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INTERNATIONAL

ADVANCED LEVEL

Business Studies

SPECIFICATIONPearson Edexcel International Advanced Subsidiary in Business Studies (XBS01)

Pearson Edexcel International Advanced Level in Business Studies (YBS01)

For first teaching in September 2013

First examination January 2014



INTERNATIONAL

ADVANCED LEVEL

Business Studies

SPECIFICATIONPearson Edexcel International Advanced Subsidiary in Business Studies (XBS01)

Pearson Edexcel International Advanced Level in Business Studies (YBS01)

For first teaching in September 2013First examination January 2014



Reerences to third-party material made in this specification are made in good aith.We do not endorse, approve or accept responsibility or the content o materials, whichmay be subject to change, or any opinions expressed therein. (Material may includetextbooks, journals, magazines and other publications and websites.)

ISBN: 9781446908303All the material in this publication is copyright© Pearson Education Limited 2013

AcknowledgementsThis specification has been produced by Pearson on the basis o consultation withteachers, examiners, consultants and other interested parties. Pearson would liketo thank all those who contributed their time and expertise to the specification’sdevelopment.



1Specification – Pearson Edexcel International Advanced Level in Business Studies – Issue 1 – June 2013© Pearson Education Limited 2013

About this specification

Specification updates

This specification is Issue 1 and is valid or the Pearson Edexcel International Advanced Subsidiary and InternationalAdvanced Level examination rom 2014. I there are any significant changes to the specification Pearson will write tocentres to let them know. Changes will also be posted on our website.

For more inormation please visit www.edexcel.com/IAL

Using this specification

This specification has been designed to give guidance to teachers and encourage effective delivery o thequalification. The ollowing inormation will help you get the most out o the content and guidance.

Compulsory content: as a minimum, all the bullet points in the content must be taught. The word ‘including’ in unitcontent specifies the detail o what must be covered.

Examples: throughout the unit content, we have included examples o what could be covered or what mightsupport teaching and learning. It is important to note that examples are or illustrative purposes only and centres canuse other examples. We have included examples that are easily understood and recognised by international centres.

Unit assessments use a range o material and are not limited to the examples given. Teachers should deliver thequalification using a good range o examples to support the assessment o the unit content.

Students need to demonstrate knowledge o technical language where required.

Depth and breadth o content: teachers should prepare students to respond to assessment questions. Teachersshould use the ull range o content and all the assessment objectives given in Section B: Specification overview.

Qualification abbreviationsInternational Advanced Level – IAL

International Advanced Subsidiary – IAS

International Advanced Level 2 (the additional content required or an IAL) – IA2

earson Edexcel International Advanc evel n Business Studies is de ed or use in s hools and colleges outsideiidhe United Kingdom. It is part o a suit Inte ational Advanced Level q cations ered by Pearson. ae o

his qualification has been approved b arson ducation Limited as meeting the or Pearson’s SeltePegulated Framework.

earson’s Sel Regulated Framework i signed o qualifications that have been cu tomised to meet the nee srdeo a particular range o learners and eholders. hese qualifications are not accr dited or regulated by any UKtakegulatory body.

Structure: modular structure co ing our equa ly weighted units.llpri

ontent: up-to-date content is engaging an relevant to internati al students.hi

ssessment: 100% exte ssessment, with Jan ary and June asse ent op ortunities. nal

Approac : enc ider reading on current i sues, using r -lie es. srages exa



2

Contents

Specification – Pearson Edexcel International Advanced Level in Business Studies – Issue 1 – June 2013© Pearson Education Limited 2013

A Specification at a glance 4

Unit overview 4

B Specification overview 7

Summary o assessment requirements 7

Assessment objectives and weightings 8

Relationship o assessment objectives to units 8

Qualification summary 9

Aims 9

IAS/IA2 knowledge and understanding 9

IAS/IA2 skills 10

C Busines Studies unit content 11

Course structure 12

Unit 1 Business Enterprise 13

Unit 2 Business Structures and Processes 21

Unit 3 Strategic Business Decisions 27

Unit 4 Business in a Global Context 35

D Assessment and additional inormation 43

Assessment inormation 43

Assessment requirements 43

Entering candidates or the examinations or this qualification 43

Resitting o units 43

Awarding and reporting 43

Perormance descriptions 43

Unit results 44

Qualification results 44

Language o assessment 44



3

Contents


Additional inormation 45

Malpractice 45

Access arrangements and special requirements 45

Equality Act 2010 45

Prior learning and progression 45

Combinations o entry 45

Student recruitment 45

E Support, training and resources 47

Support 47

Training 47

Resources 48

Specifications, Sample Assessment Materials and Teacher Support Materials 48

F Appendices 49

Appendix 1 Perormance descriptions 51

Introduction 51

IAS perormance descriptors or Business Studies 52

IA2 perormance descriptors or Business Studies 53

Appendix 2 Codes 55

Appendix 3 Glossary o International Accounting Standards (IAS) terminology 57




4

A Specification at a glance

Unit overview

IAS Unit 1: Business Enterprise *Unit code WBS01Externally assessed

Availability: January and June

First assessment: January 2014

50% o thetotal IAS marks

25% o thetotal IAL marks

Content summary

This unit provides an introduction to business practice, the importance o the market and how businesses interactwith customers and competitors. Students will learn about the role o the entrepreneur, market research techniques,the importance and use o finance, break-even analysis and how to measure and analyse business perormance. Theywill also consider how the wider economic environment and stakeholders may affect businesses, large and small.

AssessmentExamination o 1 hour and 30 minutes, consisting o supported multiple-choice questions and questions based ondata.

IAS Unit 2: Business Structures and Processes *Unit code WBS02

Externally assessed



50% o thetotal IAS marks


Content summary

This unit covers the key unctional areas o a business. Students will develop their understanding o how businessesrelate to their customers and analyse change in their markets. The unit introduces students to business operationsand develops their understanding o finance and why businesses may ail. Students will also consider how businessesmanage their people effectively.

Assessment

Examination o 1 hour and 30 minutes, consisting o supported multiple-choice questions and questions based ondata.

* See Appendix 2 or description o this code and all other codes relevant to this qualification.



Specification at a glance A


IA2 Unit 3: Strategic Business Decisions *Unit code WBS03

Externally assessed



50% o thetotal IA2 marks


Content summary

This unit develops the content o Unit 2 and examines the competitiveness o businesses through perormance andnon-perormance indicators. Students will analyse corporate objectives and strategy on the basis o these indicatorsand on external influences to businesses. Students will assess the causes and effects o change on businesses andexamine how companies can manage risk and grow effectively.

Assessment

Examination o 2 hours, consisting o questions based on data, including extended response questions.

IA2 Unit 4: Business in a Global Context *Unit code WBS04

Externally assessed



50% o thetotal IA2 marks


Content summary

This synoptic unit ocuses on the world o international business, and considers change and growth in global

economies. Students will examine the different actors businesses have to consider when operating in a global market.Students will also assess the impact o multinational corporations on the global economy.

Assessment

Examination o 2 hours, consisting o questions based on data, including extended response questions.

* See Appendix 2 or description o this code and all other codes relevant to this qualification.



A Specification at a glance

6 Specification – Pearson Edexcel International Advanced Level in Business Studies – Issue 1 – June 2013© Pearson Education Limited 2013




B Specification overview

Summary o assessment requirements

Unit number and unittitle

Level Assessment inormation Number oraw marksallocated inthe unit

Unit 1: Business Enterprise IAS Examination length: 1 hour and 30 minutes

Examination paper in two sections:

Section A

Supported multiple-choice questions. Worth 24 marks.

Section BQuestions based on data. Worth 56 marks.

80

Unit 2: Business Structuresand Processes

IAS Examination length: 1 hour and 30 minutes


Section A

Supported multiple-choice questions. Worth 24 marks.

Section B

Questions based on data. Worth 56 marks.

80

Unit 3: Strategic BusinessDecisions

IA2 Examination length: 2 hours


Section A


Section B


The case studies or Section A and B will have a linkedcontext.

80

Unit 4: Business in a GlobalContext

IA2 Examination length: 2 hours


Section A


Section B


The case studies or Sections A and B will not be linked.

80

Note: Data represents passages o text based on a real business example, which may include graphs, tables oinormation and/or diagrams.





Assessment objectives and weightings

% in IAS % in IA2 % in IAL

AO1 Demonstrate knowledge and understanding o thespecified content.

25% 20% 22.5%

AO2 Apply knowledge and understanding o the specifiedcontent to problems and issues arising rom both amiliarand unamiliar situations.

25% 20% 22.5%

AO3 Analyse problems, issues and situations. 25% 30% 27.5%

AO4 Evaluate, distinguish between and assess appropriateness o

act and opinion, and judge inormation rom a variety osources.

25% 30% 27.5%

Relationship o assessment objectives to units

Unit number Assessment objective

AO1 AO2 AO3 AO4

Unit 1 25% 25% 25% 25%

Unit 2 25% 25% 25% 25%

IAS weighting 25% 25% 25% 25%

Unit 3 20% 20% 30% 30%

Unit 4 20% 20% 30% 30%

IA2 weighting 20% 20% 30% 30%

Total for IAL 22.5% 22.5% 27.5% 27.5%



Specification overview B


Qualification summary

Aims

The aims o the International Advanced Level qualifications in Business Studiesare to enable students to:

develop an interest in and enthusiasm or the study o business

gain a holistic understanding o business

develop a critical understanding o organisations and their ability to meet

society’s needs and wants

understand that business behaviour can be studied rom a range operspectives

generate relevant solutions to business problems and issues

be aware o the ethical dilemmas and responsibilities aced by organisations

and individuals

acquire a range o relevant business and generic skills, including decision-

making, problem solving, the challenging o assumptions and thequantification and management o inormation.

IAS/IA2 knowledge and understanding

These International Advanced Level qualifications in Business Studies requirestudents to:

investigate different types o businesses that develop and sell products and/or

services in a local, national or international marketplace. At IA2 level, studentswill study the ways in which companies make decisions, and grow andoperate in the global market place

be able to analyse numerical inormation and understand how it assists the

decision-making process o a business

understand how a business is managed, how its perormance is analysed and

how it could trade internationally.





IAS/IA2 skills

These International Advanced Level qualifications in Business Studies requirestudents to use both qualitative and quantitative methods to make justifiabledecisions.




11

C Busines Studies unit content

Unit 1 Business Enterprise 13

Unit 2 Business Structures and Processes 21

Unit 3 Strategic Business Decisions 27

Unit 4 Business in a Global Context 35



C Business Studies unit content


Course structure

The Pearson Edexcel International Advanced Level in Business Studies

comprises our units and contains an International Advanced Subsidiary subseto two IAS units.

The Pearson Edexcel International Advanced Subsidiary in Business Studies is

the first hal o the International Advanced Level course and consists o Units1 and 2. It may be awarded as a discrete qualification or contribute 50 per cento the total International Advanced Level marks.

The ull International Advanced Level award consists o the two IAS units

(Units 1 and 2), plus two IA2 units (Units 3 and 4) which make up the other

50 per cent o the International Advanced Level. Students wishing to take theull International Advanced Level must, thereore, complete all our units.

The structure o this qualification allows teachers to construct a course o

study that can be taught and assessed either as:

distinct modules o teaching and learning with related units o assessmentu

taken at appropriate stages during the course; or

a linear course which is assessed in its entirety at the end.u




13

Unit 1 Business Enterprise

IAS/IA2 compulsory unit Externally assessed

1.1 Unit description

About this unit This unit provides an introduction to business practice, the importance o themarket and how businesses interact with customers and competitors. Studentswill learn about the role o the entrepreneur, market research techniques, theimportance and use o finance, break-even analysis and how to measure andanalyse business perormance. They will also consider how the wider economicenvironment and stakeholders may affect businesses, large and small.

Students are also expected to:

carry out calculations

interpret or use data rom graphs, tables or diagrams.

Note: ‘Data’ represents passages o text which may include graphs, table(s) oinormation or diagrams.

1.2 Assessment inormation

Examination length: 1 hour and 30 minutes

Examination paper in two sections:Section A: supported multiple-choice questions – 24 marks.Section B: questions based on data – 56 marks.

Total or paper : 80 marks.

Students may use a calculator.

The quality o written communication will be assessed in the context o this unitthrough the 14 mark data response question in Section B o the paper. Whenanswering this question students should consider the structure, coherence,punctuation and grammar o their responses.





1.3 Unit content

1.3.1 Entrepreneurship

What students need to learn:

1 Characteristics Individual characteristics, including takes initiative, hard-working, resilient,

creative, sel-confident, risk-taking, effective communicator.

2 Motivations Reasons why people set up businesses, including:

profit as a motive, e.g. profit maximisers, profit satisficersu

other motives, e.g. ethical stance, social entrepreneurship.u

3 Role The initial idea.

Creating and setting up a business.

Running a business.

Expanding a business.

Innovation within a business.

4 Companystructures

Different ways o structuring a business, including:

sole traderu

partnershipu

private limited companyu

public limited companyu

co-operative.u

Other orms o business organisation, including ranchises.

5 Stakeholders Definition: any person or organisation that has an interest in the outcome o a

business decision/action.

Internal stakeholders, e.g. employees, owners/shareholders.

External stakeholders, e.g. suppliers, customers.

6 Opportunity cost Choices and potential trade-offs.

Impact on decision-making.

Effects on stakeholders.



Business Enterprise Unit 1


1.3.2 Researching a business opportunity


1 Market research Product and market orientation.

Primary and secondary market research (quantitative and qualitative), used to

quantiy demand and gain insight into consumer behaviour.

Use o ICT to support market research, including websites, social networking,

databases.

Sampling: size, methods, potential bias.

Market segmentation, e.g. gender, age.

2 The market Definition: any medium in which buyers and sellers interact and agree to trade

at a price, e.g. virtual, ace-to-ace.

Market size and characteristics, e.g. a mass market, a niche market.

Competition rom existing businesses, e.g. differentiation.

3 Positioning Market mapping.

Competitive advantage o product or service.

Adding value.

4 Product trial Customer trialling to encourage purchases, e.g. ree samples, tasting.

Test marketing o a product to assess likely demand levels.





1.3.3 Supply and demand


1 Demand The relationship between price and demand.

Non-price actors affecting demand, including tastes and ashions, income,

price o substitutes and complements, demographics, seasonality, externalshocks.

2 Supply The relationship between price and supply.

Non-price actors affecting supply, including changes in costs, technological

change, climate/weather, external shocks, taxes and subsidies.

3 Interactionof supply and

demand

How changes in demand might impact on supply.

How changes in supply might impact on demand.





1.3.4 Finance


1 Sources of finance Internal sources: retained profit, sale o assets.

External sources: loans, debentures, venture capital, ordinary share capital,

overdrafs, leasing, trade credit.

Alternative sources, e.g. business angels and venture capitalists, peer-to-peer.

Secured and unsecured loans and the cost o borrowing.

Sources o finance appropriate or company structure.

Implications o limited and unlimited liability.

Relevance o a business plan in obtaining finance.





1.3.5 Measuring business perormance


1 Pricing, salesrevenue, coastsand profit

Pricing strategies, including cost-plus, competitive, skimming, penetration,

psychological, destroyer/predatory, premium.

Sales revenue, fixed and variable costs.

Calculation o profit/loss.

2 Break-even Contribution (selling price minus variable cost per unit).

Break-even point (total fixed costs + total variable costs = total sales revenue).

Using contribution to calculate break-even point.

Margin o saety.

3 Measuring andimproving profit

Gross profit.

Profit or the year.

Calculation o gross profit margin and profit or the year margin.

How a business might improve profitability.

4 Importance ofcash flow

Distinction between profit and cash flow.

How to construct simple cash flow orecast.

Use o a cash flow orecast to manage finances.





1.3.6 The wider business environment


1 Governmentinfluences

Impact on businesses o government policy, e.g. taxation, spending levels.

Impact on businesses o government legislation, e.g. health and saety,

minimum wages.

Government support or businesses, e.g. grants, subsidies.

Government protection o businesses, e.g. trademarks, patents.

Consumer protection legislation, e.g. product saety, product labelling.

2 Economicinfluences

Impact on businesses o unemployment, e.g. effect on demand, job

recruitment.

Impact on businesses o exchange rates, e.g. exporters, importers.

Impact on businesses o inflation, e.g. cost o supplies, competitiveness.

3 Social influences Impact on businesses o the digital economy, e.g. ecommerce,

communications.

Impact on businesses o ethical considerations, e.g. Fair Trade, child labour.

Impact on businesses o environmental considerations, e.g. the circular

economy, climate change.

Impact on businesses o demographic change, e.g. an ageing population,

migration.




21

Unit 2 Business Structures and Processes

IAS/IA2 compulsory unit Externally assessed


About this unit This unit covers the key unctional areas o a business. Students will developtheir understanding o how businesses relate to their customers and analysechange in their markets. The unit introduces students to business operations anddevelops their understanding o finance and why businesses may ail. Studentswill also consider how businesses manage their people effectively.






Examination length: 1 hour and 30 minutes.

Examination paper in two sections:Section A: supported multiple-choice questions – 24 marks.Section B: questions based on data – 56 marks.



The quality o written communication will be assessed in the context o this unitthrough the 14 mark data response question in Section B o the paper. When

answering this question students should consider the structure, coherence,punctuation and grammar o their responses.



2.3 Unit content

2.3.1 Marketing


1 Marketingobjectives andstrategy

Definition o marketing: the management process responsible or sales

promotion and or identiying, anticipating and satisying customerrequirements profitably.

Marketing objectives – based on market research, sales or profit orecasts, e.g.

increased sales, build a brand image.

Marketing strategies appropriate or different types o market, e.g. niche

markets, mass markets.

2 Marketing mix Components o the marketing mix: product, price, promotion, place (4Ps).

Identification o a marketing mix which meets the needs o a product or

service.

Product lie cycle and product extension strategies.

Boston matrix and the product portolio.

How current social trends may affect the composition o the marketing mix:

product, e.g. use o recycled materials, ethical sourcingu

price, e.g. online sales, price comparison sitesu

promotion, e.g. viral marketing, social mediau

place, e.g. cloud, online distribution.u

3 Price elasticity ofdemand (PED)

Effect on businesses o price changes.

Calculation and interpretation o PED.

Effects on total revenue.

Implications or pricing strategies.

4 Income elasticityof demand (YED)

Normal and inerior goods.

Effect on businesses o changes in income.

Calculation and interpretation o YED.

Implications or businesses.





2.3.2 Managing operations


1 Productivity andefficiency

Definition o productivity: output per unit o input.

Factors influencing productivity, including physical capital, technology, process

innovation, human capital, organising resources, access to finance.

Distinction between labour and capital intensive production.

Definition o efficiency: organising production so that waste is minimised and

costs are the lowest possible.

Factors influencing efficiency, including location o production, quality and

availability o labour, labour turnover.

2 Product or servicedesign

The design mix (unction, aesthetics, economic manuacture).

Changes in the elements o the design mix to reflect social and economic

trends, e.g. changes in type o materials and technology used in design tominimise waste, resource depletion.

3 Capacityutilisation

Calculating capacity utilisation:

(current output/maximum possible output) x 100.

Implications o under- and over-utilisation o capacity.

Ways o improving capacity utilisation.

4 Inventory control Inventory control graphs.

Implications o poor inventory control, e.g. cash tied up in inventory, loss o

production.

5 Lean production

and qualitymanagement

Just in time (JIT) management o inventory.

Competitive advantage o short product development lead times.

Minimising waste o resources.

Quality management techniques, including quality assurance and quality

control.

Total Quality Management (TQM) as part o company culture, e.g.

continuous improvement (Kaizen), quality circles.

Business Structures and Processes Unit 2




2.3.3 Managing finance


1 Budgets Types o budget, e.g. sales budget, production budget.

Purpose o budgets.

Historical-based budgeting.

Zero-based budgeting.

Variance analysis.

2 Sales forecast Purpose o sales orecasts.

Difficulties o estimation.

Factors affecting sales orecasts, e.g. economic variables, actions o

competitors.

3 Managingworking capital

Importance o working capital.

Managing potential cash shortalls.

Managing customer and supplier credit terms and payments, including timing

o payments.

Holding appropriate levels o inventory.

Contingency finance planning, including overdrafs, loans, actoring,

introduction o extra cash into the business by the owner/shareholders.

4 Why businessesfail

Differences between cash and profit.

Importance o cash in the short run and profit in the long run.

Reasons why businesses ail, including poor management o cash flow,

overestimation o sales, poor inventory control, changing market conditions,

attitude o lenders to releasing unds, overtrading.





2.3.4 Managing people


1 Organisationalstructures

Hierarchy.

Types o structure, including tall, flat, matrix.

Chain o command.

Span o control.

Decentralisation and centralisation.

How organisational structures affect the ability to manage businesses

effectively.

2 Recruitment,selection andtraining

Planning staffing requirements accurately.

Internal against external recruitment.

Recruitment and selection process.

Costs o recruitment, selection and training.

Types o training, including induction, on-the-job, off-the-job.

3 Leadership styles Types o leadership style, including autocratic, paternalistic, democratic,

laissez-aire.

McGregor’s Theory X and Theory Y.

4 Motivation ofstaff

Motivation theorists (Taylor, Mayo, Maslow, Herzberg).

Financial incentives to improve staff perormance including piecework,

commission, bonus, profit share, perormance related pay.

Non-financial techniques to improve staff perormance, including delegation,

consultation, empowerment, team working, flexible working, job enrichment,

job rotation.

5 Reduction oflabour costs

Flexible employment, e.g. part-time, flexible hours.

Flexible working, e.g. multi-skilled workorce, responding to change.

Reducing staff costs, e.g. dismissal, redundancy.

Business Structures and Processes Unit 2





27

Unit 3 Strategic Business DecisionsIA2 compulsory unit Externally assessed


About this unit This unit develops the content o Unit 2 and examines the competitiveness obusinesses through perormance and non-perormance indicators. Students willanalyse corporate objectives and strategy on the basis o these indicators and onexternal influences to businesses. Students will assess the causes and effects ochange on businesses and examine how companies can manage risk and groweffectively.







Unit 3 Strategic Business Decisions



Examination length: 2 hours.

Examination paper in two sections:Section A: questions based on data – 40 marks.Section B: extended response questions based on data – 40 marks.



Synoptic assessment in the context o this unit requires students to:

understand the inter-relatedness o many business issues and problems

understand how certain concepts, theories and techniques may be relevant to

a range o different contexts

apply such concepts, theories and techniques in analysing business issues and

problems and in evaluating arguments and evidence.

The emphasis will be on students’ ability to use business concepts, theories andtechniques that they have built up during their course o study. The assessmento this unit may draw on material rom Units 1 and 2, enabling synoptic

assessment.

The quality o written communication will be assessed in the context o this unitthrough the 12 mark data response question in Section A and both the 20 markquestions in Section B o the paper. When answering these questions studentsshould consider the structure, coherence, punctuation and grammar o theirresponses.



Strategic Business Decisions Unit 3


3.3 Unit content

3.3.1 Corporate objectives and strategy


1 Corporateobjectives

Corporate aims.

Mission statements.

Corporate objectives.

2 Stakeholder

influenceson corporateobjectives

Stakeholder objectives.

Stakeholder conflicts.

Impact o conflicting and common aims between different groups o

stakeholders.

Corporate social responsibility (CSR) and potential conflicts between profit-

based and other objectives.

3 Corporate culture Definition o corporate culture: the set o important assumptions that are

shared by people working in a particular business and influence the ways inwhich decisions are taken.

Classification o corporate cultures, including power, role, task, person cultures

(Charles Handy).

Factors influencing the ormation o corporate culture, e.g. owner aspirations,

customer demand.

Characteristics o strong corporate cultures, e.g. staff loyalty, high staff

motivation.

Characteristics o weak corporate cultures, e.g. poor retention o skilled staff,

staff do not support objectives.

Difficulties in changing an established corporate culture.





4 Corporatestrategy

Corporate strategy, e.g. market entry or exit, mergers and takeovers.

Portolio analysis, including Boston matrix.

Achieving competitive advantage through distinctive capabilities, e.g. brand

image, customer loyalty.

Porter’s strategic matrix (cost leadership, differentiation, cost ocus,

differentiation ocus).

Impact o strategic and tactical decisions on human, physical and financial

resources.

Strategic choice can involve co-operation or competition.

External influences on strategy, including Political, Economic, Social,Technological, Legal and Environmental (PESTLE).





3.3.2 Making strategic and tactical decisions


1 Decision makingmodels

SWOT analysis.

Ansoff’s matrix.

2 Investmentappraisal

Nature and purpose o investment appraisal.

Calculations and interpretations o figures generated by investment appraisal

techniques:

simple paybacku

average rate o returnu

discounted cash flow (net present value only).u

Limitations o investment appraisal techniques.

3 Decision trees Nature and purpose o decision trees.

Construction and interpretation o simple decision tree diagrams.

Limitations o decision trees.

4 Critical PathAnalysis (CPA)

Nature and purpose o critical path analysis.

Constructing simple networks showing critical path and calculating the total

float.

Calculating Earliest Start Time (EST) and Latest Finish Time (LFT).

Limitations o critical path analysis.

5 Contribution Nature and purpose o contribution.

Calculation and interpretation o contribution.

Contribution as a decision-making tool or making special order decisions.

6 Businesscontingencyplanning

Nature and purpose o business contingency planning.

Business contingencies, e.g. external shocks, loss o data.

Contingency planning to reduce risk.





3.3.3 Assessing competitiveness


1 Interpretationof financialstatements

Nature and purpose o financial statements: statement o comprehensive

income, statement o financial position.

Calculation and interpretation o ratios using simplified financial statements to

determine:

profitability (gross profit margin, profit or the year margin)u

return on capital employed (ROCE)u

liquidity (current and acid test ratio)u

gearing ((non-current liabilities/capital employed) x100).u

Limitations o ratio analysis.

Corporate response to profitability, liquidity and gearing issues.

2 Human resourcecompetitiveness

Calculation and interpretation o:

labour productivity (output per time period/number o employees)u

labour turnover ((number o staff leaving/number o staff employed)u 3

100).Limitations o these calculations.

Corporate response to labour productivity and labour turnover issues.





3.3.4 Company growth


1 Nature ofcompany growth

Organic and inorganic growth.

Mergers and takeovers, including horizontal, vertical and conglomerate.

Joint ventures.

Reasons or growth, including to achieve economies o scale.

2 Effects of growth Positive effects o growth, e.g. increased market share, diversification.

Negative effects o growth, e.g. diseconomies o scale, problems withcommunication.




35

Unit 4 Business in a Global ContextIA2 compulsory unit Externally assessed


About this unit This synoptic unit ocuses on the world o international business, and considerschange and growth in global economies. Students will examine the differentactors businesses have to consider when operating in a global market. Studentswill also assess the impact o multinational corporations on the global economy.



interpret or use data rom graphs, tables or diagrams

develop and refine the concepts and theories they previously covered in Units

1, 2 and 3, and to apply these in a range o international contexts.




Unit 4 Business in a Global Context



Examination length: 2 hours.

Examination paper in two sections:Section A: questions based on data – 40 marks.Section B: extended response questions based on data – 40 marks.



Synoptic assessment in the context o this unit requires students to:

understand the inter-relatedness o many business issues and problems

understand how certain concepts, theories and techniques may be relevant to

a range o different contexts

apply such concepts, theories and techniques in analysing business issues and

problems and in evaluating arguments and evidence.

The emphasis will be on students’ ability to use business concepts, theories andtechniques that they have built up during their course o study. The assessmento this unit may draw on material rom other parts o the course, enabling

synoptic assessment.

The quality o written communication will be assessed in the context o this unitthrough the 12 mark data response question in Section A and both the 20 markquestions in Section B o the paper. When answering these questions studentsshould consider the structure, coherence, punctuation and grammar o theirresponses.



Business in a Global Context Unit 4


4.3 Unit content

4.3.1 International markets


1 Reasons for theincreased growthof internationaltrade

Factors contributing to increased globalisation, e.g. political change,

improvements in transport and communication.

Increasing trade liberalisation.

Increasing specialisation by countries, e.g. Indonesia and palm oil, Sri Lanka

and tea.

Reduction o international trade barriers, including the role o the World Trade

Organization (WTO).

Expansion o trading blocs, e.g. European Union, Association o Southeast

Asian Nations (ASEAN).

Increase in oreign direct investment (FDI).

2 Conditions thatprompt businesses

to trade

internationally

Push actors, e.g. saturated domestic markets, fierce domestic competition.

Pull actors, e.g. extending product lie cycle, increase in sales and profits.

Outsourcing and offshoring.

3 Global mergersand takeovers

Spreading risk over different countries/regions.

Entering new markets/trade blocs.

Acquiring national/international brand names and patents.

Securing resources/supplies.

Maintaining/increasing global competitiveness.





4.3.2 Changing global economy


1 Growingeconomies

Indicators o growth, e.g. GDP per capita, literacy.

Emergence o the BRICS economies (Brazil, Russia, India, China, South Arica).

Other growing countries, e.g. Mexico, Indonesia.

An awareness o other growing regional economies, e.g. Arica, South

America.

Implications o their economic growth or individuals and businesses, e.g.

trade opportunities or businesses, employment patterns.





4.3.3 Business location


1 Assessment ofa country as amarket

Factors to consider, including :

levels and growth o disposable incomeu

ease o doing businessu

inrastructureu

geographic proximityu

exchange rate.u

2 Assessment ofa country asa productionlocation


skills and availability o labour orceu

costs o productionu

inrastructureu

location in trade blocu

government incentivesu

ease o doing businessu

natural resourcesu

likely return on investmentu

joint ventures.u





4.3.4 Other considerations beore trading internationally


1 Trade barriers Protectionism.

Tariffs.

Import quotas.

Other trade barriers, e.g. government legislation, domestic subsidies.

2 Ethicalconsiderations

Stakeholder conflicts.

Pay and working conditions.

Environmental considerations, e.g. emissions, waste disposal.

Supply chain considerations, e.g. exploitation o labour, child labour.

Marketing considerations, e.g. misleading product labelling, inappropriate

promotional activities.

3 Social/culturaldifferences indoing business

Considerations or businesses, including:

religionu

cultural differencesu

dietu

language, e.g. unintended meanings, inappropriate/inaccurate translationsu

inappropriate branding and promotionu

gender roles.u





4.3.5 Global marketing


1 Global marketing Global marketing strategy and global localisation (glocalisation).

Different marketing approaches, including:

domestic/ethnocentricu

mixed/geocentricu

international/polycentric.u

Application and adaptation o the marketing mix (4Ps) or global markets.

2 Global nichemarkets

Definition o international subcultures: groups o people across the globe who

have common interests or values.

Features o global niche markets.

Application and adaptation o the marketing mix (4Ps) to suit global niches.





4.3.6 Multinational corporations (MNCs)


1 Potential positiveimpact ofmultinationals on

overseas countries

Positive actors to consider, including:

oreign direct investment (FDI) flowsu

employment and incomeu

wider effects, e.g. jobs created indirectly, spread o wealthu

impact on local businessesu

impact on wider economy, e.g. tax revenues, economic growthu

skills and technology transeru

corporate social responsibility (CSR).u

2 Potential negativeimpact ofmultinationals on

overseas countries

Negative actors to consider, including :

poor wages and working conditionsu

exploitation o labour/child labouru

impact on local businessesu

transer pricing and tax avoidanceu

race to the bottomu

cultural imperialismu

environmental impact.u

3 Controllingmultinationals


political influenceu

legal controlu

pressure groupsu

social media.u




43

D Assessment and additional inormation

Assessment inormation

Assessmentrequirements

For a summary o assessment requirements and assessment objectives, see Section B: Specification overview.

Enteringcandidates or theexaminations orthis qualification

Details o how to enter candidates or the examinations or this qualificationcan be ound in the International Inormation Manual, copies o which aresent to all examinations officers. The inormation can also be ound atwww.edexcel.com/international

Resitting o units There is one resit opportunity allowed or each unit prior to claiming certificationor the qualification. The best available result or each contributing unit willcount towards the final grade.

Afer certification all unit results may be reused to count towards a new award.Students may re-enter or certification only i they have retaken at least one unit.

Results o units are held in the Pearson unit bank and have a shel lie limitedonly by the shel lie o this specification.

Awarding andreporting

The IAS qualification will be graded and certificated on a five-grade scale rom A

to E. The ull International Advanced Level will be graded on a six-point scale A*to E. Individual unit results will be reported.

A pass in an International Advanced Subsidiary subject is indicated by one othe five grades A, B, C, D, E o which grade A is the highest and grade E thelowest. A pass in an International Advanced Level subject is indicated by one othe six grades A*, A, B, C, D, E o which Grade A* is the highest and Grade Ethe lowest. To be awarded an A* students will need to achieve an A on theull International Advanced Level qualification and an A* aggregate o the IA2units. Students whose level o achievement is below the minimum judged by

Pearson to be o sufficient standard to be recorded on a certificate will receive anunclassified U result.

Perormancedescriptions

Perormance descriptions give the minimum acceptable level or a grade. See Appendix 1 or the perormance descriptions or this subject.





Unit results The minimum uniorm marks required or each grade or each unit:

All units

Unit grade A B C D E

Maximum uniorm mark 5 100 80 70 60 50 40

Students who do not achieve the standard required or a grade E will receive auniorm mark in the range 0–39.

Qualificationresults

The minimum uniorm marks required or each grade:

International Advanced Subsidiary cash-in code XBS01

Qualification grade A B C D E



International Advanced Level cash-in code YBS01

Qualification grade A B C D E


To be awarded an A* students will need to achieve an A on the ull InternationalAdvanced Level qualification and an A* aggregate o the IA2 units.


Language oassessment

Assessment o this specification will be available in English only. Assessmentmaterials will be published in English only and all work submitted orexamination must be produced in English.



Assessment and additional inormation D

45Specification – Pearson International Advanced Level in Business Studies – Issue 1 – June 2013Edexcel © Pearson Education Limited 2013

Additional inormation

Malpractice For up-to-date inormation on malpractice, please reer to the latest JointCouncil or Qualifications (JCQ) Suspected Malpractice in Examinations andAssessments: Policies and Procedures document, available on the JCQ website:www.jcq.org.uk

Accessarrangementsand specialrequirements

Pearson’s policy on access arrangements and special considerations or GCE,GCSE, IAL and Entry Level is designed to ensure equal access to qualifications orall students (in compliance with the Equality Act 2010) without compromisingthe assessment o skills, knowledge, understanding or competence.

Please see the JCQ website (www.jcq.org.uk) or their policy on accessarrangements, reasonable adjustments and special considerations.

Please see our website (www.edexcel.com) or:

the orms to submit or requests or access arrangements and special

considerations

dates or submissions o the orms.

Equality Act 2010 Please see our website (www.edexcel.com) or inormation on the Equality Act2010.

Prior learning andprogression

Prior learning

Students who would benefit most rom studying an International AdvancedLevel in Business Studies are likely to have a Level 2 qualification such as anInternational GCSE in Business Studies at grades A* – C.

Progression

This qualification supports progression into urther education, training oremployment.

Combinations oentry

Only units achieved rom this qualification may contribute to the certification othe International Advanced Subsidiary in Business Studies or the InternationalAdvanced Level in Business Studies.

Studentrecruitment

Pearson’s access policy concerning recruitment to our qualifications is that :

they must be available to anyone who is capable o reaching the required

standard

they must be ree rom barriers that restrict access and progression

equal opportunities exist or all students.




47

E Support, training and resources

Support

Pearson aim to provide the most comprehensive support or our qualifications.Here are just a ew o the support services we offer:

Subject Advisor – subject experts are on-hand to offer their expertise to answer

any questions you may have on delivering the qualification and assessment.

Subject Page – written by our Subject Advisors, the subject pages keep you up

to date with the latest inormation on your subject.

Subject Communities – exchange views and share inormation about your

subject with other teachers.Training – see ‘Training’ below or ull details.

For ull details o all the teacher and student support provided by Pearson to helpyou deliver our qualifications, please visitwww.edexcel.com/ial/businessstudies/support

Training

Our programme o proessional development and training courses, coveringvarious aspects o the specification and examinations, are arranged each year ona regional basis. Pearson training is designed to fit you, with an option o ace-to-ace, online or customised training so you can choose where, when and how youwant to be trained.

Face-to-face training

Our programmes o ace-to-ace training have been designed to help anyone whois interested in, or currently teaching, a Pearson Edexcel qualification. We run aschedule o events throughout the academic year to support you and help you to

deliver our qualifications.

Online training

Online training is available or international centres who are interested in, orcurrently delivering, our qualifications. This delivery method helps us run trainingcourses more requently to a wider audience.

To find out more inormation or to book a place please visit:www.edexcel.com/training

Alternatively, email [email protected] or

telephone +44 (0) 44 844 576 0025



E Support, training and resources


Resources

Pearson is committed to ensuring that teachers and students have a choice oresources to support their teaching and study.

Teachers and students can continue to use their existing GCE A level resources orInternational Advanced Levels.

To search or Pearson GCE resources, please visit www.pearsonschools.co.uk

To search or endorsed resources rom other publishers, please visitwww.edexcel.com/resources

Specifications, Sample Assessment Materials andTeacher Support Materials

Specifications, Sample Assessment Materials (SAMs) and Teacher SupportMaterials (TSMs) can be downloaded rom the International Advanced Levelsubject pages.

To find a complete list o supporting documents, including the specification,SAMs and TSMs, please visit www.edexcel.com/ial/businessstudies




49

F Appendices

Appendix 1 Perormance descriptions 51

Appendix 2 Codes 55

Appendix 3 Glossary o International Accounting Standards (IAS) terminology 57



F Appendices





51

Appendix 1 Performance descriptions

IntroductionPerormance descriptions describe the learning outcomes and levels o attainmentlikely to be demonstrated by a representative candidate perorming at the A/Band E/U boundaries or IAS and IA2.

In practice most candidates will show uneven profiles across the attainmentslisted, with strengths in some areas compensating in the award processor weaknesses or omissions elsewhere. Perormance descriptions illustrateexpectations at the A/B and E/U boundaries o the IAS and IA2 as a whole; theyhave not been written at unit level.

Grade A/B and E/U boundaries should be set using proessional judgement.The judgement should reflect the quality o candidates’ work, inormed by theavailable technical and statistical evidence. Perormance descriptions are designedto assist examiners in exercising their proessional judgement. They should beinterpreted and applied in the context o individual specifications and theirassociated units. However, perormance descriptions are not designed to definethe content o specifications and units.



Appendix 1 Perormance descriptors


IAS perormance descriptors or Business Studies

A s s e s s m e n t o b j e c t i v e 4

E v a l u a t e ,

d i s t i n g u i s h

b e t w e e n a n d a s s e s s

a p p r o p r i a t e n e s s o

f f a c t

a n d o p i n i o n , a n d j u d g e

i n f o r m a t i o n

f r o m a

v a r i e t y

o f s o u r c e s .

C a n d i d a t e s c h a r a c t e r i s t i c a l l y :

a

d i s t i n g u i s h b e t w e e n

f a c t

a n d o p i n i o n

b

a s s e s s t h e


f


f r o m a

v a r i e t y o

f s o u r c e s

c

m a k e a r e a s o n e d

e v a l u a t i o n o

f t h e s o u r c e s

c o n s i d e r e d .


a

m a k e s o m e d i s t i n c t i o n

b e t w e e n

f a c t a n d

o p i n i o n

b

a s s e s s a t a b a s i c l e v e l

t h e a p p r o p r i a t e n e s s o

f


f r o m o

n e o r

m o r e s o u r c e s

c

m a k e a p a r t i a l





A n a l y s e p r o b l e m s ,

i s s u e s a n d

s i t u a t i o n s .


a

a n a l y s e p r o b l e m s ,

i s s

u e s

a n d s i t u a t i o n s :

b u i l d l o g i c a l a r g u m e

n t s

u s e a p p r o p r i a t e

n u m e r i c a l a n d n o n -

n u m e r i c a l t e c h n i q u e

s .


a

p r o v i d e p a r t i a l a n a l y s i s

o f p r o b l e m s , i s s u e s a n d

s i t u a t i o n s :

b u i l d a r g u m e n t s

u s e a p p r o p r i a t e

n u m e r i c a l a n d n o n -

n u m e r i c a l t e c h n i q u

e s .


A p p l y k n o w l e d g e a n d

u n d e r s t a n d i n g o

f t h

e

s p e c i fi e d c o n t e n t t o

p r o b l e m s a n d i s s u e s

a r i s i n g

f r o m b

o t h f a m i l i a r a

n d

u n

f a m i l i a r s i t u a t i o n s .

C a n d i d a t e s c h a r a c t e

r i s t i c a l l y :

a

d e m o n s t r a t e t h e

a b i l i t y

t o a p p l y r e l e v a n t

k n o w l e d g e t o f a

m i l i a r

a n d u n

f a m i l i a r b

u s i n e s s

c o n t e x t s

b

s h o w k

n o w l e d g e a n d


f t h e

i s s u e s a r i s i n g

f r o

m t h

e s e


C a n d i d a t e s c h a r a c t e

r i s t i c a l l y :

a

d e m o n s t r a t e t h e

a b i l i t y

t o a p p l y a b a s i c l e v e l o

f

r e l e v a n t k n o w l e d g e t o

f a m i l i a r b u s i n e s s

c o n t e x t s

b

s h o w s o

m e k n o w

l e d g e

a n d u n d e r s t a n d i n g o

f

t h e i s s u e s a r i s i n g

f r o m

t h e s e s i t u a t i o n s .

A s s e s s m e n t o b

j e c t i v e 1

D e m o n s t r a t e k n o w l e d g e

a n d u n d e r s t a n d

i n g o

f t h e

s p e c i fi e d c o n t e n t .


a

d e m o n s t r a t e k n o w l e d g e

a n d u n d e r s t

a n d i n g o

f t h e

k e y b u s i n e s s c o n c e p t s

i n t h e I A S s p e c i fi c a t i o n ,

w i t h f e w s i g

n i fi c a n t

o m i s s i o n s .


a

d e m o n s t r a t e a b a s i c

k n o w l e d g e a n d s o m e


f t h e

b u s i n e s s c o n

c e p t s i n t h e

I A S s p e c i fi c a t i o n .

A s s e s s m e n t

o b j e c t i v e s

A / B b o u n d a r y

p e r f o r m a n c e

d e s c r i p t i o n s

E / U b o u n d a r y

p e r f o r m a n c e

d e s c r i p t i o n s



Perormance descriptors Appendix 1


IA2 perormance descriptors or Business Studies


E v a l u a t e ,

d i s t i n g u i s h

b e t w e e n a n d a s s e s s


f f a c t

a n d o p i n i o n , a n d j u d g e


f r o m a

v a r i e t y o f

s o u r c e s .


a


f a c t

a n d o p i n i o n

b

a s s e s s c r i t i c a l l y t h e


f


f r o m a

w i d e

v a r i e t y o

f s o u r c e s

c

m a k e a w e l l - r e a s o n e d





a


f a c t

a n d o p i n i o n

b

a s s e s s t h e a p p r o p r i a t e n e s s

o f i n f o r m a t i o n

f r o m s e

v e r a l

s o u r c e s

c

m a k e a n e v a l u a t i o n o

f t h e

s o u r c e s c o n s i d e r e d .


A n a l y s e p r o b l e m s ,

i s s u e s a

n d


C a n d i d a t e s c h a r a c t e r i s t i c a

l l y :

a

c r i t i c a l l y a n a l y s e

p r o b l e m s , i s s u e s a n d


b u i l d l o g i c a l a r g u m e n t s

u s e a p p r o p r i a t e n u m e

r i c a l

a n d n o n - n u m e r i c a l

t e c h n i q u e s

b

a n a l y s e a b u s i n e s s

s t r a t e g y

C a n d i d a t e s c h a r a c t e r i s t i c a

l l y :

a

p r o v i d e a s i m p l e a n a l y s i s

o f p r o b l e m s , i s s u e s a n d


b u i l d a r g u m e n t s

u s e a p p r o p r i a t e n u m e

r i c a l

a n d n o n - n u m e r i c a l

t e c h n i q u e s

b

o u t l i n e a b u s i n e s s s t r a t e g

y .

A s s e s s m e n t o b j e c t i v e

2

A p p l y k n o w l e d g e a n d


f t h e

s p e c i fi e d c o n t e n t t o p r o b l e m s

a n d i s s u e s a r i s i n g

f r o m

b o t h f a m i l i a r a n d u n f a

m i l i a r


C a n d i d a t e s c h a r a c t e r i s

t i c a l l y :

a

d e m o n s t r a t e e

ff e c t i v e

a p p l i c a t i o n o

f r e l e v

a n t

k n o w l e d g e t o f a m i l i a r

a n d u n

f a m i l i a r b u s i n e s s

c o n t e x t s

b

s h o w k

n o w l e d g e a

n d


f t

h e

i s s u e s a r i s i n g

f r o m t h

e s e


C a n d i d a t e s c h a r a c t e r i s

t i c a l l y :

a

d e m o n s t r a t e t h e a p p

l i c a t i o n

o f r e l e v a n t k n o w l e d g e t o

f a m i l i a r a n d u n

f a m i l i a r

b u s i n e s s c o n t e x t s

b

s h o w s

o m e k n o w l e d

g e a n d


f t h e i s s u e s

a r i s i n g

f r o m t h

e s e s i t u a t i o n s .

A s s e s s m e n t o b j e c

t i v e 1

D e m o n s t r a t e k n o w

l e d g e

a n d u n d e r s t a n d i n g

o f t h e

s p e c i fi e d c o n t e n t .


a

d e m o n s t r a t e p r e c i s e

k n o w l e d g e a n d

u n d e r s t a n d i n g

o f k e y

b u s i n e s s c o n c e p t s

d r a w n

f r o m t h

e I A 2

s p e c i fi c a t i o n , w

i t h f e w

o m i s s i o n s

b

s h o w k

n o w l e d g e a n d

u n d e r s t a n d i n g

o f t h e

l i n k s b e t w e e n b u s i n e s s

c o n c e p t s .


a

d e m o n s t r a t e k n o w l e d g e

a n d s o m e u n d e r s t a n d i n g

o f b u s i n e s s c o n c e p t s d r a w n

f r o m t h

e I A 2 s p e

c i fi c a t i o n

b

s h o w s o

m e k n o w

l e d g e a n d


f t h e l i n k s

b e t w e e n b u s i n e s s c o n c e p t s .

A

s s e s s m e n t

o

b j e c t i v e s

A

/ B b o u n d a r y

p

e r f o r m a n c e

d

e s c r i p t i o n s

E

/ U b o u n d a r y

p

e r f o r m a n c e

d

e s c r i p t i o n s



Appendix 1 Perormance descriptors





55

Appendix 2 Codes

Type of code Use of code Code number

Unit codes Each unit is assigned a unit code. This unit code isused as an entry code to indicate that a studentwishes to take the assessment or that unit. Centreswill need to use the entry codes only when enteringstudents or their examination.

Unit 1 – WBS01

Unit 2 – WBS02

Unit 3 – WBS03

Unit 4 – WBS04

Cash-in codes The cash-in code is used as an entry code toaggregate the student’s unit scores to obtain theoverall grade or the qualification. Centres will need

to use the entry codes only when entering studentsor their qualification.

IAS – XBS01

IAL – YBS01

Entry codes The entry codes are used to :

1 enter a student or the assessment o a unit

2 aggregate the student’s unit scores to obtain theoverall grade or the qualification.

Please reer to thePearson InormationManual, available on ourwebsite(www.edexcel.com).




Appendix 2 Codes




57

Appendix 3Glossary of International Accounting Standards

(IAS) terminology

The ollowing is a glossary o the comparison between the International Accounting Standards (IAS)terminology and the UK GAAP (Generally Accepted Accounting Practice in the UK) terminology.

The assessments or the International Advanced Subsidiary in Business Studies and the International AdvancedLevel in Business Studies will use only IAS terminology.

Previously used UK GAAP terminology IAS terminology

Final accounts Financial statements

Trading and profit and loss account Statement o comprehensive income

Sales Revenue

Purchases Raw materials/ Ordinary goods purchased

Cost o goods sold Cost o sales

Stock InventoryWork in progress Work in progress

Gross profit Gross profit

Sundry expenses Other operating expenses

Sundry income Other operating income

Interest receivable Investment revenues/ finance income

Interest payable Finance costs

Net profit Profit or the year

Balance sheet Statement o financial position

Fixed assets Non-current assets

Land and buildings Property

Plant and equipment Plant and equipment

Investments Investment property

Goodwill etc Intangible assets

Current assets Current assets

Stock Inventory

Stock take Inventory count

Debtors Trade receivables

Prepayments Other receivables

Bank and cash Cash

Current liabilities/Creditors: amounts due within 12 months Current liabilities

Creditors Trade payables

Accruals Other payables

Loans repayable within 12 months Bank overdraf and loans

Long term liabilities/ Creditors:amounts alling due afer 12 months

Non-current liabilities

Loans repayable afer 12 months Bank (and other) loans

Net book value Carry over

Capital Capital or Equity

Share capital Share capital



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