Financial Performance and Budgeting Exams

JaneF

Hi All,

Just wondered if anyone had any advice on financial performance and budgeting exams. I am studying them both together at college and are sitting both exams in the middle of May. I feel like there is so much to get through and not sure how to tackle it all! Just wondered what people's experience of the exams were like? Was it similar to the mocks?

Thanks in advance :001_smile:
Jane

guinea pig

Hi Jane,
They both follow on from level 3 costing, and share similarities. I passed the budgeting in January,and found it reasonably straight forward, it closely followed the format of the practice assessments on this site. I and am now working on financial performance, with an exam booked for early May, and am finding it horrendous! I was unable to attend most of the classes, I've more or less worked through the Osborne book, and am now working through the BPP book. My main challenge is understanding and learning the variances, I'm going to have a boring Easter weekend studying!
Good luck,
GP

SandyHood

Dear Jane

Interestingly, both examiners have asked tutors recently how they approach these papers. So you are in very good company.
I strongly recommend leaving the mocks until late in your preparation.
Instead, really master the subject knowledge.

For Financial Performance:
study standard costing/variance analysis
key basic statistical techniques such as the use of index numbers and time series, and make sure you know how to calculate elementary arithmetical values such as percentage increases and decreases
study ratios and put them into a context of managing a business, so understand the actions a company might have followed to generate a particular ratio
develop your cost and revenue understanding of NPV in terms of life cycle costing
learn the significance of all the variable and fixed costs (also from level 3) in the context of target costing
revise your break even analysis and limiting factors work

For Budgeting
Revise forecasting including regression techniques and time series (I know.. also tested in FNPF)
Make sure you really understand planning budget preparation and the significance of whether the company has a FIFO or an AVCO stock valuation policy
(planning budgets are the most important part of this unit)
Second most important is control budgeting - make sure that you can flex budgets (tested in level 3) you need to break down ratios to add to useful management information (so bring in your FNPF variance knowledge)
And understand how budgets issued can influence management behaviour, and that companies will need capital as well as operating budgets when they buy non-current assets.

Go to any key text book for this knowledge.
Put it into your memory with questions from any relevant examining body (A level, old AAT, ACCA F2 CIMA certificate CAT)
Once you have the knowledge start looking at the specimen exams

There have been many disappointed candidates (sadly quite a few who use this forum) who wanted to dive into the specimen exams, and then come on to the forum asking how this question should be answered, or worse still (after looking at a model answer) asking "how did the examiner get this figure for xxx?"
Not only have they wasted the practice aspect of the papers, but they have limited their knowledge to what has been tested before and would be vulnerable if the exam takes a new angle.

You have until the middle of May. Plenty of time, especially at this time with quite a few bank holidays for all important time answering exam questions (not AAT specimen ones until early May).

The very best wishes.

JaneF

Guinea pig - well done on budgeting and agree that i will be having a very boring easter studying too. I really struggled with the variances too but just try and apply the should have and did to the question and hopefully that will help!


Thank you Sandy for the advice it is going to be very useful - like you said i have plenty of time until the exams so will focus on understanding the material for now. We're using the kaplan textbooks at college and i am starting to go through these. The point you make about the practice assesments is very true - we have done a few practice questions in class but i'm going to avoid the practice papers for now - there is no point doing the practice papers if i don't understand the theory yet.