BPP's JUNE 2013 EXAM TIPS

BPP provides its list of topics for the

June 2013 exams
May 2013

F4
Important areas to cover:
Q1 – English legal system; court structures and sources of law.
Q2 – Contract formation; offer, acceptance and consideration.
Q3 – Tort of negligence; duty of care, breach, causation and
defences.
Q4 – Formation of company; or operation of a partnership.
Q5 – Capital and financing; shares and/or debentures.
Q6 – Company officers; directors/secretary/auditors.
Q7 – Employment law; employees v self employed workers.
Q8 – Contract dispute; breach of contract and damages.
Q9 – Breach of directors duties.
Q10 – Fraudulent behaviour; Money laundering or Bribery.

F5
There will be 5 compulsory questions, each worth 20 marks. It is
likely that one of these will be entirely written, with the others
being a mixture of discursive and numerical requirements. This
means that it is essential to practice written questions as well as
numerical ones when studying for F5.
The syllabus for this paper is very broad, an understanding of all
areas is necessary to pass the exam. It would be reasonable to
expect one topic from each of the five syllabus areas to be tested.
The examiner has repeatedly stated that question spotting is not a
suitable way to approach F5. I believe that time spent trying to
guess what is going to be in the exam would be better spent
revising one additional topic.
Even with this in mind there are some general themes which crop
up in most exams: variances have always been tested historically.
Given the syllabus changes for 2013 it is likely that mix and yield
and/or planning and operational variances will be tested.
Additionally performance management in the form of appraisal of a
company or divisions within one company is a regular feature. This
may include transfer pricing or the use of ROI and RI.

F6 (UK)
The exam will comprise five compulsory questions.
Q1 will focus on income tax with Q2 focusing on corporation tax.
These two questions will make up 55% of the marks.
Commonly examined income tax areas include the employed
earner and the sole trader.
Capital allowances is regularly examined within Q2 but we
anticipate aspects of groups could also feature in this question.
Q 3 to 5 will total 15 marks each. Q3 will examine capital gains tax
from either an individual and/or company perspective involving a
number of disposals. The other two questions will cover other
areas of the syllabus. One of these questions will be more thought
provoking testing candidates ability to think about the tax
implications of a situation.
VAT will be examined for at least 5 marks in either Q1 or 2 but
could form a separate question. Inheritance tax will also always be
examined for between 5 to 15 marks within Question 3, 4 or 5.
The paper will be largely computational with a few written marks
for explanations.

F7 (Int)
There will be 5 questions in the exam, all compulsory. The first 25-
mark question will cover a consolidated statement of profit or loss
and other comprehensive income and/or consolidated statement of
financial position, and may include a written part. Q2 and 3 will
also be 25 marks, Q2 covering preparation of single entity financial
statements, likely from a trial balance. Q3 is usually set in the
context of interpretation and often includes a statement of cash
flows, likely at this sitting.
The conceptual framework is often part of Q4 or 5 so it is an area
you need to ensure you are familiar with. Inflation, discontinued
operations, deferred tax, leases, intangible assets, government
grants or financial instruments are possible topics for Q4 and 5 this
sitting.

F8 (Int)
The F8 exam consists of 5 compulsory questions. Question 1 is a
30 mark scenario based question which will test a wide range of
topics such as internal controls and audit evidence and procedures.
The second question focuses on testing knowledge and is worth 10
marks. This question is often broken down in to 3 or 4 separate
requirements and can require you to define some of the key terms
within audit and assurance.
Questions 3, 4 and 5 are worth 20 marks each and the
requirements will largely be based upon the given scenario. Typical
areas which are tested in these questions are corporate
governance, planning, audit risk, internal controls, audit
procedures and audit reports.
Audit procedures, internal controls, audit risk and audit reports are
almost always examined so make sure that you can generate both
tests of control and substantive procedures for key cycles and
balances as well as being able to identify internal control
deficiencies. You should also ensure that you can draw out audit
risks from a scenario as well as determining the effect audit issues
may have on the audit report.

F9
The Examination contains four compulsory 25 mark questions,
usually each question features a scenario and multiple
requirements. Approximately 50% of the marks will be awarded for
calculations and 50% for discussion. It is important that you
practise both skills.
The F9 Examiner likes to test across the whole syllabus. In many
post exam commentaries he has stated that candidates who were
well prepared and who had studied all parts of the syllabus did well
on this paper. Candidates who were not successful may have
focused on a small number of topic areas.
Investment Appraisal, WACC, Working Capital and valuations have
featured in most exams, but just focusing on these topics alone will
not be enough to generate a pass. It’s possible to get a whole
question on each of these topics but they may just form part of a
single question. There is a fair chance that managing foreign
exchange rate risk may be tested in June, but historically this has
been for less than 10 marks.
To maximise your chances of passing you will need to ensure you
have a wide understanding of the whole syllabus.

P1
The P1 exam consists of one compulsory case study in section A for
50 marks. Within section B there is a choice of 2 from 3 questions
(25 marks each)
The section A case study will test a wide range of topics with
typically four or five requirements relating to the scenario
information. This question will assess and link a range of subject
areas across the syllabus.
It is vital that students read the case in detail, taking notes as
appropriate and getting a feel for what the issues are. Professional
marks are also awarded for presentation, logical flow of argument
and quality of argument.
Scenarios may be drawn from any situation involving governance,
internal controls, risk management, reporting. In addition students
may be required to prepare a report applying Kohlberg’s theory,
methods of ethical decision making using either the Tucker or AAA
model or TARA or ALARP for risk management based questions.
Stakeholders in organisations and in decisions, Gray, Owen, Adams
seven positions on corporate social responsibility, professional
duties of accountants and appropriate safeguards are possible
topics in both Section A and B.
The examiner has stressed the importance of reading technical
articles. It is a pre-condition that all P1 students have read the
examiner’s most recent article on Environmental accounting and
reporting 2012.

P2 (Int)
There will be 4 questions. The compulsory question for 50 marks
will cover consolidated financial statements with adjustments on
other syllabus areas, plus written parts, often in the context of
accounting adjustments and ethics.
You need to do two of the three 25 mark questions in section B of
the exam, one of which is normally set in the context of a
'specialised industry' and one being a discussion question on
current developments. A statement of profit or loss and other
comprehensive income (with/without a statement of financial
position) or a statement of cash flows seem likely for this sitting
and could include discontinued activities, disposals and acquisitions
and a joint venture/associate, while the issue of too much
disclosure (see examiner article 'Bin the clutter'), management
commentary, application of the definition of control, improvements
in performance measurement, conceptual framework or leasing are
possibilities for the discussion question.

P3
Whilst we at BPP cannot give exam tips as such the following are
areas of focus:
• The three strategic lenses, compared with emerging approach.
Note RPM.
• PESTLE, 5 Forces and Diamond.
• Value Chain and Benchmarking
• The Cultural Web
• Stakeholders ( Mendelow)
• BCG, Strategy clock and Ashridge. Parent/SBU
• Ansoff and Lynch
• Minzberg
• Analysis management of change (Balogun and Hope
• Outsourcing and Harmon’s model
• E marketing and E Business
• Financial analysis (F2 and F5)
• Project Management ( All aspects).
Note
There has been a syllabus addition this sitting this says:
“ Evaluate the role and limitations of cost accounting in strategy
development and implementation with specific reference to the
following:
1. Direct and Indirect costing
2. Overhead Apportionment
3. Activity Based costing.”
These are all aspects that should have been covered in F2 and F5.
Of course the verb “Evaluate” means weigh up i.e advantages and
disadvantages but the emphasis seems to be on the words
Strategy development.
So as an example:
If overhead apportionment is incorrect then you might set wrong
selling prices. This might lead to a reduction in profitability or loss
of customers, a major negative strategic disadvantage for the
company.
Impact could be lower dividends to shareholders or loss of market
share.

P4
Section A of the P4 exam will, from June 2013, contain one
compulsory question; this 50 mark question will, inevitably, draw
from a number of different syllabus areas. The examiner has said
that he does not plan exams by referring to past exams (i.e.
checking that the whole syllabus is being tested over the course of
a number of exam sittings). This makes question spotting almost
impossible. However we would expect section A questions to test
core syllabus areas such as discounted cash flow and business
valuations (both of which are likely to include cost of capital
calculations) and hedging.
In section B (50 marks in total) you will need to choose two
questions from a choice of three. Each question will be worth 25
marks, one of the questions may be entirely discussion based (but
this is not guaranteed from June 2013). Commonly tested areas
include risk management, the Black Scholes model and cost of
capital calculations. Islamic finance is new to the syllabus and
could feature as an aspect of a question.

P5
Performance Analysis:
The examiner has indicated that his questions will require more
skill in interpreting data and discussing strategies to improve
performance rather than performing calculations. You may be
asked to analysis performance v budgetary targets to identify
underlying problems that a company needs to address. This
analysis could include the use of activity-based approaches,
learning curves or non-financial performance measures. Ensure
you have read the article on Benchmarking published in September
2012.
‘Beyond budgeting’ is an important area that can be tested either
as a discussion or a numerical question.
Performance appraisal requires effective information systems so
expect to be asked to identify the key strategic, tactical and
operational information requirements of a business or the
implications of introducing a new system on performance
management.
Risk Analysis:
Analysis of the risk of a new proposal could include numerical
techniques such as expected values and probabilities but also
strategic frameworks such as PEST analysis and Porter could
feature here.
Strategic Performance Measures in the Private Sector:
Divisional performance measurement is another key area; ROI, RI,
EVA, NPV, share price movement or even costs of quality could
feature here and transfer pricing could feature as an aspect of
these questions.
Reward Systems:
HR issues are new to the syllabus from June 2011 and the
examiner is interested in the impact of reward systems on
performance management. Ensure you have read the article
published January 2013 on Reward Schemes for Employees and
Management.
Alternative Views of Performance Measurement:
Questions are commonly set that require a good understanding of
the balanced scorecard, the building blocks model and the
performance pyramid. Questions will often require you to analyse
data that has been collected using one of these models. The
balanced scorecard and the buildings blocks model are due to be
tested again.
Performance Hierarchy:
Linking strategic decisions to mission statements or suggesting
strategic options using models such as Ansoff’s matrix or the BCG
matrix lend themselves to questions containing a mixture of
financial and discursive elements that could easily include a simple
NPV or profit analysis.

P6 (UK)
The exam will comprise two compulsory questions within Section A
which will both be of a case study style. The first question will be
35 marks in length and will contain four marks for professional
skills. The second will be for 25 marks in total and will contain no
professional skills marks. One of these questions will focus on
personal tax issues and the other will focus on corporate tax
issues.
Section B will comprise three questions, each of 20 marks in length
of which only two are to be answered. These will be in a more
succinct, note form style.
The whole syllabus is examinable throughout the paper.
The paper will examine candidates’ ability to analyse and evaluate
the tax implications of various situations, numerical calculations
will only be required to assist in producing an answer and no purely
numerical questions will be set.
Groups of companies, unincorporated business, capital gains tax
versus inheritance tax, overseas aspects are regularly examined
topics.

P7 (int)
We expect that the P7 exam in June will mirror previous sittings,
with two compulsory questions making up the majority of the
marks on offer and a choice of two from three optional questions.
For exams in 2013 and beyond, the compulsory questions will be
fixed at 35 marks and 25 marks for Questions 1 and 2 respectively,
while the optional questions will each score 20 marks.
For this sitting, you can expect a planning scenario in the
compulsory section which should draw on article content recently
published by the P7 examiner, while we expect that optional
questions will again test audit reports, ethical issues and practice-
related matters. Candidates should also take heed of the
examiner’s recent advice on exam technique for P7 and assurance
engagements when preparing for this exam.