ACCA P7 Exam Tips March 2017 Session given below are just intelligent guesses from exam point of view provided by famous tuition providers. These exam tips must not be relied on totally. To increase chances of success in Exams you must prepare full breadth of syllabus and topics.
ACCA P7 Exam Tips March 2017:
ACCA P7 Exam Tips March 2017 Session are given below by famous tuition providers
Concentrate on the core areas – these are the ones that are regularly examined; your Kaplan tutor will help you to identify what they are. But your strategy should be study breadth not depth; it is much better to have a working knowledge of the whole syllabus rather than just 6 topics in lots of depth.
Pay attention to the verbs in the question to start with. ‘Explain’ requires you to state an answer with some facts as examples to support it. So, if the question was, ‘Explain the evidence you would seek when auditing provisions’, then an answer may be, ‘ External advice from a solicitor to prove existence and valuation.
This comprises two compulsory questions worth 35 marks and 25 marks respectively. Typically question 1 will test planning, risk assessment, evidence gathering and practice management issues using a scenario where audit client details are presented, often including financial statements extracts, which candidates need to consider as part of their answers. However, the topics covered by question 2 will be more uncertain to predict – possibly a non-audit engagement such as prospective financial information (PFI) or due diligence, or a question testing specific parts of the syllabus, such as audit completion or consolidated groups. Whatever the subject, application is vital for success here.
Within one of the compulsory questions, there will be 4 professional marks available which reward candidates for the layout and presentation of their answers.
A choice of two from three written questions that are each worth 20 marks and typically test the following syllabus areas: audit evidence and financial reporting issues, practice management including ethics and quality control and reporting including completion and communication. Again, candidates will be expected to apply their knowledge to the scenario in order to score well.
P7 has the following syllabus areas:
A Regulatory environment
B Professional and ethical considerations
C Practice management
D Audit of historical financial information
E Other assignments
G Current issues and developments
ACCA students are no longer given a separate period of 15 minutes ‘reading and planning’ time at the start of each written exam as the exam duration is now 3 hours and 15 minutes to include reading, planning and writing. However, we would still advise you to use a period similar to this at the start of the exam to continue planning the things you need to include in your answer. It is essential that you use the information in each scenario to make your answers relevant – due to the typical size of the compulsory scenarios, we would advise that you still use this notional 15 minutes to plan these question above all others.
During this time you should also pay attention to the verbs used in question requirements as these indicate the number of marks available. For example, the requirement to “evaluate the audit risks” requires a couple of sentences and will score up to 2 marks if the matter is fully explained, whereas use of the verb “list” simply requires you to present information with no further explanation: this will typically only score ½ mark per point listed.
Recent exams have tested fresh content from the examiner’s technical articles: for example, key audit matters were examined in December 2016, while INT candidates were tested on the audit of public sector performance information in December 2015.
All technical articles can be found here: http://www.accaglobal.com/gb/en/student/exam-support-resources/professional-exams-study-resources/p7/technical-articles.html so you are strongly advised to keep referring to them in advance of the exam.
- Audit risk, for a group.
- Extra information needed to assess those risks.
- Accounting matters and audit evidence.
- Ethics and prof issues including:
– Money laundering.
– Quality control.
- Audit reports including KAM and MURGC.
- Social/environmental or public sector disclosures – evidence.
- UK stream – insolvency.
- ISA 250, 260, 510, 560, 720.
Likely to have a question on identifying business risks. (see Dec 2014 Q1a, Dec 2012 Q1a, Dec 2010 Q1a, June 2009 Q1a) Must learn to link business risks to FS risks of MM (see June 2008 Q1, June 2014 Q4a theory) Dec 2014 Q1b).
Be prepared for risk of material misstatements (previously known as FS risks). Practice Dec 2008 Q1a, Dec 2009 Q1c, Dec 2010 Q1b, June 2011 Q1ai and June 2012 Q1aii, June 2013 Q1a, June 2014 Q1a. For identifying risk of MM, see Dec 2012 Q1b, Dec 2010 Q1a, June 2009 Q1a. See also Dec 2008 Q1a and Dec 2009 Q1c.
Be prepared for a group audit question. Could be a question on identify risk of MM for a group (See Sept 2015 Q1). Practice and review June 2012 Q1, Dec 2013 Q1, June 2014 Q1.
Internal auditing – Outsourcing IA issues to consider (from audit firm’s point of view, from company’s point of view), advantages and disadvantages of outsourcing IA to external audit firm. See Dec 2006 Q2 and June 2010 Q2.
Accounting problems/issues (Many past exam questions on these) Read up and focus on the recent 3 years for this type of question – Important areas include audit of provision (including warranty and decommissioning provision), deferred tax, share-based payments, leases, intangibles, investment property (must do use of expert). You should be aware of the things to cover when question asked for “matters to consider”, then the principal audit procedures.
Use of analytical procedures – Factors to consider when deciding the extent of use and reliance on analytical procedures in testing Dec 2009 Q1a). Although just tested in June 2016 Q1b, plus previously in June 2013 Q1a, Dec 2011 Q1a and Dec 2009 Q1a (theory), better to review these few questions in case we need to use ratios to get the audit risks.
Ethical issues facing the auditor – practice lots of the ethics questions. Take note of confidentiality. (Identify circumstances in which the disclosure is permitted or required and discuss the factors, which may justify disclosure under public interest). Take note of providing non-audit services like valuation, IT services, internal Audit service = Dec 2012 Q3b), cross selling service (Dec 2012 Q3b, June 2015 Q4), business opportunity with client (June 2014 Q4) and referral fees (
QC is important – can be linked to ethical issues above and how ethical conflicts can affect quality of work. Read up QC cases like recent June 2016 Q2a, June 2015 Q4, June 2014 Q3, June 2013 Q2a, June 2011 Q1c, Dec 2009 Q2b, Dec 2007 Q1c.
Assurance engagement – A possible question like factors to consider when accepting assurance services (see June 2011 Q3a, Dec 2010 Q2, June 2009 Q2). Important to do KPI assurance service – See Dec 2007 Q2, Dec 2008 Q1, June 2012 Q2, Dec 2014 Q3b, Dec 2015 Q2b.
Need to study forensic auditing. See June 2015 Q3c, June 2013 Q2c, Dec 2011 Q4, Dec 2008 Q2, Pilot Paper Q2.
Due diligence is important – See latest Sept 2015 Q3 plus June 2011 Q4, June 2008 Q2, Dec 2007 Q3. What procedures will you perform to do a due diligence, use of enquiry and analytical procedures in conducting due diligence.
Subsequent events – See Dec 2009 Q5 and review Dec 2010 Q3c.
Almost certainly a question on audit reporting – Emphasis of matter (June 2010 Q5), adverse and except for opinion. Read a new article (taken from Nov 2013) on proposed new standard of audit report, know the proposed new format and new para to be included. Do questions on critically appraise the audit opinion (ie given an opinion which is wrong, get into details on the wordings, paragraph arranging, headings etc)
Compliance with laws and regulations (see Dec 2006 Q4a, Dec 2011 Q2c and June 2015 Q2c). Auditor’s responsibility, procedures and reporting duties.
Audit of opening balance – See June 2011 Q3b and Dec 2011 Q5c
Insurance for auditors – two types, advantages and disadvantages of buying insurance.
Remember the key to this paper is practice lots and lots of past exam papers.
And lastly, look out for any relevant P7 article(s).
35 marker compulsory question 1 – 63 minutes
- this will probably involve responding to a partner’s email about a forthcoming audit client where you are asked to identify business risks, audit risks that you expect to face, principal procedures that you expect to perform during the audit and any ethical issues that may be relevant
- the 63 minutes time allocation should be allocated as 17.5 minutes PLANNING your answers to the various parts of the question and 45.5 minutes writing your answer to those various parts
- it is vital that you stick rigidly to time allocation within all these questions. There should be no question of you finishing the 3 hours and saying “I didn’t have time to do part d) of question 1”. There HAS to be a proper attempt at ALL parts of the questions that you elect to attempt
- this is the question where 4 professional marks are available for style, presentation, clarity, persuasiveness …. so make sure that you can write a letter, an email, a draft press release, an address to the shareholders a report …..
25 marker compulsory question 2 – 45 minutes
- planning time here is 12.5 minutes so use it wisely and that leaves just 32.5 minutes for writing out your plan
- this is typically an audit question with an accounting twist asking you to comment on “matters to be considered and explain the audit evidence that you should expect to find during your review of the audit working papers”
- the particularly important word in this question is “explain” the audit evidence. Not identify or list but explain. Further, you don’t expect to find something like “if that fails then telephone the third party ….” So be very careful to restrict your answer to an explanation of the audit evidence that you could expect to find in audit working papers (and a telephone conversation isn’t evidence that you would find on an audit file!)
- also important is to ensure that you are on top of the IAS / IFRS and particularly the more recent ones or those with recent amendments
- document numbers and titles are NOT IMPORTANT – they score no marks
choice of 2 from 3 questions worth 20 marks each – 36 minutes each
- planning time here is 10 minutes for each of your two chosen questions so, as always, use it wisely and that will leave only 26 minutes writing time
- there will most probably be something about ethics in one or even two of these optional questions
- make sure you write something for every part of every question. You are unlikely to be able to finish every part of every question – either because you run out of time or you get stuck – but you can always write something.
- each comment that you make should be within its own sentence and leave a line between your sentences effectively making them into paragraphs
- time yourself copying sentences from a book and stop after 1 minute and 18 seconds. That’s the time that you have available to write one sentence containing just one markable point.
- you’re unlikely to get past the third line and that’s the MAXIMUM length of a sentence / paragraph in the exam
- make sure that your writing is legible. If a marker can’t read your script, he can’t give you credit for your thoughts!
- if you write one long paragraph containing several points, then there is a danger that the marker will miss some of the points.
- start each part of each question on a new page in the answer booklet (if you run out of pages you will be provided with a supplementary booklet!).
- that way you can always go back to questions and you will be able to add more to your answer neatly, if you have time left at the end of the exam.
- do make sure you make it clear at the top of the page which part of which question you are answering.
- for a non-numerate exam like P7, be aware of just how many marks are available for each part-question and plan sufficient points to include within your answer to get the majority of those marks. Remember, one correct point earns one mark.