Updated: Apr 19, 2020
ACCA June 19 attempt results are just released.
First of all, congratulate to 4,923 ACCA students passed their final exam and become ACCA affiliates.
Link to announcement: https://www.accaglobal.com/hk/en/news/2019/july/Jun_19_results.html
Few observations from this attempt that I would like to highlight –
Significant improvement in SBL pass rate to 51% in June 2019, very closed to P1 and P3 in old syllabus;
SBR pass rate is only 48% and there is still room for improvement;
Two audit papers (AA and AAA) are very challenging to pass, as usual
ACCA will introduce innovative digital desktop CBEs for Strategic Professional exams next year, we will keep you posted for any news coming from the association.
It is always important to review examiner comments as they are highly regarded as the exam tips directly from the authority. No matter you will attempt September 2019 or any future exam, they are the ‘tips’ to you.
Let’s start the sharing of what examiners tell you need to pay attention in next exam!
Strategic Professional Module Pass Rates
SBL pass rate is gradually improved from exams in previous sessions but still slightly below the old P1 or P3.
Based on our observations, SBR pass rate is still slightly lower than P2.
APM is no more the hardest one to pass in Strategic Professional Level, AAA is the most challenging one.
ACCA SBL – Reading and Planning is the key to pass
It is a 4-hour exam with a single compulsory section.
The marking scheme included 80 technical marks for the correct use and application of technical knowledge.
In addition, 20 marks are for professional skills and competencies.
Generally, you need to take note of the following in order to do well in SBL:
Spend sufficient time reading and assimilating the case study material before even contemplating answering the questions;
Spend sufficient time planning their answers to ensure they are structured logically, covering most important points, balanced in terms of depth and breadth of discussions, not padded out with superfluous waffle and avoiding unnecessary overlap and duplication;
It is recommended to answer the requirements in order especially examiner considers future exams may follow a timeline or have question requirements that progress in other ways.
Professional skills tested in this attempt include analysis, commercial acumen, scepticism, evaluation and communication.
General comments on this session SBL exam relevant to professional skills are –
Failing to provide all the task required which means not all parts are answers, e.g. Task 4(a);
Not paying attention to the format required, e.g. Task 5;
Failing to produce a balanced answer, e.g. Task 2(a) not giving equal weight to commercial and ethical considerations and Task 3 failed to consider potential problems of the acquisition;
Poor tone and comments made.
Here is a summary of specific comments for each task.
Task 1 asked students to prepare board paper for a board meeting about the weaknesses in the composition and operation of the board in the case and improvement recommendations. Professional skills required here is communication skills.
Technical marks were generally well done and only some weaker answers only stated features of the board without justifying why they were problematic.
However, it’s found limited professional marks on many answers due to 1) poor tone together with tactless comments; 2) poor format of answers.
Task 2 asked to prepare a memo divided into two parts. Part a required a discussion on commercial and ethical issues involved in publishing a book. Professional skill asked was skepticism.
The key problem in part a is many students structured their answers using Tucker framework which was technically incorrect.
Part b asked for identification of main problems in the commissioning and review process and recommended actions. The answers were often disappointing and some of them only repeat the material in part a
Task 3 required a preparation of consultancy report to the board assessing the attractiveness of an acquisition target using financial and non-financial information. It required demonstration of commercial acumen.
Technical marks were well done but not the same as in professional marks. This was because many students failed to demonstrate commercial acumen as well as failure to link the results of calculations to other information and the answer not reading like the section of a report.
Task 4 is divided into two parts. Part a required preparation of a consultancy report to the board to assess weakness and recommend how the project management of digital platform could be improved. Professional marks were to be awarded for evaluation skills.
Many answers scored at least a pass but the major issue here was failure to address the part of requirement relating to the reappointment of the supplier.
It is also the weakness addressed in limiting professional marks as well.
Part b required recommendations to the board how current digital platform can be further developed to attract and retain customers. Professional marks required commercial acumen to be demonstrated.
It was poorly answered and some candidates wrote very little. Many answers were found insufficient number of suggestions which was also the reason of lower professional marks.
Task 5 asked an analysis of problems in retaining talented staff and recommending actions to retain and develop employees in a format set out already. It required demonstration of professional analysis skills.
Due to time pressure, it was found lack of planning and thought frequently resulted in repetition, factors being put in the wrong category and poor linkage between problems and recommendations.
Detailed examiner’s report can be found:
ACCA SBR – It is a new paper and NOT P2
The purpose of SBR is to assess your professional competences within the corporate reporting environment.
Its syllabus is not significantly different to the P2 syllabus but it requires more written answers rather than numerical ones.
The exam contains two sections, A and B. Section A includes 2 questions which totaled 50 marks while Section B has 2 questions and 25 marks each.
SBR June 2019 pass rate is 48%, similar to March 2019 which was 49%.
General approaches to SBR examination are –
Students are examined on how they apply concepts and principles to life-like scenarios that reliance on a single textbook or revision course will not be sufficient to pass. Their readings are expected to expand beyond textbook including articles from IASB, the profession and ACCA.
Students are expected to synthesise and evaluate material, the key focus is on the application of knowledge.
The SBR exam also includes ethical aspects requiring students to show their understanding of the professional and moral judgments.
June 2019 SBR examination performance was not significantly different from previous attempts while the following items should be noted:
Merely discuss an IFRS without applying knowledge;
Spending a disproportionate amount of time on question 1.
Question 1 is divided into several parts. They ask 1) drafting an explanatory note and calculation of how a dividend received from a subsidiary, investment in subsidiary and treatment of disposal in total comprehensive income; 2) deferred tax implications from sales of inventory by holding company to its subsidiary; 3) discussion of how variable lease payments should be recognized and measured in financial statements.
Overall question 1 was well answered but the discussion and accounting principle applications are still room for further improvement.
4 parts in Question 2 which were: a) explain and calculate a share incentive scheme expense under IFRS2 Share-Based payments; b) IAS24 Related Party Disclosures; c) Application of IFRS8 Operating Segments; d) Discussion of the ethical issues with reference to ACCA’s ethical code.
In general, all parts were well answered by many students. The problem in Question 2 is on professional marks. Some students merged part b and part d in their answers while professional marks were difficult for markers to sift through answers that combine two parts of a question.
Question 3 was fairly attempted which was divided into three parts. The first part asked about financial liability arising from a factoring agreement which required the knowledge from IAS 32 Financial Instruments: Presentation.
Second part required calculation of value-in-use of an asset and an impairment loss whilst discussing IAS 36 Impairment of Assets and IFRS 13 Fair Value Measurement.
The final part of Question 3 asked a discussion of the nature and importance of the distinction between a change in accounting estimate and a change in accounting policy and the provisions of IAS 8.
Answers to Question 3 were well performed but not so well on discussing why a distinction is important. In addition, many answers failed to give examples of inconsistencies in the way new IFRS Standards deal with the change in accounting policy.
Question 4 is divided into different parts and focus on accounting principles. Often, answers to this type of question are weak. The first part required a discussion of current criteria that IAS 21 uses for the recognition of foreign exchange gains in profit or loss or OCI; and further required a comment on translation of overseas subsidiary’s financial statements. The final part asked an application of IAS 21 to two scenarios
The following areas were found very challenging to many students which should be addressed:
1) Unable to deal with the recognition of foreign exchange gains;
2) Poor performed in discussing whether reporting of a transaction in a foreign currency is a measurement issue or a mechanical conversion;
3) Unable to apply IAS 21, particularly regarding the changes in a parent’s ownership interest in a subsidiary;
4) Failure to calculate correctly the elimination of an intra-group profit on inventory because of the overseas context.
Detailed examiner’s report can be found:
ACCA AFM (was P4) – Stable performance
Advanced Financial Management (AFM) pass rate is slightly higher than prior session which stood at 38%.
This exam is in two sections. Section A consisted of a 50-mark compulsory question. Section B consisted of two compulsory questions of 25 marks each. All three questions in this examination contained a mixture of computational and discursive elements.
The main reasons for less well performance are –
Lack of detailed knowledge
Poor time management
Failing to respond fully to the requirements
Poorly structured numerical and written answers
Focusing more on either numerical parts or discursive parts instead of a balanced approach
Presenting answers in bullet points, often in incomplete sentence, and without adequate discussion or evaluation
Question 1 is a 50-mark compulsory question on assessing new project, using conventional net present value method and real options; in addition, discussing the issues arising from shifting production to another country. Three parts are required as follows:
Discussion of how incorporating real options into computations can help in making investment decisions;
Asked students to undertake a conventional net present value computation of a project and apply real option valuations;
Discuss the impact on the company arising from ethical and sustainability issues and then suggest what are the resolutions to those issues.
There were several issues identified by examiner that are worth to address:
1) Very few answers discussing how real options could be incorporated into investment decisions;
2) Many students were unable to demonstrate how the asset value of the follow-on project was estimated when applying real option valuations;
3) Many responses in ethical and sustainability issues contained lots of repetition showing lack of full understanding of this topic.
Question 2 was about financial derivatives and divided into three parts. Part a was about calculating the impact of an option on futures and a swap to manage interest rate risk of a future borrowing. Part b asked for advantages and disadvantages of using swaps as a tool for managing risk. Part c asked students to criticize the view of the quality of staff needed in a treasury department in terms of its contribution to the strategic success of the business.
Part c was not performed very well probably due to many students did not read the question fully and properly.
Question 3 asked students on demergers and factors which determine communication policies.
Part a required a discussion of advantages and disadvantages of demerging a business unit part of a company into a new, independent company. This part was well answered.
Part b asked for two things, 1) cage in the cost of capital of the original company due to the demerger; 2) compute the value of new company usinglculate the chan the free cash flows method. Many students found this part difficult because the answer does not lend itself to a proforma structure.
Part c was to discuss factors which would determine the communication policies in relation to shareholders and stakeholders which was done well by only a small number of students.
Detailed examiner’s report can be found:
ACCA APM (was P5) – Overall performance is stable at low pass rate
In June 2019 attempt, Advanced Performance Management (APM) pass rate maintains at 33% which is the similar as in March 2019 session.
Since September attempt, there have been no choice of questions in APM and the examiner found a number of students may have been caught out by this, having not prepared to answer questions across the whole syllabus.
In addition, some students showed MA or PM approach in attempting APM while they can only get very limited scores that cannot pass it.
There are three APM exam tips suggested by examiner, which are –
Grasp all basic knowledge;
Good and professional answer will go beyond the mere repetition of how a technique works and focus on specific environment;
Capable of analyzing and evaluating the situation in the scenario using required technical knowledge.
Question 1 required candidates to consider issues of justifying performance measures, undertaking a target costing exercise, examining the division of responsibility and assessing the impact of sources of information. performance reporting and stakeholder management at a family-owned, national retailer.
The parts were not done well by many students are –
Many students ignored the requirement on assessment of the group of KPIs to measure strategic performance;
Only few were able to assess the impact of the sources of information on the management of quality within the outsourcing contract.
Professional marks performance was generally very good while suitable report headings, introduction, logical structure, signposted and a clear, concise style were found.
Question 2 required an assessment on how the characteristics of a service business may create problems in the performance measurement and management of quality of service and resource utilisation; and the use of Fitzgerald and Moon building block model to evaluate whether a proposed reward scheme would encourage set standards to be achieved.
Weak areas to be highlighted are:
1. Many were unclear as to any of the meanings of the characteristics
2. Not address to discuss quality of service and resource utilization
3. Not many students could answer the rewards part of the Fitzgerald & Moon building block model.
Question 3 asked to evaluate a change in budgeting system to an activity based one and complete some figure work for activity based budget, explain for any variances.
This question was not well answered by many students. The problems identified by exam team are: 1) Not well aware of the question word “evaluate” is to assess strengths and weaknesses; 2) Definitions on incremental budgeting and ABB; 3) Not offer good comments or explanations on the numbers worked out about activity based budget.
Detailed examiner’s report can be found:
ACCA AAA (was P7) – Lowest pass rate in all Strategic Professional papers
ACCA AAA June 2019 pass rate is 31%, very closed to March 2019 attempt, which is the lowest one in Strategic Professional module.
The exam is in two sections; Section A consisted of a 50-mark question, and Section B which consisted of two questions of 25-marks each. All questions are compulsory.
In general, Question 1 is about evaluating business risk and risk of material misstatement at the planning stage of group audit alongside audit procedures. Question 2 focuses on completion and reporting. Question 3 covers discussion on exposure draft on ISA 540 Auditing Accounting Estimates and Related Disclosures.
I always consider AAA is the most challenging paper in ACCA professional exam. The knowledge demanded is from Audit & Assurance (AA) to Strategic Business Reporting (SBR).
The majority of marks derive from the application and understanding of that knowledge rather than the knowledge itself.
In other words, you are required to answer the questions by addressing the scenario presented to pass.
To better prepare for the exam, you are not only studying text books and past exams but also need to read through a series of technical and exam articles on ACCA website.
Question 1 is a 50-mark question on the planning phase of the audit of a family owned business which consists 4 requirements as follows:
Evaluate business risks arising from the scenario which focused on a new client audit;
Evaluate significant risks of material misstatement arising from the scenario;
Discuss ethical issues relevant to the details given in the scenario;
Discuss difficulties in the identification of related parties and to design specific procedures to be performed surrounding a transaction given in the scenario.
Some answers are not aware of it is a new client audit engagement while discussing about detection risk which is irrelevant. In addition, many students failed to identify the client was listed and the discussion of ethical issues surrounding to non-listed entities.
Question 2 is a 25-mark question consisting 2 parts which are 1) Critically appraise an extract from an auditor’s report which had been incorrectly prepared and required amendment; 2) To discuss, along with reasons for discussion, specific matters raised in the scenario which should be reported to those charged with governance.
The majority of candidate answers were extremely disappointing especially for the first part.
Common problems are:
Lack of knowledge of auditor reporting and ISA requirements;
Answers were either long but without any clarity or were vague and incorrect.
Question 3 is a 25-mark question focused on the discussion of a published exposure draft and evaluation of accounting treatment for specific estimates given in the question scenario along with audit procedures to be performed.
The discussion of a published exposure draft were good but a large number of candidates showed a weak understanding of SBR syllabus, especially lack of understanding of provisions, i.e. IAS 37, and scored very poor marks.
Detailed examiner’s report can be found:
June 2019 session is the fourth exam on new ACCA professional qualification exam, especially in strategic professional module.
In Strategic Professional Module, both SBL and SBR performance is stable and AAA is still the most difficult paper to pass.
Given the focus in Strategic Professional Module is to apply your knowledge (both in this module or the basic knowledge from Applied Skills Module), you are suggested to better plan your schedule to take exam right after what you did in prior module.
It helps to improve your chance to pass.
If you have any questions or comments, just send me email at email@example.com and I will answer you shortly.