swaps B A
Operational techniques for managing
B A
currency risk
Theoretical determinants of foreign
B A
exchange rates
Option value
Value of a call and put option C B
Black Scholes option pricing model B
Binomial option pricing model B
Real options C B
© ICAEW 2019 125

Ethics Codes and Standards
ETHICS CODES AND STANDARDS LEVEL MODULES
IESBA Code of Ethics for Professional Accountants Certificate Level

(parts A, B and C and Definitions) C/D Accounting
B Assurance
ICAEW Code of Ethics C/D Business, Technology and Finance
D Law
C Management Information
C Principles of Taxation
Professional Level
A Audit and Assurance
B Business Strategy and Technology
B Financial Accounting and Reporting
B/C Financial Management
B Tax Compliance
B Business Planning
Advanced Level
A Corporate Reporting
A Strategic Business Management
A Case Study
FRC Revised Ethical Standard (2016) B Assurance

A Audit and Assurance
Advanced Level
A Corporate Reporting
A Strategic Business Management
A Case Study

Financial Reporting – IFRS
CERTIFICATE AND ADVANCED
PROFESSIONAL LEVEL LEVEL
TOPIC FINANCIAL
ACCOUNTING CORPORATE
ACCOUNTING
AND REPORTING
REPORTING
Preface to International Financial Reporting Standards A A

Conceptual Framework for Financial Reporting (Note 1) B A A
IAS 1, Presentation of Financial Statements A A A
IAS 2, Inventories B A A
IAS 7, Statement of Cash Flows B A A
IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors B A A
IAS 10, Events after the Reporting Period A A
IAS 12, Income Taxes C A
IAS 16, Property, Plant and Equipment B A A
IAS 19, Employee Benefits - A
IAS 20, Accounting for Government Grants and Disclosure of
A A
Government Assistance
IAS 21, The Effects of Changes in Foreign Exchange Rates C A
IAS 23, Borrowing Costs A A
IAS 24, Related Party Disclosures B A
IAS 26, Accounting and Reporting by Retirement Benefit Plans - D
IAS 27, Separate Financial Statements B A
IAS 28, Investments in Associates and Joint Ventures B A
IAS 29, Financial Reporting in Hyperinflationary Economics - D
IAS 32, Financial Instruments: Presentation B A
IAS 33, Earnings Per Share C A
IAS 34, Interim Financial Reporting - A
IAS 36, Impairment of Assets B A
IAS 37, Provisions, Contingent Liabilities and Contingent Assets C A A
IAS 38, Intangible Assets C A A
IAS 39, Financial Instruments: Recognition and Measurement (Hedging
- A
only) (Note 2)
IAS 40, Investment Property (Note 2) - A
IAS 41, Agriculture - D
IFRS 1, First-time Adoption of IFRS - C
IFRS 2, Share-based Payment - A
IFRS 3, Business Combinations B A
IFRS 4, Insurance Contracts (Note 2) - D
IFRS 5, Non-current Assets Held for Sale and Discontinued Operations B A
IFRS 6, Exploration for and Evaluation of Mineral Resources - D
IFRS 7, Financial Instruments: Disclosures C A
IFRS 8, Operating Segments - A
IFRS 9, Financial Instruments (Note 2) C A
IFRS 10, Consolidated Financial Statements B A
IFRS 11, Joint Arrangements B A
IFRS 12, Disclosure of Interests in Other Entities B A
IFRS 13, Fair Value Measurement C A
IFRS 14, Regulatory Deferral Accounts - C
© ICAEW 2019 127

CERTIFICATE AND ADVANCED
PROFESSIONAL LEVEL LEVEL
TOPIC FINANCIAL
ACCOUNTING CORPORATE
ACCOUNTING
AND REPORTING
REPORTING
IFRS 15, Revenue from Contracts with Customers C B A

IFRS 16, Leases (Note 1) B A
IFRS 17, Insurance Contracts (Note 1) - C
IFRS for SMEs - A
Note 1: The mandatory effective date for IFRS 17 is after 1 January 2019 so it is not examinable for the Professional Level 2020
FAR syllabus. Although the mandatory date for IFRS 17 is after 1 January 2018, due to its significance to financial reporting
in the insurance industry, it is nonetheless examinable at level A within the Business Planning: Insurance syllabus. The 2018
amendments to the Conceptual Framework have an effective date after 1 January 2019 so it is not examinable for the
Professional Level 2020 syllabus.
Note 2: Business Planning Banking and Business Planning: Insurance cover IAS 39 and IFRS 9 in more detail than in the
Financial Accounting and Reporting syllabus at Professional Level. Business Planning: Insurance also covers IFRS 4 and IAS 40
in more detail than in the Financial Accounting and Reporting syllabus at Professional Level.

Financial Reporting – UK GAAP
PROFESSIONAL
LEVEL
TOPIC
FINANCIAL
ACCOUNTING
AND REPORTING
The financial reporting framework A

FRS 102 s.1 Scope A
FRS 102 s.1A Small Entities B
FRS 102 s.2 Concepts and Pervasive Principles A
FRS 102 s.3 Financial Statement Presentation A
FRS 102 s.4 Statement of Financial Position A
FRS 102 s.5 Statement of Comprehensive Income and Income Statement A
FRS 102 s.6 Statement of Changes in Equity and Statement of Income and Retained Earnings A
FRS 102 s.7 Statement of Cash Flows A
FRS 102 s.8 Notes to the Financial Statements A
FRS 102 s.9 Consolidated and Separate Financial Statements B
FRS 102 s.10 Accounting Policies, Estimates and Errors A
FRS 102 s.11 Basic Financial Instruments C
FRS 102 s.12 Other Financial Instruments Issues -
FRS 102 s.13 Inventories A
FRS 102 s.14 Investments in Associates B
FRS 102 s.15 Investments in Joint Ventures B
FRS 102 s.16 Investment Property -
FRS 102 s.17 Property, Plant and Equipment A
FRS 102 s.18 Intangible Assets other than Goodwill A
FRS 102 s.19 Business Combinations and Goodwill B
FRS 102 s.20 Leases B
FRS 102 s.21 Provisions and Contingencies A
FRS 102 s.22 Liabilities and Equity B
FRS 102 s.23 Revenue A
FRS 102 s.24 Government Grants A
FRS 102 s.25 Borrowing Costs B
FRS 102 s.26 Share-based Payments -
FRS 102 s.27 Impairment of Assets B
FRS 102 s.28 Employee Benefits -
FRS 102 s.29 Income Tax C
FRS 102 s.30 Foreign Currency Translation C
FRS 102 s.31 Hyperinflation -
FRS 102 s.32 Events after the End of the Reporting period A
FRS 102 s.33 Related Party Disclosures B
FRS 102 s.34 Specialised Activities -
FRS 102 s.35 Transition to this FRS -
FRS 105 s.1 Scope A
FRS 105 s.2 Concepts and Pervasive Principles A
FRS 105 s.3 Financial Statement Presentation A
FRS 105 s.4 Statement of Financial Position A
FRS 105 s.5 Income Statement A
FRS 105 s.6 Notes to the Financial Statements A
© ICAEW 2019 129

PROFESSIONAL
LEVEL
TOPIC
FINANCIAL
ACCOUNTING
AND REPORTING
FRS 105 s.7 Subsidiaries, Associates, Jointly Controlled Entities and Intermediate Payment
A
Arrangements
FRS 105 s.8 Accounting Policies, Estimates and Errors A
FRS 105 s.9 Financial Instruments C
FRS 105 s.10 Inventories A
FRS 105 s.11 Investments in Joint Ventures B
FRS 105 s.12 Property, Plant and Equipment A
FRS 105 s.13 Intangible Assets other than Goodwill A
FRS 105 s.14 Business Combinations and Goodwill B
FRS 105 s.15 Leases B
FRS 105 s.16 Provisions and Contingencies A
FRS 105 s.17 Liabilities and Equity B
FRS 105 s.18 Revenue A
FRS 105 s.19 Government Grants A
FRS 105 s.20 Borrowing Costs B
FRS 105 s.21 Share-based Payment -
FRS 105 s.22 Impairment of Assets B
FRS 105 s.23 Employee Benefits -
FRS 105 s.24 Income Tax C
FRS 105 s.25 Foreign Currency Translation C
FRS 105 s.26 Events after the End of the Reporting period A
FRS 105 s.27 Specialised Activities -
FRS 105 s.28 Transition to this FRS -

Taxation
CERTIFICATE AND PROFESSIONAL LEVEL
TOPIC
PRINCIPLES TAX BUSINESS PLANNING:
OF TAXATION COMPLIANCE TAXATION
LEGAL AND ETHICAL FRAMEWORK

Anti-money laundering guidance C B A
Base erosion and profit-shifting (BEPS) project C
Disclosure of tax avoidance schemes (DOTAS) A
Extent of tax legislation to England, Wales, Scotland & Northern
C B
Ireland
General anti-abuse rule A
HMRC B → →
Objectives of taxation C → →
Professional Conduct in Relation to Taxation (PCRT) C B
Tax planning, evasion and avoidance C B A
ADMINISTRATION
Administration B → →
Appeals C → →
Apprenticeship levy C →
Digital accounts B → →
PAYE/NIC B → →
Payments B A →
Penalties and interest B → →
Self-assessment B A →
CAPITAL GAINS TAX
Chargeable gains
Annual exempt amount B A →
Capital gains tax for trusts C
Chargeable assets C B →
Chargeable disposals C B →
Chargeable persons C B →
Chattels: wasting and non-wasting B → →
Connected persons A →
Converted trading losses B →
Costs of acquisition and disposal C B →
Leases A
Nil gain/nil loss transfers A →
Part disposals B →
Qualifying corporate bonds B →
Rate of tax B A →
Relief for capital losses A A
Reorganisations and reconstructions A
Shares and securities (including bonus and rights issues) B →
Chargeable gains reliefs
Entrepreneurs’ relief B A
Gift relief B A
Incorporation relief A
Letting relief A →
© ICAEW 2019 131

TOPIC
Principal private residence relief A →

Reinvestment relief under EIS/SEIS B
Roll-over relief B A
Overseas aspects of capital gains tax
Arising basis B A
Deemed domicile B A
Domicile B A
Double tax relief A →
Gains on foreign assets B A
Remittance basis B A
Residence C A
Temporary absence A
UK taxation of non-domiciled individuals B A
INCOME TAX
Trading profits
Adjustments to profits B A →
Badges of trade B A →
Capital allowances B A →
Cash basis of accounting B A →
Foreign currency transactions A
Pension contributions A →
Pre-trading expenditure A →
Patent royalties B
Owner-managed businesses
Basis of assessment – current year basis B A →
Change of accounting date A →
Commencement and cessation of trade B A →
Overlap profits B A →
Partnerships B A →
Trading losses A →
Treatment of opening year losses A →
Treatment of terminal losses A →
Employment income
Allowable deductions against employment income A →
Employment income B A →
Share schemes A
Statutory Mileage Rates Scheme A →
Taxable and exempt benefits B A →
Termination payments B
Other income/expenditure
Dividends from UK companies B A →
Enterprise Investment Scheme B
Investment income B A →
ISAs B → →
Miscellaneous income A →
Property income C B A

TOPIC
Savings income B A →
Seed Enterprise Investment Scheme B
Venture Capital Trusts B
Overseas aspects of income tax
Arising basis B A
Deemed domicile C A
Domicile C A
Income on foreign assets and income from foreign employment B A
Remittance basis B A
Residence C A
UK taxation of non-domiciled individuals B A
Income tax computation
Exempt income B A →
Gifts of assets and cash to charity B A →
Income tax liability and income tax payable B A →
Income tax charge on child benefit B →
Independent taxation and jointly owned assets B A
Income tax for trusts B
Limit on income tax reliefs A →
Married couples’ allowance and marriage allowance B A →
Pension contributions – provisions for retirement B A
Pension contributions – tax reliefs B A
Personal allowances B A →
Qualifying interest payments B →
Rates of taxation B A →
Taxable persons C A →
INHERITANCE TAX
Fundamental principles of inheritance tax
Chargeable persons A →
Chargeable property A →
Excluded property B →
Inter-spouse transfers A →
Rates of taxation A →
Related property B →
Seven-year accumulation period A →
Transfers of value A →
Trusts C B
Valuation A →
Inheritance tax on lifetime transfers
Relevant property trusts A →
Potentially exempt transfers A →
Inheritance tax on death
Death estate A →
Deeds of variation B
Lifetime transfers A →
© ICAEW 2019 133

TOPIC
Overseas aspects of inheritance tax

Deemed domicile C A
Domicile C A
Lex-situs rules A →
Reliefs and exemptions from inheritance tax B
Agricultural property relief C B
Annual exemption A →
Business property relief B A
Fall in value relief A →
Gifts to charities and political parties A →
Gifts with reservation of benefit A
Pre-earned assets
Inter-spouse transfers A →
Marriage/civil partnership exemption A →
Normal expenditure out of income A →
Quick succession relief B →
Small gifts exemption A →
Taper relief A →
NATIONAL INSURANCE CONTRIBUTIONS
Class 1
–– calculation A → →
–– directors B →
–– earnings C B →
–– employment allowance A → →
Class 1A
Class 1B B →
Class 2 A → →
Class 4
Maximum contributions C →
CORPORATION TAX
Chargeable gains
Chargeable assets C B →
Chargeable disposals C B →
Chargeable persons C B →
Chattels: wasting and non-wasting B → →
Costs of acquisition and disposal C B →
Indexation B A →
Leases A
Nil gain/nil loss transfers A →
Part disposals B →
Purchase of own shares A

TOPIC
Qualifying corporate bonds B →

Relief for capital losses A →
Reorganisations and reconstructions A
Shares and securities (including bonus and rights issues) B →
Substantial shareholding exemption C A
Trading profits
Adjustments to profits B A →
Badges of trade B A →
Capital allowances B A →
Foreign currency transactions A
Long periods of account C A →
Pension contributions B A
Patent royalties B
Taxable total profits
Chargeable gains B A →
Intangible assets B A
Loan relationships B B A
Loan relationships – corporate interest restriction A
Miscellaneous income B A →
Patent box B
Property income (including lease premiums) B A
Qualifying donations B A →
Research and development expenditure A →
Research and development tax credits B A
Trading losses B A
Trading profits B A →
Use of deficit on non-trading loan relationships B A
Corporation tax computation
Accounting periods C B A
Close companies A
Corporation tax liability B A →
Distributions B →
Diverted profits tax B
Double tax relief (including underlying tax and withholding tax) B →
Liquidation A
Provision of services through a company A
Rates of taxation B A →
Residence C B →
Tax treaties and the OECD Model Tax Convention A C
Groups
Capital gains groups B A
Change in group structure A
Change in ownership A
Consortium relief A
Controlled foreign companies A
Degrouping charges B A
© ICAEW 2019 135

TOPIC
Group loss relief B A

Group relationships A →
Non-coterminous accounting periods A
Overseas companies and branches B
Pre-acquisition gains and losses A
Related 51% group companies B A
Roll-over relief B A
Transfer of assets B A
Transfer pricing A
STAMP TAXES
Basic principles B →
Chargeable occasions B →
Exemptions B →
Stamp taxes for groups B →
VAT
Capitals goods scheme B →
Classification of supplies B →
Distinction between goods and services C →
Overseas aspects A →
Group aspects A →
Input VAT A → →
Output VAT A → →
Partial exemption B →
Payments A → →
Penalties and interest A → →
Property transactions B A
Registration and deregistration A → →
Single and multiple supplies B →
Small business reliefs A → →
Taxable person A → →
Taxable supplies A → →
Transfer of a business as a going concern A
VAT records and accounts A → →

Business Planning: Banking
BUSINESS PLANNING:
TOPIC BANKING
Banking: markets, services and products

The nature and roles of different types of banks A
The nature and roles of the financial markets within which banks operate A
The nature of derivatives and how they are traded B
Financial market instruments including those relating to foreign exchange A
Key aspects of credit risk and the operations of the credit risk function A
The nature and functions of securities products and markets A
Key securities issues for banks B
Alternative financial assets and the markets in which they operate B
Risk management
The nature of corporate governance in the banking sector A
The function and purpose of the asset-liability committee (ALCO) A
The key operational risks experienced by a bank A
The concept of risk appetite A
How a bank might manage credit risk A
How financial instruments can be used to manage different types of financial risks by clients and in
A
the context of proprietary trading by banks
How a bank might manage its own liquidity and capital risk A
Managing digital and technology risk arising in banking including automated data processing,
B
cryptocurrencies, distributed ledger technology eg, blockchain and artificial intelligence
Financial and regulatory reporting
Statement of Profit or Loss and Statement of Financial Position A
Financial assets and liabilities – IAS 32, IFRS 7, IFRS 9 A
Financial reporting treatment of derivatives A
Hedge accounting in accordance with IAS 39 and IFRS 9 A
The financial reporting treatment of impairments for banks – IFRS 9 A
Fair value measurement in accordance with IFRS 13 A
Financial statement analysis to appraise potential credit risk A
Disclosing financial instruments in accordance with IAS 32 and IFRS 7 B
The proposals of the Task Force on Climate-related Financial Disclosures (TCFD) and its
C
fundamental principles
Principal differences between IFRS and UK GAAP B
Regulatory framework A
Regulatory capital and capital management B
Comparison to previous Basel regulation B
Basel 3 Pillar 1 and 2 calculations of minimum capital requirements B
Basel 3 Pillar 3 disclosures, and bank regulatory returns B
Conduct regulation and accounting for regulatory penalties A
Audit and assurance
Practice Note 19, The Audit of Banks and Building Societies in the United Kingdom A
IAPN 1000/Practice Note 23, Special Considerations in Auditing Financial Instruments A
Impairment allowances audit procedures A
The duty and right to disclose information to FCA, PRA and BoE B
The FCA’s requirement for holding or controlling client assets as set out in The Client Assets
A
Sourcebook (CASS)
Assurance procedures with respect to a credit review A
© ICAEW 2019 137

BUSINESS PLANNING:
TOPIC BANKING
Section 166 reports (and the role of a skilled person) B

Role of assurance in the banking industry including internal audit and due diligence A
Ethics
Recognition and explanation of ethical and legal issues A
Appropriate ethical actions A
Ethical safeguards A
Ethical issues to be notified to regulators A
Ethical implications of providing audit and assurance services to a Public Interest Entity A

Business Planning: Insurance
BUSINESS PLANNING:
TOPIC INSURANCE
Insurance: markets, services and products

Principles, practices and functions of the insurance sector and its related markets A
The nature, principles and purposes of general (non) life insurance A
The nature, principles and purposes of life insurance A
The nature, principles and purposes of reinsurance contracts A
Common investment classes A
Liabilities of insurance companies including IBNR and IBNER A
The principles and models of actuarial modelling C
Risk management
The nature of corporate governance in the insurance sector A
The key risks experienced by an insurance company A
The concept of risk appetite A
Conduct risk and the customer centric perspective B
Asset and liability matching scenarios A
Financial instruments to manage risk A
Enterprise risk management A
Financial and regulatory reporting
Income Statement and Statement of Financial Position A
IFRS 4, Insurance Contracts A
IFRS 17, Insurance Contracts A
Assets and liabilities – IAS 32, IAS 39, IFRS 7, IFRS 9, FRS 103 A
Financial reporting treatment of derivatives B
Hedge accounting in accordance with IAS 39 and IFRS 9 C
Impairments in accordance with IFRS 9 and IAS 39 A
Investment property – IAS 40 B
Fair value measurement in accordance with IFRS 13 A
Disclosing financial instruments in accordance with IAS 32 and IFRS 7 C
Principal differences between IFRS and UK GAAP B
Regulatory framework A
Regulatory capital, capital management and Solvency II B
Solvency II Pillar 3 disclosures, the Solvency & Financial Condition Report B
Capital and regulatory reporting requirements for non-Solvency II firms C
Economic capital models B
Conduct regulation and accounting for regulatory penalties A
Audit and assurance
Practice Note 20, The Audit of Insurers in the United Kingdom A
IAPN 1000/Practice Note 23, Special Considerations in Auditing Financial Instruments A
ISA 540 – Audit of accounting estimates A
The review actuary B
Audit and assurance procedures for an insurer’s regulatory returns B
Audit risks and procedures in respect of MCEVs A
Regulatory and audit client asset requirements of CASS 5 C
Section 166 reports (and the role of a skilled person) B
© ICAEW 2019 139

BUSINESS PLANNING:
TOPIC INSURANCE
Ethics
Recognition and explanation of ethical and legal issues A
Appropriate ethical actions A
Ethical safeguards A
Ethical issues to be notified to regulators A

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ACA Syllabus

Audit and Assurance 32

TECHNICAL KNOWLEDGE 119

Assurance and Audit 120

THE ACA QUALIFICATION AND TECHNOLOGY

DATA ANALYTICS AUTOMATION CYBER SECURITY

15 ACCOUNTANCY, FINANCE AND

4 THE ACA QUALIFICATION: FRAMEWORK © ICAEW 2019

Financial Accounting Business Strategy

Accounting Management Information Principles of Taxation

CERTIFICATE LEVEL day-to-day work. The Business Planning and

6 THE ACA QUALIFICATION: FRAMEWORK © ICAEW 2019

UNDERSTANDING THE SYLLABUS FOR EACH MODULE

Each module aim creates a syllabus area of technical and skills-based

The Technical Knowledge Grid shows the technical knowledge in the

ACA ASSESSMENT FLEXIBILITY

SKILLS REQUIRED BY THE ACA QUALIFICATION

Understand a business or accounting situation, prioritise by

Apply professional scepticism and critical thinking to identify faults,

Concluding, Apply technical knowledge, skills and experience to support

8 THE ACA QUALIFICATION: FRAMEWORK © ICAEW 2019

Certificate Level Professional Level Advanced Level

Assimilating and using information

Understanding Objective Objective Scenarios Complex scenarios Unstructured

Identifying and Information as provided Single Several Multiple information Multiple

Structuring problems and solutions

Structuring data Specified techniques Specified Techniques Techniques inferred Unspecified

Developing Highly Specified Specified problems Specified and Defined output

Applying Objective testing Specified Specified Specified Underlying

Concluding, recommending and communicating

Communicating Prescribed exam format Exam requirements, Professional Professional report

PROFESSIONAL SKILLS ASSESSED IN THE ACA EXAMS

ASSIMILATING AND USING INFORMATION

• Demonstrate understanding • Interpret information • Identify business and

10 THE ACA QUALIFICATION: FRAMEWORK © ICAEW 2019

Structure data Develop solutions

Apply professional scepticism

Conclusions Recommendations Communication

• Apply technical knowledge • Present recommendations in • Present a basic or routine

12 THE ACA QUALIFICATION: FRAMEWORK © ICAEW 2019

SYLLABUS AREA WEIGHTING

1 Maintaining financial records 30%

14 CERTIFICATE LEVEL © ICAEW 2019

2 ADJUSTMENTS TO ACCOUNTING RECORDS

3 PREPARING FINANCIAL STATEMENTS

SYLLABUS AREA WEIGHTING

1 The concept, process and need for assurance 20%

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SYLLABUS AREA WEIGHTING

1 Business objectives and functions 15%

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In the assessment, students may be required to: 7 TECHNOLOGY

SYLLABUS AREA WEIGHTING

1 The impact of civil law on business and professional services 35%

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4 THE IMPACT OF LAW IN THE PROFESSIONAL

INFORMATION AND ITS LEGAL ENVIRONMENT

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SYLLABUS AREA WEIGHTING

1 Costing and pricing + 5 Ethics 25%

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SYLLABUS AREA WEIGHTING

Audit and Assurance 32

TECHNICAL KNOWLEDGE 119

Assurance and Audit 120