ACCA AFM exam technique

How the AFM exam is built

Advanced Financial Management is a 3 hour 15 minute exam (195 minutes) worth 100 marks, with a pass mark of 50%. Section A is one 50-mark case: 40 technical marks and ten professional skills marks. Section B has two 25-mark questions, each with 20 technical and five professional skills marks. The professional skills are communication, analysis and evaluation, scepticism and commercial acumen. The syllabus and study guide says Section A asks for a specific format, such as a report to the board, and that Section B questions always combine calculation and narrative.

The biggest single block is the Section A case: at 1.95 minutes a mark, about 97.5 minutes including reading, planning and checking. The examiner's report gives 90 minutes for the case and 45 for each Section B question—a total of 180 minutes. This guide instead apportions the full 195 minutes, including reading, planning and checking.

Where AFM candidates lose marks

The latest examiner's report is clear about the habits that separate a mixed attempt from a strong one.

• No clear conclusion. "A significant minority of candidates failed to conclude as instructed." The examiner's advice is to avoid "sitting on the fence": where a conclusion or recommendation is asked for, marks are awarded for making a clear one, "even if the conclusion or recommendation they make is not necessarily that which was expected".
• Reports without structure or ending. Many candidates could earn extra marks with suitable sub-headings and a brief conclusion; "far too many candidates miss out on a mark they have nearly earned by failing to finish their report with a conclusion".
• Repeating the scenario or the method. Marks are not given for information repeated from the scenario without analysis. Before discussing whether offers were acceptable, some candidates spent time describing how they had calculated their results, for which no marks were available.
• Shallow discussion. Candidates "often failed to develop their assumptions well enough", and discussed the issues raised by negative comments rather than the actions the board could take. In a hedging question, discussion frequently lacked application to the scenario, even though the directors had said they wanted a method with a "limited range of possible outcomes".
• Scepticism and commercial acumen marks. Communication and analysis marks came naturally with a good technical attempt; candidates "did not generally earn so many" of the scepticism and commercial acumen marks.
• One fixed method. Candidates who try to impose one systematic approach on merger and acquisition questions "often struggle to deal with the specifics of a particular question".

The AFM technique that works

1. Plan the case by requirement. Read the whole question, then give each requirement a share of the time in proportion to its marks. Be ready for a Section A question where every mark sits inside the report: the examiner notes some candidates were "overawed" by exactly that.
2. Lay out calculations so you can bring figures forward. Candidates "in the best position" for later parts had laid out earlier calculations well, with headings. Use the spreadsheet, label each block, and carry your own figures into the discussion.
3. When stuck, assume and continue. "Candidates must remember not to give up and should be prepared to make assumptions where necessary." State the assumption in a line and finish the requirement; percentage gains can still earn marks from an imperfect value.
4. Discuss against the client's criteria. Find the words in the scenario that define success, such as a required return or a limit on outcomes, and judge each option against them. Then add uncertainty: which assumptions drive the answer and what happens if they fail.
5. Recommend, and say why. Choose an option and justify it with the calculation, the assumptions, the risk and the commercial consequences. A reasonable recommendation that differs from the model answer still earns credit; no recommendation does not.
6. Finish the report properly. An opening, an introduction, sub-headings that follow the requirements, and a short conclusion. These are the communication marks the examiner says candidates "have nearly earned".

Check your AFM technique

The check after this guide turns these habits into AFM decisions: how to share time across a 50-mark case, what to do when a figure will not come out, how to judge an option against the client's criteria, how to finish a report. It scores you habit by habit, professional skills included, and saves your latest result on this device and to your account if you are signed in. Answer your first run the way you sit a mock, then work on the lowest-scoring habit and retake.

Before the exam

In the last week, sit a full mock on the ACCA Practice Platform and check one thing in every answer: did each requirement that asked for a conclusion get one? On the day, check your exam docket, and write down your finish times for the case and both Section B questions before you start reading.