All CIMA exams (except certificate level) start with 20 minutes reading time. Have you thought about how you’re going to spend it? Here’s my thoughts about how to use the reading time to your advantage in the CIMA F2 exam.
If you offered students more time at the end of their exam most would bite your hand off. However give them that extra time at the beginning and many seem to waste it.
I know it sounds obvious that you should spend your reading time reading – but reading what exactly and how long for? Also, most students invest lots of time practising questions before the exam but how many build the reading time into this practice? We know that if we don’t practice answering the questions we won’t be able to answer them well on the day. So the same logic should tell us that if we don’t practice the reading time before the exam we won’t get the maximum benefit from it on the day either.
The reading time is there to help you with the whole exam so I would suggest using it across the whole paper. Allocate the time accordingly, so given that section A and B are each 50 marks allocate 10 minutes to reading each section.
Section A is made up of 5 x 10 mark questions. I don’t think that you need to be as strict as 2 minutes per question in section A as some questions are quicker to read than others but you do need to make sure you have reviewed all 5 questions in the 10 minutes. For each question you want to read the requirements and so ascertain what topic is being tested. For example, share based payments, financial instruments, developments in external reporting, consolidation or earnings per share. You then might want to spend a bit more time reviewing questions you feel less confident about compared to those where you are confident that you have the knowledge.
Skim over the information to get a little bit more detail – for example is the share based payment question equity settled or cash settled, does the earnings per share question involve a rights issue or a bonus issue.
You might also like to jot down anything you’re in danger of forgetting. For example, the formula for the weighted average number of shares to for an EPS calculation with a rights issue. For a more written based question such as the developments in external reporting you might jot down some key words that you want to build into your answer later on.
As you’re doing this you will naturally identify those questions and parts of questions that you feel more confident in answering and those you’re not looking forward to. This will give you the order in which you will answer the questions as most students prefer to answer the questions they feel more confident about first.
Section B is made up of 2 x 25 mark questions with one focusing on analysis and one on consolidation.
For the analysis question, as always start by reading the requirements. There may be separate parts, so consider the time allocation between the various parts (1 mark = 1.8 minutes so 5 marks is 9 minutes and 20 marks is 36 minutes). You might also decide that you could answer part b) before part a) and gain some easier marks relatively quickly. Next review the information thinking about what ratio’s would be relevant to calculate.
When reviewing the financial statements that you are being asked to analyse, watch out for common features of questions such as revaluations, changes in cash balances, increased revenues but reducing profits.
Where you are given narrative information think about how you might be able to use it in your analysis. For example, expanding into new markets might link to the increased revenues but significant advertising costs may have been incurred that have reduced profits.
By the end of the 5 minutes you should have decided how you will approach answering the question i.e. part a) then b) or vice versa, have a good idea about which ratios you will calculate and have identified key bits of information in the narrative.
For the group question, again read the requirements and consider the time allocation between the various parts. Skim read the information and identify the group structure. For example, it could be a parent, sub and associate or a vertical group or a parent with a sub that is disposed of during the year that then becomes an associate.
For each paragraph / bullet point of information identify what it relates to and annotate this in the margin, or annotate how it will impact on your answer. For example, fair value adjustments impact on sub’s net assets at acquisition and goodwill. Impairment will impact on goodwill, retained earnings and maybe NCIs. For any points of information that you are not sure about, put a question mark by it so that you leave it until the end when answering the question. Again, this process will enable you to identify those parts of the question you feel more confident about and so will help you tackle the question in an appropriate order when you come to answer it.
Why not go and try this approach now with the November 2012 exam and see how much that precious 20 minutes could help boost your marks.
Tagged: CIMA F2