Changes to the SBR exam

From September 23, question 1 will use a prepopulated spreadsheet response option containing a draft consolidated financial statement.

One of the requirements will ask students to correct this spreadsheet for a range of issues. This new style of requirement will require students to record, analyse and present information using a spreadsheet. Aligning with how spreadsheets are used by finance professionals in a working environment. 

For example, students may have to adjust a draft consolidated statement of profit or loss, a draft consolidated statement of financial position or a draft consolidated statement of cash flows. Students will have to deal with issues such as accounting errors, changes in accounting policies, or the acquisition or disposal of a subsidiary.

Alternatively, there may be unrecorded transactions that require recognition or adjustment, such as a defined benefit plan or foreign exchange issues. In addition, students may have to discuss the impact on the financial statements of these adjustments. For example, has the parent company’s investment in a company now changed from a subsidiary relationship to that of an associate?

However, students will never be required to construct a consolidated financial statement (including a consolidated statement of cash flow) from the parent and subsidiaries’ separate financial statements.

The question will ask students to use the pre-formatted spreadsheet to answer the relevant requirement.  Here are some exam technique tips to support you with this change:

• Use the spreadsheet to show workings by using the workings area set out below the draft financial statements. It will not be possible to copy and paste from the word processor into the spreadsheet, so save time by only using the spreadsheet to conduct your workings.
• Your workings should show clearly how the adjustments to the spreadsheet have been arrived at. This will help markers award credit where it is due.
• Marks are not awarded for the use of formulae or students’ spreadsheet ability, so simple workings can be used. Markers will review each spreadsheet cell for workings.
• Markers will continue to use existing principles to mark student responses, such as the own figure rule. Note that negative numbers in the spreadsheet will be displayed with a minus sign, rather than with brackets.

The accounting principles being assessed are not changing. The exam is simply testing the same application of knowledge by using a spreadsheet format. There will be 10-14 marks available for the spreadsheet requirement.