Tag Archives: FInance

The Week Ahead – 22nd February


It’s a nail biting week for the strategic students who are taking the case study exams this week – let’s hope its your final CIMA exam and you get a positive result! However, the operational and management level students can relax (for the time being). Although I would suggest you start thinking about what awaits you in the next level.

Here is what is coming up this week on the site.

CIMA Objective Tests

As mentioned above, I would suggest you start thinking about the next level of CIMA and work on the premise that you have passed the OCS or MCS. This way you can at least start planning when and what order you will study the next level.

For those self-studying, here are my thoughts on how to approach the CIMA objective tests and what learning providers offer value for money.


The CIMA velocity February magazine was released earlier this month and can be found here. It features articles on what to expect on objective test exam day, while there is also a guide on the P3 paper.

Meanwhile, the CIMA Financial Management (FM) magazine is well worth a read too – the FM website can be found here and you can also find links to download the FM app as well.

The CIMA Student Website

The P2 useful links and resources will be posted on Wednesday this week and this will complete the Management level of resources on the website.

Currently, I am studying for the F2 exam so I will be sharing my thoughts on Deferred Taxation as it’s a topic most people wince at but really the theory behind it isn’t as complicated as you’d expect.

As always, if you’d like to get in touch please feel free to email me on thecimastudent[at]gmail[dot]com.


The Week Ahead – 1st February 2016

It’s the beginning of February and the case study exams will soon be upon us.


Feb 2016 Case Study Exams

The OCS students are in their final week of preparation for the exam and should be making sure they have every angle covered (not just the theory). So this means, you should be brushing on Industry research as well covering ETHICS! And perhaps a final mock exam to give yourself more confidence.

Here is an article I produced in December on how I remember the key points on Ethics.

Meanwhile, the MCS and SCS students still have a week or two until they sit their examinations so there is still plenty of time to get stuck into the mock exams to prepare you for exam. Also, use the upcoming time to focus on Industry research so you can apply some real life scenarios in your upcoming exam.

The CIMA Student Website

This week I have an article that covers industry analysis for OCS, MCS and SCS for some last minute revision. I have picked out some helpful links for all three levels as well providing preview videos of the Astranti industry analysis.

Meanwhile, on Friday, I will be sharing some tips and views (taken from the CIMA connect site) from students who have already passed their respective case studies.

As always, I would love to hear from CIMA students out there who would like to share any exam tips and resources. You can leave comments below or email me on thecimastudent[at]gmail[dot]com.

Happy Studying!


The Week Ahead – 18th January 2016


Last week was a much more productive week for me personally in regards to my F2 studies. I managed to catch up on some slack from week one as well the week two topics I planned to cover.

Here is what to expect for the week ahead on The CIMA Student.


There was an interesting press release from CIMA that suggested that performance at work is dictated by peoples biology rather than effort or rewards. If you’re interested you read it in full here.

On a more light hearted note, the “19 things you need to stop saying (because you sound like a corporate robot)” article on mashable.com should raise a few smiles.

The CIMA Student Website

The examiners report for the November 2015 OCS was released last week and I will be providing more details and opinion on how the exam was received. The examiners report is an excellent resource provided by CIMA that many students will overlook or gloss over.

Also be sure to keep your eyes peeled for an article later in the week that covers all of the best CIMA and CIMA related social media accounts to follow.

Budgeting and Beyond!

Budget concept
While studying for the operational case study I was revising the budgeting section of the P1 syllabus and the idea of Beyond Budgeting really struck a chord with me.

Traditional budgeting methods, in my opinion, are becoming outdated and counter-productive. The idea that departments will needlessly spend in the final months of the year to ensure their budget is not cut the following is crazy.

Traditional Budgeting Methods

I’ve seen this first-hand when managers have been scrambling around in November/December to spend their capital expenditure budget so they got the same amount the following year. I was relatively new to the company and quizzed a colleague as to why there was so much spend in December and she told me “Well, they will lose their budget next year if they don’t spend all of this years”. Madness.

Beyond Budgeting: A new approach

So Beyond Budgeting looks to rectify these problems by abandoning traditional methods  – the two main drivers for this are;

1. A more adaptive set of management processes
2. A highly decentralised organisation

Beyond Budgeting empowers management by giving them the freedom to achieve their goals without the need of a rigid set of budgeted numbers. Instead, front line management are given goals that are in line with shareholder value and the bigger picture.

As one of the main criticisms of traditional budgeting methods is the fact it’s too short-term in it’s thinking.

These goals are measured using a set of KPI’s, industry benchmarks, customer satisfaction and revenue or market capitalisation.

Hope and Fraser identified 6 shared common principles that should be used by all companies who want to adopt a Beyond Budgeting technique:

– A governance framework based on clear priorities and boundaries.
– A high performance climate based on visible and relative success at all levels.
– Front line teams with a freedom to take decisions in line with the company’s governance principles and strategic goals.
– Teams given responsibility for value creating systems.
– Teams focuses on customer outcomes.
– Open and ethical information systems.

If applied correctly, the beyond budgeting process rewards the high performers within the company and not just the skilled budget negotiators.

Other key benefits include accountability and ownership by empowering the front line teams to make decisions. And, of course, there is less waste as managers are encouraged to work towards medium and long term strategic goals rather than traditional annual budgets that produce unnecessary spend.

CIMA produced a topic gateway document on Beyond Budgeting that can be found here and makes for interesting reading.

Beyond budgeting is:
‘An idea that companies need to move beyond budgeting because of the inherent flaws in budgeting especially when used to set contracts. It is argued that a range of techniques, such as rolling forecasts and market related targets, can take the place of traditional budgeting.’
CIMA Official Terminology, 2005


Integrating Work Experiences and CIMA

Finding different techniques to revise for exams can be difficult. Trying to recall pages and pages of notes and study text in the exam isn’t ideal.

So speaking as an older CIMA student (over 30) it makes sense to try to think about the practical experience you have gained and apply to your CIMA studies on exam day.

Trying to remember the various IFRS’s and IAS’s is nearly impossible; however, I’ve found it very helpful to think about the day job and the tasks I am performing when faced with a question or topic I am unsure of. Thinking about my practical experiences in the office sets off a trigger that allows me to answer the question or recall information I need.

I’ll give you a great example of this.

I was revising for a case study exam earlier this year and had four or five accounting standards that I thought could come up on exam day. In particular, was the one on exchange rate gain and loss.

IAS21 – The Effects of Changes in Foreign Exchange Rates


You can see from extract above the official documentation on IAS21 (in fact ALL of the accounting standards) are very dry and formal. And it’s a time consuming process to go through it over and over again so you understand the purpose of the standard, put it into your words and apply it correctly.

Relate it to Work Experience

Instead, I relate the accounting standard to my actual work experience as a general ledger accountant.

Every month end we ran the foreign currency revaluation on the open AR/AP items and any exchange rate differences were posted to the income statement as a gain or loss.

For example: Receivables Ledger issued in $

Jan 2001 – AR Invoice             $1650         1.61        £1025

Feb 2001 – AR invoice            $1650         1.68       £982

The $ invoice was issued in January when the exchange rate was 1.61, however in February the exchange rate went up to 1.68. The $ is still open but it’s now only worth £982 when translated to the companies reporting currency, so the difference needs to be posted to the income statement in February period as a cost.

Debit – Unrealised gain/loss expense account  £43

Credit – Receivables  $43

This gave me a much better understanding of IAS 21 as I was responsible for posting this transaction in the monthly accounts.

It also enabled me to explain the standard in simple and practical terms. Vice versa, when reading the full accounting standard I had a clearer picture of it’s purpose and was able to understand the more complex or long winded elements of IAS 21.

So when I was ready to sit the case study I knew if a question came up on the effects of exchange rates and how to treat I immediately knew IAS 21, the theory behind and how to practically apply it.

Next time when you’re struggling to remember key models and accounting standards try and relate to your day job and you might find things become much clearer!

F1: Useful Links and Resources


The operational level of the CIMA qualification covers the implementation of strategy as well as reporting on the implementation of the strategy. It’s focus is purely on the short term.

The main area of the F1 syllabus revolves around Financial Accounting and Reporting. However, you shouldn’t neglect business taxation as it represents a quarter of the F1 area.

Useful Links

Astranti Operational Level Membership – Free Study Text 2015 – Astranti offer some great free study texts for the whole of the operational level. The complete study text for F1 is available for free (but only the online version), you will need to pay if you want to print the text.

CIMA Connect  F1 Group  – here you will find the F1 homepage on the official CIMA site. It contains various documents and articles related to the syllabus as well as a discussion forum that can e very useful before exam time.

F1 Study Notes: Ethics – this article on Ethics is a great insight into a real life example and will help you when preparing for the F1 paper.

F1 Study Notes: Financial Reporting and Taxation – a brilliant article from CIMA on the 2015 syllabus and how it’s affected the F1 paper. A must read for all students sitting the F1 exam next.

F1 Study Resources Homepage– here you can find all of the study resources that the official CIMA website provides.


*note: you may need to login into your CIMA connect account for some of the above links.

OCS: How I passed

The operational case study is a relatively new exam – so I was delighted to pass it first time!

The OCS seemed a bit of a grey area to me when working out how to study for it. Trying to catch up on the all of the P1 theory I missed (I was exempt due to 2015 transition) as well as hearing that only 34% of the students passed the OCS in the previous sitting (May 2015) set a few alarm bells ringing.

I was comfortable enough studying for the P1 and F1 papers using study texts and practice exam kits but, in my opinion, you really need some additional support when tackling the case study.

I purchased the OCS study text from Kaplan earlier in the year but thought it was too generic for me. I needed to put some more meat on the bones.

OCS: First Steps

It’s important to make a note of when the pre-seen material for the case study is released, as soon as that’s out you will need to focus 100% on that.

So the 3-4 weeks before it was released I spent my time going through all three papers E1, F1 and P1 (mainly) and revising the key models, theories and how to apply them.

Don’t get bogged down in working out costing models and drafting financial statements etc in your preparation for case study. YOU WON’T BE ASKED TO CARRY OUT ANY CALCULATIONS – you will need to know the theory behind and how to apply it to the scenario.

I found the OCS study text from Astranti was a brilliant starting point.

The first part focuses on how to plan your answers and what expect in the exam. While the second part is split into three parts (E1, F1, P1) and covers all of the key theory and models in a short, condensed, manageable format.

Make this study text your bible for the weeks leading up to when the pre-seen material is released.

Pre-Seen Materials

As soon as it’s released you should read the whole document without making any notes. Just a get a feel for it. Then I would suggest reading it again and highlight strengths and weaknesses of the company as they could well be tested.

Pay attention to EVERYTHING! 

Personally, I used the Astranti pre-seen video analysis package that provided a tutors insight into all of the pre-seen material as well as pin-pointing the top 10 issues that could come up in the exam.

I found it invaluable and it gave me a real focus for revision and exam preparation.

Try and link the key models in P1 and E1 to the pre-seen material. Then brush up on any accounting standards that you feel could be examined.

Mock Exam Practice

After I spent two weeks watching the pre-seen videos, relating it to the pre-seen material and refreshing my syllabus knowledge I moved onto the mock exam practice.

You can find exam practice questions on the official CIMA connect website and Astranti offer a free mini-mock as well. So you have all of this resources available for free and they should be made the most of.

So, for next three weeks I took the Astranti mock exams (one each weekend) and spent the time in between revising the areas I scored low marks on.

If your budget allows, I would thoroughly recommend to get your mock exams marked. You will get detailed feedback on your strengths and weaknesses and an honest appraisal (something I probably wouldn’t have given myself!)


I spent the final week in the run up to the exam going over my notes and making sure I understood how to relate ETHICS to the case study.

Try and squeeze it in where ever you can! ETHICS, ETHICS, ETHICS.

I also used this time to do some real industry research into the floriculture industry so I could link to my answers on exam day.

Good Luck for those sitting the OCS in February 2016. Here are some useful links below that will help you get a head start.

Useful Links and Resources

OCS Course Preseen Videos
OCS Mock exams
OCS study text
OCS masterclasses

CIMA Connect: OCS Pre-Seen Material

Big Data: a hot CIMA topic

When looking at the 2010 CIMA study texts you will find very little on the subject of Big Data. But it seems to be a hot topic these days and I am sure the CIMA examiner will look to squeeze in a question on Big Data whenever they can.

The use of Big Data is becoming vital for companies to find that competitive edge or to serve their customers better by understanding their needs.

One of the classic examples of Big Data would be the supermarket industry. The amount of data they gather on their customers is staggering and the introduction of loyalty cards has made it even easier to collect data on consumer habits and trends.

Supermarkets and Big Data

For example, supermarkets realised there was a connection between the purchase of baby nappies and beer. Clearly, the parents would stop at Tesco (or any other retailer) on the way home from work to pick up some nappies and at the same time pick up some alcohol too. So to make it easier for the customer they placed the baby products closer to the alcohol selection. Win, win!

It’s the small details like this that Big Data can pick out and allows the business to cater for every aspect of the customers needs.

Big data allows you to draw on vast quantities of data to spot unusual trends and correlations that would be usually difficult to spot.


In a 2001 research report Garner identified three key challenges that organisations face – Volume, Velocity and Variety.

VOLUME – increasing volumes of data mean there is a lot more to manage and harder to extract key information from it.
VELOCITY – there is an increasing speed of data in and out, means data can quickly change. So analysis needs to be quick to spot and react to the changes.
VARIETY – the range of data types and sources of data can be varied making analysis difficult. Data in different IT systems can hard to link and analyse together.

There are 7 key stages to Big Data collection:
1. CAPTURE – what kind of data is needed and how will it be captured?
2. STORAGE – Big Data sets need physical systems that can take up vast amount of space – also need to be secure!!
3. CURATION – Once the data is captured it needs to be organised, controlled and maintained. Daily upkeep of the data.
4. ANALYSIS – The process of interpretation the data. Splitting it out into categories or make links between different types of data.
5. VISULATION – Once analysed, it needs to be put into illustration in a clear digestible format.
6. SEARCH – Once compiled, you must be able to search the data to find what you want. i.e. Google!
7. DATE SHARING AND TRANSFERS – Data must be able to be shared with those who need it.

Big Data is also massively important in marketing – by using twitter, Facebook, chat rooms and forums – companies can build up a picture of consumers and this kind of personal data is unique due to the personal nature.

It can also help identify new customers by using demographics and it also help discover new niche markets by grouping people in terms of interests and behaviour.

It’s a relatively new topic in CIMA but it’s one of the more interesting topics as you can relate to everyday life. So don’t get caught short when studying for your next case study exam – as understanding and applying Big Data could make a BIG difference in passing your next exam.

Outsourcing: A False Economy?

The E1 paper (and the Operational Case Study) could throw up a question on outsourcing. It’s a topic I am really quite familiar having worked in a couple of environments where the company were outsourcing services.

In some instances, it felt like the cost savings made by the company by outsourcing their finance function was actually a false economy. As the quality of the work delivered by the outsourcing provider would ultimately cost the company money as they wouldn’t have accurate and reliable good to make strategic decisions.

OUTSOURCING: An explanation

Outsourcing is the contracting out of services and aspects of the organization to specialist providers. There are two types of competencies that should be considered.

THRESHOLD COMPETENCIES – must be good processes but easy to imitate and they hold no source of competitive advantage.

CORE COMPETENCIES – something you are able to do that drives competitive advantage and it’s very difficult for your competitors to imitate.


  • Cost – the main reason for outsourcing comes down to cost. Large companies will benefit from economies of scale. Reduced capital expenditure and deduced headcount and labour charges
  • Quality – the supplier may have skills and expertise that adds additional value to the products.
  • Focus – company can focus on core areas of the business and increase their competitive advantage.
  • Buyer Power – the outsourcing market is so big, you exercise buyer power to negotiate better deals.



  • Loss of core competencies – losing core competencies will soon see sales drop and the brand will be damaged and overtaken by competitors.
  • Cost Issues – cost savings may not be realized in the long run.
  • Damage to morale – staff redundancies could affect morale of the existing employees.
  • Damage to brand and company reputation – if your customers are dealing directly with the outsourcing provider they could damage the brand of your company with poor service.
  • Risk of loss of confidential information.


Outsourcing, of course, can be very beneficial to a company and in fact improve the services and efficiency of the company. For example, outsourcing the AP function can save the company headcount and they can leverage on the expertise of the provider who should have better and more efficient processes to perform the accounts payable activities.

Moreover, the company can now focus their efforts on the activities that actually add value in maximising revenue.

Outsourcing is one of the very first topics in the E1 syllabus. It’s so common place in the modern business world a lot of CIMA students who are working in a finance function of large companies will have first hand experience of the reality of outsourcing.


CIMA Exams – one at a time?


The new CIMA 2015 syllabus, in my eyes, has changed dramatically when you consider the examination structure. The objective tests can be scheduled at any time and have been reduced to 90 minutes with several smaller questions covering the whole syllabus.

It’s a welcome relief not to have face the 180 minutes hand written exams for each subject area, however, the new case study exams at the end of each level are as broad as they are challenging. Trying to revise for all three subjects and apply it to the pre-seen material is definitely a big, big challenge.

Personally, I have yet to sit one of the new operational exams in the 2015 syllabus and I am thinking about the path I will take next.

The exams for the 2010 syllabus were scheduled at certain times during the year, which usually meant students (myself included) would study for two papers at a time.

  1. To add variety to your studies
  2. To make the most of the exam timetable

However, the new syllabus means you can sit the exams any time you want. Well, the case study exams have set times but you can sit the objective tests whenever and, what’s even better, is the fact you get the results there and then!

Meaning, if you  fail an objective test you can re-take it the following week or month, ensuring you don’t lose too much ground when waiting for your next exam.

Nevertheless, it’s given me a bit of a problem when considering the approach to study for the CIMA objective tests. Do I just focus on one exam at a time, or do I attempt to sit two or three at a time?

There is an interesting article on the CIMA website that highlights the pros and cons of either approach. You can find the document here and it’s well worth a read.

The main points worth considering are the impact on the case study when deciding what path to take on the objective tests. If you take just one exam at a time “You may need to refresh your knowledge before taking the case study“.

Alternatively, by taking three subjects together (or two) “You will see clear links between each subject to prepare for the upcoming case study

Currently, I am swaying towards studying for one objective test at a time so I can focus my attentions on the one subject and ensure I pass first time. Also, by focusing on one subject at a time I should be in a position to take the exam quicker – perhaps in a two month period? Meaning I won’t have such a long gap between papers and ultimately the case study.

I guess it’s all down to personal preference but the 2015 CIMA syllabus is certainly much more flexible than ever before.



Good Ethics is Good Governance!

photo from cornerstoneondemand.com

photo from cornerstoneondemand.com

The CIMA Code of Ethics is one of those areas you tend to gloss over when studying. It’s not really something I focused on particularly when studying for my E1 exam but after preparing for the Operational Case Study I realised that you can score easy marks by thinking about Ethics in pretty much any scenario.

But trying to remember all of the models and accounting standards can be a minefield. But I found a useful acronym on remembering the key principles of the CIMA code of ethics.


I remember this by thinking of alcohol (which usually comes to mind after hours of study and revision) and the drinks optic that’s attached to a bottle of gin or vodka. It stands for:

Objectivity – to look at things from a fair and unbiased point of view and not allowing personal factors to influence decision making.

Professional Competence – having the knowledge and skills required to adequately perform the tasks expected of you.

Professional Behaviour – acting in a manner that is befitting of a professional organisation.

Technical Standards – meeting the standards required by working at a specific organisation.

Integrity – an uncompromising and predictably consistent commitment to honour moral, ethical, spiritual and artistic values and principles.

Confidentiality – an expectation to keep sensitive information private.

Ethics in action

Ethics can cover such a broad range of areas too. Almost any topic in the CIMA syllabus you can relate back to ethics. Whether it’s a decision on the product mix of a company or the proposed outsourcing of an area of the business – you can tie it all up with ethics and score some marks in the process.

It wasn’t until I was watching some of the case study preparation videos from Astranti until I realiased that I could be missing out on easy marks by not covering ethics properly.

In fact the title of this post was mentioned in the Astranti text when I was preparing for the OCS “Good ethics is good governance!” was mentioned, And it’s a great point to remember – especially if faced with a governance question in the exams – as it’s the ideal time to refer back to the CIMA code of ethics.

I am also sure (well, maybe more hopeful) that the CIMA exam marker would be a happy marker if they saw students can refer back to the CIMA code of ethics. And a happy marker will hopefully be a generous marker.

Traditional Study Materials v Online Materials


image from Dave and Les Jacobs (Getty Images)

When I started my CIMA studies last year I automatically purchased all of the study materials from Kaplan without giving it much thought. I ordered the E1 and F1 books – so the study text, exam questions kit and revision guide – and was generally pleased with them in terms of content. Especially the exam questions kit, which was excellent when in the final weeks of exam preparation.

I passed both exams first time in the November 2014 sitting and thought to myself I would stick with ordering the Kaplan materials. But when returning to my desk to pack up the books from E1 and F1 I soon realised – what am I going to do with these books now? And imagine the amount of books I would have collected over the next few years while studying CIMA. Not to mention the cost involved (the delivery was astronomical as I live  in Central Europe).

Online Study Materials

So I explored other alternatives on how to study CIMA. And the more I thought about, the more I realised that purchasing physical copies of the study texts wasn’t efficient for me. Instead, while studying for my next exams, I used a smaller learning provider where I could purchase the study texts online (in fact the basic study text itself is free).

I feel it gives much more flexibility and you can access it anywhere you have internet access. So you can squeeze a couple of hours study in when you are in the office (lunch break of course), or when you’re travelling. It means you don’t have to carry around a text book the size of a telephone directory in order to study marginal costing or catch up on consolidated group accounts.

However, I do agree, there is something comforting and traditional and sitting down to study with a large textbook and calculator. You might find that this way if studying is more suitable for you. It’s hard to break this kind of trend as it’s the way we’ve always studied from the age of five years old onwards.

But overall I believe that using online materials saves you space, time and money. And if you are still getting the shakes by not having a physical book to hold you can always print the materials out!

Nevertheless, it will be interesting to see if my beliefs remain the same when studying the Management and Strategic level of CIMA.