*** ACCA P1 March 2018 Exam was.. Instant Poll and comments ***

Did anybody else realize that Q4 was about Brexit?

I had a little giggle in the exam because it came across as this to me.

The UK was called LaLand. Which the suggests the examiners wanted to call it LaLaLand because their decision to leave the European Union (or customs union as it was called in the question) was crazy LOL.

Their expansion to neighboring countries was like all the UK sports chain that also open up shops in Ireland which is the UK’s neighbor.

I reimagined the case being about being about a company like JD Sports who have shops in Ireland and the UK and who face risks to their Irish and UK operations because of the weakening pound (which was also hinted at in the case) and all the wicked changes Brexit will bring.

Meant to reply to Jas

@jasvirdi said:
Can someone please post Q3 in here – want to see the breakdown, I have something vague here below but, can someone please clarify

(a) Generic risk & risks which now have arose from the accident (7 marks)

(b) missing?? (4 marks)

(c) Internal controls and importance

(c) Recommend suitable internal controls

b) explain severity and probability and assess the accident risk 4 marks

Self review too.as an internal auditor he is very likely to review the system he helped put in place

Anyone remembers the particular word (verb) what happened in theme park accident? I didn’t understand the word, wanted check it in the dictionary. Thanksin advance.

I said keep the main control system that operates the rides secured so only authorised staff can access.

Ensure routine checks are done.

Ensure operators are fully trained

Get a 3rd party to check how sound the current controls are.

The emphasis was for health asnd safety.

I couldn’t think of anything more specific for theme parks.

@vebem said:
Thanks. Could you please recall what word was mentioned in Q3 describing the theme park accident, since i didn’t understand this word, I couldn’t make up any relevant controls:( Thanks.

Did you mean the word “circumvent”?

here’s mine:

Q1 a: I did this on a point by point basis just showing what the similarity was and what the difference was between the two roles on the basis of who owned each organisation and who they were accountable to.

b) I’m sure was, “explain was CRS is, and why might the ethical stance be different between a PSO and Plc”. I just approached this with an explanation of what it is, and then used Gray, Owens & Adams to illustrate that a PSO is all about value for money and benefit to society, so, at extremes, it would be at the opposite end of the spectrum from a Plc which is all about maximising shareholder wealth. Then developed this idea a little more with how it’s probable that each would be more towards the middle than at extremes.

Ci) That was just text book stuff really in that it was about being seen to be doing something in terms of giving something back to the community an organisation operates in by doing things like sponsoring local activities and bunging money to charities. I went on to suggest that strategic CSR would be more beneficial due it being aligned with the objectives of an organisation rather than just randomly giving money to charities and whatnot.

Cii) I thought this was quite straightforward. This was just about raising awareness in the department and trying to get staff to buy into it I suggested running workshops on it to get staff input on what the dept could do, develop some KPI’s and report on them on the intranet, encourage suggestions for improvement.

D: Draft a letter to the Gov, so you head up the letter with the “to” address (I addressed mine to the Minster for Education), the “from” address, date, salutation etc – as you would when producing a letter. Then a couple of introductory sentences along the lines of: “I am writing to you today to highlight some of the findings of the recent audit on DE which are of concern to me and I feel should be brought to your attention and shall address these separately”.

Personally, I don’t think draft a “letter” was suitable for the content you had to put in it. The requirement was more suited to a report, memo or briefing. But anyway…

Di: Transaction Costs. Can’t remember my wording on this, but it was about how the new production of reports would be an extra cost of doing something that wasn’t previously done, and that the new contracts for teachers will result in higher staff turnover and so new costs for recruitment – advertising and training. Also probable recruitment of admin staff to cover the work that teachers on the new contracts aren’t doing anymore (full time permanent teachers used to do that for ‘free’). Some other things that I can’t remember now.

Dii: Stakeholder claims. Personally I think there was a ridiculous amount of writing to do here for 6 marks. The “explain what a stakeholder claim is” was easy enough. But to then “critically assess the claims of the teachers & the Government” as well – all for a total of 6 marks? Nope. So I explained what a stakeholder claim is and left it at that.

Diii) This was just pointing out that whilst the DE head was advocating the new contracts, it was adversely affecting the quality of educational standards and that the package was pretty much a bribe to introduce the contracts and they were more happy to extend it due to the substantial amount to be gained for themselves. The ethical stuff about it was that they were doing press releases in support of it, yet not advertising the bonus structure in place. So this brought about a few ethical issues. The DE head was just acting in self interest – substantial bonuses, and at the same time possibly worried about job security as the direction was coming from people above who could get rid of them easily enough, so perhaps intimidated at the outset, but got used to the extra money, having no regard to the society their position is supposed to be to the benefit of.

My answer is along the lines of all of that for Q1. Possibly as rough a structure as you’re going to get!

I remember Q2 and Q4’s requirements pretty well

Q2

This was about an accountant who was head of internal audit. He was auditing a project where his girlfriend was the project manager. He chose not to disclose his girlfriend’s involvement after finding out she is the manager. The project was failing miserably and being nothing but a money zapper. He was due to put on a report soon recommending whether or not to shut the project down. It was obvious he should recommend it to be shut down. However his girlfriend was putting him under huge pressure and even was expecting him to falsify the report so the project could continue.

A) Explain the nature of professionalism and how this should/could influence Harry’s behavior and actions as both an accountant and head of internal audit (8 marks)

B) Identify ethicist theats to Harry and suggest safeguards that could have prevented these threats (9 marks)

C) Asked you to examine how Harry could use the AAA model to make his decision and you also had to recommend what Harry should do next. (8 marks)

Q4)

This was about a sports company who have been very successful in their native LaLand and expanded to nearby countries who were part of the same customs union as them. They have been enjoying great success.

But it was been announced that their country is leaving the customs union. It will take several years to complete but the news has already started having some bad effects such as their national currency dropping in value. When LaLand leave it could impact of their stores in neighboring countries who import completely from their LaLand stores and they could have to face tariffs on importing things once the change happens. These stores have been a good part of their success story.

They were considering setting up a risk committee to help manage and identify the risk but one guy who was a 40% owner had huge influence over the board and he saw no need for a risk committee. In fact he was pretty laid back about LaLand leaving the customs union.

A) Explain the concept of risk attitude and how this has been influenced at Xsport (7 marks)

B) Explain the dynamic nature of risk assessment and why and how Xsport should respond to the economic and <other risk I can’t remember> risks brought about by Brexit (8 marks)

C) Explain the roles and responsibilities of a risk committee and explain how this committee being made up of NEDs could improve the corporate governance structure. (10 marks)

For Q1 d i) did it not ask for you to, using Transaction cost theory, Explain the Head of the Departments behavior/actions. Can’t remember Q1’s requirements too well so unsure.

@jxlimzixuan said:
During my exam, I was flipping the optional question and i found that Q3 requirement was asked about internal control. This examiner is sucked because the way he asked the question is very different compare to the last few sittings.And i skipped Q3.

I did the question 2 and 4 first because I’m so afraid that i will running out of time if i try question 1 first.

Question 4 (a), I’m so confused that the risk attitude is influencing the company in past or in future decision?
I answered the company should do the action if it is risk seeker… and if it is risk averse.
But i feel like the requirement for this (a) is asking how the company’s behavior influencing its action in past & not asking for future. Luckily this is 6m question

Q4b & c is relatively easy since risk assessment and risk committee is quiet straight forward.

For 4a, risk attitude of a company can change depending on the strategic attitude taken by the board and risk committees recommendation.

There isnt hard or fast rule. As long u justify well in exam u should get ur marks.

In my opinion its risk seeking because market expansion into a new region,according to ansoffs matrix, is risky given that he did not bother to make any risk committee, in order to maximise his returns/benefits over costs

I started with Q2. As there were two risk questions I struggled to decide which one to go for. Finally I did Question 3. (that cost me at least 2 minutes)

I ended up doing Q3 as it contained elements of internal control. Peers above were rightly happy that in Q2 AAA 7 step ethical decision making model came up. However the way examiner structured the question 2 gave me trouble with time management.

Part a was only 8 or 9 marks but 3 different requirements. Nature of professionalism where you in inevitably had to begin explaining elements of profession and conclude that professionalism is the putting your knowledge experience and principles in action for public benefit and highlighting head of audit’s responsibilities as a professional and as a senior company manager was I think far too much for 8-9 marks . I must admit I struggle with time management and perhaps I write too detailed. This question took me more than 45 minutes. AAA model was easy of course but for each mark you have to write the step and link it to the case. That is two or three sentences per mark.

Q3 – I think I did a mistake for choosing this question. The examiner asked to identify generic risk and the specific risks arising from the serious theme park ride accident. There are some many generic risks on ACCA syllabus. Each identification requires a sentence. Specific risks requires a paragraph and while writing the answer, one must pay attention not to duplicate. Then comes the internal control part. Something like importance of Elements of Internal Control control and recommendation of suitable control activities were required. Recommending suitable controls required thinking and elements internal control required detailed writing with illustrations

I was again over 45 minutes. When I finally reached Part 1, I had 75 minutes to answer a case with lot of small requirements where I had to keep going back to case reading and reading .

One thing that got me really frustrated was the way the new examiner testified Corporate Social Reporting . He has used an abbreviation for Corporate Social Reporting in bracket (CSR) in part b of question one. And in part C he asked something about CSR strategy. That froze my brain !!! I got confused whether he was testing Corporate Social Responsibility strategy or Corporate Social Reporting Strategy as he used CSR abbreviation for Corporate Social Reporting. It is understandable to ask questions in a tricky way but I think this one was more like a booby trap.

Question 1

The theme of the scenario, a public sector organisation with a leader who tries to run the company in Ryan Air style mainly for his self interest, with a question broken down to so many little parts testifying ethics, social reporting , stake holder claims , agency issues and CSR strategies was a bit too much .I could only answer up to transaction theory and skipped part C because of the CSR abbreviation confusion.

I self study as I can not really afford private tuition. My kaplan text book only covers Corporate Social Reporting with a page of bullet point information and to my luck Corporate Reporting came up !!!

P1, is a time pressured examination and the style of the new examiner makes it more difficult for me. The only good thing for me about this exam is I already know that I definitely failed. So I don’t have to wait till 17th April to find out my result. That gives me an other 13 weeks to improve my time management and exam technique but I don’t feel confident with the question style of the new examiner. I am now considering to take classroom tuition and a a mock exam in real exam conditions so I can have a feed back from a tutor on my weaknesses and strengths.

Do you guys have any other suggestion for me on how to improve my time management and exam technique. Shall consider changing Kaplan text to an other. This was the second time I sat in Paper 1. June will be the last and final time. I already passed P3 and I am really stressed. Any tips will be appreciated. Thank you.

Musa

Was expecting 15 minutes reading time when you can’t start and then be told you may begin, became pretty obvious after 20 mins this was no longer the case??? Didn’t help that i spent the next 15 writing in blue ink so lost 35 overall! 🙁