ACCA Exam Tips December 2013

ACCA exam tips

December 2013 ACCA Exam tips

Please Note:
ACCA Exam Tips should not be relied on, they are only intelligent guesses.
The only purpose of the ACCA Exam Tips is to give you suggestions for topics to concentrate on in your last few days of preparation. Do not exclude other topics from your overall preparation.
To get the most from your preparation, make sure you watch all OpenTuition ACCA lectures, and practice as many past exam questions as possible! Also check all the latest Student Accountant Technical Articles.

Tips for ACCA F1 – F3

No exam tips available – Multiple choice questions cover entire syllabus

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ACCA F1 course notes – and watch free F1 lectures

ACCA F2 course notes – and watch free F2 lectures

 ACCA F3 course notes – and watch free F3 lectures


ACCA Exam tips for Paper F4 English

1 Criminal law, civil law and arbitration (D07)

2 Define consideration, sufficient and adequate (J09)

3 Terms, representations, express and implied (J09)

4 Limitation on choice of company names, passing off, names adjudicator (J09)

5 Meetings, AGMs, OGMs, Class (Pilot)

6 CDDA grounds and explanation (J09)

7 Corporate governance: rights, duties and role of auditors (D07)

8 Contract offer, counter offer, goods in shop window (D07)

9 Shareholder liability on partly paid shares (Pilot)

10 Fraudulent and wrongful trading (D09)


ACCA Exam tips for Paper F4 Global

1 Criminal law, civil law and arbitration (D07)

2 Arbitration advantages and disadvantages, statement of claim and defence (J09)

3 Sale of Goods, passing of risk (J08, D09)

4 Limitation on choice of company names, passing off, names adjudicator (J09)

5 Directors’ authority:- express, implied, apparent  (Pilot)

6 Incoterms – the 3 new ones -

7 Corporate governance: rights, duties and role of auditors (D07)

8 Contract breach re quality and price (D07)

9 Shareholder liability on partly paid shares (Pilot)

10 Fraudulent and wrongful trading (D09)

See F4 Tips from BPP/Kaplan etc.. 

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ACCA Exam tips for Paper F5

1 Target costing and Activity Based Costing

2 Linear programming

3 Variance analysis with Mix & Yield

4 Budgeting written question

5 Financial and non-financial performance of a division

See F5 Tips from BPP/Kaplan etc.. 

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ACCA Exam tips for Paper F6

Students should never rely on tips from any source as exam success is based on a sound knowledge of the basic rules that underpin the computations required for each tax and the ability to apply this knowledge within the 3 hours and 15 minutes available. This is based on considerable practice of past examination questions which have been updated for Finance Act 2012 and by sitting a mock examination(s) in the allotted time. It can be of little surprise that students fail exams if the last time they sat such an exam was when they sat or even failed at the previous sitting!

If any of the areas tipped should appear then this, if you are prepared, should be a bonus – you should not be expecting these areas and then be disappointed when they do not appear and therefore be immediately at a psychological low in the exam room!

Be properly prepared through work effort, expect the worst but know if you do your best you will pass whatever exam is placed in front of you!!

Each new round of annual exams will always include topics that the F6 examining team have written about in their published technical articles, most notably in the Finance Act (FA) Update article (FA 2012) and in any new technical articles. For 2013 we have so far two such articles entitled Motor Cars and Benefits respectively.

Although any and all of what appears in the FA Update may feature in this year’s exams particular attention should be paid to new legislation and major changes to existing legislation.

In this respect note specifically:

(1) Overseas branches and the new exemption election, noting very carefully the worked example on evaluating whether or not the election would have been worthwhile for a company to have made.

(2) The recent reductions in the main rates of Corporation Tax (CT) mean that either a marginal or large company whose Chargeable Accounting Period spans two Financial Years will require a split calculation of their CT Liability. Again work the examples given. Note if this were tested within Question 2 then as Capital Allowances (CA) are not examinable for such a company straddling FY 2011 and FY 2012 then a detailed CA computation would need to be performed for an unincorporated trader presumably in Question 1.

(3) The changes in car benefits may be tested in a standard Employment Income assessment and also contain other benefits as per the Benefits article. Given the separate detailed article on Motor Cars this may instead form the basis of the more challenging style of question now favoured by the examining team where the candidate is required to think very carefully to answer a more unusual stated requirement.

This may involve for example evaluating the tax position of both the business (unincorporated or incorporated), and if separate, the individual, regarding the provision of a car and fuel to an employee or proprietor. This may involve elements of Income Tax, Corporation Tax and NIC’s. Once more work carefully through the exam standard example at the end of the examiner’s article.


Q.1 Income Tax / VAT

This question always requires the preparation of an Income Tax Computation for at least one individual, possibly two (spouses or civil partners) or even three taxpayers (members of the same family) The two main sources of income tested within the computation are Employment Income and the adjusted trading profits of the Self Employed. Property income is a popular exam area and the recent changes in the definition of furnished holiday lettings may be tested here. Interest income is also frequently tested with examples of taxable interest received net and gross plus exempt interest and of course some dividend income.

A scenario involving a transition from employment to self employment part way through the tax year would allow both employment income with assessable benefits for part of tax year to be tested along with adjustment of profits and a capital allowances computation for a short or long opening period of account and dealing with pre trading revenue and capital expenditure. The adjusted profit would then be used to determine the assessments in the opening years of the new business and the computation of the overlap profits

Class I NIC’s for the period of employment and or Class 2 and 4 NIC’s for the period of self employment could also be tested.

If VAT was included in such a question then it could test issues of VAT registration, submission of first VAT return dealing with pre registration input VAT and suitability of small business accounting schemes such as cash and annual accounting and the flat rate scheme.

Q.2 Corporation Tax / VAT

Will require the preparation of a Corporation Tax Computation for a Chargeable Accounting Period which will probably straddle Financial Years 2011 and 2012 e.g. Accounting Year Ended 31 December 2012 or 9 months to 30 September 2012. The company may operate overseas through branch operations which have made profits and sustained losses and a question may ask whether the branch exemption election would have been worthwhile though not now possible in relation to either a previous or current accounting period.

A significant amount of marks are usually available for the adjustment of profit statement and Capital Allowances Computation if not also tested within Q.1, but as mentioned earlier a capital allowance computation would not be tested in an accounting period spanning 2 Financial Years where the allowance rates have changed. The company may be in a gains group and group relief group. .

Q.3 Chargeable Gains

If a question involves corporate gains rather than an individual then the main assets that a company may dispose of would include:

Properties – this may involve establishing the cost of the property from an earlier acquisition via a no gain no loss transfer from a fellow gains group member and/or the cost may have been reduced by a rollover relief claim at the time of acquisition. The gain arising may now also be deferred by a full rollover or partial rollover relief claim or if a depreciating asset is now acquired a holdover relief claim may instead be available.

Land – a part disposal of land


Chattels – e.g. a painting from the boardroom

If a share disposal by an individual takes place then this could be in the form of a takeover, or the sale of shares that had been acquired as a result of an earlier takeover.

 Questions 4 and 5

IHT seems likely to be a regular feature of part of a question and it would seem likely that at some point the examiner will test the more difficult problem of CLT’s not only taking place within the 7 years before the date of death but there also being a CLT more than 7 years before death. This would not itself be chargeable on death but given the cumulative nature of IHT would impact on the transfers within the 7 years following it which do then become chargeable on death.


Groups if not tested in Q.2

Income tax loss reliefs and / or partnerships

A question involving the provision of cars to employees and to an unincorporated trader as per note (3) above.

See F6 Tips from BPP/Kaplan etc.. 

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ACCA Exam tips for Paper F7

  1. Consolidated Statement of Financial Position AND Statement of Income, mid-year acquisition, share for share exchange, nci value based on share price, fair value upward adjustments, intra-group sales and pups, goodwill impairment
  2. Statements of Financial Position, Income AND Changes in Equity, list of  balances, problems with revenue recognition (consignment goods), inventory adjustment, TNCA revaluation, depreciation straight line and reducing balance, loan interest accrual, tax provision and deferred tax movement
  3. 20 mark cash flow (last time there was a question WITHOUT interpretation was December 2011) with a part b 5 mark chat
  4. 15 mark question covering 2 or 3 IAS with short, relatively straight- forward calculations. Possibles?  Could be anything, but here are 3 wild guesses:- subsequent events, leasing and borrowing costs
  5. 10 mark question – could be something like development expenditure, complex depreciation question or (relatively easy) earnings per share

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 See F7 Tips from BPP/Kaplan etc.. 

ACCA Exam tips for Paper F8

Receivables system and receivables circularisation

Computer assisted audit techniques

Corporate governance

Audit risk and planning

Assertions and audit evidence/procedures


Remember, if asked for audit procedures state which assertion the procedure helps with.

See F8 Tips from BPP/Kaplan etc.. 


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ACCA Exam tips for Paper F9

1 DCF – Lease & Buy and/or Replacement and/or Capital Rationing

2 WACC (including CAPM) + theories of gearing

3 Cash Management and Inventory Management. Written part on interest rate risk.

4 Share valuation  + written on market efficiency + sources of finance.

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See F9 Tips from BPP/Kaplan etc.. 


ACCA Exam tips for Paper P1

  1. 5 part 50 mark question touching on risk, ethics, environment, internal controls with 16 – 18 marks for drafting a report / briefing notes / press release / magazine article
  2. Corporate governance with internal auditors and internal controls.  Risk management, committee,  mitigation
  3. Sub committees under corporate governance, their roles, functions, objectives, make up
  4. Kohlberg and attitudes to ethics compared with Gray, Owen and Adams and their 7 sub-categories 

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See P1 Tips from BPP/Kaplan etc.. 


ACCA Exam tips for Paper P2

  1. Consolidated Statement of Cash Flows (long time since asked!) OR tent structure including a foreign subsidiary (35 marks);  8 marks of corporate governance and 7 marks chat about management commentaries
  2. Scenaria question with 4 problem areas worth 5 – 7 marks each with up to 12 references to IAS / IFRS.  Occasionally, the directors will have proposed an appropriate treatment – just occasionally!  So, be aware that the proposed action may in fact be ok – it’s not always a poor choice by the directors
  3. Similar to question 2 – a scenaria question with 3 – 4 parts worth anywhere from 5 – 12 marks with up to 6 references to IAS / IFRS
  4. Current issue question – the last 3 have been on proposed revision to IAS 37 Provisions and Contingencies, IFRS 13 Fair Values and heavy discussion about how much disclosure is “enough” and how much is “too much”.  There hasn’t been a 25 marker on Management Commentary since it started to become a fashionable discussion topic

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See P2 Tips from BPP/Kaplan etc.. 

ACCA Exam tips for Paper P3

Strategic appraisal and strategic recommendations. Portfolio management

Business process change: Harmon’s Process Strategy Matrix; Balogun and Hope Hailey.

Use of IT for marketing and improving the value chain

Activity based costing and pricing

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ACCA Exam tips for Paper P4

Compulsory question:

Report including:
Investment appraisal of foreign investment with inflation / tax / forecasting of exchange rates
Calculation of WACC (involving CAPM)
Consideration of various sources of finance
Choice questions:
Interest rate risk management
Option pricing
Written question relating to the transferring of profits to countries with lower tax rates, by multi-nationals.


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ACCA Exam tips for Paper P5

Stakeholders; reward systems

Boston consulting group

Performance management and measurement in not-for-profit organisations

Economic value added

Use of IT in performance reporting

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ACCA Exam tips for Paper P6

Questions 1 and 2 on the paper will be based around real life practical scenarios.

Question 1 will be for 35 marks and contain 4 professional marks awarded for structuring the answer in the proper format and dealing professionally with the issues raised. In either of these first 2 questions (question 2 will carry 25 marks), we are also likely to find 5 marks dealing with ethical issues such as confidentiality or non disclosure.

Here are 9 marks therefore that are little to do with technical competence in taxation in which candidates at this level should and must score highly!

A favourite area of the examining team deals with groups of companies, often where losses, both trading and capital have been experienced along with other chargeable gains arising and these need to be managed efficiently. This may involve group relief and/or consortium relief and the use of the matching election within a gains group. In establishing a trading profit / loss the treatment of R&D expenditure may be tested.

A number of areas where the candidate is asked to advise on both actual and planned transactions would also be involved. A major issue here is dealing with changes in group structures such as a proposed acquisition of a target business where either the client company may purchase the shares in the target company or the assets and trade of the target company.

Major issues here for a buyer are access to the pre acquisition trading and capital losses of the target company through a share purchase or the tax write offs available on the purchase of intangibles within an asset and trade purchase. This may also test Stamp Duty and Stamp Duty Land Tax issues for buyers as well as VAT issues such as the capital goods scheme and the transfer of a business as a going concern.

A question may instead ask for advice to a vendor group as to whether the parent company should sell its shares in a subsidiary or allow the subsidiary to dispose of its own assets and trade.

The decision will be based on which exit route achieves the highest net cash receipt on sale.

The sale of the shares would test knowledge of the substantial shareholding exemption and degrouping charges, while the sale of assets and trade would involve computing chargeable gains or trading profits arising on the sale of each asset.

The question may also have an international aspect to it with advice being required on whether to set up an overseas business as a subsidiary or branch, the application of the CFC legislation and in particular whether to make the exemption election in respect of overseas branches.

Important points in the owner managed business life cycle lend themselves well to practical real life scenarios involving multiple taxes. Incorporation may test Income Tax, CGT, Corporation Tax, VAT and Stamp Duty as the assets and trade of the individual are transferred to a company.

A tax efficient exit strategy for the owner manager is also where the client would need well structured professional advice. Should the client sell his shares in his company possibly accepting shares and loan stock from the buyer as well as cash, or should the company sell its assets and trade and then distribute the net cash to the owner as either a capital or income distribution.

Another favoured area of the examining team has been the overseas aspects of personal tax where we may have to advise on the implications for all the personal taxes of say a UK resident accepting a contract of employment overseas and determining whether their overseas income would be chargeable to UK tax and if so the application of DTR.

With many candidates now coming through to P6 having passed F6 with IHT in that syllabus we may see a move away from standard computational exercises on the death of the taxpayer. Advice may be needed on when planned gifts should be made, in lifetime or on death and therefore in relation to lifetime gifts the taxpayer’s CGT position will need to be considered. This brings into play the CGT and IHT reliefs which are consistently examined as students consistently get them wrong! Candidates must know the conditions for reliefs to apply and must not confuse CGT and IHT reliefs – note particularly gift relief and entrepreneurs’ relief in CGT and BPR in IHT.

If a death estate is required it is likely that there would be significant bequests to charity bringing in the new 36% reduced rate. Planning after death may then involve the use of a deed of variation by the beneficiaries to increase the charitable legacy to meet the 10% required level, as the resultant saving of IHT on the death estate is greater than the increased gift to charity.

In terms of advising on tax efficient investments then, though high risk, the savings under the EIS or the new Seed EIS are high and may be tested.


LSBF F6 tips


ACCA Exam tips for Paper P7

  1. Respond to an email from a partner – possible subject matters include risk of material misstatement, corporate governance and the role of the auditor, ethics
  2. Practice management, recruitment, training, review
  3. Discovery of evidence of insider dealing, offences against the Bribery Act and suggested auditor action
  4. Assurance services, ethical and professional issues
  5. A scenario question with 3 or 4 contentious matters with the requirement of “Comment on the matters above and explain the procedures you should expect to have been followed”

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See P7 Tips from BPP/Kaplan etc..