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CFE study group or partner best practices

Your CFE study partner or study group is one of the more important choices you’ll have to make early on. As with much of social interaction, results can vary.

I mentioned in a previous post, I do recommend studying with a partner or group.

My own study buddy/group experience is an example of how you could handle various kinds of situations. Under the previous exam structure in Ontario we had two exams needed to get through – the School of Accountancy (SOA) during the summer and then the Uniform Evaluation (UFE) in September. During SOA in June I lived with and also worked according to a common schedule with a single study buddy. It worked very well throughout June at SOA because we lived in the same place and it was easy to write an exam or two after classes, take it up and then debrief on our own.

This changed during my August UFE study period when commuting became a factor and it was more difficult to reliably follow a schedule. Within a week I could tell it wasn’t working for me or my study buddy and we parted ways. What works in one situation doesn’t work in another so it’s best to cut your losses. I ended up doing simulations with miscellaneous friends for another week in order to align my study schedule with another group I was planning to join the following week. I ended up doing some exams on my own as well which was naturally stressing me out a bit. Finally, for weeks 3 and 4 in August/September I joined a group of three others to form a four-member study group. For the last two weeks this worked extremely well and the four of us were successful.

Here are some things to consider before and during your study period. You might think of them as best practices.

Are you all sticking to a schedule where everyone is happy and moving forward?
Study partners or groups that are constantly late are wasting your time and energy. Buddies that are a bad influence on you by offering distractions, temptations, etc. may also not be suitable for this one month.

Are you all in the same skill league in terms of writing simulations?
When one writer is vastly superior to the others both of you are not benefiting. On one hand, the superior writer is probably not going to improve and on the other, you may be discouraged by the superior writer who is above average whereas you should be comparing yourself to the average.

Are you enjoying spending the day with your group or study buddy?
You are probably spending up to 8 hours a day with this person or group, so you want this time to be as enjoyable as possible. The writing and debriefing process can be difficult and stressful and you want to ensure you study with the right personality type to handle this. Maybe that is somebody who can make a joke out of a bad exam or maybe you need someone that takes it seriously all the time. Preferences vary.

Are you getting good feedback from your study buddy/group or are you just being used for yours?
Make sure that you are providing good feedback and getting it. The hard work is in debriefing but your partner needs to have some use by providing good feedback on exactly how your case reads to someone independent.

Are you and your group improving at all? If not, what might be the cause?
The purpose of the study partner or study group is to improve your simulations. If it’s been two weeks and you aren’t improving, find out quickly what the problem is. Are you debriefing badly? Is your group not providing any good feedback? Two weeks in is probably your last opportunity to fix the problem.

Fun Facts

The 2010 National UFE Gold Medallist Vicky Au studied with her boyfriend as part of her study group, who also made the honour roll. The 2011 National UFE Gold Medallist Juliana Yuen also had a boyfriend who wrote the 2009 UFE as her UFE mentor. Not sure I’d recommend this path but maybe they’re on to something!

Still need to find a study partner or group? Try out our Study Partner Search.

Should I study alone for the CFE?

Should you study alone for the CFE or as part of a group? It’s around that time when you should be thinking about your study plan for the upcoming CFE.

There are a few schools of thought on the issue of study partners or study groups. The majority of people feel that they are musts and it’s non-negotiable. The remaining minority aren’t sure or prefer to work alone including several who achieved honour roll.

I’ll start by saying that I’ve seen people fail due to having the wrong study group and I’ve also seen people do well without a study group. So the bottom line is that both situations are possible. This doesn’t mean that you can’t tip the odds in your favour.

 

Pros of a study group

  • You get independent appraisal of your cases. This is the single most important reason I would recommend a study group.On your own, you cannot be completely unbiased since you know what you meant when you wrote something. Although you may know what you meant, that’s not what may come across on your case. By working with a group you will get feedback about what you actually wrote in your case from someone that doesn’t know what you meant to say. This is very valuable feedback.
  • You are accountable to somebody else. It’s easier to say ‘Screw it, I’m not doing this today’ to yourself, but it’s harder when there is another person counting on you.
  • You have someone there who is going through the same thing. This can help you stay on track, not get discouraged and maintain perspective.
  • You have someone available to discuss tricky topics or get a different perspective on an issue.
  • You get to see what a realistic response looks like by marking your study partners/groups papers. Those sample responses you may have seen (or from the old UFE reports) are nowhere near what an average candidate might write and you might put undue stress on yourself if you think they are.

 

Cons of a study group

  • Your study group or partner may not be the right fit. I’ve seen it happen where a group is dysfunctional and it detracts from performance. This is more of a reason to choose wisely rather than not have a study group/partner at all.
  • When skill levels are different it can be discouraging for the person at the lower skill level and it can hinder improvement for the superior writer. Again, this is more of a reason to choose wisely rather than study alone.
  • Study partners/groups may become too much of a social gathering and waste your time.
  • You could end up with a study partner who is too emotional or stressed out and it could unnecessarily stress you out. I’ve heard of study groups which ended in tears many days for both parties, not even joking.

 

How big should your study group be?

This is another debateable issue. Most people I talk to believe that the smaller the group the better, with the ideal being just one study partner. I personally worked very well in a group of four where everyone would swap partners each simulation. I got three different perspectives from a variety of skill and progress levels. Everyone was decent at following the schedule, and if someone wanted a day off, you still had two other study partners left to discuss with. This might not work for everyone but I was good friends with my study buddies and we worked well as a group.

That said, there are of course pros and cons of smaller and larger groups so you will have to decide what is best for you. The possibility of problems tends to rise with larger groups, especially if they are dominated by any particular person.

 

In conclusion

I am strongly recommending some form of study group or a study partner, even if it’s just part time.

Remember, if you choose to have a study partner/group, it is only one part of a balanced study approach where you still need to put in the hard word writing and debriefing simulations. There is no avoiding that, no matter how good your study group is.

 

Need to find a study partner or group? Try out our Study Partner Search feature.

Some insightful comments on a UFE plan (especially outside of Ontario!)

A few days ago, I gave some suggestions of what a go-forward plan might be for studying for the 2013 UFE. Being from Ontario, I’m not as familiar with the CASB, Quebec and other regional training that candidates receive. Some of our readers were kind of enough to share their experiences with CASB and Quebec in the comments and I thought it deserved a wider audience. Of course, UFE studying is some part an individual sport so neither my own suggestions or theirs should be taken as doctrine.

I’ll take a moment to mention that in the past, there used to be a lot of argument as to why Ontario had a lower comparative pass rate to some of the other provinces. Some thought that Ontario had a strong technical base (thanks to CKE) but was weaker with case writing skills (you only get SOA to work on it). It was thought that the length/amount of case writing in other provinces increased the amounts of people which passed there. I say this, and the comments below may add some weight to it, so that Ontario students understand that they likely have most of the technical they need already (of course there are areas to brush up on), and that the focus will be on building case writing skills.

Thanks again to all those passing along what they’ve learned to the next cohort:

From a candidate in Quebec:

Experience to the UFE studies may vary significantly from person to person. For Quebec writers, most will pass their graduate diploma in chartered accountancy by end of July, given it is a requirement by the OCAQ to write the UFE in Qubec. Most will have the same technical knowledge by then, regardless of the university they will attend, regardless of the language of studies.

The biggest difference is the month of August, like any other CA writers Canada-wide. My advice for the summer, manage your time because you still need to have fun. You need to enjoy what you do. You don’t want to study late at night or in the weekend. To put it simple, basically in August, you are writing each week a year of UFE, and debrief it… maybe some technical review but not so much. You don’t need to burn yourself out.

When not studying, go out and relax. When studying, do it right, do it once. The UFE is hard, but very manageable. And, take a week off between the end of the Graduate CA program and the beginning of the UFE studies… it helps.

My advice: Have fun, manage your time, and don’t/never despair.

 

From a candidate with the CASB program:

The CASB students will definitely have to follow a different to route to study for UFE as most will have to pass Module around July I think.

Personally, being a CASB student and a repeat writer. I think that CASB student should not worry about technical too much.None of my friends and I touched anything related to UFE before June. All my friends passed on the first attempt.

Even as a second time writer, I never studied before July but did follow what Densmore recommend in his book, UFE success.

 

Lastly, Sarah, an Ontario candidate who wrote the 2012 UFE makes a good point that she took it easy in July. I agree, you’re waiting for results most of July and after SOA, you sure could use it.

Written the UFE before? Share what you did right or wrong with 2013 UFE writers in the comments!

The Road Ahead to UFE 2013

Chances are that most people are hitting their busy season now so maybe you haven’t had much time to focus on UFE recently. That’s okay and don’t worry about it. It’s too early to start stressing about that. Here’s a bit of a high level roadmap of the course you could take.

January – Brush up on your technical, this is a good time to start reviewing your tax that you probably blew off for CKE (if you’re in Ontario). Nothing too heavy but take some time on the weekends if you can and review for a few hours here and there. If it’s just not in the cards right now, don’t worry about it. If you’re the type that needs to do something, review technical because later on you won’t have nearly as much time for this.

February – Same as January.

March – Same as February, review technical, get it solidified in your head.

April – In my opinion, April is a good time to start looking at case approach and learning the basics of cases. In Ontario this means start with SOA cases. Chances are that if you’re enrolled in one of the big UFE prep programs you’ll be forced into this anyway around this time. This doesn’t mean hitting cases full steam. Do one every weekend, learn from the process. I’ll post some material on this in early April to help you out.

May – Continue practicing cases, one a week is good recommendation. Keep brushing up on any technical that these cases may expose.

June – In Ontario, you’ll have SOA which will keep you busy busy, and you’ll find yourself writing 5 SOA cases a week on average. This is a lot of cases so this is where you’ll really get your method down. Outside Ontario, I’m unfortunately not familiar with the programs, but I imagine you’ll start writing cases more often too.

July – You’ll write less cases in Ontario as you wait for your results. Good time for one last brush up on technical, there will be almost no time in August for technical so finalize it here. Go back to one or two cases a week and learn what a UFE case looks like.

August – August is when you go hard on UFE cases. Most people take the four weeks prior to the UFE an do eight hour days Monday to Friday writing simulations. These will be days of writing and debriefing simulations, you might have some time to review technical but it’s not a good time to study heavy technical so keep that in mind.

September 10 – 12, 2013 – UFE

And that’s it for the average candidate. Those who are anxious can relax a little, plenty of time remains.

Creating good procedures on the UFE

Continuing from yesterday, today we put the P in RAMP and cover one of the most important aspects of assurance which is creating good procedures.

Procedures

Procedures are often the most critical part of your audit planning memo and most often specifically asked for so you’ll have to get good at these. I felt like the 2010 UFE was full of procedures. With procedures you want to focus on the key risk areas in the simulation which is related to audit risk and also often related to accounting issues in the simulation. Here are some things that a good procedure will cover off.

  • Specify how to audit the risk – you’ll need to give a specific procedures to be performed (i.e. inventory count, reconciliation, send out confirmations, etc.) The more specific and non-generic the better. Include specific steps such as observing an inventory count, match x to y, and so forth. These must be very specific to your simulation and shouldn’t be generic. Specificity is the key with procedures so make sure to specify what the overall procedure is (i.e. inventory count) and then some additional detail related to the case (such as for example: by weighing a number of widgets in each crate and multiplying it against an average weight).
  • Specify why you are testing this area, why is it a key risk area? This could be covered off in audit risk as well.
  • Specify what assertion you are testing – Make sure this makes sense, doing an inventory count might be great for existence or completeness but probably poor for accuracy and occurrence. It’s important you understand the assertions and what they mean so that your procedure makes sense.

You’ll want to try and give a good procedure for each risk if possible and, again, the number of procedures to shoot for in many cases is 3-4 valid procedures, but obviously use your judgment and experience in determining how many to write.

One additional insight about what the Evaluation Board expects from procedures can be found on page 8 in the 2010 UFE Report.

Candidates are encouraged to always consider the effectiveness of the procedures they provide. Procedures should address the risk area identified. In addition, when presenting an audit plan to an audit committee or a client, candidates should explain why the procedure is necessary, in other words, how it would successfully address the client’s assurance needs.

 

Last thing: with all of the above, I want to stress that it’s important to use case facts often and clearly when discussing each element. Generic discussion or knowledge “dumps” are seldom rewarded on the UFE so get in the habit early of using lots of case facts in your discussions.

What kind of trouble are you having with procedures?

The Audit Planning Memo on the UFE

Most people will be into their UFE study period now and possibly be seeing their first UFE mock marks. If they are not what you hoped, don’t worry too much yet, most people quickly improve in the first week or two before leveling off.

Today’s topic is something you will almost definitely see on the UFE, and probably more than once so it’s good to master it from the beginning. The Audit Planning Memo.

Although there are some different approaches out there, the most common elements and approach of an Audit Planning Memo is the RAMP approach (Risk, Approach, Materiality and Procedures). For most audit planning memos you don’t need to discuss all three and often two or three is enough with a discussion of risk and procedures being the most important.

Audit Risk Discussion

It’s important, first of all, to state what the audit risk is exactly based on the case facts. Generally the risk is either high or low but it can also be medium at times. If you’ve forgotten, audit risk the risk that the financial statements are materially misstated after a clean audit opinion is given an is usually calculated as Audit Risk = Inherent Risk * Control Risk * Detection Risk.

Next, you must support your conclusion by specific evidence from your simulation. The amount of evidence depends on the simulation but a general rule of thumb is that you should support your conclusion with at least three specific risks from the case. This is only my opinion so use your own judgment and experience to determine how many is enough! If prior year risk is mentioned or the risk is changing from a prior year, it is important to be specific about what has changed to increase or decrease the audit risk this year.

Some examples of risks:

  • New management or ownership may introduce new biases to misstate
  • Complex accounting issues may be prone to error
  • Weak controls discovered or problems reported by employees with the financial information

 

Audit Approach

This is often the least discussed area because most UFE simulations don’t have significant approach issues. You have three options here and must state which you will take and support it with case facts. The three options are substantive approach (you will be reviewing transactions), controls reliance (you are relying on the controls) or a combined approach (for some areas you will rely on controls).

If there are very weak controls all around you will take a substantive approach and support it with information from the case as to why. If all controls are functioning fine you can take a controls reliance approach but this will probably never occur so you are most likely to take a combined approach which will rely on controls in some areas and take a substantive approach in the weak areas.

 

Materiality

Materiality is usually the easier to score a quick few points over audit approach. Materiality is a number which is based on the financial statements so you must calculate it and state why you are calculating it this way. Materiality is mostly linked to users of the financial statements and not risk so when discussing materiality it is important to discuss how it relates to users of the financial statements. Quick reminder: an amount is material if it could influence the decision of a user of the financial statements. Typical materiality amount go-tos are 5% of Net Income from continuing operations or 0.5-1% of total assets but obviously use your judgment at the time.

Some examples of issues around materiality:

  • New users of the financial statements – they may have a lower or higher materiality than previous users
  • Loans or covenants are involved which are based on the financial statements – amounts which breach these covenants are material
  • Whenever there is a sale or purchase of a company occurring, materiality is often a factor since the purchase price is based on the financial statements

 

Last thing: with all of the above, I want to stress that it’s important to use case facts often and clearly when discussing each element. Generic discussion or knowledge “dumps” are seldom rewarded on the UFE so get in the habit early of using lots of case facts in your discussions.

Come back tomorrow where I’ll tackle procedures, the most important part of the RAMP and a critical element of scoring well on the UFE.

Did I miss anything? What else do you include in your Audit Planning Memos and why?

A word about the UFE Solution and Sample Responses

Part of the UFE Report contains both the solutions to each simulation as well as a sample response. While these can both be very useful in their own way to you they can also be very discouraging if you don’t understand what they are and the purpose they service.

The UFE Solutions

You need to understand that these solutions are just the complete solution to each simulation and do not represent what is expected from UFE candidates in an actual response. It would take most people significantly more time to come up with a response like that. So don’t by any stretch of the imagination interpret the solutions as to what’s expected from you. They are only there to study and learn from and they serve that purpose well.

The Sample Response

Wow! These things are almost as good as the actual solution some times. There are many people that feel they aren’t actual responses but the UFE Report states that they are so we’ll assume it’s true. Again, I want to state that the majority of people cannot achieve anything close to this level of response and you should not be discouraged if your responses are not looking like these samples. I never even bothered to read them except when I was looking for ways to improve my responses on certain issues in an exam-like response form. These would be medalist level responses which only the best of the best could achieve. While you can’t expect that your responses will be similar to these, you can learn from them. You can read these and see how they integrate the case facts, how they present quants and occasional tricks to save time so they do serve some purpose.

A Real Response

An early-on/mid study period real response may look something more like this one which is “Pharmex Inc” (2007 P3 S2). I’m not saying this is an ideal response but it’s an average real candidate response so you might be better off measuring yourself against a response like this over the above two.

 

I wish I could write responses like these samples! Do these samples ever get you down? Tell us in the comments!

Debrief Week – How to reach competence on the UFE

You’ve received your marked response back and now the hard work begins. As mentioned in yesterday’s post, understanding how to reach competence on the UFE is a critical step in a useful UFE debrief.

The first step is thoroughly reading through the simulation solution. The simulation solution consists of several parts.

  1. The actual solution text or example report. This text is excellent to study from but is not even close to what’s expected from you in a real response so please understand that this is the ideal solution if you had days to write it. It is thorough in order to be useful to study from.
  2. The Evaluation Board’s comments throughout. In italics after the solution to each indicator you will find the Evaluation Board’s comments mixed in. These comments are extremely useful because they give the boards overall impression of how candidates did on specific issues. They will often provide great insight into what was expected, what was received and should give you an idea of how much the board expected. On a side note, these are often very amusing to read since I sometimes find the Evaluation Board to actually be pretty harsh in this area.
  3. A Table summarizing student performance. Below items 1 and 2 above you’ll find another useful goodie which is the table of how students performed on this indicator and a brief description of what was necessary to achieve each ranking. You’ll see words in here like identifies, attempts, performs, discusses, thoroughly discusses, recommends and so forth. All these mean something and are an indicator of what was necessary to achieve each rank. This is very important as each word here implies different requirements. If you only discussed an issue but to reach C required discussion and recommendation than you did not reach C and you will now understand why you did not reach C.
  4. The Evaluation Board’s comments on overall student performance. At the end, after the performance table, you’ll find a paragraph or two about how the Evaluation Board felt about student performance on this indicator. You’ll very often get more specific information about what the board wanted here in order to reach competent. The information about requirements here will often be very specific, “The board expected candidates to calculate x, y and z and provide meaningful analysis.”. If the Board expected something then you most likely needed to provide it in order to achieve C. Based on the summary of student performance table and this written summary, you should get a good idea of what was required for RC and C.
Next, you’ll want to take a step back. Chances are you’ve been reading everything in detail and gotten down to really specific issues. This is good and you will hopefully understand what each indicator needs in order to achieve C. One added step that may help you now is to understand that the ideal solution is not possible in an exam environment. You must consider ranking which is intentionally tested on the UFE. You must recognize which issues are important and why the must be addressed vs. the issues which are not as important and can be ignored. Look again at which issues you had to discuss in order to achieve C and which are played down in the evaluation guide. Determine why. It’s most often a materiality or pervasiveness thing.

I’ll have some future posts where we break down this process on a real simulation so stay tuned. In the mean time, tell us in the comments how you’ve been debriefing!

Tomorrow: comparing your response to what was required and learning from it.

Debrief Week – What, Why and When to debrief

Chances are that by now you’ve heard the term debriefing thrown around very casually. Chances are also, that you may not really have a great understanding of what exactly debriefing is. I’ll try this week to explain it better and we’ll hit the topic more in depth over the course of this week.

What is debriefing?

Debriefing is the processes that takes place after you have written and marked your simulation. It is a way to study from simulations. With simulations, you cannot just read the solution and improve significantly as you may have done in some of your University studies. Debriefing is a far more active process and this makes it difficult and hard work but this is what’s necessary in order to increase your probability of being successful on the UFE by reaching competence across the indicators.

Why debrief? As just mentioned, simulations are different types of examinations and you cannot just dump information into your simulation and expect good results. Like real life, simulations are not simple nor black or white and thinking is required. Because of these reasons, you cannot study only from the solution guide or by rereading your case after you’ve read the solution. The only way to significantly improve over the course of your study period is to debrief.

When to debrief? Debriefing is best done soon after you write and mark your case. The typical UFE study day involves writing your case first, have a study partner mark it and then debrief it on your own. You should not save debriefing for too far in the future as the simulation will not longer be fresh in your head. Although with writing comps you may have to extend the debrief over into the next day.

Please share in the comments: How has your debriefing experience been so far? Come back tomorrow when we’ll be discussing what you should learn from a good debriefing session.

How to study during your UFE study period

CA Students love to study technical. I don’t know why, but it seems that when a bad case is written, or in almost every other situation surrounding the UFE, everyone just wants to hide away somewhere and study technical. My best guess as to why is that either people feel lazy or just perpetually weak in technical. I say lazy because it’s easier to sit around and read technical rather than do the hard work of writing another case and debriefing it properly. You can convince yourself that your are still studying and being productive this way, which you are, but it’s not optimal.

This is a mistake and the level of technical required for the UFE is exaggerated and for the more technical subjects you have the Handbook available to use. Except for taxation, I did not study anymore technical after the CKE except for the simulations and the occasional reference lookup. If you still insist on having something, I recommend (it’s the only one I used so this is not an opinion about the other material out there) Densmore’s Competency Map Study Notes which cover the material in appropriate detail for the UFE.

What You Should be Doing

  1. Write simulations! Lots of them. The UFE puts you in business simulations (with a heavy tilt to accounting) and it is largely a writing exam. The best way to get good at this and reach competence on the UFE is to practice lots of exams and debrief them. This is hard work and there is no avoiding it. 
  2. For highly technical issues, you should be aware of what triggers these issues in the simulation, roughly where you can find the issue in the Handbook and then use The Handbook to find the criteria. Finding the triggers is often the toughest part and the only way to develop this is through writing and debriefing lots of cases.
  3. The solutions to the UFE Simulations contain all the technical you need to know so don’t spend a lot of time going even more in depth after debriefing. These are the solutions already! They don’t need anymore from you in order to reach competency.
  4. Many important things on the UFE to reach competence such as writing procedures, ranking issues and identifying PQ indicators come with practice and cannot be studied. Don’t overlook these, so I’ll repeat one last time, write lots of simulations!

When it’s okay to study technical

  1. For taxation related issues. Taxation is extremely rule based and the tax act is hard to navigate. It may be prudent to work some taxation technical into your study schedule if this is a weak area of yours. Keep in my that it’s only part of your entire study schedule so don’t go overboard. You don’t want to have the best taxation response in the world at the expense of all the others.
  2. For PMR, You should have a general awareness of a broad range of accounting issues so if you don’t even know what non-monetary transactions, capital leases or financial instruments are then you won’t even identify the issues and get NAs. I still recommend you start by writing cases but if you are getting a lot of NAs at this point you are missing issues and will need to brush up on technical.

Chances are that the UFE is a different kind of exam from your University days so it’s important to change the way you play the game.

Let us know in the comments: How have you been studying and do you have any other advice that’s worked?

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