Writing assumptions is important for getting full marks in CPA Canada cases, specifically in the quantitative (quant) type of AOs. In this guide, you’ll learn how to write assumptions the correct way, with tips on mastering this aspect of the case writing.
Are assumptions necessary?
Assumptions are necessary whenever there are uncertainties in quants (often there are lots!). It’s rare that you’re given a quants AO where all numbers are straightforward and there are no estimates or doubts. For this reason, you should write assumptions for every quants AOs. This is even more important for PM elective and CFE.
Below is an example from a recent CFE Day 1 case. You’ll see that it requires providing financial implications or quant considerations, like assumptions, as part of the marking rubric:
Below is an example of how assumptions could be written for Day 1:
You’ll notice that:
- It’s point form
- There are only 4 bullets (3-4 assumptions is acceptable)
- Unknown and uncertainties are included
- Other considerations, such as constraint, is included
So in summary, you should always write assumptions when you’re solving quants. Keep it point form, only a few bullets, and include any other considerations that are relevant, like constraints, user preferences, company objectives.
What about CFE Day 3?
Similar to CFE Day 1, assumptions are needed in CFE Day 3 quants whenever there are unknowns or uncertainties. Although it’s not a separate MPI (minimum proficiency indicator) in the Feedback Guide, it’s required when you have calculations that have uncertainties.
Below is an example from a CFE Day 3 case Feedback Guide:
Below is how you would write assumptions for this case:
The same rules apply towards CFE Day 2 common MA AOs, PM elective, Tax elective and Core 2. Write assumptions similar to above to support your quants and ensure you get a C.
Extra resources
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