pq magazine, june 2014
DESCRIPTION
PQ magazine is a monthly publication for trainee accountants studying for the ACCA, CIMA, ICAEW, CIPFA, AAT and ATT exams. It is packed full of top advice from leading accountancy tutors; has news of what the accountancy bodies are doing; and offers careers and lifestyle advice.TRANSCRIPT
What is the difference between amale and female charteredaccountant? According to thelatest ICAEW salary survey, around£50,000 in pay!
That is not a joke. The surveyrevealed that the ‘typical’ charteredaccountant earns a healthy£115,700 a year. The problem isthat the ‘typical’ female CA takeshome just £68,700 a year – awhopping £47,000 less.
Worryingly, the survey shows the‘gender differential’ starts early,although it is not so telling. A maleaccountant aged under 30 earns onaverage £55,100, says the study.This compares with £49,000 for hisfemale equivalent – a gap of some£5,200.
A salary survey at the tail end of2013 found similar pay gap issues.A leading recruitment consultant
ventures that the pay gap betweenmale and female accountantsincreased by an average of £1,000 ayear for the first 10 years of anaccountancy career. After 10 years
this gap had widened to what it feltwas a “staggering £26,000”. Justtwo years after qualification thisresearch found the pay gap was£6,433.
Sharron Gunn, the ICAEW’sexecutive director, commercial, toldPQ magazine that the figures hide amore complicated picture. Onefactor that skews them is wheremen and women work. Many femaleCAs seem to prefer careers in thecharity and public sectors, sheexplained. Male accountants aredrawn to banking and the financialrewards there. She felt that manyfemale accountants are also workingpart time.
The figures were published just asPwC released its research ‘Nextgeneration diversity – developingtomorrow’s female leaders’. Over40,000 global workers born between1980 and 1995 (the ‘millennials’)were asked about their opinion onbreaking the glass ceiling.
The report acknowledges that
GENDER PAY GAPJUST GETS WIDER
PQmagazineJune 2014 www.pqmagazine.co.uk / www.pqjobs.co.uk
Students must keep abreast of technologicaldevelopments, and try to anticipate whatskills they will need both now and in thefuture, the ACCA’s UK head told students at ajoint PQ magazine/LCA Business Schoolseminar recently.
Sarah Hathaway was outlining the findingsof the ACCA’s ‘Digital Darwinism’ report. Theassociation spoke to a wide range ofaccountants, academics and CFOs incompiling the research, which highlights “thetop 10 technology trends that matter”.
Hathaway used the imminent roll-out of 5Gtechnology as a development that will be a“game-changer” for accountants, as it willmake mobile connectivity 1,000 times faster.
She highlighted big data as another area ofparticular interest to accountants. She toldstudents: “Big data demands the intelligent
use of technology and data. It is a hugechallenge – some 90% of the world’s datawas created in the past two years.”
Cyber-security and social media where bothimportant areas for young accountants, saidHathaway. She warned the assembledstudents about the dangers of Facebook,saying that all personal information andphotographs should be kept in ‘private’ areasof the social networking site.
The Digital Darwinism report is availablevia the ACCA’s website, and comes highlyrecommended by PQ magazine. • PQ is working with LCA to organise moreseminars and lectures on subjects of interestto our readers. Watch this space for details.
Digital Darwinism points to the future
WHAT’SCOOKING?
Meet Vini Aujla, anentrepreneur who can
stand the heat
INSIDE THIS ISSUETOP ACCA
EXAM TIPS We’ve got four pages
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SALARYSURVEY
Are you getting paid what youshould be? We’ve the latest
figures from Reed Accountancy
Hathaway: be aware oftechnologytrends
Continued on page 12
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contents PQ
News08CIMA ethical tool Institute
launches new ethical e-resource10Which qualification rules?
Who are the top 60 firms lookingfor when they recruit PQs?
12Name and shame Students’crimes and misdemeanours
Features, etc06Have your say Administrative
review was waste of time;unease over MCQs; and the bestfrom Twitter and LinkedIn
14Profile Vini Aujla on her time asa PQ and her business success
16ACCA F3 paper Calculators atthe ready – you’ll need them
19ACCA exam tips We’ve gotfour pages of fantastic tips fromthe accountancy experts
23Technical focus #1 Part two ofour series on standard costing &direct materials usage variance
24Technical focus #2 Howactivity based costing can boostorganisational performance
26Risk management Tacklingquestions on futures contracts
28CIPFA spotlight Institutelaunches training partnership inBangladesh
29ICAEW focus Timely advice onthe Corporate Reporting paper,to be sat for the first time in July
31Technical focus #3 How tohandle incomplete records
32Salary survey We drill downinto the salaries from ReedAccountancy’s PQ Salary Guideand Market Insight 2014
33Careers #1 Don’t overlook thevalue of company benefits anddevelopment opportunities
34Careers #2 Life at Breeze &Co; tackling issues arounddepression and the workplace;and our Book Club reviews
38Fun time The Rev’s ‘knight inshining armour’; cooking thebooks; and our great giveaways
The columnistsRobert Bruce In the accountancyworld, reputation is all 08Prem Sikka The trouble withcorporate responsibility reports 10Carl LygoWhy Indonesia is a landof opportunity 12
Subscribe to PQ MagazineIt’s FREE – see page 37 or go to
www.pqmagazine.co.uk
ABC July 2012–June 2013
32,463
Publisher’s statement: We have adigital issue of the magazine which
is sent to 9,211 requested readers
Behaving badly I am confused. It is easily done. You may have noticed inrecent months we have been bringing you lists of various PQ‘wrongdoers’. Last month it was convicted burglar and AAT
student Ammar Khan. This month (see page 12) it is, among others, CIMAPQ Pritchard Bweupe, who stole £2m from his charity bosses. Both ofthese PQs were removed from the student register of their body. So theconfusion? Well, it’s those other cases where things aren’t so black andwhite that are worrying me. What do you think should happen to fellowstudents who are found to have unauthorised material at their exam desk?And what should the punishment be? In the past, we have asked thebodies for a definitive policy and they have always explained that they takecases on an individual basis. Which, of course, is right. But a look atrecent cases, however, shows some bodies allow students found to have‘unauthorised material’ at an exam desk to carry on with the qualification.Is that right? Bodies need to be really clear here and a list might help.
The case that really got me thinking was that of Kowk Keung Chan. InAugust 2006 he was convicted of indecent assault and sentenced to threeyears and three months in prison. The disciplinary committee of the HongKong Institute of Certified Public Accountants found him guilty ofdishonourable conduct. However, he failed to notify CIMA of his conviction.Interestingly, the sanction imposed by HKICPA of a suspension for threeyears was due to expire in November 2012 and he had sent letters ofregret and remorse to the institute. The committee, however, felt that theindecent assault on a vulnerable victim was a very serious departure fromthe standards of conduct required. Mr Chan was expelled and ordered topay £6,448.28.
So, the concern is this: HKICPA gave him a suspension, and CIMAseems to be punishing him for not telling them about the conviction. Now,that is not to say that he wouldn’t have been expelled had they knownearlier, but just a suspension from HKICPA? Is that right? What do youthink? (Email me with your views, I’d love to hear from you.) You couldargue he has served his time. Is there no rehabilitation possible for thisaccountant? I must stop thinking.
Graham Hambly, PQ magazine editor ([email protected])
CONTENTS June 2014
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PQ have your say
Thanks for seminarThank you very much for organisingthe ‘How technology is reshapingthe finance profession’ seminarrecently at LCA Business School. Itdefinitely made me look at ourprofession from a different angle, tothink about the future and howmuch more varied and interestingour roles are becoming thanks tothe emerging technologies.Yulia Sitnikova, via Facebook
Unease over MCQsI don’t want to be a killjoy but I amnot sure if I like the idea of MCQsbecoming a major part of theaccountancy professional exams.
Surely being an accountant meansshowing off an ability to write reportsand communicating these to seniorpeople in your organisation – bothfinance and non-financial people, ofcourse. I am not sure MCQs willprovide today’s accountants with theskills to do this. There seems to beno proper debate occurring aboutthe educational benefits of goingdown this route. I just believe oncewe start this journey there will be nogoing back.Name and address supplied
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PQ Magazine Fourth floor, Central House, 142 Central Street, London EC1V 8AR | Phone: 020 7216 6444 | Email: [email protected]: www.pqmagazine.co.uk | Editor/publisher: Graham Hambly [email protected] | Advertising manager: Polly Thrasivoulou [email protected]
Associate editor: Adam Riches | Art editor: Tim Parker | Subscriptions: [email protected] | Contributors: Robert Bruce, Prem Sikka, Tony Kelly, Ruhi Singha, 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 [email protected]
Published by PQ Publishing © PQ Publishing 2014
Timewasting reviewFollowing a recent article in PQmagazine (May 2014), I thought Iwould share my experience of anACCA administrative review. Ireceived a ‘fail’ for the P1 exam inthe December 2010 sitting with amark of 46%. Having never failedan exam (any!) in my life, Icouldn’t understand how this hadhappened – I was well preparedfor the exam and had for the firsttime attended a revision course.
From the administrative view, itseems I didsuccessfully passquestion 2 and question4 – this suggests to me
The writer of the star letter each month wins a fantastic ‘I ❤ PQ’ mug!
email [email protected]
There was a greatdiscussion onASNG recentlyafter one PQadmitted to losingtheir motivation to
study and called for help! Studentssaid she had to think about whyshe started studying in the firstplace. Another explained thatmotivation can be a strange thing –it ebbs and flows and feels like it
has run out completely. It is, saidKeith, the old work-life-studychallenge. When you study for theACCA ‘life’ has to go! Christopherstressed that PQs need to think bigand long-term, and write downwhat the future looks like, feelslike and smells like. Then you haveto break this down into smallachievable chunks. As Confuciussaid: “It doesn’t matter how slowyou go as long as you don’t stop!”
“That reminds me, have you heardabout your ACCA exam administrative
review yet?”
incomplete in the scan process.I went on to re-sit P1, did
substantially less revision than Ihad the first time and passed with74%. The ACCA administrativereview and appeal process was inmy view, a waste of time andmoney.Name and address supplied
a bare minimum of 25 marks fromthese two questions. Based on this,I can only assume I received only21 marks out of 50 from question1. I went all the way to appeal butreceived no further usefulinformation from the ACCA.
My tutor kindly offered to markquestion 1 for me, so I wentthrough it again (under examconditions). She marked it andgave me 30 out of 50 – so I wasstill none the wiser.
My pet theory is that this is oneof the first sessions where theexam papers were electronicallyscanned. I think my question 1answer was in some way deleted or
It has been a busymonth for Twitter.First, shares in Twitter droppedas it reported a slowdown inuser growth. The number ofactive users reached 255m inthe first three months of 2014,up 5.8% on the previousquarter. Twitter also reported anet loss of £78m for thequarter. Then Amazonannounced a partnership thatallows users to add products totheir shopping carts by tweetinga special hashtag –#amazonbasket. Users will stillneed to go to Amazon to payand complete the purchase.
Our most ‘viewed’ story thismonth @PQmagazine was ourvisit to De Monfort University –we were blown away with theset up and enthusiasm there(see photo below).
Another top read was: “If ManCity found guilty of falling foulto the financial Fair Play ruleswill Utd ask to take their placein Europe?” It transpires thatCity will be fined £50m andhave to contest next season’sChampions League with a squadsize of 21 players after beingfound guilty of breachingUEFA’s rules. City haveappealed the ruling and fine.
So don’t forget to follow us@PQmagazine.
Hot & Tweet
The ACCA’sSarahHathawaypresentedthe PQseminar
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8 PQ Magazine June 2014
PQ news
It is easy for accountants to losesight of what they are really about.The daily tasks keep noses to thepage. And when the busy accountantdoes look up, they don’t sniff the airand wonder about the widersignificance of it all.
I was reading the latest in a longline of brilliant crime novels byDonna Leon* the other day. They areset in Venice and corruption is neverfar away from the narrative. Thehero, Guido Brunetti, works for thepolice, but his social context is alsoat the heart of how the storiesdevelop. In this one he isinvestigating the theft of rare booksfrom an ancient library. WhileBrunetti and his wife are havingdinner with her parents anddiscussing the endemic corruption inthe city he suddenly asks: “What areyou going to do about it?” And hisfather-in-law answers: “The onlything I can do is what I have beendoing for the last five years.”Brunetti asks what that is. “Move mymoney out of the country. Invest incountries that have a future, invest incountries where there is the rule oflaw,” he says.
And that, in the end, is where thereal value of accounting lies. Peopleinvest in countries and companieswhere the security of credible
accounting exists.Countries thrive withit, and declinewithout it.* ‘By Its Cover’ byDonna Leon ispublished by WilliamHeinemann (£17.99)
ROBERTBRUCE
Reputationis all
■ Robert Bruce is an award-winning writer onaccountancy for The Times
CIPFA’s top bananas: Prize-winning students came out in force tocollect their prizes at CIPFA’s annual ceremony. PQ Cerys Ledgerpicked up two prizes – the Arthur Collins Medal and Eric Gillilandmemorial Prize. Oh, and £450!
CIMA has launched a fantasticnew ethical e-resource designedto support students with boththeir studies and ethicaldevelopment. The tool has beencreated as part of the institute’songoing work to ensure studentsare more prepared for theethical dilemmas they will facein their working lives.
CIMA’s ethics guru, TanyaBarman (pictured), saidexaminers had reported thatstudents seem to struggle whenput in business situations whereethics is a key component. “Theythrow in words such as integritywithout really understanding what itmeans,” she ventured.
Understanding how ethics worksin the real world will also get youmarks in the exam hall, Barmanstressed, and this e-resource canhelp do just that.
The tool provides informationaround what ethics are, the Code of
Ethics and ethical conflict, andincludes sample questions rangingfrom C05 to T4B. It includes threeself-tests and a wide range ofrelevant resources.
CIMA is keen to stress, however,that the tool is no substitute forCIMA study texts, but is meant tobe used alongside them.• Go to www.cimaglobal.com/studentethicstool
NEW ETHICS TOOLLAUNCHED BY CIMA
ICAS PQ numbersfall dramaticallyin the past year
Affiliates struggleto find experience
There was a dramatic 20% drop inthe ICAS student intake last year,according to the ICAS annual report.
This is the second year in a rowthat student recruitment has fallen.In 2011, ICAS recruited 1,000chartered accountancy students.This dropped to 963 in 2012 andagain, more dramatically, in 2013 to767. The report puts the drop downto offshoring and the increasingnumber of school-leavers beingrecruited in England. Another factorwas the merger of BDO and PKF,which resulted in reduced numbersof CAs starting the qualification. Itappears that some SMEs inScotland were not able to findsuitable candidates, either.
ICAS told readers that theinstitute will now focus its efforts onincreasing the number of studentsrecruited through traditional routeswhile opening up new routes ofentry. To this end, ICAS now allowsstudents to get the CA qualificationoutside a training contract.
500 new EY jobs in BelfastEY is set tocreate 486 jobsin Belfast. A newbusiness unit
will, it is reported, be advisingclients outside Northern Ireland,with the posts being filled over thenext four years. The firm alreadyemploys 1,500 people in bothNorthern Ireland and the Republic.The Stormont’s ministerialexecutive has confirmed it will becontributing £19m a year in directsalaries once all the roles are filled.
Deloitte heads to Tech CityDeloitte has joined a growingnumber of blue-chip companiesthat are locating their digitaloperations in London’s Tech City.It has opened up shop inClerkenwell Green, moving its 170strong team into a ‘technologystudio’. KPMG is already there –they moved in two years ago.
Ex-KPMG man jailedFormer KPMG partner ScottLondon has been sentenced to 14 months in prison for insidertrading. London tipped off his
golfing partner, Bryan Shaw, aboutKPMG clients including Herbalifeand Skechers. Shaw made over$1m on the informationreceived. In return,London was given cash, a Rolex watch and evenBruce Springsteentickets. On top of the jail sentenceLondon was ordered to pay a fineof $100,000.
Audit ‘roundabout’The Big 4 are playing audit‘musical chairs’. The BBC hasditched KPMG as its auditor after
18 years. EY takes its place.Meanwhile, Barclays is looking toreplace PwC, while EY is replacing
PwC at the LondonStock Exchange.And one of the UK’sbiggest financialservices group, Old
Mutual, has put its contract out tothe market. It has been audited byKPMG since 1999. Rio Tinto hasbucked the trend to say it issticking to PwC, who have auditedits books since 1980. This fallsfoul of Brussels’ rules that requirea switch every 20 years.
More and more AAT affiliates appear to bestruggling to find the relevant workexperience they need to becomemembers (MAATs). The AAT said that thejob market is still affecting its people’sability to move on to full membership. Asthey can’t meet the AATs work experiencecriteria they have to stay an affiliate. TheAAT says that this is something it will lookto address in what remains of 2014.
It has already extended its CPDscheme to affiliates. This will give them agreater opportunity for careerdevelopment and enable them todemonstrate their commitment to theaccountancy profession to both potentialand current.
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10 PQ Magazine June 2014
PQ news
What would you do if a companypublished its annual accounts and allthat they consisted of were somesmiling faces, a few graphs and plentyof self-congratulatory statements? Notmany people would have confidencein such accounts. There would beplenty of critical comments in thepress, regulators and investors.
Yet the same critical scrutiny doesnot apply to glossy corporateresponsibility reports (CSR). Theseoften contain little useful information;companies find it cheaper to hire PRexperts to write self-congratulatorystatements to assuage critics ratherthan producing meaningful reports.
Most CSR reports provide little orno data on the impact of corporatepractices on human rights, taxavoidance, environmental degradation,poverty wages, or anything else.Newspapers are full of stories aboutthe rigging of interest rates, bribery towin contracts and consumers beingsold horsemeat instead of beef. Somecompanies show remorse after theevent, but none has ever owned upbefore the public exposure.
In a world where corporations affectthe quality of food, air, water,medicines and virtually everythingelse, there is an urgent need to remindthem of their social responsibilities.This requires publication ofmeaningful social information. For fartoo long, the contents of CSR reportshave been left to the assumed goodintentions of companies, but thatexperiment has failed. It is now timefor the law to act.
PREMSIKKA
Let’s replacePR puff withworthwhileCSR reports
■ Prem Sikka is professor of accountancy at theUniversity of Essex
New CEO now in placeMark Farrar has now taken
over at the AAT, joining from theConstruction Industry TrainingBoard the UK. After time in theRoyal Navy Farrar(pictured) trainedas an accountantwith Deloitte.Following senior roles withBarclays Bank and Norwich Union,he moved into the public sectorand joined Cefas, a Government-owned marine science andenvironmental research body.
Exporting expertiseTeams of British accountants
will help transform accountingstandards and develop professionalaccountancy institutes in Africa
and Asia. InternationalDevelopment SecretaryJustine Greening said the UKwill deploy staff from the
ACCA, CIPFA and ICAEW todeveloping countries such asZambia, Nigeria and Ethiopia toimprove their financialmanagement and investmentclimates in a £4.5m programme.
Non-financials ruleAll EU large firms will have to
disclose a host of non-financialinformation in their annual reportsunder new rules. Gender diversity,corporate social responsibility, anti-corruption measures andenvironmental impact will all haveto be ‘revealed’. The FRC’sStephen Haddrill described thenew non-financial disclosurerequirements as a positive movefor investors, complementing theFRC’s work on UK guidance on thestrategic report.
In brief
Practice testsfor ACCA PQsGreat new revision aids have beenproduced for ACCA students sittingthe new F1, F2 and F3 exams. Thetests, which cost either £7 for oneor £14 for three, replicate the CBEformat and should help identify acandidate’s strengths andweaknesses. The ACCA is alsohoping they will give students a realinsight into the live examexperience.
PQs will be given personalisedfeedback, which will tell them howwell they have performed across thedifferent areas of the syllabus,although the ACCA is quick to pointout that if you manage a pass itwon’t guarantee a pass in the realthing!
These tests have been designedfor the revision phase, and theACCA has also stressed that youhave to complete your studies of thewhole syllabus before you takethem.
March ICAEW results inWhen was the last time you saw a37.5% pass rate in an ICAEWexam? Well, the answer will be theMarch 2014 Financial Accountingexam. In its defence, the ICAEWwill say just 16 PQs sat the paper,but even so just six out of those 16students won’t have to resit thepaper again. The taxation (55.4%)and financial management (67.2%)pass rates don’t make prettyreading either.
Two is definitely the magicnumber for students who want to
pass all the papers they sit firsttime. Those students sitting twopapers (70.5%) in March again didbetter than those sitting just onepaper (66.9%). They usually do!
In all, 1,838 students sat thespring test, with 2,915 papersattempted. Some 1,255 studentspassed all the paper they took.
The increasing global reach ofthe ACA qualification was alsoevident in the prizewinners – twofrom Malaysia and one fromSingapore.
Which qualification rules?The top 60 accountancy firms arefalling back in love with the ICAEW– be it ever so slightly. Latest statsfrom Accountancy magazine showthat trainees studying for theICAEW qualification rose from64.5% to 65.3% in 2103.
The Scottish institute (ICAS) alsosaw a percentage jump in its PQsin the biggest firms – from 16.7%to 18.3% in one year.
The figures aren’t perfect assome big firms, notably MooresStephens (ninth biggest), BegbiesTraynor (14th) and TaxAssist (24th)do not provide a completebreakdown of student numbers.Some have not provided anyfigures, so not much transparencyhere, one fears.
ACCA PQs in the top 60 firms areholding up. In 2013, 9.7% of all PQswere studying with the association.Some firms really like their ACCAs –
step forward Haines Watts, FRPAdvisory and Reeves & Co.
CIMA numbers were down thisyear, but CIMA PQs still make upover 6% of the total. At EY theynumber nigh on 19% of all trainees,and as the firms move back intoconsultancy these numbers can beexpected to rise. That said, PwC toldAccountancy that while it has 2,134in ICAEW training contracts, justseven CIMAs also work for the firm.
It has been a mixed bag when itcomes to the number of traineesbeing taken on. This year’s figuresshow Deloitte and EY have increasedstudent numbers, whereas PwC andKPMG have taken on fewer traineesthis time around. The same is true ofthe top 10 firms. Here Baker Tilleystands out and a firm ‘growing’ itsPQ numbers.
TOP 60 FIRMS Recruitment by body (Accountancy magazine)
ICAEW 8,129 (65.3%)
ICAS2,281 (18.3%)
ACCA 1,212 (9.7%) CIMA 768 (6.2%)
CIPFA 61 (0.5%)
ICAEW MARCH 2014 PROFESSIONAL RESULTS
December 2013 March 2014Audit & Assurance 82% 87.4%FA & Reporting 80.1% 81.2%Tax Compliance 88.4% 78.2%Business Planning Taxation 62.5% 68.6%Business Strategy 90.4% 88.7%
Financial Management 86.9% 67.2%Financial Accounting 67.6% 37.5%Taxation 75.1% 55.4%Financial Reporting 74.3% 63%
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12 PQ Magazine June 2014
PQ news
I was recently in Jakarta, capital ofIndonesia, which is the fourth largestcountry in the world by population,home to some 252 million people. Onthe ‘McDonald’s Index’ a Big Mac willset you back $2.30, compared withthe US/UK price of $4.63.
Indonesia is part of the Associationof South East Asian Nations (ASEAN),which is preparing to form a type ofEU economic union in 2015. Thisincludes reciprocal recognition ofaccounting standards/qualifications(in theory at least). I was surprised tolearn that for a population of 252 million there are barely morethan 1,000 accountant members ofthe Indonesian Chartered Accountants(IAI). The IAI appears to be thepreserve of the partner level groupand accounting outside that elitegroup has not been ‘professionalised’.Many graduates in accounting join theBig 4 firms, but then exit to industrywithout any formal professionalqualifications other than experience ofwork. The legal profession inIndonesia is similarly sparse, with justone lawyer for every 11,000 ofpopulation – in the UK there is aboutone lawyer for every 460, and in theUS the figure is one lawyer for every260!
Many professionals in Jakarta haveexpressed their concerns that thenecessary legal and financialinfrastructure is not in place to helpthe Indonesia achieve its fullpotential. The UK accountingprofessional bodies are all inIndonesia helping to develop theprofessionalism the country will needas it continues to grow at 6%-plus perannum.
Opportunity is knocking for UKprofessional services.
CARLLYGO
Oppoutunityknocks inIndonesia
■ Professor Carl Lygo ischief executive of BPP
Zambian CIMA student PritchardBweupe has been found guilty oftheft. While working for his charitybosses the PQ finance officerdiverted ZMK20,494,679.33 (£1.9 million) from his employersaccount into his own account.
CIMA’s disciplinary committeefound him guilty of misconduct.Bweupe provided no insight into hiswrongdoing during the hearing, butthe committee gave credit for thefact that the misappropriated fundswere repaid. However, the seriousnature of the wrongdoing meant hisstudent registration was cancelledand he was ordered to pay £3,000in costs.
Another student, AlistairPaterson, was also found guilty ofmisconduct. He was convicted ofembezzlement and sentenced to 40months imprisonment. Paterson’sstudent registration was cancelledand he is required to pay£6,448.20 costs.
Four other CIMA PQs haddisciplinary hearings recently.
Richard Gardiner told hisemployer he had passed the CO2exam when in fact he had onlyachieved 48%, providing hisemployer with a document headed‘CIMA’ and ‘results’. His studentregistration was cancelled and hewas ordered to pay £500 costs.
David Horner was found to havea mobile phone in his possession inan exam hall. He was severelyreprimanded and fined £500, plus£600 costs.
Ayotunde Odunsi had CIMABitesize Kaplan paper CO4 in hispossession. The committee decidedto impose a severe reprimand andannul Odunsi’s result for the examin question. Odunsi was required topay £500 costs.
Assam IIyas submitted a falseCIMA associate membershipcertificate to a prospectiveemployer. The committee cancelledhis student registration and he wasordered to pay £100 costs.
CIMA’S WRONGDOERS
Baker Tilly has come under fire from theFinancial Reporting Council (FRC) in itsannual Audit Quality Review. The FRCsaid the firm’s emphasis on obtainingaudit evidence through analytical reviewprocedures is not performed well on aconsistent basis, and the FRC continuesto find quality and robustness issues inthe audit evidence obtained. Half of theindividual audit reviews were deemed torequire ‘significant improvements’.
The FRC has provided a long list ofwhere attention is needed, including thefirm’s monitoring processes of trainingand professional development.
There is a worry that Baker Tillyseems resistant to some of thecriticisms. The FRC commented: “Thefirm has been reluctant to accept someof the conclusions we have drawn fromthe findings of our file reviews whichmay inhibit it from determining how therequired improvements in audit qualitycan be achieved.”
In its defence, Baker Tilly said it wasaddressing the findings “that willcontribute to an improvement in auditquality”.
Joint arrangements amendsThe International Accounting
Standards Board (IASB) haspublished amendments to IFRS 11Joint Arrangements. New guidanceon how to account for theacquisition of an interest in a jointoperation that constitutes a businesshas been added, specifying theappropriate accounting treatment forsuch acquisitions.
New online shop opensLSBF has launched a new
online shop for ACCA and CIMApart-time students. PQs are just afew clicks away from enrollingthemselves on a course. To markthe launch, LSBF is offering adiscount of up to £160 off ACCArevision when booked in acombination of papers. Visithttp://shop/lesbf.org.uk/
Blog it to me!Eos, the ICAEW case study
specialist tutors, have unveiled itsnew improved website. A new blogallows student to access businessnews, business ethics, case studyarticles and ICAEW material. Thetuition programme remains thesame – with weekendmasterclasses in July. For more goto www.training-by-eos.com
CIPFA training partnershipCIPFA has launched a training
partnership with LCBS Dhaka, amajor training provider, allowingaccountancy students inBangladesh to study for CIPFA’sinternational professionalqualification, and ultimately givingthese PQs the opportunity to achievechartered public finance accountantstatus. See page 28 for more.
In brief
Significantimprovement
demanded
All smiles: ICAS prizewinners got together to celebrate their successat a recent awards ceremony in Edinburgh
Photograph: SUCCESS
Pay gap widensContinued from page 1women remain scarce at the top,with only 4.6% of Fortune 500CEOs currently women. The studyfound that when itcomes to internalpromotion nearlyone in three (29%)female millennialsbelieve employersare biased towardstheir male colleagues.
Women are still struggling tomake it to partner level in many ofthe bigger chartered firms. EYstands out among the Big 4 with
113 female partners out of a totalof 565 partners (20%). Womenpartner numbers in the other Big4 firms hover around the 15%
mark.However, it is much
worse at other bigfirms. At Haines Wattjust 8.7% of itspartners are women,while at Johnston
Carmichael it is just 7.5%. Amongthe top 30, Menzies has thedubious honour of the lowestnumber of female partners – twoout the 34 (we make that 5.9%).
14 PQ Magazine June 2014
PQ profile
Vini & Bal’s is an award-winning range offresh, chilled Punjabi spice blend basesthat allow food lovers to easily create
intensely-flavoured, authentic Indian cuisinefrom scratch in their own kitchens.
Vini and Bal Aujla, the husband-and-wifeentrepreneurs behind the range, recentlyappeared on BBC’s Dragons’ Den and securedinvestment – the first British Asian couple to doso in the history of the programme.
Before Vini & Bal’s, Vini worked in the City atan investment bank, RIT. She studied ACCA parttime, although she did not complete the course.
Why did you choose to studyaccountancy? I found the subject interesting. I have alwayshad a keen interest in business and I found thataccountancy offered a real variety of subjects; itwasn’t just about numbers. The various subjectsgive a real insight into the fundamental elementsof business; anything from business structuresand the legalities, to the fundamental elementsof financial management.
How did you find the exams?I was actually expecting our first child during myexams. I found the course to be extremelyflexible, which greatly helped me manage mystudying alongside my pregnancy. It wasconvenient as there were various options andresources available.
What is it that you didn't like about beingan accountant?It can become quite repetitive, hence my desireto pursue my dream of developing a range offresh, authentic and delicious curry sauces.
We read that you had the idea for yoursauces as a student.What was it thatsparked the concept for rustic sauces?The inspiration for Vini & Bal’s came when I firstrealised how different the perception of Indianfood was to the reality. It was impossible to findanything resembling authentic, fresh Punjabihome cooking in restaurants or shops. Vini &Bal’s sauces are inspired by the traditionalrecipes that have been passed down through thegenerations, to allow British households toexperience real Indian cooking; the very samethat Bal and I both enjoyed growing up and nowprepare for our own children.
Do you feel you have always had anentrepreneurial spirit?Yes, I have always shown ambition and a desire
to succeed. I also have always maintained apositive attitude, which is crucial, as it can betempting to just give up at the first hurdle. It alsohelps that Bal and I have each other. Wecontinuously motivate and support one another.
What advice would you give anyone elsethinking of going it alone?I’m not alone – I am lucky enough to have Bal’ssupport both at home and at work! For anyonethinking of launching their own brand, it is vitalthat you have complete confidence in yourbusiness and the concept behind it. Not onlythat, but you need to know your market insideout, including any competitors. It’s alsoimportant to expect a major change in yourlifestyle; Bal and I had to make some sacrificesto launch Vini & Bal’s, including cutting down onleisure activities, but it was all worth it in theend.
You now have the backing of a ‘Dragon’Piers Linney.What has he added to yourbusiness?As well as providing the finance our businessneeded, partnering with Piers has bought theexpertise, drive and ambition of a third party.
What was your first job?I worked in a local chemist, assisting thepharmacist.
What was the last book you read? Decoded
What is your favourite TV programme?TV is a luxury I do not have time forunfortunately! However, when I do, I really enjoyMasterchef. It is possibly one of my favouriteshows next to Dragons’ Den.
Do you have a claim to fame?Being one half of the first Asian couple ever tosecure investment in the history of Dragons’ Denis a great claim to fame! While I haven’t seen myname in lights yet, spotting our names on theshelves of major supermarkets gives the samethrill!
Who is your hero?My dad. In the early 1980s I watched my fatherlose his business, but instead of giving up hepicked himself back up and started over again.As I grew older I became more aware and moreappreciative of the long hours he put intoproviding for the family – I can never rememberbeing without. With my mother’s help he builthimself up to be successful, which is somethingI really aspire to. My dad taught me that hardwork pays off and that I can be whatever Ichoose to be. • You can check out the Vini & Bal’s productrange at http://www.viniandbals.com
PQ
PQ spoke to Vini Aujla, co-founder of Vini & Bal’s Indiancurry sauces business, about hertime as a PQ and her career to date
CURRY FAVOUR“It is vital that you
have completeconfidence in your businessand the concept behind it
June 2014 Exam
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The syllabus . .The ACCA F3 syllabus is designed to helpstudents develop knowledge and understandingof the underlying principles and conceptsrelating to financial accounting. In addition,students should develop their knowledge andunderstanding of double-entry accountingtechniques which should enable them to preparebasic financial statements. This provides afoundation for future study of financial reportingas students’ progress through their ACCAexaminations towards qualification. The syllabuscontent of ACCA F3 is also relevant to thepractical work requirements of many students.Students who are in work may find that they canrelate part of their ACCA F3 studies to theactivities they and colleagues perform in theworkplace. F3 has eight key syllabus areas:
AThe context and purpose of financialreporting: This section of the syllabus
introduces students to the scope and purpose offinancial statements for external reporting,together with other related factors such as theregulatory framework and governance issues.Included within this syllabus area is recognitionof the different types of business organisation,together with how this affects the format andcontent of financial statements. Students willneed to understand the format and content ofthe primary financial statements, together withthe underlying definitions which relate to thesestatements.
BThe qualitative characteristics of financialinformation: This section requires students
to understand and apply the qualitativecharacteristics of useful financial information asderived from the 2010 Conceptual Frameworkfor Financial Reporting. The section alsoincludes accounting concepts and principlesrelevant to the preparation of financialstatements. While these are relativelystraightforward topics, students need to ensurethat they understand the definitions, principlesand concepts which are examined in this paperand which provide a foundation for their futurefinancial reporting studies.
CThe use of double-entry accounting systems:This is a key element of the ACCA F3
syllabus that introduces students to double-entrybook-keeping principles, together with the roleand purpose of ledger accounts, books of primeentry and journals.
DRecording of transactions and events: Thisis a major element of the ACCA F3 syllabus
that will act as a foundation for subsequentACCA studies. It focuses upon the recording oftransactions together with classification oftransactions and account balances as a basis forpreparing a trial balance and a set of financialstatements. Students will also be introduced toformalised accounting requirements derivedfrom financial reporting standards.
EPreparation of a trial balance: This sectionrequires students to understand the nature,
purpose and limitations of a trial balance,including identification and correction of errorswithin the accounting records and trial balance.Students may be required to prepare a trialbalance in full or in part.
FPreparation of basic financial statements:This could include a requirement to prepare
in full, or in part, a statement of financialposition, a statement of profit or loss and othercomprehensive income or a statement of cashflows. Based upon the new format examinationfrom February 2014, this is of great importanceas one of the two 15-mark questions will be anaccounts preparation question. The accountspreparation question could be for anunincorporated business or for a limited liabilityentity and may include an element of incompleterecords that requires students to calculate orderive information based upon their knowledgeof accounting principles, techniques andrelationships.
GPreparation of simple consolidated financialstatements: This section requires students
to understand and apply definitions relating tocontrol, significant influence and non-controllinginterest as a basis for preparing simpleconsolidated financial statements. This will formthe basis of the second 15-mark question in theexam and may require students to calculate and
account for goodwill, account for fair valueadjustments and identify and account forintercompany trading, including any unrealisedprofits on that trading.
HInterpretation of financial statements:Students will be required to understand
the importance, and limitations, of interpretationof financial statements. They will be expected tocalculate and explain a range of financialaccounting ratios dealing with businessprofitability, liquidity, efficiency and financialposition.
Sitting the P3 exam .In February 2014, ACCA introduced a revisedformat exam consisting of two sections. SectionA comprises 35 compulsory multiple choice styleor equivalent questions for 70 marks. Section Bcomprises two compulsory 15-mark questions;one dealing with accounts preparation and theother dealing with consolidated financialstatements. Students have two hours tocomplete the exam, which may be attempted ineither a paper-based or computer-based format.
The introduction of the longer-style questionsin Section B of the exam paper represents amove towards making the examination a bettertest of student knowledge and understanding.This should benefit students as they progressthrough their ACCA studies and deal with morechallenging issues in financial reporting.
Students therefore need to understand at anearly stage of their ACCA F3 studies, that theyneed a combination of theoretical understandingallied with practical application of elements ofthe syllabus to be successful in their ACCA F3studies. • Tony Sweetman is the F3 Content Specialistat Kaplan Financial
PQ
16
PQ ACCA F3 paper
PQ Magazine June 2014
Kaplan’s Tony Sweetman explainsthe ins and outs of the F3 syllabus– so get your calculator out
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Kaplan FinancialF4• English legal system: types of law,court vs tribunal, Human RightsAct.• Contract law: exclusion clauses,offer & acceptance, intention tocreate legal relations.• Tort of negligence: duty of care,breach of duty.• Employment law: common lawduties, redundancies.• Agency/partnership: how agencyrelationship arises, termination ofpartnership.• Company law: separatepersonality/lifting the veil, articles ofassociation, dividends, class rights,corporate governance.• Fraudulent behaviour: moneylaundering, bribery, fraudulent andwrongful trading.F5• Specialist cost and managementaccounting techniques.• Decision making techniques.• Budgeting.• Standard costing and varianceanalysis.• Performance managementsystems, measurements andcontrol.F6• Income tax: detailed income taxcomputation, employment income,self assessment.• Corporation tax: long period ofaccount, chargeable gains tocalculate, with rollover relief,property income, single companylosses and/or group loss relief –with some tax planning.• VAT: VAT return – including somediscounts and impaired debtsrelief, deregistration, flat ratescheme, capital gains tax, husbandand wife making disposals, wastingassets or chattels, rollover relief.• Inheritance tax: transfer ofunused NRB between spouses.F7• Q1: company SOFP orconsolidated statement of profit orloss with SOFP workings to includegoodwill, retained earnings, NCI.Adjustments to include: PURP, intra-group sales, deferred consideration,share exchange, impairment,revaluation, fair value adjustment.
• Q2: published accounts toinclude statement of profit or loss,statement of financial position andstatement of changes in equityfrom trial balance. Possibleadjustments to include: revenuerecognition, depreciation,revaluation, tax & deferred tax,convertible loan, share issue.• Q3: either a mix of statement ofcash flow with some ratio analysis,or an question involving ratios.• Q4/Q5: the framework, intangibleassets, events after the reportingdate, earnings per share.F8• Audit framework: confidentiality/conflicts of interest/auditcommittees.• Internal audit: outsourcing, VFM.• Planning and risk: audit risk.• Internal control: payroll system(including tests of control).• Audit evidence: purchases,payroll, inventory, reviewengagements.• Completion & reporting: goingconcern (ISA 580), evaluation ofmisstatements (ISA 450) andauditor’s reports.
• Specific standards/topics:elements of internal control (ISA315), inherent limitations of internalcontrol, risk assessmentprocedures (ISA 315), auditplanning (ISA 300), expectationgap, sampling (ISA 530), auditingaccounting estimates (ISA 540).F9• Investment appraisal.• Working capital management.• Valuations.• Business finance.• Cost of capital.• Risk management.• The financial managementfunction and the financialmanagement environment.P1• Corporate governance critiqueand improvements.• Effective internal control systems,reporting within differingjurisdictions.• Influence of and intervention byinstitutional investors.• Function and importance ofinternal audit.• Risk definition, analysis of riskand the role of board of directors.
• Risk correlation and strategies formanagement of such risks.• Kohlberg’s human moraldevelopment theory.• Ethical standpoints and theirapplication to business decisions.• Corporate codes of ethics critiqueand improvements.• Tucker’s ethical decision makingmodel.• Social and environmentalfootprint.• Sustainability accounting.P2• Q1: groups and ethics,consolidation of an overseassubsidiary hasn’t been tested since2011 so this is a possibility, andalso statement of profit or loss andother comprehensive incomeseems more likely.• Q2 & Q3: core areas that havenot been examined in discursiveform recently include: deferred tax,related parties, IFRS 10 and thedefinition of control, de-recognitionand impairment of financialinstruments• Q4 (essay style): focus seems tohave been on existing standards sothe adequacy of the existingframework seems a possibility aswell as how companies haveaccounted for and disclosedgoodwill impairments (IAS 36).P3• Project management and benefitsmanagement.• Supply chain management andthe value chain.• Strategy evaluation.• Managing strategic change andculture.• Decision making techniques.P4• Salary vs dividend.• Lease vs buy assets: net cost.• IHT vs CGT for gifts.• Stamp duty and SDLT.• Ethics.P7Core areas likely to be examined inevery paper:• Engagement planning and riskassessment (business risk & risk ofmaterial misstatement).• Engagement procedures (orevidence).
PQ Magazine June 2014 19
ACCA exam tips PQ
The experts tell you what they think might come up inJune – but, remember, there are no guarantees
Continued on page 20
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20 PQ Magazine June 2014
PQ ACCA exam tips
• Disposals (December 2009).• Step acquisitions (December2011).• Cash flow (December 2013).• Foreign sub (June 2010).• Complex group (December 2012and June 2013).• Foreign subsidiaries – notexamined for a few exams.• Financial instruments (IAS39/IFRS 9) to include hedgingaccounting, get this topic in mostexams.• Employee benefits (IAS 19) – thisstandard was amended by IASB in2011 and is now examinable underthe new standard.• Leases (IAS 17), Share-basedpayments (IFRS 2), Impairment ofassets (IAS 36), Deferred tax (IAS12).P3• Project management focusing ondocuments (such as business case,benefits review, etc).• Internal strategic capabilities orvalue chain.• Finance – possibly sources offinance or working capitalmanagement.• Organising business success –organisational structures andinternational strategy.P5• Budgeting – possibly includingbeyond budgeting.• EVA or value based management.• The performance prism.• Reward schemes.
De Montfort UniversityF5• ABC vs. traditional costingtechniques.• Linear programming.• Planning and operationalvariances.• Sources of managementinformation.• Performance measurement.F6• Profit adjustments.• Capital allowances.• Benefits.• Capital gains.• Look out for small adjustments/written parts about FY2013 changessuch as the child benefit charge orthe cash basis for sole traders.
F6• Q1: employment income includingthe evaluation of benefits, savingsincome and dividend income andinterest payable on special loans,ISAs and the rules for individuals,child benefit income tax charge,introducing a partner into thepartnership with opening year rules,computing the income tax payable,computing national insurance.• Q2: (a) corporation taxcomputation, adjustment of atrading loss including capitalallowances for plant and machineryand relief for the trading loss, VATor maybe a separate question,errors on the VAT return, VATimplications of a business offering adiscount to customers, flat ratescheme for VAT.• Q3: capital gains tax forindividuals, a mixed bag.• Q4: the cash basis of accountingvs. the normal or accruals basis.• Q5: the residency position of anumber of individuals, IHT onmaking lifetime gifts into a trust.F7• Q1: consolidated statement offinancial position (maybe with P/L)with associate – no associate lasttime.• Q2: published accounts, possiblyredrafting (missing for many years)and including SOCIE and EPS.• Q3: interpretation with cash flow(15 marks on standards).• Q4: mixed standards: EPS, fininst, PPE, intangibles, provisions,substance, deferred tax,discontinued, etc.• Q5: concepts with standards, forexample, contracts, provisions,leasing, events after reportingperiod, impairment, etc.F8• Conflicts of interest.• Threats to objectivity.• Confidentiality.• Audit risk with ratios to calculate.• Internal controls (objectives,procedures, tests) over multipleareas.• Substantive tests over payables.• Subsequent events.• Audit report scenarios.• Reliance on internal audit work.
• Ethics and professional issues.• Completion (matters toconsider/evidence on file) andengagement reporting.• Current topics.Subjects of recent articles:• Reporting on audited financialstatements – significant changesproposed.• The control environment.• A question of ethics.• Planning an audit of financialstatements.• Completing the audit.Significant topics not examined forat least 18 months:• Prospective financial information.• Related party transactions.• Relying on the work of others.• Auditing accounting estimates.• Outsourcing.• Review of interim FS.• Tendering.
Becker Professional EducationF5• ABC.• Linear programming.• A budget calculation possiblyincluding ABC.• Variance – mix & yield variancesand discussion.• Performance measurement inservice industries – Fitzgerald &Moon.F7• Construction contracts.• Revenue recognition.• Substance vs. form.• Convertible instruments (IAS32/IFRS 9).• Accounting for taxation (part ofQ2).• Accounting for assets – IAS 16.• Provisions & contingencies.F9• Rights issues.• IRR.• Capital rationing.• Debt factoring.• Dividend policy.• Efficient markets hypothesis.• Equity valuation.• Bond valuation.P2• Consolidations in Q1.• Disposals & complex groups(June 2010).
Continued from page 19 P1• Agency relationship.• Corporate governance reportingand disclosure.• Stakeholders.• Roles in risk management. • Kohlberg.• Gray, Owen & Adams positions.P2• Q1: Foreign currencyconsolidation with a complex group,ethical issues.• Q2-4: Financial instruments,leases, revenue recognition.P3• PESTEL analysis.• Portfolio analysis (BCG, PLC,Ashridge).• Value chain.• Stakeholder analysis.• Supply chain management.• Project management – businesscase and benefits.• Variance analysis.• Ratio analysis.
LSBFF4• Judicial precedent.• Civil vs. criminal law.• Offer and acceptance.• Intention to create legal relations.• Doctrine of privity.• Breach of contract and remedies.• Liability of auditors in tort.• Volenti and contributorynegligence.• Redundancy.• Types of worker.• Agency position of partners.• Doctrine of incorporation andcompany names, promoters andpre-incorporation contracts, issue ofshares, duties of directors(including ultra vires), companymeetings and resolutions, CVL vMVL v administration, fraudulentand wrongful trading.F5• ABC/target costing.• Linear programming andlimitations.• Flexible budgets and budgetrevisions.• Mix & yield, sales mix andquantity variances.• Corporate performance, profit ornon profit organisations.
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PQ Magazine June 2014
• Pros and cons of outsourcinginternal audit.F9• Investment appraisals: NPV,capital rationing/asset replacement.Discussion question on risk anduncertainty – possibly sensitivityanalysis and probability distribution. • Working capital management:quantity discount (EOQ) andfactoring calculations or cashbudget. Discussion of workingcapital financing and/or investmentpolicies. • Cost of capital: WACC –calculating cost of equity usingCAPM or dividend valuation model,cost of redeemable debt and bankloan/preference shares. • Business valuation: valuation ofequity using; DVM, P/E ratio andasset basis. Valuation of convertibledebt and calculation of conversionpremium. • Sources of finance: the effect ofdifferent financing options on keyratios like EPS, debt/equity ratio andinterest cover, including calculationof TERP. Discussion of factors toconsider in raising short/long-termcapital or equity/debt capital.• Risk management: hedgingcurrency risk using forward contractand money market hedge – usingpurchasing power parity andinterest rate parity theories. P1• Role of chairman.• Induction/performance appraisal.• Institutional investors.• AGM/proxy voting.• Global standards.• Failure in internal control.• Auditor conflict.• Risk committees.• Risk audit.• Absolutism and relativism.• Kohlbergs model.P2• Group position or performance.Two mix questions plus currentissue question in framework orintegrated reporting or consistency.P3• External analysis.• Stakeholder management.• Strategic choice.• Improving business processes.• Project management.
in a partnership.• Personal pension schemes.• Errors on the VAT return –prompted/unprompted disclosure.• Capital gains tax includingentrepreneurs’ relief, PPRrelief/letting relief and sharesmatching rules.• Opting to tax a building, electronicfiling of the VAT return, flat ratescheme. • The capital goods scheme.• Overseas aspects of VAT includingexports and imports.• Ethics and the duties of a senioraccounting officer.P7• Business risk and risk of materialmisstatement.• Ethics and professional issues,including money laundering andadvertising.• Matters and evidence on variousIAS/IFRS.• Criticism of a given audit report.• Discussion on benefits ofproposed new audit report format.• Quality control of audit.• Prospective financial information.• Social and environmentalreporting KPIs and evidence.• ISAs 210, 240, 250, 510, 550,560, 720.
First IntuitionF4• Sources of law.• Formation of a contract –invitation to treat.• Veils of incorporation.• Directors.• Professional negligence.• Contract of employment.• Remedies for breach of contract.• Insider dealing.• Fixed vs. floating charge.
21
ACCA exam tips PQ
Continued on page 22
P4• Investment appraisal usingmodified internal rate of return andadjusted present value or netpresent value. • Mergers and acquisitions –valuation using free cash flows;cash or share exchange aspurchase consideration. Discussingdefensive tactics and regulations oftakeovers.• Cost of capital using the principlesof Modigliani and Miller prepositionsor geared and ungeared betas.• Hedging exchange rate or interestrate risk using forward contract,futures, options and swaps.• Option pricing theory. • Valuation of company using theBlack-Scholes option pricing modeland delta hedge.• Capital reconstruction schemes –designing a capital reconstructionscheme or assessing the success ofa given scheme.P5• RI, ROI & EVA.• Building block model(dimensions, standards andrewards appraisal system).• Traditional budgets vs. beyondbudgeting.• Quality – TQM or Six Sigma.• The difficulties of performancemeasurement possibly withcorporate failure.• BCG matrix.P6• IHT with the death estateincluding BPR, APR and gifts into atrust.• Changing the will after a person isdead, using a deed of variation toapply the reduced rate of IHT whena charitable legacy is made. • Company selling shares and thesubstantial share exemption or acompany selling its trade/assets. • Research and developmentexpenditure for large companies.• Controlled foreign companies. • Badges of trade, partnership witha partner joining/leaving withopening year rules, choice ofaccounting date, conditions tochange the accounting date.• Trading losses at the beginning ormiddle of the trading cycle, maybe
F5• Activity based costing.• Target costing.• Limiting factors.• Profit tables.• Budget systems.• Mix/yield variances.• Building block model.• Performance assessment.F7• Q1: consolidated SFP, withassociate, deferred consideration,Pups and fair value adjustment.• Q2: single company accountsquestion, including taxation, lease,and intangible assets.• Q3: statement of cash flow andcomments thereon with no ratios.• Q4: computation for non currentassets. • Q5: provisions.F8• Scenario-based ethics question.• Audit risk and auditor response.• Internal controls – deficiencies,recommendations and tests ofcontrol.• Substantive testing and auditevidence.• Going concern.• Modified audit reports.F9• Working capital management.• Investment appraisal and cost ofcapital.• Business valuations.• Discussion of the economicenvironment and the impact oninterest and exchange rates.P1• 50-mark scenario question, toinclude: ethics, AAA model, rulesvs. principles governance, alsocorporate social responsibility.• Optional questions to include:importance of internal controls,NEDs and remuneration committeeand structure of directorsremuneration, business risks, GrayOwens and Adams.P2• Q1: group question on disposals,piecemeal acquisitions or foreignsubsidiary. Will contain a variety ofnon-group topics too.• Ethics.• Revenue recognition or leases –current issue.
• Deferred tax.• Share based payments.P3• Environmental analysis, peoplewith financial analysis.• Project management, strategicaction, information technology –pricing strategy.P4• Investment appraisal techniquesfocusing on risk management toolssuch as value at risk.• Impact on WACC followinghedging of interest rate risk.• Company valuation basedscenario, possible MBO finance tostructure.• Adjusted present value with linkto real options and Black Scholesoption pricing model.P5• Critique an existing performancemanagement system.• Transfer pricing.• ROI, RI and EVA.• Activity based principles.• Corporate failure prediction.• Performance managementmodels.• Assess performance againstfinancial/non-financial targets.• Value based approaches toperformance management.P7• Business risks in a scenario.• Identifying ethical and otherprofessional issues in a scenario.• Matters to be considered andaudit evidence for a couple ofcore accounting issues.• Audit reports.• Money laundering.
BPPF5• Variances have always beentested historically. Since basicvariances were designated asassumed knowledge from 2013 itis likely that mix and yield and/orplanning and operational varianceswill be tested for syllabus area D.• Performance management –appraisal of a company or divisionswithin one company. May includetransfer pricing/use of ROI and RI.F6• Income tax areas including theemployed earner and sole trader. • Capital allowances – aspects ofgroups. • Companies chargeable gains.F7• Q1: consolidated statement ofprofit or loss and othercomprehensive income and/orconsolidated statement of financialposition with one subsidiary plusassociate (including usualadjustments – fair values, PUP oninventories/PPE, intragroup trading,
goods/cash in transit). • Q2: accounts restatement orpreparation from trial balance –with the usual adjustments fordepreciation, revaluation andcurrent/deferred tax, plus a mixtureof adjustments. May includeearnings per share or statement ofchanges in equity with a priorperiod adjustment. • Q3: interpretation or cash flowsand interpretation, which mayinclude discussion of how aims ofnot-for-profit organisations aredifferent. Interpretation may focuson limited ratios and theirinterpretation (e.g. liquidity).• Q4 and 5: context of conceptualframework; other containing one ortwo discrete topics, possibilities:inflation, deferred tax, provisions,intangible/tangible assets,
government grants, earnings pershare or financial instruments. P2• Section A: a 50-mark compulsorycase study, including preparation ofa group statement of profit of lossand other comprehensive incomeand/or statement of financialposition, which may includediscontinued activities, disposals,acquisitions or a foreign subsidiary.This will include other accountingcomplications such as financial
instruments, pensions, share-basedpayment and impairments. There will also be discursiverequirements on a linkedaccounting adjustment andsocial/ethical/moral aspects ofcorporate reporting. • Section B: Q2 and Q3 – two casestudy questions, one a multi-partquestion covering a range of topicsor a theme such as deferred tax,foreign currency transactions,financial instruments, pensions,share-based payment, non-currentassets (recognition and/orimpairment of tangible andintangible assets), borrowing costs,the effect of accounting treatmentson earnings per share or ratios; theother an industry-based questiontesting a range of standards suchas accounting policies and theframework, leases, grants, IFRS forSMEs, reorganisations, provisions,events after the reporting periodand related parties. • Q4: a discussion question lookingat current developments incorporate reporting and problemswith existing standards, such asregulatory issues over adoption andconsistent application of IFRSs,implementation issues, updatingthe conceptual framework,impairment in the currenteconomic climate, managementcommentary, application of the
definition of control,improvements in performancemeasurement. P5• Performance analysis. • Risk analysis. • Strategic performance measuresin the private sector. Divisionalperformance measurement isanother key area; ROI, RI, EVA,NPV, share price movement oreven costs of quality could featurehere.
• Reward systems – HR issues arenew to the syllabus from June2011 and the examiner isinterested in the impact of rewardsystems on performancemanagement. • Alternative views of performancemeasurement. Good understandingof the balanced scorecard, thebuilding blocks model and theperformance pyramid is needed bystudents.• Performance hierarchy: linkingstrategic decisions to missionstatements or suggesting strategicoptions using models such asAnsoff’s matrix or the BCG matrixlend themselves to questionscontaining a mixture of financialand discursive elements that couldeasily include a simple NPV orprofit analysis.
P6• Groups of companies,unincorporated business, capitalgains tax versus inheritance tax.P7• Planning scenario – test riskassessment, audit procedures andprofessional issues.•Audit reports, evidence, ethicaland other practice-related matters.
Manchester Met UniversityF7• Q1: consolidation with usual mixof consolidation adjustments.Detailed goodwill calculation withvarious elements to theconsideration for the subsidiary.• Q2: trial balance & adjustmentsquestions preparing SFP, statementof P&L and OCI and perhaps astatement of changes in equity.• Q3: analysis question includingcash flow.• Q4 & Q5: asset based standards– calculating initial cost of assets,impairments, constructioncontracts, leases and investmentproperties. • Provisions.• Inventory, revenue recognitionand substance.F8• Internal control assessment andtesting.• Audit risk assessment – linked toa new client acceptance andconsideration of ethical issues.• Ethics.• Audit evidence – going concernissues.• Audit reporting – content of auditreports, modified reports.• External auditor’s right/duties.F9• Investment appraisal – more thanlikely calculating an NPV of aproject with inflation and tax.• Working capital management:managing accounts receivable,accounts payable, inventory levels,cash.• Business valuation: work out thevalue of equity using the dividendgrowth model and/or P/E ratio.• Foreign exchange riskmanagement.• Sources of long-term finance.• Effects of a rights issue.P1• Need to know Kohlberg, GaryOwen and Adams and AAA. • Ethical conflicts.• Risk identification/analysis –identify controls.P4• Discount rates and valuation in atakeover scenario – ways to pay fora takeover target.• Foreign exchange rate risk, realoptions, bonds and interest rateswaps. PQ
22 PQ Magazine June 2014
PQ ACCA exam tips
These tips should be used in conjunction with
proper study and revision. Theyare not a substitute for in-depthrevision. We cannot guaranteethat everything we mention will
be on the paper. These tips are arough guide only, no one knowswhat the examiner was thinking 18 months ago when the paper
was set!
HEALTHWARNING
Continued from page 21
23PQ Magazine June 2014
technical focus PQ
In part two of a three-part series, Mary Ofili explainsstandard costing and direct materials usage variance
VARIETY PACK
Part 3 of this article will feature in the next issue of PQ magazine
STANDARD DIRECT MATERIALS .The standard cost of direct materials is made up of:• The quantity of materials expected to be used; and• The unit cost of materials
Material cost
Unit price X Quantity
The total direct materials variance can be split into the following twovariances:
• Direct materials price variance.• Direct materials usage variance.These two variances will enable management to narrow down and
identify what would have caused the variance – whether the unit price orthe quantity of materials used in the production process.
The direct materials price variance has been covered in the last editionand now we will be covering the direct materials usage variance.
DIRECT MATERIALS USAGE VARIANCE .This is the difference between the standard cost of the expected quantityof materials to be used for the actual production and the standard cost ofthe actual quantity of materials used for the production.
This variance focuses on the quantity of materials which was supposedto be used for the actual level of production and compares this with theactual quantity used for the production at the standard unit rate. Itmeasures how much of the difference between the expected and actualcost of materials is due to using different quantity of materials.
Where we have the standard quantity of materials to be used for theactual production and the actual quantity (both priced at the standardprice) being compared, any difference arising can only be as a result ofthe quantity of the materials used.
This variance will indicate whether the quantity of materials actuallyused in the production is more or less than the standard usage for thatlevel of production. In this case, we are comparing the actual quantity tothe standard quantity for the actual level of production and therefore,when valuing these quantities, the same standard price must be used.
£Standard quantity required for actual production at standard price XActual quantity used for actual production at standard price XMaterial usage variance X
If the actual quantity is less than the standard quantity, then the variancewill be favourable and if the actual quantity is more than the standardquantity, then the variance will be adverse. This will mean that:
ACTUAL QUANTITY > STANDARD QUANTITY = ADVERSE variance
ACTUAL QUANTITY < STANDARD QUANTITY = FAVOURABLE variance
Where there is a favourable direct material usage variance, it indicates tomanagement that there was some efficiency in the quantity of materialsused for the production when compared to the budget, and where there isan adverse variance it indicates that there was some inefficiency in thequantity of materials used which has contributed to the total materialvariance.
For example, if the standard cost of materials for a product called‘Product F’ is as shown in the following table:
1 unit of Product F Quantity Cost per yard (£) Total cost per unit (£)
Materials 3.2 yards 16.00 51.20
4,200 yards of materials, which cost a total of £76,860 was used for theproduction of 1,300 units during the month. What will be the materialusage variance.
SOLUTION .
STANDARD QUANTITY ACTUAL QUANTITY
£66,560 £67,200
£16.00 4,160 yards £16.00 4,200 yards
Material usage variance:Standard quantity required for actual production atstandard price (3.2 yards x 1,300 units x £16) £66,560Actual quantity used for actual production atstandard price (4,200 yards x £16) £67,200Material usage variance £640 Adverse**
Also:Standard quantity (3.2 yards x 1,300 units) 4,160 yards Actual quantity 4,200 yardsQuantity variance 40 yards Adverse
Material usage variance = 40 yards x £16 = £640 Adverse**
Note:You may have noticed that the standard quantity for the 1,300 unitsproduced should have been 4,160 yards but the actual quantity used was4,200 yards, which establishes an adverse quantity variance since thequantity of materials used was higher than the budgeted quantitysupposed to be used. This is then multiplied by the standard price ofmaterials, and with this, you arrive at the material usage variance. • Mary Ofili is a director of The Training Place
PQ
24 PQ Magazine June 2014
PQ ACCA paper F5
For many years, ABC has helped improveorganisational performance in the areas of planning,control and decision making. For paper F5 you
must to learn and apply various management accountingtechniques, and ABC too is examined in this context in F5.
A typical exam question on ABC will have two elements: first, knowledgeof the ABC methodology – how it works in relation to calculating overheadcosts for various products; second, to discuss the application of ABC inimproving organisational planning, cost control and making appropriatedecisions. Students must gain appropriate knowledge of the ABCmethodology as to how this works, especially ‘cause and effect’relationships (how controlling the cost driver helps to control the costs).This causal relationship actually attempts to convert fixed and periodcosts into variable and product costs.
Students must learn the following computation steps to build overheadcost per unit of each product:• Calculation of the cost driver rate for each overhead activity.• Linking each driver rate to each product on its consumption of the driver.
It is also important to understand traditional or conventional approachesto absorbing overheads for various products, to see the real benefits ofABC to an organisation.
Example 1Say a company is manufacturing children toys and has provided details ofits three most popular products. Figures from the latest budget workingpapers are set out below:
Product TowerRangers Sokemon JumboNinjaAnnual production (units) 1,000,000 2,000,000 500,000Selling price per unit ($) 4.75 3.70 5.00Direct costs/unit ($) 3.50 2.00 2.50Machine hours per unit 2 3 4
Annual budgeted overhead costs are $3,500,000.
RequiredUsing traditional absorption costing, calculate overhead costs for eachproduct, in total and per unit.
SolutionRemember: Calculation of Sales revenue and direct costs is not required(which maybe required in the exam), but both sales and direct costs arecalculated likewise under absorption costing and ABC (volume x value perunit). Therefore the emphasis of this article is entirely on the overheadsonly.
Calculate overhead costs for each product as follows: rememberabsorption costing assumes Totality when it links overhead costs to theproduct, which means that complete production is carried out under oneroof.
Overhead absorption rate = Total overhead costs for the periodTotal machine hours for the period
If hours are given per unit, first calculate total hours for all products for thewhole period, multiplying time per unit into total volumes of each product.
= $3,500,000(2x1,000,000 + 3x2,000,000 + 4x500,000)
= $0.35 per hour
Now you can multiply this rate back to the above denominators for eachproduct (machine hours for each product) to get a share of overhead costsfor each product.
TowerRangers Sokemon JumboNinjaTotal overhead costs ($000)($0.35 x 2,000,6,000,2,000 hours) 700 2,100 700Per unit overhead cost $0.70 $1.05 $1.40
The example 1 continuedCompany carried out an investigation of ABC analysis, and the followingdata has been collected from such investigation.
$Machine running costs 1,400,000Set up costs 1,500,000Purchase order costs 600,000Total 3,500,000
TowerRangers Sokemon JumboNinjaBatch size (units) 1,000 500 250Machine hrs per unit 2 3 4Set ups per batch 4 4 6Purchase orders per batch 2 3 1
RequiredCalculate the overhead costs for each product in total and per unit usingthe ABC method.
SolutionYour first step should be to find the relevant cost driver for each overheadcategory, then calculate the total of such driver for the period if it is notprovided per annum. Then calculate the cost driver rate for each overheadactivity, dividing the overhead cost of each activity by the total number ofcost driver selected
Then link the above rate to each product on consumption of eachproduct.
Total number of set upsTowerRangers 1,000,000 units/1,000 units in a batch = 1,000 batches x 4
= 4,000 set-upsSokemon 2,000,000 units/500 units in a batch = 4,000 batches x 4
= 16,000 set-upsJumboNinja 500,000 units/250 units in a batch = 2,000 batches x 6
= 12,000 set-ups
Total number of purchase ordersTotal number of POs = (2 x 1,000 + 3 x 4,000 + 1 x 2,000) = 16,000 POs
Therefore the overhead costs for each product would be as follows(answer from the last column above):
Activity based costing is an effective method to boostorganisational performance, says Hafeez Qazi
AS SIMPLE A
Overhead Driver Total of driver Cost driver Linking of driverCategory selected for the period rate rate to each product
Machine Machine As per above $1,400,000 / Multiply $0.14 x running hours 10,000,000 10,000,000 = by hours of costs hours $0.14 per hour each product
Set up costs Number of 32,000 $1,500,000 / Multiply $46.875 by set ups set ups 32,000 = number of set ups
$46.88 per set up for each product
Purchase Number of 16,000 POs $600,000 / Multiply $37.5 by order costs purchase 16,000 = purchase orders
orders $37.5 per PO for each product
PQ Magazine June 2014 25
ACCA paper F5 PQ
TowerRangers Sokemon JumboNinjaMachine running $280,000 $840,000 $280,000Set up $187,500 $750,000 $562,500Purchase order $75,000 $450,000 $75,000Total overhead costs $542,500 $2,040,000 $917,500Per unit cost $0.54 $1.02 $1.84
Possible discussionsThe above findings can be used to create various discursive requirements,general and specific to the scenarios, and students should be able todifferentiate as to whether the question requires a general benefit orlimitation of ABC, or whether it asks to link such benefits or limitations tothe scenario under consideration. Some possible theory requirementsmaybe as follows:1. What are the advantages and limitations of implementing an ABCsystem (a general answer)?2. What are the benefits of ABC to the company (focusing on planning,cost control, pricing, product competitiveness, profitability, etc). Rememberto compare the answers of both absorption and ABC before you lay outyour discussion. 3. Explain relevance of the cost drivers with examples.4. Why traditional method conclusions are often different to ABCs.
Study advice• Remember to read the requirements very carefully and set out an answerplan for each requirement before reading the scenario.• Try to apply the ‘read-and-write’ approach (that means reading thequestion in parts and making use of it in the answer plan, before readingnext paragraph or block of information).• Highlight/underline any important phrase from the scenario and link upwith any requirement that may help to create a focused discussion. • Hafeez Qazi is an ACCA tutor at LSBF
PQ
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26 PQ Magazine June 2014
PQ risk management
Last time, we introduced therationale behind FuturesContracts. Let’s take this to the
next level and put a practical applicationto the theory.
Unravelling the mystery?The best way is to consider the positionof the business. What is the transactionthat they are considering hedging?
For example, a gold jewellerymanufacturer will, periodically, need tobuy gold. Therefore, they will beconcerned about the price of gold rising.The spot market transaction they arehedging is therefore a situation of buyinggold. The initial contract with the futureshould be the same – a contract to buy.
OK, as time moves on, if the price ofgold rises, then the jewellery maker willend up paying more for gold in the spotmarket than they would have wanted.Don’t worry, if the spot market price isrising, the futures market price will alsobe rising. When the business comes toclose out the opening contract to buy,they will enter an opposite contract toclose (as described in the first article).This will therefore be a contract to sell.They will now have a situation where theyhave a contract to buy at one price andanother contract to sell back at a higherprice – this is a ‘winning’ position. Thiswinning position will offset the loss (orsome of it at least depending upon howclose they could get to their actualexposure with the value of the futurescontracts they entered into) in the spotmarket, bringing the net position (like asee-saw) back to somewhere near theoriginal price.
The extension of this, of course, is howto account for it. We’ll leave that foranother day.
How would it work if I was looking tosell something?
If I was a wheat farmer looking to sellwheat in the future, I would beconcerned about the price of wheat
falling. The spot market transaction is acontract to sell (wheat farmer sellingwheat), therefore following the same logicas above, my initial contract with thefutures exchange (assuming I was goingto use futures to hedge the price ofwheat) would be a contract to sell.
If the price of wheat falls, I lose in thespot market but on the futures market Ihave to be winning – that’s how it works.So, I have an initial contract to sell, so Iwill enter a contract of ‘buy to close’.Therefore, a contract to sell at an initiallyhigher price and now a contract to buy ata lower price – therefore winning andoffsetting some or all of the loss on thespot market position.
In the second part of a two-part series, Matt Holden outlines the best way to tackle questions on futures contracts
Futures are fixingDon’t forget though, that the futurescontract is a ‘fixing’ instrument.Therefore, for my jewellery maker lookingto buy gold, if the price had fallen theywould win on the spot market – payingless for gold than first thought. They stillhave to go through with the futurescontract they entered into at thebeginning. An initial contract to buy at ahigher price and a closing contract to sellat what is now a lower price – therefore aloss position offsetting the winningposition in the spot market. The see-sawworking again.
For the wheat farmer, if the price ofwheat actually rises, then the farmer getsmore for the wheat in the spot market –winning. Being a fixing instrument, thiswin has to be offset by a loss on thefutures contract. Initial contract to sell ata lower price and a closing contract tobuy at what is now a higher price – againa losing position, offsetting the win in thespot market.
Real life and the examClearly, there are numbers involved inreal life and the exam. I believe thatthese numbers are made so much easierif you can grasp what is actually going onbehind the numbers and the reason forthe actions being taken.
The other linkage in real life and higherlevel exams is to corporate governanceand the risk management report.Stakeholders (specifically investors) haveto know the business’ approach tomanaging risk. They need to makeinformed investment decisions. Imaginethat you recently invested in a goldmining business and then the price ofgold doubled.
Your investment should logicallyincrease in value. You then find out thatall that potential gain has been wipedaway because the board hedged againstgold prices falling by using futurescontracts!
If you get time, research Ashanti Gold– it was simply ‘a hedge too far’! • Matt Holden, Reed Business School
PQ
FUTURES PERFECT
Where there’s muck, there’s… gold. Miners in South Africa
NQ strip, repeat p33 last month’s issue
26 PQ Magazine June 2014
PQ risk management
Last time, we introduced therationale behind FuturesContracts. Let’s take this to the
next level and put a practical applicationto the theory.
Unravelling the mystery?The best way is to consider the positionof the business. What is the transactionthat they are considering hedging?
For example, a gold jewellerymanufacturer will, periodically, need tobuy gold. Therefore, they will beconcerned about the price of gold rising.The spot market transaction they arehedging is therefore a situation of buyinggold. The initial contract with the futureshould be the same – a contract to buy.
OK, as time moves on, if the price ofgold rises, then the jewellery maker willend up paying more for gold in the spotmarket than they would have wanted.Don’t worry, if the spot market price isrising, the futures market price will alsobe rising. When the business comes toclose out the opening contract to buy,they will enter an opposite contract toclose (as described in the first article).This will therefore be a contract to sell.They will now have a situation where theyhave a contract to buy at one price andanother contract to sell back at a higherprice – this is a ‘winning’ position. Thiswinning position will offset the loss (orsome of it at least depending upon howclose they could get to their actualexposure with the value of the futurescontracts they entered into) in the spotmarket, bringing the net position (like asee-saw) back to somewhere near theoriginal price.
The extension of this, of course, is howto account for it. We’ll leave that foranother day.
How would it work if I was looking tosell something?
If I was a wheat farmer looking to sellwheat in the future, I would beconcerned about the price of wheat
falling. The spot market transaction is acontract to sell (wheat farmer sellingwheat), therefore following the same logicas above, my initial contract with thefutures exchange (assuming I was goingto use futures to hedge the price ofwheat) would be a contract to sell.
If the price of wheat falls, I lose in thespot market but on the futures market Ihave to be winning – that’s how it works.So, I have an initial contract to sell, so Iwill enter a contract of ‘buy to close’.Therefore, a contract to sell at an initiallyhigher price and now a contract to buy ata lower price – therefore winning andoffsetting some or all of the loss on thespot market position.
In the second part of a two-part series, Matt Holden outlines the best way to tackle questions on futures contracts
Futures are fixingDon’t forget though, that the futurescontract is a ‘fixing’ instrument.Therefore, for my jewellery maker lookingto buy gold, if the price had fallen theywould win on the spot market – payingless for gold than first thought. They stillhave to go through with the futurescontract they entered into at thebeginning. An initial contract to buy at ahigher price and a closing contract to sellat what is now a lower price – therefore aloss position offsetting the winningposition in the spot market. The see-sawworking again.
For the wheat farmer, if the price ofwheat actually rises, then the farmer getsmore for the wheat in the spot market –winning. Being a fixing instrument, thiswin has to be offset by a loss on thefutures contract. Initial contract to sell ata lower price and a closing contract tobuy at what is now a higher price – againa losing position, offsetting the win in thespot market.
Real life and the examClearly, there are numbers involved inreal life and the exam. I believe thatthese numbers are made so much easierif you can grasp what is actually going onbehind the numbers and the reason forthe actions being taken.
The other linkage in real life and higherlevel exams is to corporate governanceand the risk management report.Stakeholders (specifically investors) haveto know the business’ approach tomanaging risk. They need to makeinformed investment decisions. Imaginethat you recently invested in a goldmining business and then the price ofgold doubled.
Your investment should logicallyincrease in value. You then find out thatall that potential gain has been wipedaway because the board hedged againstgold prices falling by using futurescontracts!
If you get time, research Ashanti Gold– it was simply ‘a hedge too far’! • Matt Holden, Reed Business School
PQ
FUTURES PERFECT
Where there’s muck, there’s… gold. Miners in South Africa
Check it out now – the all-new NQ!NQ magazine is an e-mag for newly qualifieds who want to get aheadIt's packed with articles from industry experts that will help you do your job better
Sign up today via the PQ magazine website – www.pqmagazine.co.uk
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There has been a great deal of activity inBangladesh in recent weeks as CIPFAstrives to improve public financial
management globally; in April, CIPFA officiallylaunched its partnership with LCBS Dhaka at acelebration event at the Lakeshore Hotel inDhaka. The new partnership gives CIPFA aplatform to provide its qualifications and trainingto people working across the public sector inBangladesh. This is an exciting development forCIPFA to help improve public financialmanagement, and support the future prosperityof the country.
Guest speakers at the event included theBritish High Commissioner to Bangladesh, HisExcellency Robert W Gibson, the CEO of LCBSDhaka, M A Kalam, and chief guest, theComptroller and Auditor General of Bangladesh,Masud Ahmed. Mr Ahmed was awarded anhonorary membership of CIPFA at the event, inrecognition of his ongoing commitment toimproving public financial management.
Bangladeshi students have been studyingCIPFA’s professional qualification in InternationalPublic Financial Management (IPFM) sinceSeptember 2013 and have demonstratedimpressive pass rates so far, with the December2013 exam achieving 11% above the global passrate. The launch event provided an opportunityto congratulate a particularly outstandingstudent, Md. Mamun-Ul Mannan, who scored98%, the best-ever global performance in theIPFM Financial Accounting exam. Such highmarks are a clear indication that CIPFA’s passionfor improving how public money is managedthroughout the world is infectious.
A step change in global public financialmanagement (PFM)The IPFM qualification gives students fromacross the world the opportunity to achieveChartered Public Finance Accountant status. Theglobal financial crisis highlighted how importantgood PFM is and in 2011 CIPFA published itsdiscussion paper, ‘Fixing the Foundations’. It wasa call to action for the accountancy profession topull together globally to help deliver high-qualitypublic services, economic growth and prosperity,and improvement in life chances. Since then, theinstitute has been deepening existingrelationships and engaging with otherorganisations who want to transform publicfinancial management globally, regionally,nationally and locally.
CIPFA’s partnership with LCBS Dhakacontinues the growth of CIPFA’s internationalpublic financial management training provisionacross the globe. Set and supported by theInternational Federation of Accountants (IFAC),these are the only accountancy qualificationsbased on International Public Sector AccountingStandards (IPSAS), and are designed to improvegovernment transparency and accountability andallow for greater comparability between countriesand public sector bodies.
Speaking at the launch, CIPFA’s education &membership director Adrian Pulham said: “Thelaunch of this new partnership is a significantcontribution to the stability of public finances inBangladesh and ensures specialist training forgovernment and public sector staff in goodpublic financial management.
“It demonstrates how CIPFA’s continued
28 PQ Magazine June 2014
PQ CIPFA spotlight
international growth is helping to ensure that thenext generation of public sector managers acrossthe world have the skills and expertise necessaryto effectively lead and manage their country’spublic services. This new partnership with LCBSDhaka is yet another great example of CIPFA’swork to strengthen the accountancy professionand accountancy standards around the world.”
LCBS chief executive MA Kalam added: “Weare proud that LCBS Dhaka has been awardedAccredited Training Partner (ATP) status toconduct training and tuition programmes forCIPFA qualifications locally. “The launch is amilestone for both parties and is the first of itskind. I hope that LCBS Dhaka, being the firstglobal ATP, will be a role model for all futureATPs established elsewhere and wish this newCIPFA ATP scheme great success.”
Connecting public sector staff around the worldIn a global world no one country can ever beisolated from what goes on outside its borders. Itis the foundation of the future financial stabilityof all countries across the world. CIPFA isuniquely placed to help governments developstronger financial management practices; ournew partnership with LCBS Dhaka in Bangladeshis an example of how CIPFA is working tostrengthen the accountancy profession aroundthe world.
“CIPFA’s continued international growth willhelp ensure that the next generation of publicsector managers has the skills and expertisenecessary to effectively lead and manage theircountry’s public services.”
For more information about the scheme visitwww.cipfa.org/bangladesh • Johanna Courtney is a marketing executiveat CIPFA
PQ
BETTER TOGETHERCIPFA recently launched a new training partnership to improve publicfinancial management in Bangladesh. Johanna Courtney explains all
East meets west (from left): Raeesa Chowdhury, director of business development, Multidrive; MA Kalam, Chairman and CEO, LCBS Dhaka; Adrian Pulham,Education and Membership Director, CIPFA; Masud Ahmed, Comptroller and Auditor General, Bangladesh; and British High Commissioner Robert W. Gibson
29PQ Magazine June 2014
ICAEW focus PQ
What has changed? .The main change from old syllabus BusinessReporting (BR) is the removal of the taxquestion (previously BR Question 2): CorporateReporting (CR) will be a three-question paper, areduction on the previous four questions of BR.BR tended to have four questions of 25 markseach but the CR sample paper has a 40/30/30split, with an audit-heavy question (Q1)accounting for the 40-mark element.
As each CR question will carry more marks,the CR examiner will provide much morescenario material (4.5 pages for Q1 in thesample paper) than under BR. This means youwill have to improve your ability to read andabsorb information quickly. You will also need toprioritise your answers because there will not betime to look at everything – these strategicchoices over what to consider will be even moreimportant given the increase in the stimulusmaterial.
It is likely that the examiner will be able to testmore financial reporting and audit issues thanunder the old BR paper. You should invest timein building your breadth of knowledge;concentrating on only a few core areas could bea risky approach.
What has stayed the same? .Financial reporting will remain a key area. Forexample, the mixed question may require you toidentify financial reporting concerns, risks orerrors before discussing an appropriate auditapproach – if your financial reporting skills areweak you will not be able to identify the issueswhich will get the audit marks and hence you
could suffer badly from weak financial reportingskills.
The new topics introduced in the CR studymanual are: pension accounting, share-basedpayments, hedge accounting, deferred tax andforeign currency issues (including consolidationof an overseas subsidiary). Despite the extensiveexplanations of these topics in the new CR studymanual, we are continuing to advise ourstudents to ensure that they do not just studythe new CR-only topics as these are notsufficient to serve as the full basis of threequestions. The examiner is likely to continue todraw on financial reporting and audit issuestested at earlier stages of the ACA.
CR remains an open book exam so creation ofan appropriate and practical folder of notes andresources remains an important element ofpreparation. Given the increase in marks foreach question, it seems likely that the average
CR exam will cover more topics infinancial reporting and audit than theprevious BR paper so your foldercould be a useful back-up resource.At the same time, don’t fall into theclassic trap of becoming dependenton your folder as the time pressurewill remain significant; havingknowledge in your head remains thesafer approach.
Given the relatively unchangedsyllabus, students may benefit fromusing old BR papers as part of theirpreparation because there will be nopast papers available for July 2014.You should of course ignore any taxquestions within the old BR papers.Also bear in mind that the examinerwill be providing much longerstimulus material than in the BRpapers, given the higher number ofmarks per question; BR past paperquestions will appear easier than newCR questions.
We strongly recommend that you practice afew Financial Reporting/Financial Accounting &Reporting and Audit & Assurance papers fromthe Professional Stage/Level as a way of quicklyrevising relevant key areas of brought forwardknowledge and the most efficient ways ofexplaining these for ACA exam purposes.
Conclusion .Overall, we believe that the removal of the taxelements of the syllabus should provide studentswith more thinking time per question. As always,practice really is the best method of preparingfor the tough ACA exams, so make the most ofthe additional time you have to prepare for CRby looking at old BR papers or thoroughlyrevisiting your Professional Stage materials: theexaminer can, and will, draw on this broughtforward knowledge extensively. • Martin Johnson is a tutor at ACA Simplified
PQ
Sorted, thanks topqjobs.co.uk
Martin Johnson has some timelyadvice on the new CorporateReporting paper, which will be satfor the first time in July
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31PQ Magazine June 2014
technical update PQ
When I last arrived at 221BBaker Street, SherlockHolmes took one look at me
and said: “You have just had a glass ofclaret with your wife at London zoo.”Mind-reading? Magic? Not at all. It was asimple deduction, based on the red stainon my shirt cuff, a single ginger hair onmy lapel and the smell of monkeydroppings on my suit.
Similarly, sometimes in accountingwhen we think that a crucial figure ismissing we may be able to deduce itfrom clues that we do have. Enter theexciting world of incomplete records, DrWatson!
Cost structures .If we know what the relationship betweensales revenue, cost and profit is we canuse this information to help us to deducemissing information. The two differentrelationships you need to know about aremargins and mark-ups.
• MarginA ‘margin’ is the percentage of salesrevenue that profit represents. I think of itas ‘margin on sales’ as you wouldmultiply the percentage margin by thesales revenue.
– Using margin to identify costIf sales are £100 and your margin onsales is 10%, then you must have madea profit of £100 x 10% = £10. We canuse this information to deduce that ourcosts must be the sales revenue less theprofit which is £90. Alternatively, you canthink of it this way: if profit is 10% ofsales then costs must be 90% of salesand £100 x 90% = £90 cost.
– Using margin to identify salesIf you know that your margin on sales is30% then your costs will be 70% ofsales. If you know that your costs are£140 (and that this is 70% of sales) thenyou can deduce that sales must be£140/70% (or £140/0.7) giving £200.
• Mark-upA ‘mark-up’ is the percentage of cost thatprofit represents. I think of it as ‘mark-upon cost’ as you would multiply thepercentage mark-up by the cost.
– Using mark-up to identify salesIf cost is £500 and the mark-up is 10%then the profit will be £50. Sales must bethe cost plus the profit which is £550.Another way to look at this is that sincewe add the mark-up of 10% to the cost,the sales will be 110% of the cost and£500 x 110% (or £500 x 1.1) is £550.
– Using mark-up to identify cost With a mark-up of 20% you know that
sales will be 120% of (or 1.2 times) cost.If sales were £360 then we can deducethat cost must have been £360/1.2 =£300.
Control accounts .If we know some of figures that would sitin a control account we can oftenestablish a missing figure using a‘balancing figure’ approach.
• Sales ledger control account (SLCA)If we know that the opening balance onthe SLCA is £100 owed to the business,that cash receipts from credit customersin the period were £500 and that theclosing balance on the SLCA was £120then we can deduce the value of creditsales made by balancing off the ledgeraccount:
So we can deduce that credit sales must have been £520.
Gareth John turns his attention to the thorny issue of incomplete records • Purchases ledger control accountIf we know that the opening balance onthe PLCA is £250 owed by the business,that cash payments to credit supplierswere £700 and that the closing balanceon the PLCA was £280 then we candeduce that the value of credit purchasesmust be:
Credit purchases must be £730.
Using cost of sales .Cost of sales (COS) consists of three keyelements. It is calculated by addingopening inventory (1) to purchases (2)and then deducting closing inventory (3).If we know what the COS figure is, andwe also know two of the elements thatmake up COS, we should be able todeduce the third.
Let’s say that COS is £5,000, and thatwe know that opening inventory (1) was£1,000 and that purchases (2) were£5,200, but we don’t know the value ofclosing inventory (3). Taking openinginventory plus purchases would give£1,000 + £5,200 = £6,200 so to getback to COS of £5,000 we must bededucting closing inventory of £1,200.
Here’s one for you to try. Once youhave finished your answer you can watchme work through my solution atwww.firstintuition.co.uk/blog.html.
At 1 January, a business has inventoryof £10,000 and trade payables of£40,000. During the year the businessmade sales of £400,000 and achieved aprofit margin of 25%. They paid creditsuppliers a total of £290,000 and at theend of the year trade payables were£65,000. On the 31 December a fire inthe warehouse destroyed all units ofinventory. Can you help Sherlock Holmesto identify the value of the inventorydestroyed? • Gareth John is a tutor/director withFirst Intuition and helps to managetheir AAT online learning programme.He was PQ Magazine AccountancyLecturer of the Year in 2011
PQ
LET’S GET TECHNICAL
1. Sales ledger control account (SLCA)£ £
Opening balance (known) 100 Receipts (known) 500Credit sales 520(BF) Closing balance (known) 120
620 620
2. Purchase ledger control account (PLCA)£ £
Payments (known) 700 Opening balance (known) 250Credit purchases (BF) 730
Closing balance (known) 280
980 980
I love incomplete
records!
32 PQ Magazine June 2014
PQ salary survey
SHOW ME THE MONEY!We drill down into the salaries from Reed Accountancy’s PQ Salary Guide and Market Insight 2014
• Go to reedglobal.com/pqhub for more great resources and the guide in full
NORTHERN IRELANDPurchase Ledger £15,000 - £20,000Accounts Assistant £15,000 - £22,000Finance Assistant £15,000 - £21,000Assistant Accountant £19,000 - £24,000Accountant £23,000 - £28,000Financial Accountant £24,000 - £32,000Management Accountant £24,000 - £32,000Finance Manager £26,000 - £36,000
WALES Purchase Ledger £15,000 - £21,000Accounts Assistant £15,000 - £19,000Finance Assistant £15,000 - £22,000Assistant Accountant £19,000 - £26,000Accountant £22,000 - £35,000Finance Accountant £24,000 - £33,000Management Accountant £23,000 - £32,000Finance Manager £26,000 - £35,000
LONDONPurchase Ledger £18,000 - £25,000Accounts Assistant £19,500 - £30,000Finance Assistant £19,000-- £28,000Assistant Accountant £25,000 - £36,000Accountant £27,000 - £44,000Financial Accountant £35,000 - £49,000Management Accountant £27,000 - £50,000Finance Manager £35,000 - £50,000
THE SOUTH WESTPurchase Ledger £16,500 - £21,000Accounts Assistant £17,000 - £27,000Finance Assistant £17,000 - £25,000Assistant Accountant £20,000 - £28,000Accountant £25,000 - £36,500Financial Accountant £25,000 - £35,000Management Accountant £26,000 - £34,500Finance Manager £30,000 - £38,000
THE MIDLANDSPurchase Ledger £15,000 - £20,000Accounts Assistant £18,000 - £25,500Finance Assistant £18,000 - £22,000Assistant Accountant £19,000 - £28,000Accountant £22,000 - £37,000Financial Accountant £25,000 - £37,000Management Accountant £25,000 - £36,000Finance Manager £30,000 - £40,000
NORTHERN ENGLANDPurchase Ledger £15,000 - £21,000Accounts Assistant £16,000 - £20,500Finance Assistant £17,000 - £25,000Assistant Accountant £21,000 - £27,500Accountant £20,000 - £32,000Financial Accountant £25,000 - £35,000Management Accountant £23,000 - £33,000Finance Manager £27,000 - £38,000
THE SOUTH EASTPurchase Ledger £17,000 - £25,000Accounts Assistant £17,000 - £28,000Finance Assistant £17,000 - £26,000Assistant Accountant £21,000 - £34,000Accountant £26,000 - £40,000Financial Accountant £27,000 - £38,000Management Accountant £24,000 - £38,000Finance Manager £30,000 - £40,000
SCOTLANDPurchase Ledger £16,500 - £19,000Accounts Assistant £17,000 - £22,000Finance Assistant £17,500 - £22,000Assistant Accountant £19,000 - £26,500Accountant £23,000 - £32,000Financial Accountant £25,000 - £34,000Management Accountant £23,000 - £33,000Finance Manager £26,000 – 34,000
EASTERN ENGLANDPurchase Ledger £15,000 - £20,000Accounts Assistant £15,000 - £24,000Finance Assistant £17,500 - £24,000Assistant Accountant £20,000 - £25,000Accountant £21,000 - £36,500Financial Accountant £24,000 - £34,000Management Accountant £24,000 - £35,500Finance Manager £25,000 - £35,000
Benefits matterAs job movement is created within the
accountancy profession, opportunitiesare out there for PQ accountants looking
for a new job. Many people will be job-hunting forthe first time after opting for the security of stayingput during the economic downturn, and shouldensure they are aware of the benefits available tothem and are prepared not only to negotiate salaryand benefits in a new role, but also consider thecareer development path that will be available,too. It’s not all about the money, money, money!
With your attention focused on the headlinesalary figure it can be easy to underestimate theimportance of a good benefits package.Considering 70% of employees say they don’treceive any support to understand the benefitsavailable to them, it’s not surprising this can beeasily overlooked. However, generous benefitssuch as study support, pensions, annual leaveallowance and support for continuous professionaldevelopment can make a big difference to youroverall remuneration package and future careerpath. Many employers also offer additionalschemes such as season ticket loans and bikepurchase schemes that can help to save youmoney.
According to the latest Hays Accountancy &Finance Market Overview and Salary Guide, the
most commonly received benefits by accountingand finance professionals are: an above minimumcontributory pension; health insurance or privatemedical cover; over 25 days annual leave; and anindividual or company performance-related bonus.To further their careers, PQs were also likely toreceive financial support for training; this was thesecond most commonly received benefit afterpension contributions.
On the whole, the benefits accountancyprofessionals currently receive are in line with theones that are important to them. However, whenconsidering a new role flexible working options area priority for many, yet almost half of employees
33PQ Magazine June 2014
careers PQ
were offered no flexible working options in theircurrent job. While home working or flexi-time maynot be practical for all organisations, this can bean area where employers can stand out whencompeting for the best people.
Aside from salary, our survey shows thataccountants looking for new opportunitiesprioritise job security and a good work-lifebalance, followed by a challenging role or projects.Ambitious people also look for financial supportfor training from employers when looking for anew role, not only for their initial professionalaccountancy qualification but for continuedprofessional development long after the finalexams are passed.
An overwhelming 90% of PQ accountants wesurveyed are confident that they have the skills toprogress in their careers, yet 73% do not feel thatthere is scope for career progression within theirorganisation. With many people looking for thiscareer progression and changing jobs this year,employers will need to compete for the bestpeople, giving part qualifieds the opportunity tochoose the best role for them, with an employer oftheir choice.
To request a copy of the Hays Accountancy &Finance Salary guide visit www.hays.co.uk/af-salary-guide. • Karen Young, Director, Hays Accountancy &Finance
PQ
Don’t overlook the value of company benefits anddevelopment opportunities,says Karen Young
PQ Magazine June 2014
PQ careers
Sarah Williams, 41, is an accounts assistant based in Llandudno, Wales. She hasworked for Breeze & Co for 18 months. Currently studying AAT level 4, Sarah wasrecently named AAT Student of the Year and was shortlisted for this year’s PQ awards
Life at the Breeze & Co
The workplace: tackling depressive issuesMore than 90% of people believe that admitting to amental health condition could damage their careerprospects. The result is that most give a differentreason to their employer, if they need time off fromwork.
Against this backdrop,and during NationalDepression AwarenessWeek, KPMG’s NickBaber, a director in theFinancial ServicesConsulting Team whosuffers from depression,argued that creating aculture of openness, earlyintervention and supportin the workplace is criticalif UK plc is to remove thestigma attached todepression and mental illness.
He explained: “People often present a differentpersona in their personal and professional lives,fearing rejection by their peers if they fail to project acertain image. The stark reality is that so muchenergy is spent by individuals pretending to be
something they are not that mental and physicalhealth, performance and productivity suffer as aresult.”
Baber said that it would be far better if employeeswere comfortable enough intheir working environment to bethemselves. But this will onlyhappen, he felt, if seniorbusiness leaders withexperience of mental healthproblems tell their own storiesand implement performanceindicators that measure andreport on progress in theworkplace.
Stephen Frost, UK head ofdiversity & inclusion atKPMG, adds: “Being
comfortable in your own skin is a key ingredient forcareer success and employees need to know thatthey will not face career road blocks if they ‘comeout’ and admit to having mental health problems.• KPMG is a founding member of the City mentalHealth Alliance, which is committed to managingand supporting employees’ mental health.
34
What time does your alarmclock go off? 6am.What’s the first thing you dowhen you get to your desk?Switch the computer on and havea cuppa.What’s on your desk? Piles ofaccounts files – I’m not joking.What’s the best thing aboutwhere you work? I only work 20hours a week – I’m a singleparent. My boss is very flexibleand when the kids are ill I canswap my day off.Where’s your favourite placeto go for lunch? I work throughlunch.What (or who) can you seewhen you sit at your desk? A
seagull that taps on the window –we’re three storeys up.Which websites are yourfavourites and why? Ebay,Amazon and Preloved – I love abargain.Which websites do you usefor work? AAT andEagle Education andTraining’s moodle.How many hours aweek do you spendin meetings? Zilch. What time do you leave theoffice? 2pm at the latest – I startat 8.30am.How do you relax? All thesoaps.What’s your favourite tipple?
Red wine.How often do you take workhome with you? Never.What is your favourite TVprogramme? I bounce betweenEmmerdale, Coronation Street andEastEnders. I need to get a life!
Summer or winter?Winter.Pub or club? Pub.Who is your hero?My late grandfather,Rolley Hughes.
If you had a time machine,where would you go? Back to the 80s.If you hadn’t chosenaccountancy, what might yoube right now? A hairdresser.
The PQ Book ClubEVERY MONTH WE REVIEW THEBOOKS YOU SHOULD BE READING
The Failure and Future of Accountingby David Hatherly (Gower, £65)In this book, the author – EmeritusProfessor of Accounting at theUniversity of Edinburgh, no less –rethinks accounting in the light of afinancial crisis which exposed itslimitations. He proposes nothingshort of a major revolution infinancial reporting. By expanding on
the traditionalaccounting model byaccounting for thecomponents of themarket capitalisationof the business, theauthor challengesdirectly the world's
present system of accounting. Usingexamples such as Enron and thefinancial crisis, Hatherly illustratesthe deficiencies of the present modeland, unusually, suggests how torectify them. With its insights intoboth accounting and business moregenerally, this book is essentialreading for accountants andaccountancy students and for thoserunning a business.
When a commentator asdistinguised as Sir David Tweediesays that this is “a must-read bookfor all who wonder where the futureof reporting might lie”, then it’s timeto take note.PQ rating: 5/5 Worth seeking out, butwith a hefty price tag you might wantto look in the college library.
Essentialism – the DisciplinedPursuit of Less by Greg McKeown(Virgin Books, £12.99)This book is for anyone who feels lifeis just too busy, that they are beingpulled in too many directions. SiliconValley’s McKeown propounds histheory of ‘Essentialism’ which can besimply summed up as ‘less is more’.The author argues that we have tolearn that we should only be doingwhat really matters. So are you doingsomething simply to please other
people? Do youvolunteer to take onnew projects, eventhough you haven’t gotthe time to do themproperly? If so, thenthis is the book foryou. It will help yousucceed at work, by
focusing your efforts on your coretasks, and also help you to achieve abetter work-life balance.PQ rating: 4/5 Seek this book out.
WE HAVE THESE BOOKS TO GIVEAWAY – SEE NEXT MONTH’S PQ
Vacancy surgeThe improving economic
situation is generating reneweddemand for accountants. Therehas been a ‘surge’ inopportunities for financialprofessionals, as year-on-yearvacancies climb by24%. The problem isthat the supply hasremained constant andone recruitmentconsultant is predictingthat employers will need to offerenhanced salary packages toland sought-after candidates.
Beat PhilOh dear, here comes Phil.
He loves himself (someone hasto) and he likes the sound of hisown voice! Somehow he earns£15k more than you. You can, ofcourse, do better than Phil, and
BeatPhil.com is there tohelp. The site provides aquiz, free expert CV adviceand a whole load of careertips, like follow companiesthat you want to work for on
social media sites. It’ll help youlearn more about them and whatthey like, bit by bit.
Your PQ hubIf you are job hunting then
social media can be key to yoursuccess, says Reed Accoutancy’sPQHub. Among 10 tips to helpyou stand out is the importanceof updating your LinkedIn profileand matching it to your CV. Alsoremember that recruiters mayscreen you, so be honest andconsistent with your profile. Byconnecting with other professionsyou can create a network, whichcan help put you on their radar.For more great stuff go towww.reedglobal.com/pqhub.
In brief
I need to findpqjobs.co.uk now!
PQ jobs pqjobs.co.uk
Your jobs boardnew pqjobs house ad 26/9/11 13:52 Page 1
YOUR JOURNEY AHEADMAKING THE RIGHT CHOICE
© Copyright Hays Specialist Recruitment Limited 2014. HAYS, the Corporate and Sector H devices, Recruiting experts worldwide, the HAYS Recruiting experts worldwide logo and Powering the World of Work are trade marks of Hays plc. The Corporate and Sector H devices are original designs protected by registration in many countries. All rights are reserved.
hays.co.uk/journey-ahead
Your professional accountancy exams may soon be behind you and once you’ve gained your newly qualified status, you’ll need to think about the next steps in your career path.
There are a number of things you’ll need to consider and to arrive at the decisions that are best for your career, it’s crucial to equip yourself with accurate, up-to-date market intelligence.
Our Journey Ahead Guide offers practical advice on how to approach your career progression, the range of career paths available and how to meet your aspirations.
If you’re starting to think about your next steps as you work towards becoming a qualified professional, we have the tools and advice you to help you make the right choice.
AF-5755-22 PQ Mag 14-05-2014.indd 1 01/05/2014 10:59
YOUR JOURNEY AHEADMAKING THE RIGHT CHOICE
© Copyright Hays Specialist Recruitment Limited 2014. HAYS, the Corporate and Sector H devices, Recruiting experts worldwide, the HAYS Recruiting experts worldwide logo and Powering the World of Work are trade marks of Hays plc. The Corporate and Sector H devices are original designs protected by registration in many countries. All rights are reserved.
hays.co.uk/journey-ahead
Your professional accountancy exams may soon be behind you and
once you’ve gained your newly qualified status, you’ll need to think
about the next steps in your career path.
There are a number of things you’ll need to consider and to arrive at
the decisions that are best for your career, it’s crucial to equip yourself
with accurate, up-to-date market intelligence.
Our Journey Ahead Guide ofers practical advice on how to approach
your career progression, the range of career paths available and how
to meet your aspirations.
If you’re starting to think about your next steps as you work towards
becoming a qualified professional, we have the tools and advice you
to help you make the right choice.
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PQ Magazine June 2014
PQ got a story, funny or serious, you want to share? Email [email protected]
W E V E G O T T H E L O T’
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 bereceived by Friday 6 June. The main draw will take place on Wednesday 11 June 2014
TO ENTER THESE GIVEAWAYS EMAIL [email protected]
DAVID HUNT – ‘LIFETIME’WINNER Sir David Tweedie was the starturn at the recent IFA awardsevening, aboard the Dixie Queenon the Thames. If he hadn’t beenan accountant he would definitelyhave been a comedian! His topjoke? There were so many. Weparticularly liked: what is thedifference between a Big 4 partnerand a coconut? You can get adrink out of a coconut! PQ feltsorry for one group of overseasvisitors who had gone on a visit toSouthampton during the day, only
to miss the awards night boat. But it was great to see our goodfriend David Hunt (pictured above) win the IFA LifetimeAchievement Award – a worthy winner and a great guy.
GO STRAIGHT TO JAIL Finally we get an accountant in the popularcomedy series Rev, only for him to turn out tobe a City accountant just released from jail. Itgets worse. The Rev is desperate to find the£60,000 he needs to keep his church openand the senior accountant could be his knightin shining armour. Then we find out that thesaviour of St Saviours has been in prison forhaving 30,000 child abuse images on hiscomputer – accountants really can’t get apositive role on TV for love nor money. Nosooner had this been aired when anotherpositive role model appeared on TV – not! –with Steve Pemberton playing the mild-mannered kidnapping accountant in BBC’s Happy Valley.
GOOD GRUB Reed Business’s School’s chef was‘featured’ in a recent issue of Stir It Up –a cooking magazine. Craig Wright wascalled a ‘calculating’ chef (groan). Theschool is known for its good food, whichCraig explains he likes to keep ‘fresh’ and‘radical’. He makes his own bread, andserves things like chipotle chicken andpulled pork, which is slow cooked fornine hours then shredded and servedwith homemade BBQ sauce and pittabread. Craig and the team even made a27ft-long filled baguette for an eventcalled ‘Reed v Food’!
HOWBIG?CIMA students who getFinancial Management mayhave been concerned with thepicture on the Exam noticepage (p53). They will bepleased to hear that CIMA isn’tchanging the size of examdesks!
LUCKY NUMBER 7Writer Alex Bellos believes he has discoveredthe world's favourite number... and the answeris 7! Bellos surveyed 44,000 people todiscover what numbers they liked best. Itappears odd numbers are far more popularthan even numbers. In all, a whopping one in10 people chose 7 as their special number. Atnumber 2 was number 3 with 7.5% of thevote. Bellos claims that 7 is different, it the
‘most prime’ -– you cannot multiplyor divide it within the first group ofnumbers (1 to 10). So it feelsunique. We are told than evennumbers are deemedfeminine and odd numbersare masculine. It gets worse –those who like number 1 arethought to be independent,strong and brave: yes, that works– it is our favourite number of course!
7
A CHARACTER NOTAN ACCOUNTANT!Nigel Farage has been called lots of things,but he’s never been accused of being anaccountant. UKIP’s accountshave come under scrutiny,although millionaire PaulSykes, who is bankrollingthe European elections forthe party, insists Farage“isn’t an accountant, he’s a character – that’s why he’s ahead inthe polls.”
Wise up to Wise GuidesPQ has teamed up with Osborne Books to offer five lucky AATstudents at Level 2 the chance to win a free set of guides.These pocket-sized guides are the perfect study and revisiontool for use anywhere, any time. Wise Guide’s use diagrams,bullet points and ‘plain English’ to distil accounting principles ina manageable and easily-memorised format. You will get
Bookkeeping 1 Wise Guide, Bookkeeping 2Wise Guide, Introduction to Cost Wise
Guide, and Working in Accounting &Finance Wise Guide.• Send your name and address [email protected], and
head up your email Wise Guide
Any ACCA ebookof your choice Top ACCA publisher EW Publishing is offering 10 lucky PQmagazine readers the chance to download one of their studenttext ebooks. The 2014 kits retail at £9.99 and over 75,000texts and kits have been downloaded in over 130 countries. • To be in with a shout of winning one of these 10downloads just put ‘EW ebook’ in the subject header along with the paper you want(for example, F4). We also need your full name please for this giveaway. Send yourentry email to [email protected]
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