PQ magazine, September 2016

PQ magazine September 2016

www.pqmagazine.co.uk / www.pqjobs.co.uk

Crunching the numbers in the FRC’S ANNUAL REPORT

559,000 Total number of students signed up to UK accountancy bodies worldwide

28.4%

304 The fall in the total of registered audit firms as at December 2015

55/46 28,947 46% ÂŁ660.40 The percentage of students still studying accountancy after five years The total number of AAT students who are under 25

The number of CIMA students who hold a relevant degree

The average income ICAS generates per member and student

6,331 How many registered audit firms there are now, as the number continues to decline

Percentage ratio of female to male students signed up to the ACCA

22,221

The number of students worldwide who became members of one of the UK accountancy bodies in 2015

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CONTENTS

News 08FRC figures A quarter of PQs still studying after five years 10CIPFA apology Institute sorry for online exam problems 12ACCA results Study support boosts June exam pass rates Features, etc 06Mind your Ps&Qs The very best of your letters and emails 14Studying ACCA Get on the right track with the ACCA’s range of study guides 16Cover story We pick the bones out of the Financial Reporting Council’s latest annual report

18International standards

Moves are afoot to make changes to group consolidation accounting

22Coaching methods How a

new approach to coaching is paying dividends for graduates

24CIMA F2 Part two of our series

September 2016 32CIMA exams All you need to

know about grade descriptors 33ICAEW focus Two business planning modules introduced 34Careers #1 Meeting the boss need not be daunting 35Careers #2 Life at Blackpool Council; and social media bites 38Fun stuff The wacky side of life; and our great giveaways The columnists Robert Bruce It’s time to change the corporate mindset 8 Prem Sikka Why Brexit won’t change anything soon 10 Carl Lygo ACCA report offers a glimpse of the future 12 Subscribe to PQ magazine It’s FREE – see page 29 or go to www.pqmagazine.co.uk ABC July 2014 – June 2015

32,233

on long-term finance and WACC

26ACCA exam changes We

outline the changes that will take effect for September’s exams

28CIMA P1 Beat the examiner;

plus we’ve two great HTFT resit packages to give away!

30College visit PQ took a trip to

the south coast to PACA college

31CIPFA conference reports

Star speakers explain how you can make it to the top

Publisher’s statement: We send a digital issue of the magazine to an additional 8,624 requested readers Free to all accountancy students Annual subscription: £35 (£50 overseas)

Where are the women?

The FRC’s latest ‘state of accountancy’ report shows that when it comes to gender there is still a long way to go before the profession has a more equal split at some of the accountancy bodies. With 46% of its members female, the ACCA is very much leading the way. But in 2015 (the FRC’s figures cover last year) just 28% of ICAEW members were women – does that sound right to you? One area where being a woman and a qualified accountant really seems to be an advantage, however, is politics. PM Theresa May’s cabinet is now full of female accountants, who all incidentally went to their local comprehensive school. Female accountants now run education, justice, equality, women and culture in May’s new government. Elizabeth Truss is a management accountant who worked for Shell and Cable & Wireless. She is the first female Lord Chancellor and Secretary of State for Justice. Justine Greening trained with PwC before working for Centrica and GlaxoSmithKline. Her education remit has been enlarged to include universities. She apparently becomes the first education secretary to have been wholly taught at a comprehensive school. She also becomes minister for women and equalities. Finally, there is chartered accountant and chartered tax adviser Karen Bradley, who is the new Culture Secretary.

She has worked at both Deloitte and KPMG. Student debt a third of a mortgage!

Another worrying stat coming out this month was the fact that UK student loan repayments now stand at a third of a mortgage! UK students are graduating from university with an average debt of £41,000. That, says the Money Charity, is equivalent to a third of the average outstanding mortgage, which stands at £117,162. The Money Chairites CEO, Michelle Highman, said: “Normalising large quantities of debt right at the start of people’s financial independence risks setting them up to fail.”

Graham Hambly, PQ magazine editor – graham@pqaccountant.com

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PQ have your say

email graham@pqaccountant.com Shambolic CIPFA I recently passed my final two CIPFA exams and got the results on July 15. I wanted to write in to PQ magazine to highlight the pretty shambolic communication levels from CIPFA. In the past, CIPFA students have received an email from CIPFA at (or before) 9am on the morning of the results. However, this year I did not receive that email until noon.

There was no communication from CIPFA that the emails either weren’t being sent or that there was a problem with them. CIPFA HQ was not reachable on the

phone the morning of the 15th – it was probably inundated with people in the same position.

It turns out that the results had been included on a page in people’s CIPFA profile called ‘My qualification’. However, this page was only visible to click on when logging in for the first time.

Once you started navigating around (and refreshing) you could not see an obvious click to get to this page.

To compound matters the CIPFA website had no indication that it was exam results day, no guidance or updates on the situation and how to access results and no emails with similar information.

Responses from the CIPFA email address were not received until a few hours later. Overall, it was astounding to me the complete lack of communication on such an important day.

I sent a follow up email to CIPFA asking for some explanation but have not received any reply.

All this coupled with the case study being extended by an hour to compensate for poorly tested mocks and trial papers made for a disappointing end to my qualification.

Rob Ray, by email The editor says: We’ve heard lots of similar stories from CIPFA studiers, and have the results on page 31.

The writer of the star letter each month wins a fantastic PQ memory stick!

Currency review

As a regular PQ reader (I am studying overseas) I was pleased to see that the ACCA is planning to review its multi-currency pricing policy. Not before time I say, but what we need to know is how long this review will take. I don’t want to come across as too much of a moaner but didn’t I also read that CIMA has already introduced tiered pricing for its exam already? Now that would make life much easier here in Botswana. Come on ACCA – do the right thing Name and address supplied

Time to merge

I know creating partnerships is the current ‘name of the game’, but can anyone tell me what is going on in accountancy? The ACCA has a new strategic alliance with some New Zealand and Australian body, and CIMA has created an association with the Americans.

CIPFA and ICAS have created a joint qualification, and now CIMA is ‘in talks’ with both ICAS and CIPFA about offering reciprocal membership deals.

One word that no one seems to want mention is the ‘M’ word. Is the time right now for the professional to take another look at merging the profession? There are

far too many bodies – we have the ACCA, CIMA, CIPFA, ICAEW, ICAS and ICAI. Surely that’s too many chartered bodies for one small country.

It is so confusing for graduates too when they come to choose, many really don’t get proper advice

about the differences and seem to be at the whim of the their employers preference, often based on ‘who I qualified with’.

Name and address supplied

Money trouble

Wow, I now know what I want to be

when I grow up – a CEO of an accountancy body (PQ magazine, August issue, pages 12 and 20).

But where is my chief executive’s salary and mark out of 10 for our annual report? I am an ACCA PQ, by the way.

James Reeves, by email The editor says: Sorry James, but some years ago the ACCA changed its year-end, so we don’t get its integrated report and financial statement until now. It covers the year ended 31 March 2016. Your CEO Helen Brand’s salary for the year was £370,746. Both Michael Izza (ICAEW) and Anton Colella (ICAS) are paid more than her.

Watch out for next month’s issue when we will take a more in-depth look at what the ACCA produces. However, if you can’t wait and want to take a look go to http://annualreport.accaglobal.com/ uploads/docs/ACCA_Integrated_ Report_2015-16.pdf

PQ Magazine Fourth floor, Central House, 142 Central Street, London EC1V 8AR | Phone: 020 7216 6444 | Email: graham@pqaccountant.com Website: www.pqmagazine.co.uk | Editor/publisher: Graham Hambly graham@pqaccountant.com | Advertising manager: Polly Thrasivoulou polly@pqaccountant.com Associate editor: Adam Riches | Art editor: Tim Parker | Subscriptions: dom@pqaccountant.com | Contributors: Robert Bruce, Prem Sikka, Carl Lygo, Tony Kelly, Phil Gammon, Jo Daley | Origination and print services by Classified Central Media If you have any problems with delivery, or if you want to change your delivery address, please email dom@pqaccountant.com

Published by PQ Publishing © PQ Publishing 2016

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PQ news

ROBERT BRUCE It’s time to change corporate mindsets Corporate culture is the easiest thing in the world to bang on about.

Everyone knows that the way it is approached in the UK is probably the most effective way of doing it. Yet every time an egregious corporate failing comes to light it is the culture which gets it across the back of the head with a baseball bat.

The latest report from the Financial Reporting Council, on corporate culture and the role of boards, is a good example. It is packed with insights from its underlying research and examples of how it ought to be done. But culture takes years to change. And what it really requires is a different mindset within companies.

Too often the existing corporate culture mitigates against this.

Successful folk with large pay packets inevitably become imbued with the status quo. For me the best pithy comment on the topic comes in a report produced in tandem with that of the FRC from consultants Independent Audit who carried out the underlying research for the FRC report. It comes from Ian Durant, the chairman of Greggs, the purveyor of sausage rolls to the masses. It is in a section dealing with how board members, non-executive directors and audit committees can get in touch with the real thoughts and insights of employees. Durant puts his finger on it. “There’s no substitute for talking to a delivery driver in South Wales at 2am on a cold wet morning,” he says.

That should be emblazoned across any boardroom door.

Robert Bruce is an award-winning writer on accountancy for The Times

STILL STUDYING FIVE YEARS ON PQ magazine

EXCLUSIVE Over one in four trainees are still ‘at it’ five years after they started their journey to obtain a professional

accountancy qualification, according to latest figures from the Financial Reporting Council. That means there are nearly 160,000 PQs who are still studying with one of the UK-based accountancy bodies half a decade later.

The figures, based on 2015 data, show the ACCA has the bulk of

TIME REGISTERED AS A PQ IN YEARS <1 1>2 2>3 3>4 4>5 5+ TOTAL

ACCA 81,289 62,182 48,634 40,969 36,084 119,478 388,636

CIMA 30,023 26,729 16,843 11,424 7,563 33,181 125,763

CIPFA 862 1,289 709 191 108 602 3,779

ICAEW 7,829 6,093 4,854 3,891 1,003 479 24,149

CAI 1,452 1,410 1,232 1,034 445 1,054 6,627

ICAS 987 861 689 476 242 111 3,366

North West CIPFA Student Network has a new executive committee. The new president is Jennifer Pope (see Life at… on page 35). Also elected were Liga Berzina, Naomi Jackson and Ben Haydon. To find out more about joining the NW CSN just email NorthWestStudent @cipfa.org

these trainees, with nigh on 120,000 PQs still registered with them five years after starting their studies. That is 31% of the total number of students signed up to the ACCA. CIMA has in recent years managed to get its five-year-plus percentage down. It currently stands at 26%, but that still amounts to 33,181 PQs. CIPFA also appears to have been working hard to reduce the time its students take to qualify. Last year the number of trainees who had been studying over five years stood at 25.6%. The latest FRC data show this figure is now down to 16.4%, which is very similar to the Irish Institute’s 16%.

The ICAEW and ICAS don’t have this problem. The ICAEW has a mere 1.9% of its students still signed up as trainees after five years. ICAS has slightly more with 3.3%.

ATT results in

The Association of Taxation Technicians results for May are out.

In all, some 1,878 papers were sat and 1,193 passes achieved.

The Business Compliance paper had the biggest pass rate this time around, with 91% passing. The pass rates in two papers, Business Taxation & Accounting Principles and Inheritance Tax, Trust & Estate, were the same at a healthy 78%.

The only paper where sitters seemed to struggle was Personal Tax, which had a pass rate of 44%.

CIMA ‘in discussions’ with CIPFA and ICAS CIMA has announced it is in discussion with both CIPFA and ICAS about offering their members a route to CIMA membership and the Chartered Global Management Accountant designation.

Looking ahead, CIMA said it is discussing with CIPFA how they can co-operate to strengthen public sector financial management.

In a short press release, CIMA said further details are expected to be available later in the year.

qualification while not necessarily wishing to qualify as a chartered accountant.

in accordance with IFRS, but with reduced disclosures. The FRC has now issued FRED 65 for public consultation to eliminate the administrative burdens of IFRS 15.

Questions will surely now arise as to whether this could be a precursor to more formal talks about unifying the profession.

This coming together has been ‘off’ the agenda for nearly two decades now!

In brief New AAT provider Oxfordshire-based Vale Financial Training is launching AAT courses in September. Director Liz Hulls (pictured with fellow director Jo Tuffill) explained Vale Financial Training is the only Platinum-rated ACCA training course provider in the county, working with 80 employers and 200 PQs. She felt the new AAT courses will enable Vale to reach out to staff working in financial roles who may be looking to achieve a professional 8

Further changes to FRC 101 The FRC has issued limited amendments to FRS 101, which predominately provide exemptions from many of the disclosure requirements of IFRS 15 Revenue from Contracts with Customers. FRS 101 is an optional standard that allows entities within groups to prepare financial statements

Don’t get 49%!

Open Tuition’s P7 noticeboard showed that many ACCA candidates are failing by just one percentage point. Several students only managed 49% in the June exam, and felt it was ‘so cruel’ they had failed. Another student was more lucky, registering 50% with

the markers. Like many it was his fourth attempt at P7, and his 50% followed marks of 46, 38 and 48.

CIPFA/EY ‘game-changer’ A new partnership to produce fully compliant accounts for local authorities has been unveiled by CIPFA and EY. The Assured Managed Services offering draws on CIPFA’s expertise as the official standard-setting body for the sector and EY’s extensive experience in monthly reporting and accounts closedown for companies.

PQ Magazine September 2016

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PQ news

PREM SIKKA Brexit won’t result in rapid change With over 23,000 EU laws and directives, the UK faces considerable challenges in disentangling its legal system from the EU’s. In the era of globalisation, crafting UK specific laws on money laundering, data protection, competition, financial services and consumer rights is likely to be extremely difficult. A pragmatic approach would be to retain current laws and modify them gradually. This would pose ideological problems as the thrust of the arguments against remaining in the EU was that UK needs its own specific legislation.

UK companies trading with the EU will still need to comply with the EU directives on consumer rights, product safety and environmental protection.

So the influence of the EU will remain.

The UK is likely to continue to use IFRSs but local scandals will increase pressures for variations. The UK has grudgingly accepted EU attempts to restrain the sale of non-auditing services by auditors to audit clients.

The exit may comfort the auditing industry, but international developments cannot be ignored as UK financial statements need to be acceptable in other countries.

On tax matters, the ruling Conservative Party has sought to make the UK a tax haven. Of course, any special tax deals can be construed as state aid and may fall foul of the EU treaties which would give the UK access to European markets.

The EU exit has created new politics which many will be watching with considerable interest.

Prem Sikka is professor of accountancy at the University of Essex

CIPFA says sorry to its students CIPFA’s introduction of online exams did not go as smoothly as it had hoped, and director of learning Giles Orr made a very big public apology to delegates at the CIPFA student conference in Manchester.

He stressed that while the majority of summer sitters had no problems with the new online exams not everyone had the same experience. He said sorry to students, employers and their families for the stress they were put through.

In the run-up to the first online session some issues had emerged from the pilot. Orr explained CIPFA tried to make some quick changes and fixes. This created the first big

problem – lack of communication.

The email process is far from perfect and some emails with key information went unread. Orr didn’t blame students for this and agreed that there was confusion when students contacted the institute for support. Some emails were also not

3 the magic number Three is still the magic number for the number of sitters was low the ICAEW professional students who pass rates were 91.2% and 87.5% want to pass their exams, according respectively. to the latest June results. The ACA students also excelled in Tax highest pass rates this summer Compliance (88%) and Business were achieved by PQs who had Strategy (89%). opted to sit three exam papers – PwC dominated the list of prize 79.4%. winners, picking up six of the nine In comparison, just 71.9% of available prizes. The firm’s Mihir trainees sitting one paper passed.

Patel came top in both the Audit & What not to do is sit four papers.

Assurance and Financial Three PQs decided this was the Accounting papers in June. right number.

ICAEW PROFESSIONAL EXAM RESULTS While one student June 16 March 16 passed all four papers the Audit & Assurance 82.7% 80.9% other two candidates FA & Reporting 83.5% 87.4% failed all four!

Tax Compliance 88.0% 82.8% June saw the first Business Planning: Banking 91.0% – sitting of the new Business Planning: Insurance 87.5% – Business Planning: Business Planning: Tax 78.0% – Banking and Business Business Strategy 89.0% 90.3% Planning: Insurance Financial Management 78.8% 84.9% modules, and although

KPMG appoints Head of Brexit Following the EU referendum, KPMG has appointed its own ‘Head of Brexit’, in the form of Karen Briggs. She said that dialogue with clients showed that they need expert support on mitigating the risks and taking advantage of the opportunities that arise from a Brexit. KPMG has been using a 2:2:2 model: “We have been advising our clients to consider the next two weeks, two months and two years to assess the path ahead.”

New service for SMEs Deloitte is investing £2.5m to launch Propel by Deloitte, a cloud-based service that aims to 10

Giles Orr

help ambitious start-ups and SMEs to grow.

Alongside a core accounting service, Propel provides customers with a bespoke dashboard that gives a real-time view of how their business is performing, from a cash position to web traffic. Customers receive a full bookkeeping and accounting service on a monthly subscription. The company’s data is then fed into a bespoke Propel dashboard to give a realtime view of their financial performance.

EY unveils 62 new partners EY has appointed 62 equity partners to its UK business. Some 33 of these are internal promotions, with another 29 direct entry partners from its competitors and industry. EY chairman Steve Varley explained: “Of the 62

responded to at all.

The pilot practice papers were also taken down too soon and there were problems with the online proctoring. CIPFA even flew someone to the US to try to sort this problem out and brought in additional resources.

Students’ worry now is that things will not be better come September.

“We are in July, so how confident are you all these bugs will be sorted

by September?” asked one PQ. Other PQs told of crashing screens and not being able to submit their exams properly. One explained that there wasn’t a form to fill in tell the institute that things had gone wrong. “It wasn’t the time for the special consideration form!”

Another student said she should not have had to travel to Manchester to receive her first apology. She said: “With better communication there is a lot that you would be forgiven for.”

Tilley quits as CIMA’s CEO Charles Tilley has announced he is stepping down as CEO of CIMA. After 15 years at the helm Tilley is quitting to become the executive chairman of the CGMA Research Foundation. Tilley (pictured) is leaving just weeks after CIMA and the AICPA announced the creation of the groundbreaking Association.

MD Andrew Harding became CIMA CEO on 9 August. He will then become the first CEO of the new 'CGMA Unit' of the Association, in January 2017.

Harding said: “I am delighted to be leading CIMA and the new CGMA Unit – and look forward to working with our members, partners and students across the world in forging the new association.”

partners appointed over the last year 29% (just one point shy of the firm’s 30% rolling target) are women and 15% are from a black and minority ethnic (BME) background – exceeding EY’s 10% target.”

HMRC defeats tax scheme HMRC has defeated a tax avoidance scheme used by brewery Greene King plc, protecting around £30m in tax. The scheme, involving loans between group companies, was marketed by Ernst & Young in 2003 to the brewery and other large groups. The idea was for one company in a group to get tax relief on interest paid to another group company without that other company paying tax on the income it received.

PQ Magazine September 2016

Good Luck to all ACCA students sitting exams from the 5 â&#x20AC;&#x201C; 9 September!

EXAM TIP: Read each question carefully â&#x20AC;&#x201C; underline keywords and verbs to ensure that you answer correctly and to the point.

learningcommunity.accaglobal.com

PQ news

CARL LYGO ACCA’s glimpse into the future

Landing in my in-tray this month was a weighty piece of research from the ACCA looking at the future dynamics of the accountancy profession 20162025. It is worth a read to prepare you for what skills are most likely to be in demand over the next decade.

The main drivers for change are increased regulation and governance, the spread of digital technologies, changing expectations of professional advice and continued globalisation.

The report surveyed over 2,000 accountants from around the world, and some 55% felt that the development of intelligent automated accounting systems would have the greatest impact on the accounting profession within the next 10 years.

Knowledge of digital technologies tops the list of competency areas where professional accountants believe there are key skills gaps. The accounting profession is being reshaped by trends in digital technologies. Smart software and systems are replacing manual bookkeeping and accounting work (such as financial close). Smart software and analytics will enable more, better and closer to real time reporting, supporting the transition from retrospective to predictive analysis. Don’t worry about your job being totally replaced by robots though; fortunately the report concludes that the “global need for professional accountants is expected to increase”.

The full report is available on ACCA’s website.

Professor Carl Lygo is chief executive of BPP

Study support boosts June exam pass rates

The ACCA believes that the study support it now offers its PQs is finally paying off, with small increases in the pass rates.

The June results show improvements in a number of papers. The P5 pass rate jumped from 33% in March to 38% this time around. June sitters had been ‘confused’ as many believed the examiner had been changed. The questions seemed uncomplicated and even ‘decent’. The pass rates in both F8 and F9 were also much healthier this June. PQs had told us they were generally ‘happy’ with F8 and felt F9 was ‘not a bad paper’.

There was, however, a drop in the F7 pass rate, from 51% to 47%.

ACCA’s director of Learning,

ACCA EXAM RESULTS JUNE 2016 – WORLDWIDE?????

Jun 16 Mar 16 39% F5 Performance Management 41% F6 Taxation 46% 44% F7 Financial Reporting 47% 51% F8 Audit & Assurance 45% 41% F9 Financial Managem’t 46% 41% P1 Professional Accountant 48% 50% P2 Corporate Reporting 46% 47% P3 Business Analysis 48% 48% P4 Adv Financial Managem’t 40% 38% P5 Adv Performance Managem’t 38% 33% P6 Adv Taxation 35% 44% P7 Adv Audit & Assurance 32% 30%

Mary Bishop, said: “We believe that, increasingly, more students are using the study support materials we have introduced to help them prepare and succeed at

12

these exams.” Some 140,642 students entered the June exams, with 198,144 papers sat. The session saw 6,128 students globally complete their final exams.

Open Tuition offering free courses for CIMA’s OTs

Open Tuition is now offering free online courses for the CIMA objective tests. It is offering all the papers except F3, which will go live in a few months time. Case study material should also be available before the end of the year.

Students can download CIMA

notes, watch lectures and have access to online multiple-choice tests, all for free. There is even an ‘ask the tutor’ forum on the site.

Open Tuition also recommends all students buy the Kaplan official texts. MD John Moffat said: “We

HLC changes name to Avado

Leading online financial training provider Home Learning College has a new name – AVADO. The rebrand brings together their AAT and ACCA qualifications under a single award-winning campus, serving both individuals and businesses.

Chris Simpson, managing director of AVADO Accounting and

Finance, told PQ magazine: “We take each syllabus and re-imagine it for the most engaging online learning experience possible, building powerful tracking, live online classes and personalised tutor support into the journey.

“Our new name better reflects our global ambitions and world class learning delivery.”

P7 PQs are ill-prepared, says examiner Too many ACCA P7 sitters are just not properly prepared for the exam, says the examiner in the latest examiner’s report.

Overall, the June exam performance was ‘disappointing’ (32% pass rate), and the examiner felt that too many candidates want to focus on the minutiae of a point, which means they often miss wider implications of the issue at hand.

There was also a clear lack of both auditing and financial reporting knowledge.

Dec 15 41% 53% 45% 46% 45% 47% 47% 47% 35% 29% 42% 39%

Specific areas which meant a student failed, included: • Writing out or simply restating facts from the question with little or no development.

• Not answering the question set.

• Quoting accounting standards without applying them.

• Using vague phases like ‘perform analytical procedures’, ‘check the relevant documentation’, ‘in accordance with the relevant standard’, which do not earn marks unless the point is developed.

• Obvious lack of accounting knowledge – an error cannot simultaneously overstate assets and understate profits, for example.

All the June examiner reports are now available on the ACCA website.

are delighted to offer free study materials for CIMA exams. At Open Tuition we believe that all students should have access to high-quality professional tuition irrespective of their location or their financial circumstances.”

• Open Tuition has been recognised by CIMA as an official Learning Partner.

Average CIMA salary is £33,638 The average salary for a CIMA PQ is £33,638, according to CIMA’s annual salary survey. Students working in the legal sector are paid the highest average pay packet, at £42,603. Next are the banking (usually #1) and education sectors.

The results also reveal that the average earnings among qualified members reached £64,011 in 2016, an increase of 1.95%. It appears both PQs and members in the UK are positive about their continued salary development. Some 95% of students are anticipating a salary increase of on average 6% over the next 12 months. Members (94%) think they will be getting a rise of about 4%.

On top of base salaries, 55% of CIMA PQs also receive a bonus, which on average amounted to 8% of their annual salary.

PQ Magazine September 2016

Start to be great.

A bright future starts with a smart decision.

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PQ studying for ACCA

HELP YOURSELF Studying accountancy is a journey, so get on the right track with ACCA self-study guides

A

n updated suite of self-study guides to help students through the ACCA qualification is now available on ACCA’s website. And ACCA has also refreshed its Learning Community with a new brand style update and new features – see https:// learningcommunity.accaglobal.com.

ACCA has recently launched updated guides which, reflecting ACCA’s move to four exam sittings a year, are for students sitting exams in September and December 2016 and March and June 2017. ACCA students now have a full range of self-study support from Fundamentals Level through to Professional Level.

Alison McHugh, Director of Education Development ACCA, explained: “These guides give our students a structured and phased approach if they are self-studying for their exams. They offer tips for success, signpost and explain how to use support resources, and include interactive clickable checklists to help keep students on track.”

ACCA regularly reviews the guides to ensure they are up-to-date and relevant. They are

accessible online or can be printed in PDF format, and can also be used by students studying with an education provider as an additional support resource.

McHugh said: “We are committed to giving our students the support they need to succeed, regardless of how they choose to study to become an ACCA professional accountant.

“The update to ACCA’s online Learning Community is one example of this commitment to help students on their ACCA journey to success. Students now receive personalised updates of activity within the Community, and they can take part in polls which gather relevant up-to-the minute views and feedback. And by moving part of the support function in-house, students’ queries will be dealt with more quickly and efficiently.”

She added: “We offer a range of resources to support students and we are always looking to improve these, taking into account the feedback we receive from students. As well as the selfstudy guides, other recent initiatives include live web chat events on the ACCA Learning Community, Study Schools in conjunction with Becker Professional Education and support resources for P3 and P5 designed to address specific challenges which students sitting these exams face.

“We encourage students to keep checking ACCA’s website and Student Accountant for updates on what is available.” PQ ACCA’s Exam Support Resources are available on ACCA’s website: • http://www.accaglobal.com/gb/en/ student/exam-support-resources.html Self-study guides can be found here: • http://www.accaglobal.com/gb/en/ student/your-study-options/choosing-to-selfstudy.html ACCA’s Learning Community is at: • https://learningcommunity. accaglobal.com.

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14

PQ Magazine September 2016

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PQ state of accountancy

KEY FACT AND TRENDS

We take a look at the Financial Reporting Council’s annual report on the state of the accountancy profession

T

he UK may have reached a hiatus when it comes to number of students studying for accountancy qualifications.

The latest Financial Reporting Council report, ‘Key facts and Trends in the Accountancy Profession’, shows that student numbers have declined in the UK and Ireland in the past two years.

From 2014 to 2015, the decline has been 1.8%.

That said, the FRC stresses that the profession continues to remain attractive, and points to the fact that student numbers worldwide are still growing.

In total, there were 163,000 students studying with the accountancy bodies in UK and ROI, and over 559,000 worldwide (at 31 December 2015).

ACCA has by far the most students in the UK and Ireland, with 81,460 – its numbers have fallen year-on-year by 2.1%.

However, of the major players it was CIMA who saw the biggest drop in student sign-ups in the UK and Ireland.

At the end of 2015 it had 51,677 registered trainees, a fall of 5.5% on 2014. CIMA’s annual report (see last month’s issue) acknowledged that the revised syllabus and new assessment platform had had a profound impact on its business model.

CIPFA also saw a drop in student numbers in the UK, but growth overseas more than matched any drop here.

The big winners, when it comes to growth, were ICAS and ICAEW with 9.5% and 8.7% respectively for the year. ICAS now has 3,350 students and the ICAEW 18,165 based in the UK and Ireland.

Bring on the women The number of female students rose ever-so-slightly in 2015. The total worldwide for all the bodies is now 49%.

The ACCA continues to attract most women and its percentage is now a healthy 54%. CIPFA mirrors the average of 49%. There is then a drop to CIMA where 46% of its PQs are female. This is up two percentage points on 2014.

The ICAEW and ICAS still lag some way behind the rest, at 42% and 41% respectively. This means ICAS now has the dubious honour of being the least attractive professional body for women!

These figures obviously affect female membership numbers. Some 46% of 16

ACCA members are women. The Irish Institute is next on the list with 40%.

CIMA, CIPFA and ICAS all have a one to three female-to-male membership ratio.

ICAEW membership is slowly moving in the right direction but currently just 28% of its members are female.

A question of degrees ICAS wins when it comes to the number of students holding a degree, with 96%.

This is some way ahead of the ICAEW (76%). Just over half of CIMAs (53%) and ACCAs (51%) also have a degree before they start studying for their accountancy qualifications. Just 47% of CIPFAs come into training with a degree.

However, if you are looking for an accountancy student with a relevant degree then you should go to CIMA, as 46% of students hold one. Just one in four of the rest hold a relevant degree – 23% of ICAEW students have one when they start their training contract.

The AAT For the first time information from the AAT has been included in the report. We discover the AAT has 47,997 members and 74,498 students in the UK and Ireland. Student number increased by 4.3% in the UK and Ireland between 2014 and 2015. The figures also show that nearly 70% of students were younger

than 34 years, with some 29,000 students under 25.

Average income The FRC also worked out the average income per member and student each body receives. ICAS squeezes a whopping £660.40 from each member and student. This is closely followed by the Irish Institute, which manages £575.40. Then it’s the ICAEW with income of £485.60 and CIPFA with £413.30. The average income per member and student at the ACCA is £298.90 and at CIMA it’s £206.40.

Audit regulation Turning to the audit, the report found that despite changes more listed companies outside of the FTSE 350 were being audited by the Big 4 in 2015 than in previous years. A worry will also be the fact that the number of registered audit firms continues to decline gradually, with a fall of 304 firms (4.6%) since December 2014. More than 50% of registered audit firms are now sole practitioners, however the number of sole practitioners also fell during 2015 by 6.4%. PQ • The FRC’s fourteenth edition of ‘Key Facts and Trends in the Accountancy Profession’ was published on 29 June 2016 PQ Magazine September 2016

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PQ international standards

BUSINESS COMBINATIONS: ALL YOU NEED TO KNOW

I

love YouTube. And if I am honest I always use Google for my searches.

The reason that I mention these two together is that they both belong to the same entity Alphabet, which is the newish name for the Google group ultimate parent. It is a quirk of financial reporting that the brand YouTube is recognised on the group balance sheet but the more valuable brand Google is not. This is because only purchased intangibles are recognised. The brand YouTube was purchased as part of the acquisition of YouTube Inc in 2006 and of course the brand Google was internally developed.

This brings me to the news. The IASB is deliberating on feedback on current group consolidation accounting. The last sizable shake up was in 2008 when full and partial goodwill was introduced into IFRS 3. While it is recognised that the 2008 improvements to IFRS 3 Business Combinations were significant, the feedback from the Post Implementation Review (PIR) reads like a shopping list of failings from a ‘could do better’ school report.

First up is a criticism of the separation of intangibles from goodwill. The brand YouTube was separated from the goodwill during the 2006 acquisition. But the feedback questions the meaningfulness of this distinction. Intangible recognition recognises the customer loyalty to the brand and goodwill recognition recognises customer loyalty to the entity.

You can see why commentators argue that the difference is so small as to make no difference.

Next up is a criticism of definition of a ‘business’ in IFRS 3. A business combination requires the calculation of goodwill to recognise the fair value of the customer loyalty and an asset purchase does not. IFRS 3 defines a business as an entity that has inputs and processes and outputs. An asset is just an asset.

But the feedback is that it can be difficult

18

Martin Jones looks at IASB moves to make changes to group consolidation accounting

• Martin Jones lectures at LSBF

to make this distinction work in real life transactions.

Then the feedback criticised the accounting for contingent liabilities under a business combination. This requires that a contingent liability must be measured at fair value in an acquisition (IFRS 3). Other contingent liabilities are carried at full value or zero value depending upon a probable/possible analysis (IAS 37). This inconsistency has already been dealt with in this column under the heading ‘Contingent Liability Inconsistency’ and is clearly a thorn for other commentators.

Contingent consideration is also addressed. This like everything in an acquisition is measured at fair value but the feedback was that it is really devilishly difficult to derive a fair value for share consideration that may flow five years into the future if uncertain criteria are fulfilled.

Criticism of fair value continued in commentary on organic growth. It is currently difficult to compare a group that has grown through organic growth with one that has grown through acquisitions as the acquisitive group will inevitably have a bigger balance sheet from the fair value measurement of the incoming subs.

Interestingly, amortisation of goodwill raised its head. I thought this idea was long dead but some commentators still believe that amortisation has logic founded in the idea that purchased goodwill is steadily replaced by inherent goodwill through the customer relations fostered by the sub under the guidance of the parent. You could make a persuasive argument that the goodwill that we all feel for YouTube in 2016 is more to do with the parent management since acquisition in 2006 than the original management from before acquisition.

And, lastly, commentators criticised the choice between full and partial goodwill.

This drives me nuts and I would put this way out ahead in first place as my number-one criticism of IFRS 3. Under current rules groups can value NCI either at fair value (full goodwill) or at NCI proportion of net assets (partial goodwill).

Groups are generally plumping for full goodwill, but clearly the choice gives the potential for inconsistency. But even worse, IFRS 3 allows full or partial goodwill on a transaction by transaction basis. This means two acquisitions in the same group on the same day could be measured using different methods. I do not know of any group actually doing this but this really highlights the craziness of the choice. However, commentators generally placed criticisms of the choice lower down on their list of criticisms. I guess the difference is that I am a teacher and in exam questions there is always NCI but in real life NCI is actually quite rare. PQ

PQ Magazine September 2016

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LSBU believes coaching is key to the success of its students.

Here it explains why

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fficient design and manipulation of spreadsheets sits prominently at the forefront of the key skills required by accountants. Indeed, so important is it that the ICAEW have launched a Spreadsheet Competency Framework. These and many other core skills are prerequisite for candidates entering the current job market. So would it not be useful for students to arm themselves and prepare, become battle ready and focused on the list of core competencies they need to succeed?

The ACCA has also recognised the importance of future proofing, capturing and building on these essential skills with their research campaign, called the Talent Equation. According to ACCAglobal.com, this is to “assess and address the critical talent challenges that organisations – and their finance leaders – now face in ensuring that they attract, train and retain the next generation of finance professionals”.

Arguably, the definitive list of competencies will vary between being measurable characteristics related to success at work, taking the form of behavioral and technical skills and including attributes and attitude.

According to the CBI/Pearson Education and Skills Survey published July 2016, 87% of employers surveyed said the key factors considered when recruiting graduates were attitude and aptitude for work. How can these skills be ‘taught’, or rather nurtured?

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The value of the competence test

mindset of future goals and how they can be achieved, underpinning the LSBU mission statement: ‘Become what you want to be’.

Using this information students are equipped to become more focused on following a career pathway that supports and enables them to live by their values, and so get greater fulfilment out of their career. Essentially, LSBU aims to produce

A QUICK LOOK AT...

Capital gains tax for an individual: Current year capital losses for an individual are automatically offset against current year capital gains. Capital losses brought forward are then offset before the application of the annual exempt amount (AEA), which, for 2015/16, is £11,100.

However, capital losses brought forward are restricted to preserve the use of the AEA. This preserves capital losses to be carried forward and set against capital gains in future tax years, rather than wasting the AEA. Trading loss relief against capital gains: As well as considering the offset of capital losses, there are circumstances in which a trading loss 22

a new breed of student, with a greater capacity for higher learning, engagement and contribution to wider society.

As the first university to embed the use of coaching as a tool to enable students to gain greater clarity of where they are now, their options, goals and pathways to achieving them LSBU is at the cutting edge. Watch this space! PQ • Thanks to LSBU for this article

Capital gains and losses

incurred by an individual may be offset against capital gains. If a claim is made under s.64 to offset a trading loss against general income, in the year of the loss or the preceding tax year, that claim may be extended to offset the remaining trading loss as a capital loss against capital gains in that same tax year in which a s.64 claim is made.

Corporation tax: Chargeable gains are offset by both current year and brought forward capital losses, without restriction, and the net gain is then included as part of taxable total profits for a company.

A loss relief claim in the accounting period or group relief may offset this gain, but as part of

the overall total profits, depending on the relief, against which the loss relief is set.

Group definitions: Be clear of the definition of a gains group which requires a 75% direct shareholding and a 50% indirect holding.

Within a gains group the transfer of chargeable gains or losses between companies can allow matching of these items. However, this possibility becomes less relevant from FY15 as the corporation tax rates align at 20%.

• Cath Hall is an AIA Achieve e-tutor. The AIA Achieve team is producing a series of ‘A Quick Look at….’ articles and more can be found on the AIA website: www.aiaworldwide.com/ a-quick-look-at.

PQ Magazine September 2016

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PQ CIMA F2

Playing the long game

In the second of his series of articles focusing on the long-term finance and WACC section of the F2 syllabus, John Sharratt investigates further the cost of debt calculation. See next month’s PQ for the final instalment

T

he costs of debt or equity are considered when the entity is trying to raise finance. Olympic organising bodies may require finance to help build a new Olympic stadium or a new velodrome for the cycling event. Financing could be used to help set up a new small business selling drinks, sun tan lotion, and union jack flags to the travelling sporting fans outside the various sporting arenas.

Deciding the best method of raising financing for your business is a complicated decision. Do you want to give up control of your investment by issuing shares? Do you want to saddle your business with large compulsory annual repayments of interest? How obtainable is the finance and will it raise enough capital for your company’s needs? Which method is the cheapest?

The kd and ke calculations can be used to determine how expensive a chosen method of finance may be. This could be one of the deciding factors when determining the suitable method of finance for your entity. It is also used within the assessment of the overall weighted average cost of capital (WACC) calculation used in investment appraisal decisions.

Cost of debt A company may choose to raise finance through debt.

They could source the debt from banks – via loans.

They could source the debt from other companies – via the issue of debentures, loan stock and bonds.

This market place can be confusing as loans and debentures can have different rates of minimum interest repayments (known as the coupon rate), different repayment terms with some being repayable (also known as redeemable) at par, some repayable with a premium, some issued at below par value (issued with a discount), and some incorporating different levels of issue costs.

What directors will really want to know is “how much is the loan actually going to cost me?”

The cost of debt allows an assessment of the overall % cost of the debt finance.

*IMPORTANT POINT* What is the main “cost” of debt? What do you have to repay for the banks to be happy lending the capital to your company?

Answer – interest.

Interest is tax deductible. This means, when an entity incurs finance costs, the finance costs will reduce taxable profits and reduce the entity’s tax bill.

As a result, cost of debt is always calculated with consideration of post-tax interest cash flows.

Back to our perpetuity calculations The kd is just a riff on the perpetuity calculations discussed in the first of this series of articles. The cash flows where debt is concerned are interest. kd is calculated differently for: Bank loans: kd = r(1–T) Long term redeemable or irredeemable debt: kd = i(1–T) Po Redeemable debt: IRR calculations Where: kd = cost of debt i = interest paid each year (using coupon rate) T = marginal tax rate Po= ex int market price of the loan (ex int = AFTER interest paid) My mantra when dealing with kd calculations is similar to that of a Chinese gymnastics instructor: “Practise, Practise, Practise” but with less implied threat of violence. The more questions attempted will breed confidence that your answers are correct.

Here are a couple of example questions on this topic area to help with your practice.

24

Example kd questions Q1) Cost of debt for long dated/irredeemable bonds BOLT has in issue £125 million of long-dated bonds issued at par with a coupon rate of 15%. The ex interest market price of the bond is $96.

The corporate income tax rate is 30%.

Calculate the kd of the long dated bonds giving your answer to one decimal place Answer Q1 = 10.9% Technique Q1: Long dated bonds are considered the same as irredeemable bonds for cost of debt purposes. Remember, cost of debt considers interest post tax.

Therefore, to calculate kd: kd = i(1-T)/Po kd = 15 (1 – 0.3) 96 kd = 10.9% Q2) Cost of debt for long dated/irredeemable bonds COE has in issue some long-dated bonds and has a post-tax cost of debt of 8.4%. The bonds are currently trading at $92 per $100 nominal.

COE pays corporate income tax at a rate of 19%.

Calculate the interest rate of the long-dated bonds. Give your answer to two decimal places Answer Q2 = Interest rate = 9.54% Technique Q2: Questions may require the kd formula to calculate figures other than the cost of debt. Long dated bonds are considered the same as irredeemable bonds for cost of debt purposes.

Therefore kd = i(1–T)/Po Rearranging the equation gives: kd x Po = i(1-T) i = kd x Po / (1-T) i = (0.084 x 92) / (1-0.19) i = 9.54% Q3) Cost of debt for redeemable bonds RIO has issued some 4% $100 loan notes, which are redeemable in five years’ time at a premium of 5%. The current market value of the loan notes is $96 ex interest. Corporation tax is paid at 28%.

Calculate RIO’s cost of debt to one decimal place. Use discount factors of 5% and 10% in your calculations.

Answer Q3 = 4.7% Technique Q3: To work out the cost of debt for redeemable bonds (the type with capital repayments within a relatively short time frame as well as annual interest repayments) a net present value calculation for the cash flows associated with the loan, will be performed using two discount rates.

In this case that is specified as 5% and 10%.

Remember, interest is always considered post tax.

Year 0 1–5 5

Cash flow -96 4 x (1 – 0.28) = 2.88 105

Discount factor at 5% 1

Present value

Discount factor at 10%

-96.000

1

4.329

12.468

3.791

0.784

82.320

0.621

NPV

Present value -96.000 10.918 65.205

–––––

–––––

-1.212

-19.877

Once the net present value using each discount rate has been calculated an IRR calculation will be completed to work out the cost of debt.

This uses IRR = r1 + (NPV1/(NPV1–NPV2) NPV1 kd = r1 + x (r2-r1) NPV1 – NPV2 Where: r1 = lower discount rate r2 = higher discount rate Using IRR: IRR = 5% + [-1.212 / (-1.212 + 19.877) x (10%-5%) = 4.7%

PQ

PQ Magazine September 2016

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CIPFA

PQ ACCA exam update Papers F5-P7 Overview: As is usual, ACCA has updated its syllabuses after the end of the June 2016 examination session, meaning there are some changes that kick in from the September sitting onwards. In addition, there are also some changes to examination paper structure on some Fundamental level papers, specifically F5 through to F9.

Before I go into the detail, let me make one thing very clear – the core content of each exam paper is not changing very much, and there is no problem at all in students continuing to practise past exam questions from recent sittings. Changes to exam structure are not designed to change the nature of your exam preparation or learning, and practising old questions that are for a different amount of marks, or in slightly different formats, is not going to do you any harm.

Changes affecting every paper from F5 to P7 Reading time: The 15-minute reading time is now simply 15 minutes of additional exam time, to be used however you wish. Students who wish to start writing answers can do so from the start – but any experienced tutor will tell you that 15 minutes (at least!) of planning time remains a very sensible tactic. This helps to ensure longer questions in particular are fully understood in terms of requirements, before getting into the detail of the scenarios.

Papers F5 to F9 Exam paper structure: The amount of MCQs on every paper is increasing. F5, F6, F7, and F9 all move to having 60 MCQ marks, with 30 MCQ questions worth two marks each. Half of the MCQ will be individual questions with the other half centred on scenarios, with five MCQ per scenario.

The F8 paper will also have 30 marks of MCQ centred on these scenario questions, with five two-mark MCQ per scenario, but the rest of the marks on F8 will be traditional long questions requiring written answers.

The increase in MCQ is likely to make the exams feel easier, especially for those students who are not fans of writing lots of sentences, although whether it will help push pass rates up is yet to be seen. The scenario MCQs will of course require students to read rather more than traditional shorter MCQ, and find the relevant information, but it should be possible (in noncomputational MCQ) to get to answers more quickly than longer questions where writing is involved.

Another interesting move is that the long questions on papers F5-F9 are now more predictable, with each syllabus spelling out what topics the long questions are likely to be on (see below for more detail on a paper-by-paper basis). This should assist greatly in knowing what exam techniques to practise for each paper, and should also assist the pass rates in each case (as long as you do the necessary practice in advance of course!).

The ACCA has produced a specimen exam paper in the new format for each paper and these can be found in the Exam Support Resources section of the accaglobal website.

Every student should take a look at these to 26

CHANGES A LSBF’s Paul Merison outlines the changes to the ACCA exams that kick in for the September exam diet. So how will it all affect you?

help get familiar with the new style of MCQ questions in particular.

F5 The two long questions on F5, totalling 40 marks, will be on the following topics: • Decision making.

• Budgets and control.

• Performance measurement and control.

The only notable addition to the syllabus is Beyond Budgeting, otherwise no changes to this exam paper.

F7 The two 20-mark long questions on F7 will be on the following topics: • Interpretation of financial statements.

• Preparation of financial statements (including groups).

There are some additions to F7 that need to be noted, including some with potential for calculations to be needed: • Foreign exchange translation.

• Functional currency v presentational currency.

• Disposals of subsidiaries (not part disposals, just full disposals of a holding).

There are also clarifications, notably that impairment losses might have to be calculated, and that interpretation of financial statements can be for groups as well as for single companies.

F6 (UK) The two 15-mark long questions on F6 will be on the following topics: • Income tax.

• Corporation tax.

There is also a 10-mark long question, but this can be on any topic.

Naturally with tax, there are changes to the syllabus because of new tax legislation. However, most of the ‘additions’ to the syllabus are additions to excluded items within each type of tax. Any addition to things that do NOT need to be studied will be welcomed by everyone no doubt.

Within corporation tax, topics on franked investment income, and associated companies, have been removed from the syllabus.

Other than that, students should of course remember that the new tax rates from the 2015 Finance Acts kick in from the September sitting, and will continue to apply through the December and March sittings, after which they are due to be updated again.

F8 The three long questions totalling 70 marks will, as usual, be centred around three core topics, namely: • Audit planning (in particular audit risk and response).

• Internal controls.

• Substantive procedures.

With 70 marks of long questions, expect other areas to be included but for smaller numbers of marks.

The F8 syllabus has one main addition, being Quality Control (ISA 220), which is being copied across from the P7 syllabus – but students should not let this worry them, as it has always been one of the easier topics on the advanced paper. Students should also consider the new format audit report. This has been evolving a lot in the past three years and the revised audit standards have finally hit the ACCA syllabus.

The examining team have recently added an article on accaglobal.com in Technical Articles, and students should ensure they read it carefully

CBE As you should be aware, ACCA are gradually introducing computer based exams for papers F5 to F9 – but this change is beyond the scope of this article.

PQ Magazine September 2016

ACCA exam update PQ

AFOOT – most of what you learned on F8 in the past (if you are resitting, for example) remains true and relevant, but the report content has been expanded a lot so there are additional elements to know and understand. Also, the Financial Statement assertions have changed a little, and again there is an examiner article covering this which has recently been added to accaglobal.com, which students should read. If anything the changes are going to simplify things, as the assertions covering the St of P or L, and the St of FP, are now almost identical.

F9 The two long questions totalling 40 marks will mostly come from: • Working capital management.

• Investment appraisal.

• Business finance.

There are no syllabus changes at all for F9.

Papers P1-P3 No changes in exam structure, or in syllabus content – so the only change at all here is the 15 minutes of reading time now being available for writing, if students wish.

Students should make sure they consult the

examinable documents list for P2 to ensure they are aware of all existing exposure drafts, etc, and remember that the examiner believes that any matter being discussed in public counts as a current issue even if not specifically mentioned on the syllabus.

Papers P4-P7 There are no changes to exam paper structure for the Options papers. However, there are some syllabus changes.

P4 Most of the syllabus changes to P4 are tidying and reordering the syllabus. However, there are some small changes, such as EVA being removed from the syllabus, and reverse takeovers being added.

P5 The list of changes on the study guide looks scary, but in fact virtually all of the changes are simply moving syllabus content around for clarification. One notable change is the removal of the Performance Prism from the syllabus (as this has been tested more than once in recent sittings), and ‘Big Data’ has been copied across from the P3 syllabus, but apart from that there are no changes of any substance.

P6 (UK) As with F6, there are always some changes to tax because of the constant changes to tax legislation. Thankfully, this time most of the syllabus changes are highlighting additional

items that are excluded from study, which is a relief for students and tutors alike. There are a couple of new areas – the tax of property gains made by non residents, and penalties charged on certain ‘offshore’ matters (the latter being well timed, given recent revelations about Panama!).

Other than that, students should of course remember that the new tax rates from the 2015 Finance Acts kick in from the September sitting, and will continue to apply through the December and March sittings, after which they are due to be updated again.

P7 Changes to P7 are very minor and are mostly clarifying things that were already there.

However, it is worth noting that Quality Control has been added to the F8 syllabus, and therefore might now appear on the P7 paper a little less than it has in the past (I stress ‘might’, since all F8 is assumed knowledge for P7 anyway). The biggest issue to consider for P7 is the new format audit report. This has been evolving a lot in the past three years and the revised audit standards have finally hit the ACCA syllabus (although they have been a current issue for the past five years or so). The examining team have recently added an article on accaglobal.com in Technical Articles, and students should ensure they read it carefully – most of what you learned on F8 in the past remains true and relevant, but the report content has been expanded a lot so there are additional elements to know and understand. PQ • Paul Merison, director of ACCA, LSBF

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The Institute of Certified Bookkeepers 27

PQ CIMA P1 exam

The art of passing P1

James Taylor explains how a successful PQ approaches P1 Management Accounting, and offers some tips on how to beat the examiner

I

n a previous article I highlighted the CIMA P1 pass rate (the first-time pass rate has gone up by two percentage points in the first six months of 2016), set out three tips to help you in your preparation to sit the exam and provided a series of questions from each section for you to test yourself.

In this article, I want to elaborate on my tips – going into more detail on how successful students prepare themselves for the P1 exam.

In my experience, successful students know where they are going and what to expect on the way – they understand the syllabus learning outcomes and understand the definitions of the verbs CIMA use.

The CIMA P1 syllabus has four syllabus topics, each with a specific weighting – this should give you a clue to where most questions in the exam will come from, and will also give you an idea of how to apportion your time (see table).

Another successful student habit is

that they know why they are studying and they have a plan of action. Plans typically set out what reading, watching of videos, classes and question practise they are going to engage in. On average, successful students spend an hour each day engaged in studying – being careful, however, to work in 45-minute blocks with a 15-minute break inbetween.

I think it is fair to say that if you ask anyone for tips on how to pass an Objective Test paper they will say “question practise, and lots of it – mocks,

Summary of syllabus Weight

Syllabus topic 30%

25% 30% 15%

P1 pass rates

Overall pass rate – 67% First-time pass rate – 47% Exam pass rate – 42%* * Total exams passed/total exams taken

A. Cost accounting systems B. Budgeting C. Short-term decision making D. Dealing with risk and uncertainty

exam kits, the lot!” It may not shock you to know that I agree with this, but I would like to offer one subtle difference: outside of mock exams, split your questions into learning outcomes/syllabus topics and don’t just attempt them once – have a go at the questions, check your answers and then re-visit the same questions a week or two later (under exam conditions) to see if you have improved.

This re-visiting of questions will force you to develop a greater understanding of the

syllabus (as you check your answers and correct your mistakes) and move you away from just marking right or wrong.

Excellent students, as they go through question practice, also take time (especially with ‘select all that apply’ questions) to understand why the other answers are incorrect.

There are times during revision where it is a good idea to test yourself (using recall) to see what really has stuck. Start with a blank piece of paper and see what you can remember – with P1 it is a good idea to see if you can recall the shorthand pro formas.

Treat your mocks like real exams – including timings. At HTFT, we talk about a system of rounds. Go through the exam attempting the questions you know the answers to first and flagging the rest, maybe noting down level of difficulty.

Then, next time around, attempt the questions you have flagged as next level of difficulty up, and so on – the idea behind this is so that you don’t get stuck on one question and leave questions at the end you could have scored on.

In summary, the critical success factors of successful students are: • Know what you have to achieve.

• Get into a routine.

• Don’t just practise questions once.

• Spend time recalling what you know.

• mirror your mocks to the exams.

• Get settled on an exam technique and stick to it. PQ • James Taylor, HTFT Partnership

HTFT CIMA P1 Resit offer HTFT Partnership have developed a £99 CIMA P1 Resit package for individuals who have already sat the exam, and are giving away TWO free places for PQ magazine readers.

The HTFT CIMA P1 Resit course will help you identify the areas to work on and provide a comprehensive package of exam focused questions. You will be asked to sit an online mock exam, and then spend time with P1 tutor Kate Williams working through the mock, focusing on the questions where additional support may be required.

The session is recorded so you can watch it back again, and following it you will be provided with two further online mock exams to work through.

To enter the prize for the TWO free places email at graham@pqaccountant.com, heading up your email ‘P1 Resit’ 28

PQ Magazine September 2016

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PQ college visit

Making a difference PQ magazine visits Portsladeâ&#x20AC;&#x2122;s PACA Adult Learning

P

ACA Adult Learning was recently short-listed at the AATâ&#x20AC;&#x2122;s Training Providers awards. OK, it didnâ&#x20AC;&#x2122;t win â&#x20AC;&#x2DC;Best New Training Providerâ&#x20AC;&#x2122;, but after a visit from PQ magazine we wouldnâ&#x20AC;&#x2122;t be surprised to see another nomination in next yearâ&#x20AC;&#x2122;s awards (Small College of the Year, perhaps?).

PACA only started offering AAT courses in 2015, and top tutor Paul Robbins explained the first intake was just nine students. Come this September, Robbins is expecting to have between 65 and 70 AAT PQs signed up. Most of these will come from the Portslade area, although there will also be a few students from nearby Hove and Brighton.

It all means that PACA, which is attached to PACA Academy School, is looking to expand. Vice Principal Nick Fenn was also on hand during our visit and showed us around the school and possible new classrooms for their AAT trainees.

Fenn stressed that PACA was proud to be different from the â&#x20AC;&#x2DC;usualâ&#x20AC;&#x2122; big FE

PACAâ&#x20AC;&#x2122;s Paul Robbins is expecting the college to grow its AAT numbers next term

providers. He truly believes his students need to be happy with what they are achieving. â&#x20AC;&#x153;You canâ&#x20AC;&#x2122;t be happy if you are not achieving your potential,â&#x20AC;? he stressed.

PACA is trying to raise aspirations in an area where traditionally they have been low. And both Fenn and Robbins have seen the positive effect gaining the AAT certificate has had and people who

S TUDY. ACHIE V E . PROG RE SS .

have often left school without any proper qualifications. â&#x20AC;&#x153;Students feel they have achieved something concrete and this really builds their confidence to carry on,â&#x20AC;? says Fenn.

All this has been achieved against a background of 40% education cuts over the past four years.

On top of the AAT qualification, PACA also offers English, English for Speakers of Other Languages (ESOL) and Maths courses. The changes due to come into force from September, in the form of AQ2016, means AAT students have to be more comfortable with their writing skills, and here PACA can offer real support for its students.

The collegeâ&#x20AC;&#x2122;s AAT results have been very good, and Robbins says they have consistently been above the AATâ&#x20AC;&#x2122;s benchmark figure. He believes the philosophy of never leaving anyone behind is working. That means if someone misses a session they will get a call. But this call is all about help and support.

Making sure PACA keeps ahead of the game is what Fenn is all about, so over the summer the college is upgrading all its IT. He said: â&#x20AC;&#x153;Our students say they expect state of the art equipment, and we make sure we provide that.â&#x20AC;?

PACA Adult Learning, then, is a college that is living up to its community interest credentials. PQ

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Keep up with the latest industry news â&#x20AC;&#x201C; follow on Twitter @pqmagazine PQ Magazine September 2016

CIPFA conference PQ

Let me tell you a story PQ magazine’s Graham Hambly visited the CIPFA student conference, which was held in Manchester this year

H

ow do you get to the top? CIPFA’s recent student conference in Manchester brought together some leading lights to tell their stories, showing there is definitely more than one way to get to where you want to be.

Up first was Joe Seally, founder of Greater Pacific Capital. He is not how many people would picture a CIPFA qualified accountant. The council estate boy went to Leeds University and began his working life in local authorities. In truth he took this route because as an ethnic minority this was an environment where he thought he could thrive. Seally then moved to the capital to get London borough experience, and was headhunted by KPMG, where he worked for five years on competitive tendering. From there he jumped to Goldman Sacks as an investment banker, working in London, New York and Asia.

In 2005 he set up his investment three-partner firm that now manages billions of dollars.

He loves his CIPFA qualification, and believes it fundamentally trains you to think about and handle complexity.

The LCA deputy chief executive, Sarah Pickup, was next up and revealed she was an accidental accountant. Pickup was looking for a job in the middle of a recession (1984), and was thinking about the arts, administration or the police. However, she went for a job as a trainee accountant at the London Borough of Richmond and got it. She explains that on the way to the interview she was trying to think what she would say about the public sector, and came up with something she believes is still true today. “I told them accountancy in local government is like trying to squeeze a cork into a bottle.”

As a trainee Pickup moved around a lot but spent time in financial research (not strictly accounting). The exams weren’t all plain sailing either – she failed the project! The treasurer made the deputy finance manager her project manager and she passed next time.

On graduation she moved into education finance and worked on the first formula for special schools. Her next job was as education finance manager. But she admits she was worried that she had never closed a budget or T accounts. Ok, she had a big team, but she was supposed to be in charge.

PQ Magazine September 2016

Seally: ‘the qualification helps you handle complexity’

As her career flourished she also found time to bring up four children.

Pickup then did something odd. She took a sideways move as Director of Adult Social Services, which she did for 10 years, before becoming Hertfordshire’s Director of Corporate Service. Not bad for someone who failed the project and only has a 2.2 degree, she said. She is now leading LGA’s finance policy.

She stressed the CIPFA qualification doesn’t teach you to be accountants; it is much more than that. It teaches you to be a finance manager and a manager who understands finance. Pickup said it was important to be confident in your own ability. Occasionally, that may mean you come over as over-confident and get pushed back, but you need to carry on. PQ • More news from the conference next month

CIPFA June results

CIPFA JUNE 2016 RESULTS

CIPFA June sitters seem to have few problems with the Audit & Assurance paper, which had a 90.71% pass rate. Students sitting the Taxation paper did even better, with a success rate of 94.12%.

The ‘problem’ summer papers were the Company Financial Reporting and Financial Management papers, both of which had 55% pass rates.

The strategic pass rates held up and both pass rates are in excess of 70%.

CIPFA students can, for the first time, sit retakes this September. The exams run from the the week beginning 5 September.

Professional Certificate Financial Accounting Management Accounting Company Financial Reporting Audit & Assurance Professional Diploma Public Service Financial Reporting Taxation Corporate Governance & Law Business & Change Management Strategic & Policy Development Financial Management Strategic Level Strategic Public Finance Strategic Case Study

75.61% 84.62% 55.79% 90.71% 71.67% 94.12% 86.54% 80.82% 84.42% 55.56% 72.00% 78.74%

31

PQ CIMA exams

UNDERSTAND YOUR GRADES Stephen Flatman explains all you need to know about CIMA grade descriptors

required across all three pillars, but some clear gaps across core syllabus areas.

• Limited understanding and/or exploration of key accounting issues/core topics.

• Little or no meaningful description of the application of techniques.

• Discussion of the results obtained from techniques and decision models is generally invalid.

• Significant and/or frequent errors in application of technical knowledge and interpretation of presented data/information.

C

How can students use these grade descriptors?

The descriptors at each level are applicable across all variants and case study sessions. They offer students a consistent way for them to understand their performance in the exam taken.

They also show students what they are aiming for. Besides this, they will help identify where their performance in an individual competency may have fallen short of the general standard for the level of case study they sat. The grade descriptors are best used in conjunction with the syllabus content and all other case study resources available.

Students preparing for the exam can use the descriptors to benchmark their performance and thus see what they need to become ready to sit the exam.

If the performance across all competencies was strong, the grade descriptors will highlight what students should continue to do and which skills they can build on for future exams. If students have failed a case study, they will be particularly useful when used in conjunction with other case study resources on CIMAconnect, including the post exam kit for their variant.

IMA students who sat the May 2016 Case Studies might have noticed some changes when they checked their sectional feedback results on MyCIMA. This is because for the first time we have published new grade descriptors in order to improve the learning experience of our students. They are intended to help students better understand their exam performance across the four competencies (Technical, Business, People and Leadership skills).

This also helps students comprehend what standard of performance is expected at each level, helping them focus on their future studies.

What’s new?

While CIMA’s passing criteria remains unchanged, we have improved the sectional feedback for students’ performances across the competencies by developing a set of grade descriptors to map the ratings (Fail, Moderate and Pass). They are based on CIMA’s Competency Framework, which identifies the skills and competencies expected for different occupational roles, while recognising the links between categories and progression between levels.

The CGMA Competency Framework 32

Stephen Flatman

reflects the knowledge and skills employers told us they expect to see from finance professionals at various levels in their organisations.

Our students now receive grade descriptors for Technical, Business, People and Leadership skills. As an example, we have included the descriptors for a ‘Moderate’ rating in the Technical skills for a case study exam on Operational level: • Demonstrates adequate knowledge of the techniques and technical knowledge required across all three pillars, although there may be some gaps.

• A general understanding and/or exploration of key accounting issues/core topics.

• Describes the application of techniques in a way that implies competence.

• Discusses the results obtained from techniques and decision models in a way that implies sufficient understanding.

• Minimal technical errors in application of technical knowledge and interpretation of presented data/information.

For a better understanding, we also show you the descriptors for a “Fail” rating in the Technical skills.

• Demonstrates basic knowledge of the techniques and technical knowledge

What hasn’t changed Apart from the sectional feedback’s grade descriptors, students will still receive an overall grade (either ‘pass’ or ‘fail’) and a scaled score between 0 and 150 for their Case Study exams.

To pass, students need to score 80 or above and reach a minimum threshold score for each competency (approximately one third of the total marks available for that competency) and Integration. The only exception to this is Operational level where the marks available for Leadership and Integration are only a small proportion of those available. No candidate will fail at Operational level on Leadership or Integration for this reason.

We hope you find this new feature useful. Best of luck in your future exams.

For further information about the grade descriptors and to access the grade descriptors across all levels please visit CIMAconnect. PQ • Stephen Flatman is Director of Exams at CIMA PQ Magazine September 2016

ICAEW focus PQ

IN WITH THE NEW I

n June, ICAEW introduced alternative Business Planning modules at the Professional Level of the ACA. In addition to the Business Planning: Taxation module, ACA students will now be able to choose from Business Planning: Banking and Business Planning: Insurance. These changes come at a time when scrutiny over the quality of financial statements and audits of banks and insurance companies is increasing.

The rationale The demand for new alternative modules has come from employers. Changing work and skill requirements mean that trainee ICAEW chartered accountants are specialising earlier in their careers, with financial services being a prime example of that specialisation.

ACA students are required to sit and pass one of the Business Planning modules as part of the ACA; no matter which one they take, theyâ&#x20AC;&#x2122;ll still become an ICAEW Chartered Accountant at the end of their training. The family of three Business Planning modules is designed to be academically equivalent, adopting the same skills-based approach. Some exposure to the banking or insurance industries, while not absolutely required, is expected to be the norm for those taking these modules.

The Business Planning: Banking and Business Planning: Insurance modules are intended to reflect the role of an ICAEW accountant in these industries.

Banking and insurance issues set the context for questions, but the questions are not intended to be about banking and insurance in general. As the syllabus weightings show, the focus is on the areas where ICAEW accountants can bring particular skills to these industries.

The exams The Business Planning: Banking and Business Planning: Insurance exams are available at the June, September and December exam sittings and they are 2.5 hours long each, with three scenariobased compulsory questions. The exams will be unrestricted open book which means students can take any written resources into the exam.

Students are advised to refer to the

ICAEW PQs are specialising earlier in their careers. In response, ICAEW has introduced two Business Planning modules. So what do the exams consist of?

IFRS and Auditing Standards texts, as well as Practice Notes 19 (Business Planning: Banking) and 20 (Business Planning: Insurance).

The requirements may be either at the end of the scenario, as formal requirements, or embedded within the question (eg, as requests from a line manager) with a brief formal requirement to respond to the instructions provided.

In either case, only the total marks will be given for each question; the marks will not be shown for each requirement.

This follows the Business Planning: Taxation exam approach. In each question, the scenario will place you in a role that may be external to the bank or insurance company (eg, an auditor or assurance provider) or internal (working for the company, eg, in risk management, internal audit or financial control).

It is important that students have knowledge of the terminology, markets, operations and products of the relevant industry that will set the context for questions.

It is also recommended that students obtain and study several annual reports of banking or insurance companies.

Reference should be made not only to the financial statements, but also to the management commentary. In particular,

Need help to decide which Business Planning module to take? As part of the ACA qualification, students only need to sit one of the Business Planning modules. There are three to choose from and your employer will guide you as to which module is right for you. If you are studying the ACA independently, you should consider your future ambitions when selecting which module to sit.

Download the syllabus, sample paper and the June 2016 exam paper at icaew.com/examresources PQ Magazine September 2016

this should include: accounting policies; the audit report; risk reporting; corporate governance; business and financial reviews. The knowledge gained from studying annual reports will ensure that students are up to date with current practice in the industry, which is important in understanding the context of questions. Annual reports also provide specific ideas and examples that can be used in answering questions.

Prior knowledge There are no regulations stipulating the order in which to take the ACA Professional Level exams. However, it is recommended that the Financial Accounting and Reporting and the Audit and Assurance exams are taken before attempting either of the Business Planning exams.

Summary The critical success factors for the Business Planning: Banking and Business Planning: Insurance exams include a knowledge of the industry operations, practices, products and procedures. The questions will be set in this industry context and risk management will be a key issue. This industry knowledge is required along with the skills to apply relevant financial reporting and regulatory reporting and the ability to identify and explain audit and assurance procedures appropriate to the scenario. PQ Reproduced with the permission of ICAEW, this article was first published in Vital (April 2016) 33

PQ careers

Meeting the boss Are you meeting your FD for the first time?

Make sure you’re set to impress, says Karen Young

M

eetings with senior people, though sometimes daunting when you first start attending them, are a fantastic opportunity for you to demonstrate your knowledge, skills and business understanding to important contacts. You can make the most of meetings by turning them into opportunities to impress the right people. Like in an interview, opinions will be formed about you during the meeting, so it is very important you make the right lasting impression. Preparing for the meeting will increase your chances of doing this.

Make sure you know what you would like to get out of the meeting before it starts. It may be that you want to be noticed by a certain manager or be assigned a particular project, so you should prepare fully to achieve this. You will be expected to come prepared with knowledge of your role and current projects in relation to the topic of the meeting. Most large meetings will have an agenda of discussion points that will be circulated beforehand, spend time reading through it and research any points, projects or people that that you are not familiar with.

Is your boss a devil wearing Prada?

Do you know who else will be in the meeting with you and what their key projects are? Make sure you do some research into their remit, team and latest successes. Use this to think about what each person’s individual agenda will be for the meeting and anticipate how it relates to your own. Your manager will probably have met these people before so ask them what they are like, what their expectations are and if your team has worked with them in the past.

When in the meeting be enthusiastic and come forward to volunteer for tasks as this demonstrates a willingness to get involved. Do voice your opinion if you have one, don’t be quiet, speak up and be noticed but remember

that meetings are collaborative so try not to dominate conversation. Like an interview, it is just as important to listen as well as observe, and ensure you leave the meeting having thoroughly understood the facts and figures. A FD told me that the best accountants are the most inquisitive; remember that the devil is in the detail, so don’t be afraid to show initiative and ask where the numbers came from.

My top tips for impressing senior people are: • Read the situation. You want to find a balance between being confident and chatty and being concise. Do maintain the conversation if the boss has time and is interested; if not, thank them and close the conversation, even if you didn’t get the opportunity to say everything you wanted to. In some ways your sense of decorum is as important as what you say.

• Anticipate what you are going to be asked. Try to foresee what questions you might be asked. If somebody was meeting you for the first time what would they want to know? Choose topics of conversation that you are confident talking about, you can quickly become awkward and nervous if you are probed on a topic you know little about. Talk about what you know.

• Don’t forget that senior executives are people too. Making small talk in the right manner to the right people can have a big impact on your career. So be chatty and welcoming while also remaining polite and professional.

For further information visit www.hays.co.uk/pq PQ • Karen Young, Director, Hays Accountancy and Finance

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careers PQ

social media ROUND-UP On our travels around Lincolnshire we met up with Natasha Everard, a Level 4 AAT student. She is no ordinary AAT student, as she is the brains behind the highly successful Accounting Student Network.

The student Facebook group, sponsored by Premier Training, now has

1,500 members, mostly AAT PQs, and is growing fast.

The network actually has both a Facebook and website presence, both of which you can join. Everard wants the group to become one of your key stops for studying resources, motivation and career development.

The real plus for group members are the regular Q&A sessions. Contributors have included AAT award-winning iCount tutor Caroline Warburton and Sage, who offered a free software prize.

It is the Facebook page where you really see students helping students in action. One PQ recently asked: “Does anyone know which provider out of BPP and Kaplan is best?” This is a common question on most sites. Fellow students Chloe Lee gave the perfect answer: “Have a mixture of both – both use different exam style questions – which is really helpful.” Another student agreed both are worthwhile (they will be pleased with that!).

Another discussion asked whether studying before bed can work. A study tip suggested that when sleeping your brain files new information, so by studying before bedtime the information is fresh and filed as highly important, ready to be retrieved when you need it.

What did PQs think? Ashley Shaw felt the opposite was true. He has found studying first thing in the morning is best, just after breakfast. Katie Lown agreed that morming is best, although she seems more hardcore as she gets up at 4am to start studying.

Turning back to us, our top tweet @pqmagazine was the ACCA results, which we got out smartly on 18 July.

The low pass rates for P6 and P7 are still puzzling one PQ. Another PQ felt some pick P7 thinking they can ‘wing it’, when in reality it is a really tough subject. Meanwhile, it was pointed out that the P5 rate was the highest in six years.

PQ Magazine September 2016

Life at Blackpool Council Jen Pope, 26, is a Trainee Financial Manager based in Blackpool. She has worked there for a year-and-a-half. She has Bachelors and Masters degrees in Philosophy from Lancaster University and is studying CIPFA. She is the new President of the NW CSN What time does your alarm go off on a work day? 5:35am.

What’s the first thing you do when you get to your desk?

Get out my laptop.

What’s on your desk? Usually my pencil case and calculator – and a brew!

What’s the best thing about where you work? How well staff are looked after. There’s a big initiative to get fit and healthy so we’ve had some sports activities such as table tennis. It’s been fun but also helped me get a more active at lunchtimes – although you can’t beat a stroll down to the beach on a sunny day!

Where’s your favorite place to go for lunch? Hogan’s, a lovely sandwich shop near the office that does some amazing sandwiches.

What (or who) can you see

when you sit at your desk? We hot-desk so I’m sat with different people every day.

Which websites are your favorites and why? Mostly social media and news sites. I also love Ted Talks.

Which websites do you use for work? I use Google a lot, we also have our own council intranet page that is really useful.

How many hours a week do you spend in meetings? It can vary so much, sometimes I can spend the whole day in a meeting and have loads on through the week, other weeks I can have none at all.

What time do you leave the office? We have flexi time so it varies a lot. Between exams I leave around 4pm, when I’m studying I stay till about 6–7pm

and use the office to study.

How do you relax? Baking, craft, and computer games, although I find the best way to relax is my colouring book!

What’s your favourite tipple?

A pint of cider.

How often do you take work home with you? Very rarely to be honest.

What is your favourite TV show? Game of Thrones Summer or winter? Summer.

Pub or club? Pub. Who is your hero? Aung San Suu Kyi, she’s an inspiration.

If you had a time machine, where would you go? The original screening of Return of the Jedi.

If you hadn’t chosen accountancy, where might you be right now? No idea!

Recruitment process is too long!

KPMG is streamlining its graduate recruitment process after it own PQs said the firm’s recruitment process was too cumbersome and convoluted.

Following research with current and prospective graduates the Big 4 firm has now introduced LauchPad, a streamlined approach that combines the three stages of first interview, assessment centre and final interview into a single day.

The firm discovered that the

recruitment processes of many big organisations left millennials feeling frustrated and unloved. Top gripe (55%) was the lack of feedback given to unsuccessful candidates. Delayed and poor communication from the employer was also a problem, as was the length of time it takes employers to tell graduates if they have got the job.

KPMG is worried that this frustration could harm its ability to attract talented graduates who

could opt out of traditional job schemes in favour of roles with smaller companies that are more in line with their personal passions and offer a faster and simpler recruitment process.

Chairman Simon Collins admits: “Our own graduates have given us some hard hitting but really useful feedback and we’re using this to overhaul how we recruit.” He said KPMG will now make an offer or give feedback explaining why a candidate was not successful within two working days.

The PQ Book Club: books you should read Body Language by Elizabeth Kuhnke (Capstone, £10.99) The subtitle to this excellent book is ‘learn how to read others and communicate with confidence’, which perfectly sums it all up. As the author herself puts it: “Feeling hot, engaged and passionate? feeling low, aloof and cool? You don’t need to answer that question, your body says it all.”

Body Language deals with specific scenarios that occur daily, both in and out of the workplace (there’s even a chapter on dating!). These scenarios deal with what your

body language says about you; detecting lies; dealing with conflict, aggression and confrontation; meetings, interviews and negotiation; building rapport and networking; and cross cultural communication, among others.

The layout of this book, with its bite-sized chunks of information, make it a very easy read, and make the lessons easy to digest. Each chapter contains practical exercises, designed to help you think both about what you’ve just read and your own behaviours.

This tome will help you better understand the people around

you, and by being aware of the body language of others you will be able to moderate your own behaviour to your advantage. As the author puts it: “By being aware of the messages your body sends out and practising specific gestures, postures and expressions, you can create the impressions and convey the messages that you want to communicate.”

PQ rating 5/5 Remember, your body language says more about you than words ever do. With this in mind, read this book and make yourself an expert.

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forging real partnerships Management Accountant

Group Finance Analyst

Leisure, Surrey

FMCG, West London

£32,000 to £35,000

£35,000 to £40,000 + benefits

• Part Qualified CIMA/ACCA • Key member of the team, reporting to Senior Finance Manager • Responsible for monthly revenue recognition, reconciliation and commentary • Delivery of month end results in line with group timetable • Intercompany account reconciliation, and settlement • Produce and review balance sheet reconciliations highlighting potential risk • Delivery of consistent accounting policies and procedures with the ability and desire to improve processes • Experience of Hyperion Financial Management, Cognos and TM1 useful

• Part Qualified CIMA/ACCA/ACA • Ownership of the reporting and planning process for overhead budgets • Preparing forecasts, reporting and working capital balances for c30 cost centres • Reporting on variances and challenging forecast • Interaction with overseas country teams and integration of new acquisitions in conjunction with cost centre owners • Contribute to annual plan and quarter forecasts, supporting cost reduction initiatives • Significant interaction with senior management team offers excellent opportunity to make an impact and build a profile within the business

redefining financial recruitment T +44 (0)20 8408 9999 E info@walkerdendle.co.uk www.walkerdendle.co.uk

YOUR PATH TO A FULFILLING CAREER Hays specialises in part-qualified recruitment, working with leading organisations to offer you access to a wide range of jobs across the UK. With many years’ experience recruiting for accountancy and finance jobs, we currently have hundreds of vacancies for part-qualified accountants in the commercial and public sectors, as well as professional accountancy practices.

If you are studying towards your professional qualifications, whether that be management, financial or commercial accounting or tax, we can find you the most suitable jobs to advance your career.

To find out about the range of opportunities we can offer you, email karen.young@hays.com or call 07834 260 029.

Alternatively, you can visit us online.

hays.co.uk/pq

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PQ got a story, funny or serious, you want to share? Email graham@pqaccountant.com

TIME TO LAMINATE IT

ACCA students are often very vocal about how to get through what many perceive as the toughest accountancy exams there is. So, what is the advice of one student sitting the nightmare P5 exam? Well, you need to laminate your notes so you tears can roll directly off them! Wow, are they really that tough?

HOW SAFE IS DIGITAL MONEY?

GOING COLD TURKEY

The French ban on out-of-hours work emails may seem a bit extreme to some, but apparently millions of people are already trying to wean themselves off their iPads as they search of a healthier balance in their lives. An Ofcom report found 15 million Brits have tried to have a ‘digital detox’ this year. Some one in 10 admit they are choosing holiday destinations with no mobile coverage to beat their addiction. The researchers found that the average adult spends one day a week (25 hours) online. Most users (59%) describe themselves as ‘hooked’ on their devices.

JOG ON It has to make sense. Scientist have found that the best way to consolidate ‘memories’ is to turn off the iPad and go for a run straight after a revision session. A new study from a medical centre in the Netherlands has shown that people who exercise directly after hours of study have a much better chance of recalling what they have actually learnt. However, with the rise of Pokémon Go maybe you may want to take your phone with you on that run!

WHAT ARE

YOU WORTH?

MAKING A SPLASH IN TAX

What would you do? You are part of the tax team cracking down on rampant tax evasion when one evader jumps into the sea to avoid arrest. Well, one Greek tax inspector, fed up with waiting for the coastguard, simply dived in and swam after them!

The story involved a Chinese masseuse who was operating on a Rhodes beach without a license. The inspector, wearing a bikini, was working undercover as a tourist. The pursuit went viral on Greek social media. It appears that as austerity has bitten into Greek family finances just 45% of taxpayers admit they will be able to meet their obligations.

’ WEV E

On a day when many national papers lead on the fact that FTSE 100 bosses got a 10% pay rise last year, one story may have passed you by. It is that of Sports Direct’s acting finance chief, Matt Pearson. His reported salary is just £80,000 a year, with a notice period of 8 weeks. One paper suggested that this shows the company does not take the role seriously.

The price of Bitcoin plummeted after hackers were able to steal £54m worth in a digital heist. Bitfinex, the world’s largest dollar-based bitcoin exchange, admitted that 120,000 units of the digital currency were recently ‘stolen’. And this isn’t the first time that the currency exchanges have been hacked. In 2014, Mt Gox (another exchange) had 850,000 bitcoins worth $450m taken. Just 200,000 units were recovered.

GIVE ME CHOCOLATE

It appears you don’t have to employ sophisticated software to access people’s email accounts. All you need is a bit of chocolate. A team of researchers found that almost 50% of strangers (chosen at random) will reveal their passwords if you give them a treat!

Some 48% of those given chocolate before they were asked about their password gave them up.

GOT THE L OT

OSBORNE WISE GUIDES

PQ magazine has joined forces with Osborne publishers to offer 10 AAT readers the chance to win the ‘Wise Guide’ of your choice. Osborne offer the guides, which are a perfect study and revision tool, for the AAT Foundation Certificate and Advanced Diploma Levels.

If you would like to win a Wise Guide then send your name, address, and the name of the assessment you are sitting (for example Advanced Bookkeeping or Bookkeeping Transactions) to graham@pqaccountant.com. Please put Wise Guides in your header so we enter you for the right draw.

BEDSIDE SUDOKUS We have three of The Daily Telegraph’s new bumper collection of the best Sudoku puzzles (worth £23.96) up for grabs this month. They are everything you have come to expect from The Daily Telegraph puzzles, compiled with both addicts and novices in mind.

To be in with a chance of winning one a set email graham@pqaccountant.com with your name and address. Please put ‘Sudoku giveaway’ in the headline box.

Terms and conditions: One entry per giveaway please. You must send your name and address to be entered for the draw. All giveaway entries must be received by Friday 9 September. The main draw will take place on Friday 12 September 2016.

TO ENTER THESE GIVEAWAYS EMAIL GRAHAM@PQACCOUNTANT.COM 38

PQ Magazine September 2016

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