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How long should I spend on question 1 in Paper P2 as it is for 50 marks?

Candidates should spend only half of the time allocation for the whole exam on the question as it is difficult and mistakes are quite common.

My strategy is to only learn certain topics and answer questions just on those. Is this the best way to revise?

A candidate should have an understanding of every element of the syllabus.

How should candidates study for the current issues element of the syllabus?

Candidates should read journals and periodicals and look at the websites of the International Accounting Standards Board and the 'Big 4' accounting firms (KPMG, PwC, Deloitte, Ernst & Young).
Look out for major issues for users and preparers of financial statements.

Current issues are normally covered by an essay question and therefore if a new accounting standard has been issued then candidates should know the key implications.

If there has been an issue about an accounting standard and an exposure draft or a discussion paper has been issued, then that could be a topic for a question.

Do you have any guidance on teaching students with exemptions, who are often not as proficient as students who have taken and passed F7?

Candidates should ensure they have good basic group accounting knowledge and can understand and apply the conceptual framework before doing the P2 course. You may like to set a past F7 exam paper as homework to help them assess their abilities.

How are the F7 and P2 papers changing from June 2011?

From June 2011 onwards, the UK versions of both Papers F7 and P2 will:

  • be based on international accounting standards in the same way as the international versions of these papers 
  • include relevant elements of UK legislation 
  • include relevant differences between international generally accepted accounting principles (GAAP) and UK GAAP 
  • be written using $ (dollars) as the currency 
  • be based on international terminology.

Will ACCA test impairment of assets in a sub-subsidiary?

We could do.

Will ACCA test impairment of assets in a pre-existing group?

We could do although this is more likely to appear within an impairments question rather than a preparation of consolidated accounts question.

In complex groups, can candidates use proportionate measure of non-controlling interest?


Are marks given for workings not included in the final answer?


What should be the starting point for a cash flow question?

Although guidance on the starting point under IAS7 is not prescriptive, the suggested solution will follow the illustration within the appendix of the standard and marks will be awarded accordingly. 

Are recently revised versions of International Financial Reporting Standards (IFRS) examinable?

The current version of the IFRS is examinable if it has been issued before the cut-off date of 30 September.

Does examiner prefer full or partial measurement of goodwill?

This will depend on the question, both could be examinable.

Can local knowledge be used in an interpretation question?

Yes, as long as it illustrates the point the candidate is making and answers the question.

How do questions take account of local tax variations?

Candidates are given enough information for this not to matter.

Will IFRS9 be examinable within the 2011 examinations?

IFRS9 Financial Instruments was issued in November 2009 and deals with some aspects of accounting for financial assets. It is a replacement to part of IAS39 Financial Instruments: Recognition and Measurement, which covers accounting for all types of financial instrument. As IAS39 has not been replaced in its entirety, the standard has not been not yet been withdrawn.

We made the decision to list IFRS9 as an examinable document as it was issued before 30 September 2010. Therefore any financial asset questions will use IFRS9 as the basis of the illustrative answer where relevant. IAS39 is still examinable for the accounting of all other types of financial instrument and for certain aspects of accounting for financial assets not covered by IFRS9.

IFRS9 is listed as an examinable document within ACCA F7 Financial Reporting, P2 Corporate Reporting and the Diploma in International Financial Reporting Standards.

The International Accounting Standards Board (IASB) issued 'The Conceptual Framework for Financial Reporting' on 28 September 2010. Given the proximity to the examinable documents cut-off date, will this be examinable in the 2011 examination sessions?

IASB issued 'The Conceptual Framework for Financial Reporting' on 28 September 2010 (two days before the ACCA cut-off date). We will wholly rely on the existing "Framework for the Preparation and Presentation of Financial Statements" within the 2011 examinations because the new conceptual framework is incomplete and would have had a far-reaching impact on learning materials if incorporated.  

The exposure draft of the new framework is an examinable document as a current issue.

Why is ACCA making amendments to the UK and Irish versions of Paper F7 and P2?

We are making changes to the UK and Irish versions of Paper F7 and P2 in order to meet the requirements of the Statutory Audit Directive, which governs all UK and Irish professional accountancy bodies.

Effective from the June 2011 examination session, anyone wishing to practise as a registered auditor within the UK or Republic of Ireland will need to sit P2 UK/ROI, if they have not already passed P2 before this date.

The revised Papers fully meet the regulatory and business environment requirements for those wishing to obtain the UK audit qualification. Although it is preferable that a candidate has studied F7 (UK), it isn't imperative and the progression to P2 (UK) will not be any more difficult.

Will Question 3 continue to be an 'industry question'?

Yes. The examiner researches corporate accounting and issues companies have when writing scenarios for Question 3. This will continue.

Question 2 and Question 3 of the June and December 2010 exams didn't include many calculations. Will this be the same in future exams?

Question 2 will contain some calculations but Question 3 will usually not. There are also some calculations required for Question 4. For Questions 2 and 4, candidates need to apply principles so the use of numbers is useful.

We have written the paper to include a similar amount of potential numerical and narrative marks.

Will there be a translation of financial statements followed by a disposal?

No, this won't be examined.

Could you test the reconciliation of group-retained earnings?

Yes, but candidates don't do this particularly well. It hasn't been tested a lot in the past.

Do we need to teach candidates about the sale and leaseback proposals in the leases exposure draft?

Yes. The exposure draft deals with the partial de-recognition model so they would need to know this.

There seems to be a big gap between financial instruments examined in F7 and P2. Does ACCA have any advice for candidates preparing for P2?

IAS 39 is not difficult if candidates learn the basics of the standard. The Platinum and Gold learning provider materials cover the areas very well.  

If a question was set on financial assets and liabilities, would ACCA specify which standard should be used?


Can you explain the difference between accounting rules and principles?

Principles (eg substance over form) can be applied to a scenario and don't refer to a particular standard. Rules are contained within standards eg impairment.

Generally, candidates find it hard to differentiate between key rules in the standard and those that are not important.

The topic of reconstructions has been expanded since the 2010 study guide was published. What level will they be tested at? Some older papers (from before 2007) had questions that were very technical.

We do not want questions to be so technical that candidates can't answer them.

The topic has to be in the syllabus partly due to regulatory reasons but also to give candidates the accounting knowledge required for P7 Advanced Audit and Assurance.

We won't examine reconstructions to the same technical level as in the past and candidates should be able to do the question from the information given in the scenario. Up to 25 marks can be awarded for the answer, part of which will need to be written in an essay style.

Can you clarify if changes within a group are internal reconstructions and changes outside a group are external reconstructions?

Yes. For example, if a company takes over the shares of another company, that is an external reconstruction. A change in ownership of subsidiaries is internal reconstruction.

Will you examine the before and after scenario in reconstructions?


How should candidates better prepare for the F7 and P2 exams?

We have evidence that many candidates do not practise exam questions prior to the exam but simply read the questions and model answers together.

Candidates are advised to practise the papers as if they were sitting the exam.

If partial workings in the consolidated financial statements aren't referenced back to the financial statements, would they be marked?

Of course, anything in the answer booklet is marked.

To what extent does ACCA allow for candidates with English as a second language?

ACCA markers do not penalise candidates with English as a second language but they need to be able understand what candidates are trying to say.

For paper P2, often the issue is not language ability but that candidates don't write enough. Candidates often hone in on the conclusion but have missed out the discussion that gets them there. This makes it difficult for them to score enough marks.

In accordance with IFRS9 Financial instruments, an entity may elect to recognise subsequent re-measurement of investments in equity instruments within other comprehensive income. Is this within the syllabus?

Yes, this is within the syllabus. It is therefore examinable, but unless the question specifically mentions that the entity has made this election, candidates should assume the default position.

Candidates should treat investments in equity instruments within the scope of IFRS9 that are not held for trading as fair value through profit or loss.

Last updated: 10 Dec 2014