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A big part of getting ready for CPA Canada exams is reviewing your practice case attempts and checking how well you did. Even if your cases are marked by CPA Canada, CFE National Marking Centre, or someone else, marking them yourself helps you get better at case writing and seeing where you need to improve. Self-marking lets you find out what you need to study more, where to cut out extras, and areas you need to focus on to ensure you pass the exams. Marking own cases also gives you quick feedback, so you can keep moving with your studies without having you wait for feedback from the experts.

Materials needed

To get started with marking your own case, first gather all the resources you need. These include:

• Your response (both Word and Excel)
• Feedback guide
• Official solution
• Case
• Sample strong answer (if available).

Feedback guides are one of the most important tools in self-marking. They are provided in CPA Canada’s PEP modules and the Capstone 2. If you are missing the feedback guides, you can purchase it from CPA Canada’s RMM module.

Some modules also offer walkthrough guides and debrief notes. I find these too time consuming to review, so I suggest skipping them unless you have a lot of available time. For example, if you’re working full time and studying during evenings and weekends, you won’t have time to review these extras, so you can skip them, but if you’re studying full-time, then you can use them.

Feedback guides explained

In the CPA Canada marking centers, including the CFE Marking Centre, exam papers are graded using a Performance Matrix. These are not the same as the PEP and Capstone feedback guides, but they are similar. As the Performance Matrix is not publicly available, the feedback guides are the next best resource we have to determine your grade.

The feedback guides are typically in Excel and show the marking scheme. They break down the case into assessment opportunities (AOs), which is a fancy way of saying the problems in the case you are expected to find and solve. For each of these AOs, there are minimum proficiency indicators (MPIs), which tell you what exactly you needed to write to achieve a specific grade. The following grades or “rankings” are available:

• Not addressed (NA)
• Not competence (NC)
• Reaching competent (RC)
• Competent (C)
• Competent with distinction (CD)

To pass the CPA Canada exams, you need a mix of C and RC. Achieving a CD doesn’t give extra points in the exam so it’s best not to aim for that grade, instead use the extra time to firm up the other AOs.

The feedback guides across the PEP modules and Capstones are consistent, but there are slight differences. For example, if you are self-marking Day 2 of the CFE, there will be a different feedback guide based on your chosen role. CFE Day 1 also has its own unique feedback guide and grading scheme.

The biggest value of feedback guides is learning what exactly is required to get to RC/C. This will help you find what is unnecessary in your writing and should be removed. For example, in CFE Day 2, the “issue” statement is not in the feedback guides, this teaches us that it doesn’t give any marks, so it can be removed or kept brief.

Using CFE Day 2 RMZ as an example, let’s look at AO#1, which is about revenue recognition.

The gray area on the bottom tells us what is needed for each of the grades. For example, to get C, you needed yes on revenue recognition criteria + yes on conclusion + yes on adjustment/journal entry. These specific items (revenue recognition criteria, conclusion, adjustment/journal entry) are the MPIs that we spoke about earlier.

A student who achieved a C grade would have the feedback guide fill out like this:

You’ll notice there are “x” boxes on MPI#1 (“Discusses revenue recognition criteria”) in 3 discussed lines and 2 attempts. As per this feedback guide, to achieve a “discussed” or “Y” (Yes), at least 3 discussed X’s are needed, out of which 2 must be in Step 2 and Step 4. This specific student hit those areas, so they received a Y. Another student may have gotten “x” in Steps 1,3,4,5, but not in Step 2, in which case they would not receive “Y”, they would get “P” (Partial). The lesson here is that some areas in the technicals are more critical than others. For example, when you’re answering IFRS 15 rev. rec. AOs, put more emphasis on Steps 2 and 4 to ensure you get a discussed grade.

A student who achieved RC grade would have the feedback guide fill out like below:

So in a nutshell, the self-marking process is like this: Go through your case attempt, give yourself “X” for every line you attempted or discussed, then give yourself a final grade (ie, C, RC, NC, NA) based on the ranking scheme. Seems pretty easy, so why do students request external marking?

The complexity is in determining what exactly is attempted or discussed. This is a gray area. The exam markers go through extensive training to learn how to use professional judgement when evaluating cases. This is why Canadian CPA exams are subjective, which makes them harder to prepare for compared with other international accounting exams.

Here’s guidance to help you differentiate discussed and attempted:

• For qual items, answering “so what”, “why” and “how” means discussed, while point form or generic writing is attempted. Generic means not using case specific information.
• For quant calculations, writing assumptions, providing support for calculations, and having your calculations close to the correct answer means reasonably calculated, while missing these means attempted.

Additionally, each feedback guide will define what is “discussed” or “attempted” in that specific AO. For example, in the RMZ AO#1, discussed means having: “Technically correct discussion of the step, incorporating case facts as support. Reasonable supporting calculations are provided, where applicable.”

This means you must:

• Use the correct Handbook criteria
• Conclude as “met” or “not met”
• Explain why you concluded as met/not met using case facts
• Provide calculations where needed.

Steps to self-marking & debriefing

Here’s a step-by-step guide to self-marking and debriefing. First, open your case attempt (Word/Excel), the feedback guide, the case file and the case solution. You can have all these printed out or on your computer. If it’s on your computer, a good tip is to have at least 3 monitors so that you can put everything side by side. Experienced CPA Canada NMC (National Marking Centre) markers have up to 4 or 5 monitors so that they can quickly grade hundreds of cases.

Once you have the above materials ready and open, follow the steps below. 

• Step 1: Determine if you addressed the AO: As a first step, you want to confirm if you identified the correct AOs. Any AO missed will result in NA. Scroll through the feedback guide, compare with your answer, and give yourself NA for areas that you missed. If you have any missed AOs, then open the original case file, read through it again and try to find the trigger for that AO. Once you find the trigger, you can either: 1) read the solution, or 2) try to answer this AO to the best of your ability. Your grade will still be NA, but this will let you practice your technical skills as opposed to just reading the solution. Quick tip on case writing: When you’re writing cases, separate each AO (with titles, bolding, underling) so that you and the CPA exam marker can identify your AOs in the lengthy memo.
• Step 2: Mark the AO using a “step-down” approach: Reviewing the requirements (ie, MPIs) in the feedback guide, go top-to-bottom and give yourself a grade for each AO. The goal is to achieve RCs or Cs. If you have doubts on your score, always rank down as it’s likely the CPA markers will also score you at the lower level.
• Step 3: Debrief with the solution: For every AO not ranked at C, you need to determine how your response can be improved to move up to the C level. This is a critical step in improving your technicals and case writing so that you can perform better on future cases. Compare your attempt for each specific AO with the solution and debrief the following in writing:
  • What you missed
  • What you wrote extra
  • Where did you have errors (technical or calculation)
  • Why did you have these errors
  • How can it be improved in the future
• If you didn’t print your case and you’re self-marking on the computer, use “track changes” or a different colour font (i.e. red) to write yourself feedback. Your feedback can also include how much additional time you think you should have added to the AO to perform better. Here’s an example of feedback from a marker which you can replicate for yourself:
• 
• Step 4: Summarize and optimize: Once you have self-marked and debriefed all the AOs in the case, you will then create a summary of performance on the entire case. Write down the areas you did well, the areas you struggled with, and how exactly you will change your approach for the future AOs and cases. You can write this summary in a separate notebook, on the bottom of the feedback guide, on the original case file, or any other resource accessible to you. You can also create an Excel tracking file that tracks your performance on all cases. You should be reviewing the summary and the tracking file often so that you are reminding yourself of your successes, mistakes, and where to focus. For instance, you may discover that you’re constantly getting C in Management Accounting, but NA/NC in Taxation. This is a sign to spend extra study time on Taxation.

It’s important to note that there are different ways to self-mark and debrief, the above is one suggested approach that I find works well with most students. If you find that another methods works better for you, you should adapt and use that method. For example, if you find that you learn better by comparing your attempt with the sample strong answer, as opposed to the official solution, then use the sample strong answer instead.

Why you’re not getting C (Competent)

There are several reasons why you’re not getting a C , including:

• Time management – Not enough time allocated to the AO. You might have understood the issue and how to solve it but did not have the time to provide your full analysis.
• Lack of technical knowledge – You did not include the necessary criteria or formulas to achieve a C. Maybe you remembered the recognition criteria but missed discussing the definition criteria first.
• Missing conclusion or recommendation – For pretty much all AOs, a conclusion on your analysis is required to achieve C. You need to recommend the best course of action for the user, whether this be an adjustment entry, to pursue an opportunity or not, to adjust their organization structure and so on.
•  Not enough depth – Your response did not include enough explanations. This is the tricky part where a judgement is needed to determine if you got discussed (which is the same thing as depth) or attempted.
• Lack of case facts – To achieve C, you need to not only need to provide the correct technical, but make your discussion specific to the case. For example, it’s not enough to say that the revenue recognition criteria is “MET” because the contract price is known. Instead, link it to the case to explain why/how (i.e. did the case provide you with the dollar amount of the exchange?). Using RMZ as an example, notice how the analysis links to the units and price, which are specific to the case:

Conclusion

Preparing for CPA Canada exams means actively self-marking and debriefing your practice cases. This process helps to improve your technicals and case writing skills, highlighting areas that need more focus. The feedback guides let you estimate your grade and learn why you didn’t score C. Find a self-marking and debriefing method that fits your learning style and ensure you do it immediately after practicing a case, without waiting for external feedback so that the insights and areas for improvement are fresh in your mind.

Extra resources

CPA Canada PEP and CFE professional case marking services are offered by the Gevorg CPA Team. Please contact us to learn more.

As you’re gearing up for your CFE exam in the CPA Canada’s education program, it’s important to plan what you’re going to study and when, so that you’re on track and efficiently prepared. This article will help you create a study plan that’s both flexible and focused, helping you cover the necessary material without feeling overwhelmed.

Step 1: Choose the CFE

As a first step, you’ll need to pick which CFE offering you’ll be writing. Currently, CFEs are offered in May and September. Taking into account your work schedule, personal commitments, finances, and study pace preferences, decide which offering suits you best. I recommend the May CFE exam for most students who are allowed by their employer to take time off in spring.

Step 2: Figure out your learner profile

A “learner profile” is the category of CFE writer based on your program status. You can be:

• First-time writer
• Internationally trained accountant (MRA/MOU)
• Experienced writer – Day 1 only
• Experienced writer – Days 2/3 only
• Experienced writer – Days 1/2/3

First-time writers, and others, who are taking Capstone 2 will receive a Capstone 2 Calendar. This is a good starting point to build you study plan as it shows the 8-week module with case submission deadlines and study activities.

Step 3: Write out your inputs

To build an effective study plan, we need to know how much time you have available. Think of all your commitments and write it out in a document. Be specific, don’t write “personal errands”, write the specific item, what day(s) of the week you do it, and the time commitment. For example:

• Work
• Commute
• Exercise
• Health activities (eg dentist appointment)
• Walk the dog
• Cooking
• Family dinner
• Toastmasters meetup
• Take kids to daycare

These are going to help you determine how much study time you have and how to balance you professional, personal, and educational commitments. If you find that your list is lengthy and there is not much time left for studies, I suggest outsourcing some the tasks to family members and others living with you (eg roommates). For example, you can delegate walking the dog and cooking so that you’re not responsible for it during the study period and free up more study time.

Step 4: Sort out your study leave

If you’re like most CFE writers, you will have weekends and weekday evenings available for studies as you’re likely working full time. These alone aren’t enough to effectively prepare you for the CFE, so you’ll need to ask your manager for additional time off or “study leave“. Nearly every student writing the CFE gets some type of study leave, be it paid time off, use of vacation time, or unpaid time off. In public practice, the large firms give 8 weeks time off to their staff, which is one of the reasons I recommend writing the CFE in May as opposed to September. The average time off requested by CFE writers is 3-8 weeks from my experience, so you should try to get something in this range.

You may end up with as much as 5 or 6 weeks, or as little as 2 or 3 weeks. The more time you have, the better. As of the date of writing this article, we have 50+ past CFE exam cases available; it’ll take you really long time to cover them all. If you didn’t get at least 3 weeks off, negotiate with your manager for additional time. For example, you can offer to complete key projects ahead of the leave period or work overtime when you return to catch up on tasks.

If you don’t win the negotiation, it’s no a reason to quit your job. While time is the most valuable resource in the preparation for the CFE, the utilization of your time is more important. For example, you may get 8 weeks study leave, but if you don’t start deep studying until 2-3 off before the exam, than you may as well had 3 weeks off.  

Step 5: Allocate resources

The bread and butter of studying for CFE is practicing cases and debriefing. Past exam cases are going to be the main inputs in your study plan. While Capstone 2 provides cases for practice, these are only the recent CFEs so I recommend adding more cases in your plan. I suggest practicing cases from older to newer. You can start from year 2018 CFE and work your way up to the most recent ones. You’ll learn most technicals from debriefing, as long as you do it properly, but I also recommend adding a few technical review days to your plan.

Once you start mapping out the cases (see the next step below), you may discover you’ll be out of time and won’t get the chance to write the most recent CFE exam. In that case, drop the oldest case and start the plan from the next oldest CFE. For example, remove 2018 and start the plan from 2019 to see if everything fits. Note that Capstone 2 doesn’t provide the most recent CFE cases/solutions and these not released until a year late, you can consider getting the solutions I’ve written as a substitute.

If you hired a tutor, coaching program, or partnered with a study buddy, these will be additional resources that will be added to the study plan. For example, you should add the time it takes to attend tutoring sessions, watch case walkthrough videos, and attend calls with your study group or study partner.

Step 6: Map the study weeks

The next step is mapping out the inputs and resources. Choose a platform, such as Excel, Word, Google Sheets,Google Docs, etc. and add a calendar template. For example, you can download free Word / Excel calendar templates from this website.

Begin by mapping out which cases you plan to write each week leading up to the exam. If you’re taking Capstone 2, make sure to use the Capstone 2 Calendar in conjunction so that it’s aligned with your deadlines. I recommend coding the cases based on the CFE year, for example: “Day 2 2018”, “Day 2 2019”, “Day 3 2023 May”, “Day 1 Version 1”. Have a listing of cases in another tab or document, similar to below, so that you can keep track of your progress:

I also suggest allocating Day 2 cases for the weekends and Day 3 cases, plus technical review, for weekdays. You won’t be able to accomplish much during the week as you’ll be tired from work so allocate no more than 1-2 Day 3 cases from Monday – Friday until you get to full-time study leave.

For the full-time study leave, allocate more cases and less technical review. It will be all about practicing cases, debriefing, having your cases marked (by Capstone 2 or your tutor) and debriefing again.

Step 7: Be flexible

Life happens. Keep flexibility in your study plan for unpredictable events in your life. I suggest adding “Flex days” every other week to catch up on errands and any materials that require extra time to review. This approach ensures that you can adapt to unforeseen circumstances without compromising your overall preparation strategy.

To give you a guideline, a Day 2 practice and debrief will typically take a day and a half. Same for Day 1, it’s about the same length (Day 1 4 hours, Day 2 5 hours), so allocate day and a half for Day 2 and Day 1 case practices. A single Day 3 case will take a few hours to write and debrief, depending on its length, so allocate 1/2 or 1/4 of a day.

Conclusion

The goal of the study plan is to give you a roadmap to successfully navigate the preparation process and to help you stay on track. It’s important to set realistic goals and manage your personal life. I’ve seen many students fail the CFE because something personal happened and they missed several days and weeks of studies. Be sure to speak with your household members and set the right expectations with them so that you’re on track to pass the CFE. This clear communication ensures that everyone understands the importance of your CPA designation, reducing disruptions and supporting your journey to success.

Extra resources

Extra CFE resources are available at CFE Review course.

Update: CPA Canada 2024 pass rates are now available, you can find it at this updated post.

CPA Canada has now released the 2023 PEP and CFE exam pass rates. The 2024 pass rates will be released in February 2025.

2023 CFE Pass Rates

Below are the official exam pass rates as reported by CPA Canada:

CFE Offering	Cumulative Pass Rates
	First Attempt	Second Attempt	Third Attempt
May and September 2023*	70.5%	n/a	n/a
May and September 2022*	71.3%	n/a	n/a
May and September 2021*	73.6%	n/a	n/a
September 2020	75.8%	n/a	n/a
September 2019	76.3%	87.4%	n/a
September 2018	77.6%	87.5%	90.8%
September 2017	77.6%	88.1%	90.6%
September 2016	76.8%	88.6%	91.4%
May 2016	68.7%	75.4%	79.9%
September 2015	82.9%	94.6%	96.6%

*In 2023, 2022 and 2021, there were two offerings of the CFE. The 70.5%, 71.3% and 73.6% pass rates are the combined averages of the first-time writers in both the May and September CFEs. Overall, there is a decrease of 1-2% year-over-year, with 2023 CFE pass rate of 70.5%.

2023 PEP Pass Rates

CPA PEP Module	2023 Pass Rate	2022 Pass Rate	2021 Pass Rate	2020 Pass Rate	2019 Pass Rate
Core 1	72.1%	74.0%	77.1%	81.9%	79.4%
Core 2	78.4%	82.5%	85.3%	86.2%	84.3%
Taxation	87.6%	87.5%	88.1%	88.0%	88.1%
Assurance	87.6%	89.7%	90.5%	89.1%	89.2%
PM	90.2%	89.5%	90.9%	90.7%	90.6%
Finance	87.1%	87.2%	89.1%	89.0%	89.9%

There is a notable decrease in Core 1, Core 2 and Assurance pass rates, while other PEP modules stayed flat in 2023.

PEP and CFE Exam Coaching

My name is Gevorg. I’m an instructor and CPA exam coach. If you need helping passing your CPA Canada exams, contact me for consultation or check out my courses.

 

 

When studying for the CPA Canada CFE, many candidates find time constraint to be one of the most challenging aspects of passing the exam. One way to save time is to skip the unnecessary parts of the “CPA Way” template that are not part of the marking rubric. Let’s look at Financial Reporting (FR) AOs to understand whether you need to write the issue statement or whether it can be skipped.

CFE Feedback Guide Review

Using the CFE Day 2 “RMZ” case feedback guide, you’ll see that writing an issue statement doesn’t grant any marks towards the AO: 

Instead, to get a C grade, you should be starting with analysis of the CPA Canada Handbook IFRS 15 criteria (i.e. 5-steps of recognition).

This is true for most AOs in CFE, so the issue statement can be skipped in your memo to save time.

However, it’s not all about time management – you still need accuracy, depth, consistent conclusions, and effective formatting. Let’s look at whether there are any reasons to still write the issue statement.

When to write Issue statement

While it doesn’t explicitly give you marks, there are several reasons to still take the time to write out the issue statement.

First, writing the issue statement can help in your case planning step. As you write down the AOs when you complete your initial read of the case, writing what exactly the issue is will help you determine how much time should be allocated to that AO. For example, if the issue statement is lengthy with multiple sub-issues, then you need to allocate more time. If the issue statement is short, you should allocate less time.

This issue statement used for planning can also be used as the start of your answer’s framework. You can build up your answer by using the issue statement as a framework and avoid duplication of work. It also ensures that you remember exactly what to address when the time comes to write your response. 

Additionally, writing an issue statement tells the marker that you have a clear understanding of the issue. It is also the foundation of your analysis and will help guide you on what criteria should be addressed. For example, for RMZ’s R&D issue, the issue statement outlines the current treatment of capitalization and the issue being whether it should be capitalized or expensed.

This is a short issue statement that does the job and helps to structure the answer.

Writing the issue statement also helps you build a solid conclusion / recommendation by acknowledging the current treatment of the item and what adjustment is necessary to treat the item correctly. For example, since RMZ’s issue was capitalization, we can conclude by directly addressing the issue and explaining what portion should be capitalized vs expensed.

Conclusion

While the issue statement is not directly required to get a competent (C) grade in CFE, it indirectly helps in structuring your response, ensuring a proper approach, and accurately writing your conclusion. So I recommend to always include short issue statements in your CFE case responses.

Extra CFE resources are available at CFE Review course.

When preparing to write and pass Day 1 of CPA Canada CFE, you’ll encounter many questions on the exam format. One of the most common questions I receive from my students is how many competent (“C”) grades are needed to successfully pass CFE Day 1. This article will help you understand how Day 1 is marked and which AOs are crucial.

Day 1 marking

Unlike PEP cases and CFE Days 2 & 3, CFE Day 1 is structured and marked differently. In addition to AOs (assessment opportunities), Day 1 has SAs (summative assessments). Unlike other CPA cases, which are marked as competent (“C”), reaching competent (“RC”), and so on, Day 1 is marked as: Yes, No, or Marginal/Partial. So there is no such thing as “getting RC in Day 1” or “getting C in Day 1”, grades will be either: Yes, No, or Marginal/Partial.

Day 1 always has 8 AOs and 5 SAs. The 8 AOs in Day 1 are: Situational analysis, 4-5 strategic issues, 1-2 operational issues, conclusion, and communication.  The 5 SAs are: Situational analysis, overall strategic and operational issues, conclusion, communication, and overall assessment.

Day 1 feedback guide

Using a past Day 1 case , let’s review the marking process.  A standard Day 1 strategic issue is separated into two components: quantitative and qualitative analysis. To achieve “Yes” on the AO, a reasonable attempt in both is required. For the quantitative part, you will get a “Yes” if you make a reasonable calculation. For the qualitative, a “Yes” is given when enough pros/cons are written and there’s depth.

What I find typically holds candidates at “Marginal” is the lack of depth in their qual. Depth means explaining why it’s a pro/con, how does it impact the company, and what it means for the users. This is an important concept and I cover it thoroughly in my Day 1 exam preparation program.

Another challenge I see students make is identifying the correct quants tool. You don’t need a perfect calculation, but you do need to find the right quants tool. A good trick is to use the company objectives and appendix information to find the correct quants tool.

The above example illustrates the marking of strategic issue AOs. For the marking of situational analysis AO, please refer to this blog post.

Your overall Day 1 mark

Day 1 is holistically marked as a pass or fail for the entire Day 1 exam. You will also see Marginal Pass and Marginal Fail when practicing cases, but this mean the same thing as “Pass” and “Fail” when it comes to passing. 

Looking below at the criteria for a “Marginal Pass” (the minimum you must get to pass the exam), you must achieve “Yes” on 1 strategic issue, on communication AO, and “Partial” on all other AOs.  Since you must get “Partial” in all remaining AOs, it is critical to balance time for each AO throughout the 4-hours and not miss any AOs.

It’s also important to avoid any of fatal flaws that will result in an overall failure. These include missing big picture (eg. constraints), not providing useful qualitative/quantitative analysis, not having a balanced analysis, or not providing recommendations / conclusions. For example, all recent Day 1 exams had cash flow constraints. This meant that while several strategic issues were acceptable, they required capital investments above the total cash available. You had to consider what is more aligned with the strategic direction of the company and recommend only those.

In conclusion, doing well on Day 1 of the CPA Canada CFE means knowing how Day 1 is graded and studying smart. Make sure you learn how to write qual in-depth,  how to find the right quants tool, and understand the concept of big picture issues. 

Extra resources

Extra Day 1 resources are available at CFE Review course.

If you have experience working with budgets or forecasts, you should target MA2 in your CPA Canada PERT reporting. It’s an area that anyone exposed to budgets or forecasts can get at least Level 1, if not Level 2. When I’m helping students pass PERT, I’m surprised how few target this area. It’s structured methodically, doesn’t take much character space, and you automatically get exposure to it during the budget season.

If your role doesn’t include budgets or forecasts, you should chat with your manager. Go into their office or send a Teams message asking if you can assist at the next budget cycle. Getting exposed 1-2 times is enough to get Level 1 if written correctly.

Here’s a breakdown on how to answer MA2 in PERT and a full example.

What’s MA2: Preparing operational/financial budgets, plans and/or forecasts

Every company creates a budget. MA2 is all about that: Preparing budgets (or forecasts) for your company. This includes different types of budgets/forecasts:

• Operational
• Master (financial)
• Project (eg construction project)
• Flexible
• Static
• Cash

The type of budget that I’ve seen most success in getting Level 2 is the operational or master (financial) budget. If your exposure is in project budgeting, you will need to write an additional paragraph explaining how your project budget integrates into the overall financial budget for the year.

There are three parts to the process of creating budgets or forecasts:

• (1) Preparing inputs
• (2) Calculating the budget/forecast
• (3) Performing variance analysis.

These 3 parts form the template for your MA2. Let’s break them down.

1) Preparing inputs

The inputs are the specific items you put in the budget. Examples of inputs:

• Activities to perform (eg. research, market analysis, development, product launch, staff training, monitoring)
• Resources required
• Sales price
• Cost of materials and labour
• Monthly expenses
• Capital expenditure
• Debt interest
• Tax rates
• Employee salaries
• Various expenses
• Inventory levels and costs

You need to write that you analyzed inputs for the budget/forecast. Start by picking 2 specific inputs (like the ones above) and write how you analyzed them to see if it makes sense to use them in the budget/forecast. You need to include:

• 1) Examples of inputs
• 2) Sources of input (where did you get the input?). Example: ERP, CRM, project manager, department head.
• 3) Assumptions you made. Example: I considered annual inflation rates and industry-standard salary increases. For sales price, I assumed a steady market demand.
• 4) Reasonableness (how did you know it’s accurate/reasonable?). Example: I cross-referenced the inputs with internal ERP data and external market reports, and consulted with department heads for reasonableness.

2) Calculating the budget/forecast

Once the inputs are ready, the next step is to prepare the actual budget or forecast. In this step, we want to cover these details:

• 1) Scope (are you responsible for the entire budget/forecast, or sections?): Example: As my company is large, I’m responsible for specific sections of the budget: the head office and regional distribution centers.
• 2) Scale (do you prepare for the full company, or operating unit/project?): Example: I prepare for the entire organization.
• 3) Steps (what exactly do you do?). Example: My task involves collecting, analyzing and evaluating data from various departments (eg. HR, accounting, marketing, sales), assessing reasonableness, adjusting for projected changes, and consolidating this information into the final budget. Specifically, I gather data from internal systems like our ERP and CRM platforms, departmental reports, and my direct communications with department heads. The data is in Excel format. I then analyze this data for trends, reasonableness, and potential changes before inputting into the final budget. This analysis helps in accurately forecasting revenues, expenses, and resource needs. My final step is synthesizing all these into a detailed budget proposal, which is then presented to executives for approval. 

3) Performing variance analysis

The third and final step is to perform a variance analysis. This is done after the budget/forecast is finalized and actual results are in. You need to write 2-3 specific examples of variance analysis you did. Common mistake I see CPA students make here is that they miss the implications of their variance analysis. In this step, we will cover these:

• 1) Steps (how do you perform variance analysis?)
• 2) Variance #1
• Implication
• 3) Variance #2
• Implication
• 4) Variance #3
• Implication

How much exposure do you need for Level 2?

For a large company, you can be performing budgeting/forecasting for few complex sections. For a smaller and medium-size company, you need to be involved for the majority of the budget/forecast.

Frequency and complexity are important too.  You will need to write what judgement factors you used for evaluation and the frequency (monthly, quarterly, annual). We’ll add this to the bottom of the template.

MA2 template and full example

Below is a template and full example covering MA2. It’s important that you don’t directly copy the example below. This is is against CPA Canada’ s plagiarism policy. Use below as a reference and write your own original example.

1) Inputs: I start the budget preparation and evaluation task by analyzing inputs:

• Examples of inputs: I analyze sales price (revenue) and wages expense.
• Sources of input: I gather the inputs from the company ERP, CRM,  and holding meetings with department heads.
• Assumptions. In my analysis, I considered annual inflation rates and industry-standard salary increases. For sales price, I assumed a steady market demand.
• Reasonableness: I cross-referenced the inputs with internal ERP data and external market reports, such as economic forecasts by StatsCan, to assess reasonableness. I checked the consistency of these inputs against historical data trends and future forecasts.

2) Calculating budget

• Scope: As my company is medium-size, I’m responsible for the entire financial budget.
• Scale: I prepare for the entire organization.
• Steps: My budget analysis and evaluation task includes collecting and analyzing inputs from various departments (eg. HR, accounting, marketing, sales), adjusting for projected changes, and consolidating this information into a comprehensive budget. I gather inputs from the internal systems (ERP and CRM), departmental reports, and my direct communications with department heads. The data is in Excel format. I use two tabs in Excel: the first has the inputs and the second has the draft budget. I use VLOOKUP and Pivot table to calculate the budget. I analyze inputs for trends, reasonableness, and potential changes, before calculating the draft budget. My analysis helps in accurately forecasting revenues, expenses, and resource needs. My final step is synthesizing all these into a detailed budget proposal, which is then presented to executives for approval. 

3) Variance analysis

• Steps: Once the actual results are ready, I perform VA by comparing the budgeted figures against the actual. I do my analysis in Excel using formulas such as VLOOKUP, XLOOKUP and Pivot table. I identify and quantify differences to find areas of financial overperformance/underperformance and to adjust future budgets, thus helping the company meet its targets.
• Variance #1: I evaluated wages expense budget vs actual. I looked at each department’s actual salaries and compared to the budget, considering factors like overtime, new hires, and turnover rates. I found that overall wages were higher than budgeted due to increased overtime in the distribution centers.
• Implication: I recommended increasing hiring for the next fiscal period. The implications of my analysis on the business are improved cost management, meeting customer delivery targets, and more accurate staffing projections for next FY.
• Variance #2: I evaluated revenue budget vs actual. I analyzed sales volumes, pricing strategies, and market conditions that impacted our revenue. I found that actual revenues were below budget, mainly due to lower-than-expected sales volumes.
  Implication: I recommended revising pricing strategies and sales targets. The implications of my analysis on business are enhanced revenue forecasting and strategic sales planning, specifically lowing the price of low-performing products for market penetration.
• Variance #3: I evaluated marketing expense budget vs actual. I compared the budgets of 4 marketing campaigns against the actual spend and the effectiveness of these 4 campaigns. I found that 2 campaigns outperformed in terms of ROI while the other two underperformed.
• Implication: I recommended reallocating funds to high-performing campaigns next FY. The implications of my analysis on the business are more efficient use of marketing resources and improved ROI on marketing activities.

Frequency: I’ve performed the above budget analysis and evaluation for 2 annual budget cycles.

Complexity: My budget and variance analysis are complex because they required research, interpretation, and judgment. The budgets are complex because they involve multiple departments, variety of expense categories, and the need to balance short-term operational needs with long-term strategic goals. This complexity was higher last year due to dynamic market conditions (high interest rates) and internal company factors, such as layoffs and new ERP system implementation, which required me to update the spreadsheets and the budgeting models to match the new system outputs.

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The above is a level 2 example because it has 2 annual budget cycle exposures and it follows the PERT guidelines as needed. Level 1 example will follow the same format, but it would have less frequency (1 cycle) and lower complexity. The above example is ~4,300 characters, which is within the 5,000 limit.

More PERT templates and examples

Full CPA PERT templates and examples are available at PER Review success program.

Pass the Performance Management (PM) elective in the CPA Canada PEP program can be challenging. Candidates often face dilemmas regarding the best strategies for tackling cases effectively. Below are some common questions I receive, with practical strategies to improve your exam results.

1. Depth of first read-through of case

I suggest to start your PM case with a brief overview. This means flipping through the pages, eyeballing the information. As you’re doing this, focus on the number of appendices, the titles of appendices, tables/graphs/charts, and any potential hidden Assessment Opportunities (AOs). Indicators of hidden AOs are question marks or phrases like “Can you please…”.

Use a highlighter or pencil to write your assumptions about each appendix. For example, if the title of the appendix is “Board Composition”, write: “SG – WIR BOD”. This step helps to get a general sense of the case without getting bogged down in details.

2. Narrative and Appendices

After flipping through the pages, the next step is a detailed read of the narrative and any appendices that continue the narrative, such as “industry information”. Your goal here is to gain a clear understanding of the AOs. While you’re doing, you’re also creating an outline. When it comes to outlining cases, simplicity is key. The outlines, or “skeletons,” should be concise, made of headings and bullet points. This helps to keep a structured yet flexible framework to build your answer.

Once this is done, quickly read remaining appendices with 2 goals:

• (1) Identify hidden AOs
• (2) Connect each appendix to identified AOs

Notice that you don’t read the remaining appendices in detail at this stage yet. You’re quickly reading it to find hidden AOs and connecting each appendix to your identified AOs.

Once this is done, your next step is to create a time budget and allocate time for each AO. Once the time budgets are ready, you will read each appendix in detail and solve the AOs simultaneously. 

In summary, here are your steps to solving the case:

• Step 1: Overview (flip through)
• Step 2: Detailed read of narrative (and industry information) and create case outline
• Step 3: Quick read remaining appendices
• Step 4: Create and allocate time budgets
• Step 5: Rank AOs
• Step 6: Detailed read of appendices and solving simultaneously.

3. Recognizing and prioritizing AOs

Identifying whether something is an AO or not can be tricky. For example, you may read in the narrative: “The company is concerned with meeting profitability targets and opening two new stores”.  Is this an AO? Maybe. We need to look for more clues.

For example, is there a dedicated appendix with profitability targets? If yes and this required has its own appendix, it’s very likely a separate AO. If not, you need to focus on more clear-cut AOs and leave these questionable AOs for later.

Good strategy to handle these questionable AOs is to focus on obvious AOs first and leave questionable ones for the end (“ranking”). Start by solving all obvious AOs, then when you have 5-10 minutes left at the end, solve these questionable AOs. If they end up not being real AOs, it’s not a big loss, since you had spare time. If they end up being real AOs, you protected yourself against an NA and may even get RC since you spent a few minutes solving them.

In summary, the key to PM elective cases is smart reading, efficient planning, concise outlining, and prioritization of AOs. By using these strategies, you’ll be better prepared to tackle the complexities of CPA Canada cases and effectively pass your exam.

Extra resources

Extra PM resources are available at PM Lessons course.

Members of the Chartered Institute of Management Accountants (CIMA) can now apply to become a Canadian CPA under the new Memorandum of Understanding (MOU) issued by CPA Canada. Your only obstacle is to pass the Common Final Exam (CFE) Days 2/3.

Who’s eligible?

To be eligible, you must be:

• Designated: Be fully qualified CIMA member
• Member in good standing: Obtained a membership through completion of the accounting body’s qualification process and not through a recognition agreement with another accountancy body
• University degree: You must hold a university degree recognized by institutions, such as the International Association of Universities or World Education Services (WES), in addition to completing the CIMA program.
• Designated abroad: Obtained your designation while not a resident of Canada (details below).

Do I need to take exams?

Yes, you’re required to pass CFE Days 2 and 3. A maximum of 3 attempts is allowed; failing thrice results in deregistration.

You’re also encouraged to take Capstone 1 and Capstone 2 modules by CPA Canada. However, I don’t recommend taking these modules, because the preparation these provide is geared towards domestic students, not international accountants. For example, Capstone 1 teaches a case study which is tested only on Day 1 of CFE; however, CIMA members are exempt from Day 1, which makes Capstone 1 irrelevant.

Do I need to show proof of work experience?

CIMA members with over 2 years of post-qualification experience are exempt from experience assessment. Those with less than 2 years will undergo a review of their practical experience, both pre- and post-qualification. You can contact me for resources and consultation if you need assistance in understanding how your practical experience aligns with the Canadian CPA requirements.

What if I’m a resident of Canada?

CIMA members who completed/passed the Management Case Study while having been a resident of Canada, or become a resident of Canada, or returned as a resident to Canada, must demonstrate either:

• University degree from a recognized institution outside Canada, obtained through full-time in-person classroom instruction.
• Minimum of 3 years of full-time practical accounting experience outside Canada.

How do I apply?

• Step 1: Start by contacting the CPA body in the province where you intend to work.
• Step 2: Provide necessary documents, including proof of CIMA membership and work experience.
• Step 3: The provincial CPA body will guide you through the assessment and any additional requirements.
• Step 4: Study and pass the CFE Days 2/3 exams.

What’s the format of CFE Days 2/3?

CFE Days 2 and 3 test using a case-study approach. There are no objective format questions, such as multiple-choice questions, only cases. CFE Day 2 is 5 hours long, while CFE Day 3 is 4 hours long. To pass CFE Days 2/3, you must pass both days; passing an individual CFE day will not exempt you from re-writing that day in the next attempt.

Read the blogs posts below on Days 2/3 for further details:

• CFE Study Guide
• Day 2 Format
• Day 2 Study Tips
• What Role To Choose

What challenges will I face?

Unlike the CIMA exams, which focus on management accounting, strategic management, and finance, CFE Days 2/3 test a broader spectrum of competencies, including: financial reporting, assurance, taxation, management accounting, finance and strategy/governance. This comprehensive approach requires more study time and understanding of various exam scenarios. Your main obstacle will be learning Canadian financial reporting (ASPE, in addition to IFRS), Canadian taxation rules, and how to manage your time (because CFE exams are extremely time constrained). 

CIMA exams emphasize strategic decision-making and management functions, whereas the CFE requires an integrated approach, testing on multiple competency areas simultaneously. You must learn how to approach, outline, and correctly answer the exam cases within the time constraint.

As an experienced CPA Canada examination coach, I can provide you resources and strategies to effectively navigate and pass CFE Days 2/3. You can reach out to me for questions and check my CFE Review course for details.

As a designated CPA in Canada, you’re probably aware of the continuing professional development (CPD) requirements necessary to maintain your membership. In this post, I’ll guide you through understanding CPD and how to fulfill your requirements fast and cost effectively.

Understanding CPD hours

CPD stands for continued professional development. It’s a mandatory element for keeping your Canadian CPA membership, and it’s consistent across all provinces. The idea behind CPD is straightforward: as a CPA, your knowledge must remain current in a world where industry standards, regulations and technology are constantly changing. So you’re required to take courses or seminars every year to keep your knowledge fresh. This is CPD in a nutshell.

There are two requirements: (1) yearly minimum requirement and (2) 3-year “rolling” requirement. There are also two categories of CPD: verifiable and unverifiable.

To meet the (1) yearly minimum requirement, you must get a yearly minimum of 20 hours, split evenly between the two (ie, 10 hours verifiable, 10 hours unverifiable). You’ll learn the difference between the two soon.

To meet the (2) 3-year “rolling” requirement, you must get 120 hours in total in three years.

For example, let’s say you got 20 hours in Year 1 and 20 hours in Year 2. So far, you have 40 hours in total and you’re meeting the requirements. In Year 3, you must get 80 hours to get total 120 hours and meet the (2) 3-year “rolling” requirement. If you get only 20 hours in Year 3, you’ll still meet the yearly minimum requirement, but you won’t meet the 3-year rolling requirement, because you’ll have 60 hours in total. 

So I suggest getting 40 hours a year. Getting 40 hours per year (20 hours verifiable, 20 hours unverifiable) guarantees that you won’t need to catch up in any of the years and you’ll always have 120 hours in a 3-year rolling period.

Verifiable vs. Unverifiable CPD

Unverifiable CPD hours are the ones you are not required to prove through documentation: think of activities like reading industry publications, participating in informal learning, watching educational videos, or self-study. Although no evidence is required, honesty is crucial, and you should be prepared to present a log of these activities if audited.

Verifiable hours, on the other hand, require some sort of evidence. This could be certificates of completion from online courses or attendance records from events like seminars or workshops. Activities such as networking or non-accounting related courses don’t count as verifiable nor unverifiable.

Ethics CPD Requirement

Within the 3-year rolling requirement, you must also complete at least 4 hours in ethics verifable CPD. For example, you can take courses, audiobooks, webinars or seminars on:

• Ethical business culture
• CSR
• Whistleblowing
• Anti-money-laundering
• Bribery and corruption
• Regulatory updates
• Corporate codes of conduct
• Independence/conflict of interest

Verifiable: Where to get CPD Hours

Audiobooks and online courses are the fastest and most convenient method for getting verifiable hours. They offer convenience and flexibility, allowing you to learn on the go, such as when you’re commuting to work.

Both CPA Canada and provincial CPA bodies offer courses, however they tend to be pricey. Luckily, you’re not required to take CPD from CPA Canada nor provincial bodies, you can take CPD from any reputable online source.

For example, you can get CPD from the following sources:

• Courses and audiobooks
  • LinkedIn Learning
  • Udemy
  • FastCPD by Gevorg, CPA (coming soon)
• Webinars
  • Eventbrite
• Conferences and seminars
  • Accountex
• Formal education programs (ie. microcredentials, certificate, diploma, or degree at a local college/university)
  • University of Toronto
  • University of British Columba

Unverifiable: Where to get CPD Hours

For unverifiable hours, digital publications and online videos are the easiest ways of getting CPD:

• CPA Canada publications (eg Pivot journal, news, articles)
• Canadian Accountant (news publications)
• LinkedIn articles (accounting, tax, audit and other CPA related subjects)
• YouTube (educational videos related to CPA competencies)
• PERT mentorship
• On-the-job training (for example, you get trained at your workplace on new software, systems, procedures or techniques)

What is NOT considered CPD?

The following don’t qualify for unverifiable nor verifiable CPD:

• Activities that are unrelated to CPA competencies
• Taking language courses
• Networking (for example, social functions, lunches, dinners, etc., these don’t count as CPD, unless you can show there was learning involved, like there was a speaker during the event)
• Volunteering (exception is if the volunteer work is related to one of the above verifiable activities. For example, you can volunteer to be in the Capstone 1 panel and this qualifies for verifiable hours)

Affordable and fast CPD by Gevorg, CPA

I’m excited to announce that I will be releasing engaging and affordable verifiable CPD audio courses in the coming months. Please bookmark this post and check back in December 2027 for updates.

The Capstone 1 Amuzu Parks Inc. (API) case will be tested in September 2024 Common Final Exams (CFE) on Day 1. The original Capstone 1 case has been made available to candidates enrolled in Capstone 1 and released publicly by CPA Canada.

How do I prepare for API case for the CFE Day 1?

On CFE Day 1, you will be presented with the same API case and you will be required to analyze and answer new strategic and operational issues.

Follow these strategies:

• Step 1: Study the Capstone 1 original case well: It’s important that you know the Capstone 1 case inside-out. You will encounter the same users and similar industry challenges. I suggest making notes of the following key situational analysis factors:
  • Users
  • Mission, vision and values
  • Key success factors (KSF)
  • Strengths, weaknesses, opportunities and threats (SWOT)
  • Board objectives
  • Quantitative analysis
• Step 2: Know the Capstone 1 strategic issues: In Capstone 1, API was facing 4 major strategic issues and several minor issues. In the Day 1 CFE exam, you’ll get 3-5 new strategic issues.
• Step 3: Make note of the timeline: CFE Day 1 case is several years in the future and there are new issues to analyze. It helps to stay organized by creating a timeline of events as you are reading the case.
• Step 4: Understand key stakeholder preferences: API case has several users who have opposing views. It’s important that you understand these user preferences as these will repeat in the CFE Day 1.

I strongly recommend practicing with supplemental mock exam cases. In Capstone 2, you will get 3 practice versions of the API case. However, most writers find that this is not enough and feel unprepared.

Where can I get extra API mock exam cases?

I released one (1) original Amuzu Parks Inc. (API) supplemental mock exam practice case to help you better prepare for the CFE Day 1. The mock exam case is a realistic simulation of what you may get on your exam and cover typical AOs that you may find in your Day 1. The package includes the API mock exam case, marking guide and the solution.

Head over to the cases section of my website for a free preview.