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ACCA Exams 2010

Passing F7

Having trouble unlocking the secret of F7? Clare Finch offers you the keys to success
Once again, ACCA F7 has the joint lowest pass rate (39% in the recent exam diet). This is the core accounting paper (being sat by trainee accountants), asking sitters to prepare primary accounting statements, applying the rules of the accounting standards, so how could it go so wrong? And how do you make sure you don’t fail?
PLANNING TO PASS?
Five key facts to remember are:
1. F7 is a week two exam Human nature is to study for the exam that is coming first. Inevitably, students with F6 and/or F8 entered alongside F7 will be focusing more on their week one exams, to the detriment of F7 revision.
2. F7 is timetabled as the last exam of the ‘F’s Doing it alongside F9 means you have F9 the day before, so you will need to compensate with proper planning.
3. F7 is a ‘cumulative knowledge’ paper Unlike F6 or F8, you are meant to already have the knowledge for F3 at your finger-tips. Entering for F7? You must know your double-entry bookkeeping from F3.
4. F7 is a huge syllabus Download the list of examinable documents for 2010 for your stream. For the international route, there are 25 on the list; it’s a lot to learn.
5. F7 needs a lot of question practice Imagine you were planning a marathon. Would you just study books about your route and read explanations of how to run a marathon? No, you would put your trainers on, get out there and actually practise.
The five keys to success
1. Start early Do not put off F7 for another minute. Get your study material now, get your list of examinable documents on the wall and plan for this second week exam at once!
2. Start with F3 Be honest about your assumed knowledge; an exemption or scrape pass at F3 can cause a problem, so get your F3 (or whatever gave you your exemption) books out now. A quote from the June 09 examiners report says it all: “Worryingly, a number of candidates depreciated the owned plant and equipment using cost rather than carrying value.” The distinction between straight line and reducing balance depreciation should be second nature to anybody at this stage of their studies. If it isn’t for you, sort it out.
3. Start with your assumed knowledge accounting standards The list of international examinable documents 2010 includes 10 that flow through from F3. These are core for any accountant, and certainly anybody who is entering F7 must know them inside out:
• The framework for the preparation and presentation of financial statements.
• IAS 1 Preparation of financial statements.
• IAS 2 Inventories.
• IAS 7 Statement of cash flows.
• IAS 8 Accounting policies, changes in accounting estimates and errors.
• IAS 10 Events after the reporting period.
• IAS 16 Property, plant and equipment.
• IAS 18 Revenue.
• IAS 37 Provisions, contingent liabilities and contingent assets.
• IAS38 Intangible assets.
Do not put this off; there is a lot of new learning to come. If you have a weakness here think about doing an assumed knowledge day. In my book ‘A student’s guide to International Financial Reporting Standards’ – on the F7 (Int) reading list – these are the ‘orange chapters’.
4. Start to practise questions now You do not need to wait to begin question practice. Look, for example, at question 4 in the June 09 sitting. It is all about IAS 10 Events after the reporting period. Again from the examiner’s report: “Many of the failed F7 candidates did not attempt question 4 at all and many those that did seem to believe there is a set time ‘three or six months’ after the reporting date.”
This topic was examinable at F3 and all three transactions covered were core examples of events after the reporting period, including the classic fire! Starting now on working through the F7 examiner’s questions and answers on the F3 standards will pay dividends later.
5. Start as you mean to go on As you learn the new F7 topics, don’t just go through the motions making notes. Get to question practice as soon as you can; this way you will identify any knowledge gaps rather than ignoring them. Plug the weakness and move on to success– get those trainers on regularly!
SUMMARY
F7 is a lovely paper; you get to prepare statements of financial position, cash flows and things that reconcile! It is
an accounting exam, being sat by accountants, but it needs care and respect. It has a ‘Cinderella’ place in the exam timetable, but with careful planning and a lot of hard work, it should get to go the ball.
• Clare Finch is content manager – FR/Audit and Law at Kaplan Financial and the author of ‘A student’s guide to International Financial Reporting Standards’

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