CPA CFE (common final exam) 2019


CPA CFE (common final exam) 2019

CPA Canada Common Final Exam 2019 consists of

•Capstone 1
•Capstone 2
•Common final exam, (a) Day 1 (b) Day 2 (c) Day 3

Capstone 1:

•A group assignment among 6-7 students
•A case analysis of around 45-50 pages
•Individually need to present with markers
•The case is related to day 1 final exam
•All students mostly get through in this work

Capstone 2:

•A group assignment among 6-7 students
•A case analysis of around 45-50 pages, role base
•Individually need to submit the reply
•The case is related to day 2 final exam
•Student should select his role from Performance Management, Finance, Audit and Taxation in advance
•Mostly all students pass this module

Day 1:
•one case analysis of 4 hour duration (about 50 pages) based on enabling competencies related with ethics , problem solving, leadership and communication skill.
•This is an extension of Capstone 1 case with different scenario. The focus is not on technical competencies but ethics, big picture and problem solving.
•Answer should be based on a) situation analysis b) analysis of major issues c) conclusion and advise d)effective communication with holistic approach ( i.e. from all aspects)
•Student need to separately pass this exam
•Grade is either pass or fail

Day 2:

•one case analysis of 5 hour duration (about 50 pages) based on technical competencies related with financial accounting, management accounting, and chosen role
•Answer should be depth in financial or management accounting and in selected role
•Grade will be for each issue, a) not address b) Just identify c) reaching competent d) competent e) competent with distinction
•Day 2 will be graded combine with day 3

Day 3:

•Three case analysis of total 4 hour duration based on technical and enabling competencies
•Answer should be depth in financial or management accounting
•Answer should be integrated with breath of other courses like taxation, audit, strategy and governance
•Grade will be for each issue, a) not address b) Just identify c) reaching competent d) competent e) competent with distinction
•Day 3 will be graded combine with day 2

Day 2 & 3:

To pass day 2 & 3, student should write answer with
•Sufficient with aggregate all issues….Level 1
•Depth in MA or FR ……Level 2
•Depth of issue in selected role…Level 3
•Breath of issues …..Level 4

Students must reply satisfying all 4 level in all major issues. Passing grade /limit will be decided for each exam by CPA Exam Board. Students should be familiar with all technical course are to pass this exam.

•Financial Accounting
•Management Accounting
•Finance and Financial Planning
•Taxation
•Audit
•Strategy & governance

Students also should have mastery and expertise knowledge in preparation of financial statements for all legal entities in Canada like Private , Public , Not for Profit corporation and Government.

Students will be provided with two booklets, one for case exam and other for rough work. Students will also get CPA Canada Handbook and Income tax act (valid up to Dec 31 2018) PDF version.

To pass this exam, student should have a through technical knowledge along with applicability of related accounting standard in the final exam.

Exam questions are little complicated and students should remain very careful about what exactly is the requirement.

CPA want a reasonable professional judgement which student should have under normal circumstances. Speed and accuracy are equally important. Time constraint will be observed by the students particularly in Day 3.

To pass this exam at first attempt, students should know the techniques of writing this exam. They need proper guidance to approach this exam with some practice and feedback for improvement from an expert tutor.

Professionally qualified students from India & Pakistan in particular, need some more efforts to understand Canadian taxation law and accounting standard.

If you require expert guidance and coaching, contact www.beyond.coach.
Tutor Paresh Desai CPA-CGA, CMA(USA) FCMA(INDIA) …..he will also published exclusive book CFE Technical Guide 2019 shortly…his cell no 6475056648

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CPA CFE (COMMON FINAL EXAM) SEP 2018

CPA Common Final Exam 2018 is approaching fast and now just two month away. Exam is conducted by CPA Canada only once a year. If student get through in the exam, he will get the most prestigious designation of CPA Canada. Many students are in process to do the same.

Exam is for three days and little more tough and lengthy. Most of you are busy with the jobs and family as well and left with little time to prepare well. As all of you know very well that exam is totally on case writing approach and time is always the constraint. Speed, accuracy and professional judgement are the essential skills in this exam.

Many students are struggling to pass day 2& 3 exam. Time constraint was faced by the students particularly for day 3. The most preferable approach is to read, understand and prepare outline in 30 % of available time for each case.

CPA is testing your knowledge from variety of in depth course concepts and as such you should have a through technical knowledge and practice for reading and understanding cases. In view of limited availability of time, we at Beyond Accounting Coaching Services have prepared 7 recorded video lectures exclusively for CFE 2018 exam. These lectures cover in brief all important technical competencies normally being tested in the exam. Exam is for total case writing approach, and without sound knowledge of technical concepts, it is difficult to provide in-depth response.

These video lectures are available at just $ 75 plus tax. Exclusive book CFE TECHNICAL GUIDE 2018 is also available at a cost of $ 165. For further information and for one to one coaching, you can contact us at www.beyond.coach or email at tutor.pa1.pa2@gmail.com

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Strategies to pass CPA Core 1 & Core 2 2018 exam

It is again now for students to well prepare for Core 1 & Core 2 exam scheduled on summer, fall & winter session of 2018.I observed that many students lack confidence for passing these exams. They remain very busy with job, family and also for submission of assignments. They also lack technical knowledge of various course area covered.Strong Technical knowledge is the key to success in these exams.These exams are evaluated on the basis of around 75 % MCQ and 25 % on one small case analysis. Exam is of 4 hour duration and as such students are required to do one multiple in about 2.5 minute and case analysis in 60 minutes.

I have seen many students could not get success in the last session on account of time constraint. They took more time in MCQ and as such could not allot enough time for case analysis. I provide following very successful strategy to pass these exams

1. Right from today, review your technical stuff of related course area along with your assignment work.

Financial Accounting and Management Accounting are the two major courses in both Core 1 and Core 2 respectively. Allot more time on it.
Learn the correct format of writing case analysis. Ensure that you read, understand and prepare the outline for case in 20 to 25 minutes. I have seen students normally are taking more time in the same and then lack confidence in writing the case effectively. Do the practices till you cannot achieve this.

Daily try to do some MCQ for the course area you have studied
In the exam, preferably first write the case in 60 minutes and then try for MCQ. This strategy is more successful to pass both theses exam.

Those who could not get success should consult experiences tutor for guidance and training. Repeated failure will increase frustration and you have only 3 attempt to get through
Those who have challenge exam, can also approach experienced tutor for guidance and training.

Students, who lack confidence in technical course area, can take my lectures online or at in person at Brampton location.For practice in MCQ, exclusive book is available for Core 1 & Core 2 at a cost of $ 165 plus 5 % tax for Core1 and $150 for Core 2, delivery free.

For any further question visit my web site www.beyond.coach or send email at tutor.pa1.pa2@gmail.com

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CPA CFE September 2018

 

CPA Canada Common Final Exam 2018

CPA Canada Common Final Exam 2018 consists of…

  • Capstone 1
  • Capstone 2
  • Common final exam

(a)  Day 1   (b)  Day 2   (c)  Day 3

Capstone 1:

  • A group assignment among 6-7 students
  • A case analysis of around 45-50 pages
  • Individually need to present with markers
  • The case is related to day 1 final exam
  • All students mostly get through in this work

Capstone 2:

  • A group assignment among 6-7 students
  • A case analysis of around 45-50 pages, role base
  • Individually need to submit the reply
  • The case is related to day 2 final exam
  • Student should select his role from Performance Management, Finance, Audit and Taxation in advance
  • Mostly all students pass this module

Day 1:

  • one case analysis of 4 hour duration (about 50 pages) based on enabling competencies related with ethics , problem solving, leadership and communication skill.
  • This is an extension of Capstone 1 case with different scenario. The focus is not on technical competencies but ethics, big picture and problem solving.
  • Answer should be based on a) situation analysis b) analysis of major issues c) conclusion and advise d) effective communication with holistic approach ( i.e. from all aspects)
  • Student need to separately pass this exam
  • Grade is either pass or fail

Day 2:

  • one case analysis of 5 hour duration (about 50 pages) based on technical competencies related with financial accounting, management accounting, and chosen role
  • Answer should be depth in financial or management accounting and in selected role
  • Grade will be for each issue, a) not address b) Just identify c) reaching competent d) competent e) competent with distinction
  • Day 2 will be graded combine with day 3

Day 3:

  • Three case analysis of total 4 hour duration based on technical and enabling competencies
  • Answer should be depth in financial or management accounting
  • Answer should be integrated with breath of other courses like taxation, audit, strategy and governance
  • Grade will be for each issue, a) not address b) Just identify c) reaching competent d) competent e) competent with distinction
  • Day 3 will be graded combine with day 2

Day 2 & 3:

To pass day 2 & 3, student should write answer with

  • Sufficient with aggregate all issues….Level 1
  • Depth in MA or FR ……Level 2
  • Depth of issue in selected role…Level 3
  • Breath of issues …..Level 4

Students must reply satisfying all 4 level in all major issues

Passing grade /limit will be decided for each exam by CPA Exam Board

Students should be familiar with all technical course are to pass this exam.

  • Financial Accounting
  • Management Accounting
  • Finance and Financial Planning
  • Taxation
  • Audit
  • Strategy & governance

Students also should have mastery and expertise knowledge in preparation of financial statements for all legal entities in Canada like Private , Public , Not for Profit corporation and Government.

Students will be provided with two booklets, one for case exam and other for rough work.  Students will also get CPA Canada HB and Income tax act (valid up to Dec 31 2017) PDF version.

To pass this exam, student should have a through technical knowledge along with applicability of related accounting standard in the final exam.

Exam questions are little complicated and  students should remain very careful about what exactly is the requirement.

CPA want a reasonable professional judgement  which student should have under normal circumstances. Speed and accuracy are equally important. Time constraint will be observed by the students particularly in Day 3.

To pass this exam at first attempt, students should know the techniques of writing this exam. They need proper guidance to approach this exam with some practice and feedback for improvement from a expert tutor.

Professionally qualified students from India & Pakistan in particular, need some more efforts to understand Canadian taxation law and accounting standard.

If you require expert guidance and coaching, contact www.beyond.coach.

Tutor Paresh Desai CPA-CGA, CMA(USA) FCMA(INDIA) …..he has also published exclusive book CFE Technical Guide 2018…his cell no 6475056648

 

 

 

 

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IAS 2, Inventory

Inventory

Inventory is one of the main items in the financial statements, and as such many time questions are appearing related to it in your final exam.

Inventories are of following types:

  • Raw materials
  • Work in process
  • Consumable stores and spares
  • Finished goods

It is appearing in balance sheet as current assets and in cost of goods sold (credit side on income statement) in income statement. Increase or decrease in inventories will directly have impact on current ratio and profit or loss of a company.

Inventory is measured at the lower of cost and net realizable value (NRV). Note that inventory includes land held for resale but does not include financial instruments.

NRV is the estimated selling price in the ordinary course of business less: (1) the estimated costs of completion; and (2) the estimated costs necessary to make the sale.

Cost should include all:

  • costs of purchase (including taxes, transport, and handling) net of trade discounts received
  • costs of conversion (including fixed and variable manufacturing overheads) and
  • other costs incurred in bringing the inventories to their present location and condition

Inventory cost should not include:

  • abnormal waste
  • storage costs
  • administrative overheads unrelated to production
  • selling costs

LIFO cost flow assumption is not permitted under IFRS.

 

 

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Strategies to pass CPA Core 1 & 2

It is again now for students to well prepare for Core 1 & Core 2 exam scheduled on summer, fall & winter session of 2017. I observed that many students lack confidence for passing these exams. They remain very busy with job, family and also for submission of assignments. They also lack technical knowledge of various course area covered. Technical knowledge is the key to success in these exams. These exams are evaluated on the basis of around  75 % MCQ and 25 % on one small case analysis. Exam is of 4 hour duration and as such students are required to do one multiple in about 2.5 minute and case analysis in 60 minutes.

I have seen many students could not get success in the last session on account of time constraint. They took more time in MCQ and as such could not allot enough time for case analysis. I provide following very successful strategy to pass these exams

  • Right from today, review your technical stuff of related course area along with your assignment work.
  • Financial Accounting and Management Accounting are the two major courses in both Core 1 and Core 2 respectively. Allot more time on it
  • Learn the correct format of writing case analysis. Ensure that you read, understand and prepare the outline for case in 20 to 25 minutes. I have seen students normally are taking more time in the same and then lack confidence in writing the case effectively. Do the practices till you cannot achieve this.
  • Daily try to do some MCQ for the course area you have studied
  • In the exam, preferably first write the case in 60 minutes and then try for MCQ. This strategy is more successful to pass both theses exam
  • Those who could not get success should consult experiences tutor for guidance and training. Repeated failure will increase frustration and you have only 3 attempt to get through
  • Those who have challenge exam, can also approach experienced tutor for guidance and training

Students, who lack confidence in technical course area, can take my lectures online or at in person at Brampton location.  For practice in MCQ, exclusive book is available for Core 1 & Core 2 at a cost of $ 145 plus 5 % tax, delivery free.

For any further question visit my web site www.beyond.coach or send email at tutor.pa1.pa2@gmail.com

 

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Absorption and Variable Costing System

 

Definition and explanation:

Absorption costing is a costing system which treats all costs of production as product costs, regardless weather they are variable or fixed. The cost of a unit of product under absorption costing method consists of direct materials, direct labour and both variable and fixed overhead. Absorption costing allocates a portion of fixed manufacturing overhead cost to each unit of product, along with the variable manufacturing cost. Because absorption costing includes all costs of production as product costs, it is frequently referred to as full costing method.

 VARIABLE, DIRECT OR MARGINAL COSTING:

Definition and explanation:

Variable costing is a costing system under which those costs of production that vary with output are treated as product costs. This would usually include direct materials, direct labour and variable portion of manufacturing overhead. Fixed manufacturing cost is not treated as a product costs under variable costing. Rather, fixed manufacturing cost is treated as a period cost and, like selling and administrative expenses, it is charged off in its entirety against revenue each period. Consequently the cost of a unit of product in inventory or cost of goods sold under this method does not contain any fixed overhead cost. Variable costing is some time referred to as direct costing or marginal costing. To complete this summary comparison of absorption and variable costing, we need to consider briefly the handling of selling and administrative expenses. These expenses are never treated as product costs, regardless of the costing method in use. Thus under either absorption or variable costing, both variable and fixed selling and administrative expenses are always treated as period costs and deducted from revenues as incurred.

Absorption Costing and Variable Costing Compared:

 The only difference between absorption costing and variable costing is the treatment of fixed manufacturing overhead (FMOH). Under absorption costing, FMOH is allocated to units produced, so that there is a little bit of FMOH included in the cost of every unit of inventory. Under variable costing, FMOH is treated as a period expense, appearing on the income statement as a lump-sum in the period incurred.

Comparing income under absorption costing to income under variable costing, the following observations can be made:

–   When there are beginning and ending inventories, absorption costing and variable costing will generally result in different inventory valuations for beginning inventory, different inventory valuations for ending inventory, and different incomes, but it is possible for the inventory balances and income to be the same under the two methods.

–  If beginning and ending inventory levels are zero, absorption costing and variable costing will always result in the same income.

–   If beginning inventory is zero and ending inventory is positive, absorption costing will always result in higher income than variable costing, and a higher valuation for ending inventory.

–  If beginning inventory is positive and ending inventory is zero, absorption costing will always result in lower income than variable costing, and a higher valuation for beginning inventory.

–   When inventory levels are increasing from period-end to period-end, as would be expected when the company is growing, absorption costing will generally result in higher ending inventory valuations than variable costing, and also higher income in each period. The reason is that absorption costing postpones recognizing ever-increasing amounts of fixed manufacturing overhead on the income statement, because increasing amounts of fixed manufacturing overhead are capitalized as ending inventory.

Over the life of the company (or from any point in time at which there is zero inventory to any other point in time at which there is zero inventory), the sum of income over all periods must be equal under the two methods. The difference between absorption costing and variable costing is only a timing difference: the question of when fixed manufacturing overhead is taken to the income statement

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Case Writing Skill

Technical Knowledge & Case Writing

Technical knowledge is very important part for CPA exam. Many students do not have enough exposure to previous courses on account of long time gap. Also students found migrating from different countries and obtained exemption from courses studied in their countries. CPA exam test the knowledge of students on main concepts they learned and passed out earlier. This knowledge is very important to solve MCQ (Multiple Choice Questions) and case analysis.

CPA exam are evaluated on the basis of competencies identified by the student. They expect in depth analysis of the response along with professional approach. Points are allotted on the basis of identification, analysis, alternatives and relevant and effective recommendation. Students are required to identify direct and indirect (integrated) competencies in case analysis. Some time students are required to identify hidden competencies as well.

Effective writing is another important skill required to pass CPA exam. Answer should be very well drafted, concise, clear and with easy to flow language. This requires lot of practice for physical writing. A wonderful write-up of a non-relevant issue is of no use to the reader. On the other hand, you need to be able to show your knowledge in a clear, coherent manner that the reader can understand and be able to use in his/her decision-making. A professional response integrates a discussion of the appropriate technical knowledge with a clearly communicated writing style. It is important to apply conceptual knowledge and exercise judgment. You will have to use your knowledge to solve practical problems. This means you will have to know what parts of that knowledge are relevant in a given situation. You also will need to be able to identify the problem from the facts provided.  You will have to consider alternatives, analyze them using your core knowledge and exercise your judgment in choosing one alternative.  Finally you must support your recommendation with a logical argument flowing from your analysis. Write your answer with proper heading and sub-headings; do not write case analysis like a story. There are many competencies that marker need to assess form your response, and therefore well-organized professional write up is the key to get success in the final exam.

Students will face case analysis from CPA Core 1 & 2 exam and onward till Common Final

For better approach and appearing with confidence in the exam, contact the tutor directly for guidance

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Basis Accounting- Accrual or Cash

BASIS OF ACCOUNTING: HOW TO DECIDE WHETHER TO USE CASH OR ACCRUAL ACCOUNTING

James runs a side business selling paintings. He does not sell on credit often and he buys all the materials for making the paintings from his local store on cash. In keeping financial records for the business, what basis of accounting should James use?

By basis of accounting, we mean the time in which the various financial transactions of a business are recorded. Should they be recorded immediately value is exchanged or should they only be recorded on receipt of cash?

There are two ways businesses track expenses and revenues: cash accounting/basis and accrual accounting/basis. In the hypothetical case above, cash accounting would be the more straight forward way for James to do his accounting. However, big companies are frequently required by law to use accrual accounting. Firms, Households, Individuals and even countries use the different basis in various situations.

In cases where there is no restriction on which method to use, deciding whether to use the cash method or the accrual method is an important decision for every business as there are advantages and disadvantages mostly due to the tax and business implications.

The cash method is a straightforward method. Expenses are only recorded when they are paid and revenues are recorded only when the cash comes in. For example, a farmer selling oranges to a supermarket uses cash accounting. He gives the supermarket oranges on consignment and the supermarket pays him every weekend for sales made during that week. The farmer would only record as sales the amount that was paid to him every week and not the actual value of the oranges he gave to the supermarket.

There are implications to the use of cash accounting. For example, it may not give a true view of the profit made in a particular time period. It measures pure cash flow and thus sometimes gives a false impression of long term profitability. It is not suitable for companies that carry out a lot of business on credit.

Its major advantage lies in its simplicity. The business does not need to hire expert help as in accrual accounting. Under the cash method, any customer payments the business received in say, 2016 for projects completed in the previous year would be counted as revenue for the 2016 tax year. This reduces the taxable income and as a result, it can lower the tax payments for the 2015 tax year.

The accrual method is the more formal method and records expenses and revenues when they are incurred and earned respectively. The business invoices the amount in question and records it even though the payment has not actually been received. Expenses are thus matched with revenues. For example, a laundry business using accrual method receives quarterly utility bill for November, December and January. Under cash accounting, this expense would only be recorded when it is paid. Accrual accounting, on the other hand, would estimate two months’ portion of the expense (November and December) and record it in the previous year’s financial statements.

Expenses and revenues are thus recorded whether or not cash is made. This has the implication of given a true view of the profitability of the business under a particular time period. Accrual basis of accounting often require expert help as it is complicated. In the example above, adjustments might need to be made as the cleaning company would have estimated expenses before the utility presents the bill. Due to the costs, small companies may not implement accrual accounting.

In conclusion, the decision to choose between cash and accrual basis should not be taken lightly. For a small company with low growth, the cash accounting method may be cheaper. However, companies that intend to grow would eventually need to use the accrual basis.

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Concepts of Accounting

Concepts of Accounting:

Accounting is based on two basic concepts

  • Business entity
  • Money measurement

Although there are also other concept of accounting but business entity and money measurement concepts are the basic concepts. Each of the concepts of accounting is discussed below briefly:

Money measurement concept:

According to money measurement idea, only that bonds in our accounting data which are measurable in financial terms, are requested.

Business Entity concept:

Business entity concept says that the firm and the owner of firm are two different entities. In simple words we can say that I and my company are separate.

Going concern concept:

Accounting is based on the inference that trade unit is a going concern. We keep all the economic data of a firm by keeping this point of view that a firm or trade is a going concern; not a gone concern. It means we always consider a trade or business in continuity form. In case if not take it as a going project we will be unable to obtain loans form the banker, we will also not get supplies or services from the supplier. In this case work of  employees will also be lessened, and the process of data recording will altogether.

Some cases have exception to this concept. These cases are:

  • One of the units is being stated sick.
  • When there is conversion and the converter is being appointed for same.
  • When there is extreme economic crisis and the business is going to end up.

Cost concept:

Cost concept is one of the important concept of accounting which depends on the going concern concept. As we always order the value of the things or assets on the basis of their cost instead of  their possible value or wholesale value of the assets based on inference that a firm unit is a going concern. No confusion, we decrease the value of assets giving deflation to assets, but we overlook the value of assets in the market.

The cost concept block all kind of manipulation by taking into account that value of assets in the market. Its bad effect is that this concept neglects the effect of expansion in the market. But still,  this concept generally accepted.

Dual aspect concept:

This concept says that there should be double entry for completion of any economic transaction, means debit and credit should be equal . Therefore,  there is dual aspect in all financial transaction:

  • You get benefit
  • You give benefit

Accounting Period Concept

For calculation of the loss or profit and to determine economic status of any firm balance sheets and profit, loss accounts for that firm are regularly prepared, most commonly at the end of year. This one year cycle is called as the accounting period for that company. In the view of past performances and to decrease the damage due to seasonal changes , we get guide from the accounting period. Accounting period tells us the exact status of the firm at specific intervals.

Matching concept:

This concept of accounting is based on accounting period concept. According to this concept, the expenses of a firm for specific accounting duration are matched with the credit of similar accounting duration to determine exact profit or loss for the similar duration of accounting. This practice is accepted worldwide.

Accrual concept:

As already said in the matching concept before, the credit for the specific accounting period is considered and expenses related to the accounting duration is also considered. On the basis of this concept if our items are sold or we provided some service, then that is our source of revenue irrespective of the fact that we received cash or not. Cash basis of accounting is used by most of the professionals which means that cash received and expenses during that particular accounting duration is the basis of their accounting.

Objective evidence concept:

According to this concept there should be an evidence of objective behind every economic entry. For example there should be purchase bill for any purchase, sale with their bills, cash memos in case of cash expenditure and cash receipts should be presented for payment to creditors. In case of stock there should be personal verification and its value should also be matched with its purchase bills. In case these are not present, there will be no accuracy in accounting, manipulation chances will be increased to great extent and people will not trust on such economic statements.

 

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