F7 Exam technique

Work through the mini exercises towards the end of the course notes.

In the preparation of single company financial statements there are always “standard” adjustments to be made and these have been extracted from past exams and put into mini exercises. Get on top of those and you needn’t worry about reading / studying the chapters on the lesser topics

And, whenever you have 5 minutes to spare over the weekend, do 2 or 3 mcqs – as many as you can

And mcqs, yes

You’re welcome – have a great weekend 😉

Read the answers to past exam interpretation questions! Note the sub-divisions into Profitability, Gearing, Shareholder ratios etc and note, too, the way that the answer targets the specific question and omits ratios that lie beyond the subject matter of the question

Note the way that the answer avoids saying bland superficial comments like “days’ sales in receivables has gone up by 4” but may say instead that “the change in receivable days represents an increase of 10% when compared with last year’s 40 days” and then how it goes on to suggest possible reasons for that rather dramatic increase

At this stage, on the Saturday before the exam (!) your best approach would probably be just to read questions and answers and get the “feel” for how to set about answering an interpretation question

That’s all in the recorded lectures! There’s no way that I can type out a lecture on the format of letters, reports, memoranda and press releases!

Very basically, think of the top of an email and you have the four main matters to include at the top of a report (to, from, subject, date)

Find a letter that has been written to you and look at the top of that (company name, address, addressee name, addressee address, date, salutation, subject matter, details of the letter content, invitation to get back to you with any questions, valediction and signature)

And next time, don’t leave such important matters until the Saturday before the exam!

I have NO IDEA whether construction contracts will be tested – how could I know.

IAS 11 will certainly NOT be tested – it no longer exists.

IFRS 15 may be tested – you’re not alone in realising that there are no questions to practice on but now is your chance to steal a march on your competing candidates. Where they are worrying about IFRS15 and what to do with it, you now settle back and adopt a stoical position!

What will be will be, it’s the same for everyone, but you will be all calm and collected (cool, I believe is the expression) where they are getting hot and bothered and it’s doing them no good at all!

You have at last realised that getting worried about something is a fruitless and often counter-productive state of affairs and that stoical realism is the way to go.

Between now and the exam, do NOT think about IFRS 15 again. Not once. Do some mcqs instead, and a consolidation or two. But NO looking at IFRS 15.

Ok? Promise?

Yes, that seems ok

But what makes you so convinced that there will be “the ratio interpretation question”?

In addition, it depends on how many marks are available and the direction that the question is asking you to take

For example, it may be asking for a report to the bank that has been approached for a loan in which case maybe “stability” and / or “profitability” ratios are of no great concern. Rather, the bank may be more concerned with gearing and liquidity ratios

It’s not possible for me to say “This is what you need to do if there should happen to be a question that asks for an analysis of performance or of financial position. It would be quite wrong of me to suggest that there is a (say) 5 step structure to answering such a question

Each question should be treated on its merits and no two questions are likely to require exactly the same approach!

And I answered your question in the first line of my response!