If you have read my difficulty ranking of all 15 ACA exams with statistics, you will be aware that I found ACA Corporate Reporting (CR) to be the hardest ACA exam. I will talk you through exactly how much time I spent revising for this exam in this article. Spoiler alert, it was quite a lot. At the time of studying for this exam I did not think it would be that difficult. However, despite all this revision the August 2020 (delayed COVID-19) Corporate Reporting exam gave me the biggest shock of them all. I will shortly be sharing with you why I thought I failed this exam. With a pass mark of 50 and a score of 53, I was close!
Click here to find out how to almost fail CR.
Table of Contents
- What is Corporate Reporting (CR)?
- ACA Corporate Reporting Exam Outline
- How to Prepare for Corporate Reporting
- Corporate Reporting Open Book
- Audit Requirement
- Time Management
- Further Revision Advice for Corporate Reporting
- Are the Recent ICAEW Question Bank Questions most Relevant?
- Corporate Reporting Wrap Up
What is Corporate Reporting (CR)?
Let’s recap from my Advanced Level breakdown but add some more detail. The CR open book exam is 3.5 hours in duration and 2.1 minutes per mark. Corporate Reporting is a combination of the Financial Accounting and Reporting (FAR) and Audit and Assurance (AA) Professional Level exams with some new accounting standards too. The ACA Corporate Reporting exam syllabus is as follows:
|Corporate Reporting – Compliance and Financial Statement Analysis
|Audit and Assurance
As I work in Audit, the 30-40% AA aspect of the exam was usually quite nice. However, as mentioned in ‘What is the ACA? …’ the ACA cover a range of roles so others may struggle. That being said, you can prepare for it in the same way as AA.
ACA Corporate Reporting Exam Outline
The exam typically consists of three written questions where the marks are usually split 40, 30 and 30. If we look at the questions in turn:
Questions 1 and 3 – these are integrated questions that test a variety of financial reporting (including group consolidation) and assurance topics. The majority of the financial accounting and reporting content would already have been taught during FAR. I would strongly recommend recapping and brushing up on this for Corporate Reporting. There are more standards taught to you too such as IFRS 9 Financial Instruments and IAS 19 Employee Benefits to name a few.
Regarding the CR and AA split in one question, the questions vary paper to paper. You could have a question almost solely testing AA. Alternatively you could have a question more mixed between Corporate Reporting and AA.
The main difference between question 1 and question 3 is that question 1 now involves the use of Advanced Information (AI). This has been newly introduced since I sat my exam in August 2020 and so I will not be able to comment on this aspect of the exam. I do know it involves the use of new data analytics software. These ICAEW resources should help with this and my ACA calendar will help you to keep track of when the AI is released for your sitting. Remember even though this area is new, stick to your timings!
By this stage you should be aware that there will be an ethics element. Again, as in BPT, these should be the easy marks so make sure to get these!
Question 2 – this will assess purely financial reporting. Depending on the standards tested, question 2 can be good to secure marks as with practice it should be straightforward. Your open book if prepared well can help you with this. I will touch on this below.
Examples of financial reporting and financial statement analysis that could come up in this exam are:
- Reviewing the accounting treatment in question which is usually put together by a junior. Then correct these where necessary through adjustments to the extracts provided. This reminds me of Certificate Level Accounting (correct treatment? What was done? How to adjust?) but of course much more difficult.
- Review financial statements for the choice of accounting policies.
- Use accounting ratios such to summarise or compare financial information.
- Perform analytical procedures to identify audit risks which is slightly more difficult than AA.
How to Prepare for Corporate Reporting
Before I share details of how to prepare for Corporate Reporting, I think it is important to understand how the exam is structured. I know I outlined this above but what I mean here is that you reaallly need to know how it pulls together. I thought I knew this from sitting a progress test and mock but it was only when I sat the real exam I had a wake up call.
This exam is one that I found can massively vary paper to paper and it does come down to luck of the exam. In my progress test/mock months before any revision or even completing learning all the content for CR I was able to achieve 65. This definitely gave me false confidence. If I share my experience with you with the real exam I am hoping it will give you a head start so nothing will shock you as much as mine did me.
August 2020 Exam
Why did I find this exam to be so awful?
- IFRS 9 is a very tricky standard. I would even go as far as saying it is the hardest standard to get your head around. The whole of question 1, the 40 marker, was on this.
- There were no questions on group consolidation that I thought always tends to come up in CR. This was frustrating as I was well prepared for this.
- The purely financial reporting question 2 in theory should have been good to help pick up marks. It was on leases and deferred tax both by this point I wanted to come up. However, the IFRS 16 question I found was worded weirdly. I thought I had a good understanding of leases until the cracks appeared when I was wasting a lot of time figuring out which lease accounting rules to apply based on the wording.
- The final 30 mark question was on IFRS 8 Segmental Reporting but as this standard is not tested frequently, it was really not obvious at all. In fact, there were barely any ICAEW Question Bank questions on this.
I am going to be shortly releasing the blog post I wrote straight after the Corporate Reporting exam. Join the journey so you don’t miss this.
Key Takeaways to Prepare for CR
If we now turn the above downfalls into lessons in no particular order:
- Although it did not come up in my exam, still get comfortable with group consolidation. Wider advice would be to really recap FAR beforehand and the AA aspects. With your notes as a comfort blanket you should be at the exam ready stage where you could do really well on these areas.
- There are some standards such as IFRS 9 that do really require time to understand. Solely relying on learning this well from ICAEW Question Bank questions alone will be tough. I would suggest spending at least a day really trying to master this. Build your open book file on this one too.
- Tab up your notes and recap all areas beforehand. This even includes the IFRS standards open books you can take in. If I had not got this to hand I really do not think I would have identified IFRS 8 Segmental Reporting and probably would have failed.
Corporate Reporting Open Book
I have essentially touched on this above where you should aim to make the most of your open book file for this exam. As there is SO much content, having a well organised file with a good level of detail and example solutions is ideal.
If you need help with how to prepare an open book file, I would suggest applying the same technique as BPT. Good summary notes annotated and references to model answers should do the trick. However, that being said I do think using the ICAEW Question Bank under the time pressure is less helpful for CR than BPT. There are some questions such as sale and leaseback and DB pensions where model answers are useful for their good layout. For CR I would recommend brushing up on your notes alone.
Standards I would say from memory that ICAEW were hot on is IFRS 9, IFRS 15, IFRS 16 and IAS 12 so try to have a better understanding of these. Use the IFRS standard books too to tie in for those niche areas as that helped me in the exam too.
Note: although the ICAEW digital bookshelf has been newly introduced, for Corporate Reporting you can still take in any materials. It might be worth printing out a few useful model answers if you would prefer this to using the online ICAEW Question Bank.
For the audit requirement, I do not remember there being much new content from AA. That being said, some of the questions did seem to be more skills based. By this I mean you need to apply this to the question to interpret the audit issue by say performing analytical procedures. You should practice questions to get better at this.
This section within How To Pass ACA AA can help here.
I essentially had an open book file on audit alone. I planned it out with the different risks associated with each account balance and relevant procedures to address the risk. I would keep adding to it as I went through the Question Bank to make the notes as helpful as possible. For example, the risk for revenue is usually overstatement so I would then list audit procedures to address this risk. You do need to really explain why and apply to the scenario to gain a full mark.
Working in audit did help but I definitely had some good notes to hand. I would recommend having this as a comfort blanket.
As I will be sharing in my next CR blog, I really did make THE fatal error of messing up my timing. This is something I was usually very good at and had done well in all exams prior to this. I really did not think this would happen to me at the Advanced stage. Join my journey to find out in due course how I did this.
What I should have done is the same approach as my revision technique and as outlined in this BPT blog. The question will be split into smaller examinable areas but you will not be told how many marks these are worth individually. With practice you should get more accurate at approximating the marks. As there are 2.1 minutes per mark, allocate this time and make sure to move on once the time is up. You do not want to run out of time and miss the easier marks at the start of the question!
Further Revision Advice for Corporate Reporting
I started revising quite early especially because of the COVID-19 month delay to my exam date. Due to this extra time, I aimed to space out my revision and did one Question Bank question a day. I wanted to really take my time with CR and not get too overwhelmed. However, these questions are very LONG especially when it comes to debriefing them. In all honestly, in the end Corporate Reporting went so badly it felt like all the revision I did barely made a difference.
Where my revision strategy went wrong on this exam was by not taking the time to really learn the content. I would recommend focusing on learning and thoroughly understanding the new, complex standards mentioned already. I may have jumped into the Question Bank too early and I should have practiced several questions from the same examinable area to do this effectively. What the real exam highlighted to me was that I had not understood the standards as well as I had thought such as IFRS 16.
Note: for Corporate Reporting the ICAEW Question Bank does not provide a contents page for each topic and relevant questions. Although slightly time consuming, you could produce this yourself by flicking through the mark scheme and pulling this together. Alternatively, ask your tutor if you have one. The ACA Group have been asking about this and some have purchased this from ACA Masters or Paradigm Shift. Another approach is to simply search for the words from the standard you are looking for. As the materials are digital now, this is much easier to do.
You should start preparing your open book file as soon as possible. You can start this as early as you would like with content from FAR and AA. I do think with Corporate Reporting it could be easy to burn out especially given how long the questions are. You could try doing a question a day or every other day once familiar with the content.
Are the Recent ICAEW Question Bank Questions most Relevant?
A question I am frequently asked that may help you is “if you are short of time should you focus on the more recent ICAEW Question Bank questions rather than the older questions?”.
I do think if it’s recently come up it might not come up so quickly again such as IFRS 8 in 2020. That being said, topics like IFRS 9 and other newly taught/modified standards such as IFRS 16 still might. This exam is really unpredictable so having the approach that it came up recently so will not again probably isn’t the best.
If the questions are in the ICAEW Question Bank then they will be relevant regardless of whether they are newer or older. That being said, the newer questions are said to be more representative of the exam so perhaps aim to get through these. If you do not have enough time to get through them all properly it may be worth planning and skimming through answers.
Corporate Reporting Wrap Up
To summarise, ACA Corporate Reporting is honestly the hardest ACA exam because of the unpredictability. BPT is also unpredictable but I personally found the new content in Corporate Reporting harder to understand. Perhaps this was because I did not put in enough time to learn this and jumped to question practice too early. However, even with all my mistakes including poor time management, not completing all the exam questions and having an awful exam I still passed. If I can do it then you definitely can.
I would also like to take this moment to congratulate you on getting this far. Corporate Reporting has unlimited attempts given it is an Advanced Level exam but you will not need this I am sure. This is not the time to slow down but instead keep pushing because you are almost there!