Don't neglect studying for Day 1 of the CFE


The results of the first CFE in December gave us more information to work with. Something that’s becoming clear is that Day 1 of the CFE is not the breeze that some candidates thought it would be. In my discussions with candidates and from the comments on the blog, I am seeing that a lot of candidates who did not pass the full CFE did not pass because of Day 1.

So what’s up?


It’s new to candidates

Day 1 is something completely new and many of the CFE writers may have been used to (and worked with) the old UFE format and therefore getting less practice on Day 1 of the CFE. With the May CFE approaching, you’ve now got more information to work with so use it.


It’s group work but you can’t work in isolation

Day 1 of the CFE is based on your Capstone 1 module which is a large group assignment that is evaluated. An interesting observation is that many Capstone 1 groups are taking the divide and conquer approach to the case which means individual candidates may be very familiar with one area of the case and less familiar with other areas. The down side of this approach may manifest in the CFE where you have to be very familiar with the whole case. If this is your group’s approach to Capstone 1, plan for additional time to study the whole case before the CFE.


Understand what’s being assessed on Day 1 and how to approach it

Remember, Day 1 is focused on the soft, high-level skills of the CPA Way. The case response is judged on the whole based on these key skills:

  • Assess the situation – integrating multiple parts of the case in your overall assessment, think holistically, think about organizational goals, risks, constraints and so forth.
  • Analyze the major issues – think of the tools you can use in your analysis (qualitative, quantitative, assumptions), think about the issue and how it interrelates across multiple competencies, consider alternatives and uncertainties.
  • Conclude and advise – use the result of your analysis to conclude on the alternatives (including implications) and then provide further advise (implementation, reducing risk, etc.)
  • Communication – Write professionally and keep in mind the audience and purpose of the communication.


Understand what was done badly on Day 1 of the first CFE

I’ll finish off by offering the Board of Examiners commentary on Day 1 of the September, 2015 CFE:

The Board was surprised that some candidates did not provide a quantitative analysis of the
major issues presented. Candidates are reminded that Chartered Professional Accountants are
expected to perform both quantitative and qualitative analyses, as appropriate, to support their

A large number of candidates spent a large part of their response (one-third) on a situational
analysis. The points made were typically valid and identified many of the decision factors to be
considered. However, these points were simply listed as pros or cons, or they were part of a
SWOT analysis that was done as an independent section of the response. Many candidates
failed to then take this great up-front analysis and incorporate it into their discussions of the
specific issues and the recommendations they were making. Candidates are reminded that the
situational analysis is there to help provide a frame of reference for the decision factors they
should be bringing into their analysis of the issues in order to help them make relevant
recommendations that consider the goals, objectives, mission, vision, et cetera, of the company.

(2015 CFE Board of Examiners Report, p. 10)

Take the above advice and apply it. If the Board of Examiners shares any similarity with the previous UFE Boards then they are a lot less forgiving the second time around to candidates making the same mistakes.

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