Day 1 on the CPA Canada CFE exam is focused on testing your understanding of strategic analysis and applying this technical knowledge on a single case. This case is based on Capstone 1, set a few years in the future, with a new set of strategic options to decide on. All of these strategic options will require a quantitative analysis, some of which you will need to apply a discount rate. But if the Day 1 exam has not provided you with a discount rate, what rate are you supposed to use? Here’s the answer.

Use Capstone 1 rate

If an updated discount rate is not provided on Day 1, you can use the Capstone 1 discount rate. When you do this, you must also add an assumption highlighting where you obtained this amount from (i.e. Capstone 1 case).

It’s not often that an updated rate in not given in Day 1, they usually provide you with a new rate. However, certain inputs, including the discount rate, may not be updated or reiterated in the case and this has happened in past CFEs. This shows the importance of thorough review of the Capstone 1 case before your exam.

Since you will have access to the Capstone 1 case during the exam, you are expected to reference important details from it. To streamline this process and save precious time during the exam, I recommend you create a cheat sheet containing essential information, with page numbers, for quick reference. This includes the discount rate used in Capstone 1. For example, in the NPF Capstone 1 case below, the discount rate was given in one of the Appendices and this can be re-used in the Day 1 exam if a new rate is not given.

Can you use another rate?

Some CPA solutions use the rate from the objectives as the discount rate. Rates from the Financial Statements, such as the bank interest rate, has also been used. These are also acceptable and can be used instead of the Capstone 1 rate. When you use any of these rates, make sure to state them in the assumptions. 

Why do you need the discount rate?

There are several calculations that could require the use of a discount rate. Some of the more common assessments include:

• NPV: This is the most common quants tool where you use a discount rate. You would perform NPV when determining if a project will generate positive value or not. The NPV analysis involves discounting all future cash flows associated with a project or investment back to their present value using a discount rate.
• IRR: This is another important quants tool used in capital budgeting where you would use the discount rate. The Internal Rate of Return (IRR) is the discount rate that makes the NPV of all cash flows from a particular project equal to zero. In other words, it’s the expected annual rate of return that will be earned on a project or investment. You would calculate the IRR and compare to the discount rate. If the IRR exceeds the discount rate, the project is considered worthwhile as it is expected to generate a positive return. If the IRR is less than the discount rate, the project is likely to be rejected.
• Valuation: When valuing a company or a project, one method that can be used is the discounted cash flow (DCF) analysis. In this case, future cash flows are discounted back to their present value using a discount rate to determine the current worth of an asset or investment. However, Day 1 rarely requires a DCF valuation, most of the time it’s multiples based (eg, EBITDA x5).

Conclusion

In summary, when the discount rate for Day 1 is not given, use the Capstone 1 case discount rate, a rate from the Day 1 objectives, or the rate from another appendix (such as Financial Statements or another proposal). All of these methods are acceptable, just make sure you note it in your assumptions.

Extra resources

If you’re struggling with quants, the Day 1 Quants Mastery toolkit is a valuable resource to practice with.

As you’re studying for CPA Canada CFE and PEP exams, outside of the commonly tested ASPE and IFRS topics, it’s also important to know the Public Sector Accounting Standards (PSAS) and the Accounting Standards for Not-for-Profit Organizations (ASNPO), as these are included in the CPA Canada Competency Map.

What’s PSAB?

The Public Sector Accounting Board (PSAB) is a Canadian organization responsible for establishing accounting standards for the government, crown corporations, and other public entities in Canada. Some examples are the federal, provincial, and municipal governments, such as the City of Toronto in Ontario, Canada. The City of Toronto would be required to report its financial statements, cashflows, and operational results following Public Sector Accounting Standards (PSAS).

The PSAB sets the PSAS, it helps to guide financial reporting to provide accountability and transparency to taxpayers and public funds. They are based on the principles of fund accounting, which emphasizes tracking and reporting funds separately for specific purposes or activities.

The PSAB standards are in the CPA Canada Handbook:

Is PSAB tested on CPA exams?

Public Sector Accounting standards are not typically tested on CPA Canada exams, so you shouldn’t spend too much study time here. However, some topics that could theoretically be tested include:

• Introduction to the public sector accounting handbook (para’s: .02, .04-06, .09, .17).
• Fund accounting principals
• Accounting for government activities such as taxes and grants

What’s ASNPO?

ASNPO are the accounting standards specifically for not-for-profit (NPO) organizations in Canada, such as charities, associations, and clubs. NPOs can be organized and operated for social, educational, religious, health, or professional purposes, without the mission of earning a profit. For example, a community health center in a specific geographic location. These standards are developed by the Accounting Standards Board (AcSB), to meet the financial reporting needs of NPOs to provide transparency to stakeholders and donors (which are the key users).

The standards are in Part III of the CPA Canada Handbook:

They address items unique for NPO organizations, including contributions, collections held, and reporting controlled and related entities. Where items aren’t included in this section, you must refer to ASPE standards.

Is NPO tested on CPA exams?

NPOs have been tested previously, especially in Core 1 and CFE Day 3 cases, so it’s important you practice this standard. The ASNPO is also tested in MCQs of the Core 1 Module. Common AOs tested under these standards include:

• 4400 F/S presentation
• 4410 Contributions revenue rec.
• 4420 Contributions receivable
• 4433 Tangible capital assets
• 4434 Intangible capital assets

For information on how to access both of these standards, check out this post where I discuss the CPA Canada Handbook.

Conclusion

In summary, PSAB focuses on establishing accounting standards tailored to public sector entities, like crown corporations, whereas ASNPO focuses on standards related to not-for-profit organizations, like charities. Each set of standards is custom designed to meet the distinct needs of the sectors and users. Both standards can theoretically be tested on the CPA Canada exams, though less likely for PSAS, and they are covered in the CPA Canada Handbook.

Extra resources

Extra resources are available in Gevorg’s review courses.

Update October 2025: New information released

Please see this NEW October 2025 BLOG POST on the deadlines and updates about the 2027 program.

Introduction

 The much-anticipated CPA Canada New Certification program (NCP), initially slated for 2025, has now been pushed back to 2027. This delay is significant, not just for its impact on timelines, but also for what it means for current and prospective CPA Canada students who must make critical decisions about what educational paths to choose.

Understanding the 2027 delay

Recent communication from CPA Ontario and other CPA provincial bodies have confirmed that the launch of the CPA Canada New Certification Program has been postponed to early 2027. This delay comes from financial struggles in CPA Canada, highlighted by layoffs and the withdrawal of Ontario and Quebec. These internal issues are raising concerns with me about the readiness and robustness of the planned new program.

Below is the communication from CPA Ontario on May 3, 2024:

Will there be CFE in the new CPA program?

Last year, CPA Canada said they want to shift away from the traditional three-day Common Final Examination (CFE). Today’s update suggests this will still be the case.

CPA Canada seems to be planning to offer “summative examinations” that incorporate case-based evaluations,  like the current CFE, but segmented into three different parts.

Below is the Draft Model, it’s not the final model, which in my opinion hints on what the new program may look like:

Above draft model, from 2023 presentation I was part of, proposed a four-level structure. Levels 1, 2 and 4 would have summative exams, similar to what CPA Canada noted in the recent update. The third level won’t have a formal exam but rather an assessment of workplace competencies.

If this draft model holds, it will alter the CPA pathway, giving you more flexibility and reducing the pressure of a single, high-stakes exam.

Additionally, the above draft model is similar to how other accounting bodies around the world hold their exams, which is my opinion is what CPA Canada is shifting towards: they want to align more closely with global standards and practices in the accounting profession.

Will the CPA exams be the same in all provinces and territories?

Yes, CPA Canada exams under the new certification program are expected to be the same across all provinces and territories. This is confirmed by CPA Ontario’s update.

This is beneficial for our CPA profession, consistency will help to maintain a standardized level of knowledge and competency among all Canadian CPAs, irrespective of their region.

Can you switch to the new CPA certification program?

Yes, you can switch to the new CPA certification program once it launches. CPA Canada is creating policies to help you move from the current program to the new one. I expect to see CFEs up to 2028, 2029 and maybe more, until all current students finish the current program and new students start the new program.

The update also said that if you transition, you’ll get exemptions so you won’t have to re-do the exams you already passed, you’ll be placed at a higher level in the new 2027 program.

Can you take the new 2027 program if you didn’t pass CFE three times?

There is no information whether you can register into the new program if you didn’t pass PEP or CFE exams three times and you were de-registered. I will update this as I get new information.

Should you wait or take the exams now?

The big question is: should you wait for the new 2027 CPA program or continue with the current CPA pathway? If you have the flexibility to delay your CPA certification, for example you don’t have CPA program expiry deadline or immediate need for the CPA designation, then I recommend to wait. You’ll get the advantage of seeing what the new 2027 program looks like and deciding which one is easier to pass.

However, if you need to get your CPA sooner, or your program expiry is coming up, it’s better to finish under the existing structure now.

Currently, we have many past exam papers to learn from and practice with, while the new program is new and different, so it may be more challenging to pass the new program, rather than the current one, simply due of lack of past exam cases. This makes the current program more advantageous.

Below is the new Competency Map 2.0 structure that will be built into the new program’s examinations.

Conclusion

The CPA Canada New Certification Program is going to be the biggest change since the unification of CA, CGA and CMA legacy designations in 2014. There’s a delay in the program’s start date from 2025 to 2027 and we know that there will be three summative examinations. It’s not clear now whether there will be CFE-like back-to-back exams or separate exams. The exams will be the same across all provinces and territories and current students can switch to the new program without losing their progress.

I recommend to wait if you can, otherwise continue with the current program and use the past exam papers to your advantage, as these won’t be available in the new program since it’s being built ground-up.

As CPA Canada keeps working on these updates, it’s important to stay updated. If you’re working towards becoming a CPA or thinking about starting, make sure to subscribe to my YouTube channel to stay informed about the changes and how they will impact you. 

 

Tackling the Tax AOs is a daunting task due to the volume of technicals. Studying the Income Tax Act (ITA) can be tough because it’s dense and complex, with lots of divisions, sub-divisions, sections and sub-sections. This article will give you tips to study tax and help you prepare for tax competencies in CPA Canada exams.

Use memorization 

Like the CPA Canada Handbook, you will have access to the ITA during your exams, but being able to find specific information quickly will be tough due to exam time constraints and the massive amount of information in the ITA. My recommendation is memorization of specific formulas/calculations for quants and common theoretic items, like what are the pros/cons of incorporating. Some examples of commonly tested quants and theoretic items you should memorize include:

• Tax income/payable – Individual and Corporate (common items added and deducted)
• CCA formula
• Residency rules
• Employee vs Contractor (the tests)
• Salary vs dividends (common pros/cons)
• Sole prop. vs partnership vs corporation (common pros/cons)
• Sale of assets vs shares
• Loss carry fwd and deadlines
• Tax filing and payment deadlines
• Benefits (impact on ‘er and ‘ee)
• Notice of assessment (NoA)/reassessment
• Sales tax (HST/GST/ITC)

You don’t need to give references to specific sections of the ITA in your answers; you’re only expected to answer technically correct. For example, if you’re asked to discuss the tax consequences of a company’s potential perks, like parking permits, club memberships, transit pass, you don’t have to refer to specific ITA sections for each. You can simply give explanation of the implications to the company and the employees. The requirement is that your explanations must be accurate (for example, transit pass payment is deductible as a business expense to the company and they are a taxable benefit to the employee). Giving technically incorrect answers will not get you RC nor C.

Know the Income Tax Act (ITA)

While memorizing helps, we know there are lots of tax rules and criteria. Therefore, you need to  know your way around ITA and incorporate usage of the ITA into your study routine and exam writing. The following sections are frequently tested and you should practice navigating to these sections in Knotia:

• ITA 2(2), ITA 248(1) – Primary definitions
• ITA 114 – Secondary definitions
• ITA 3(1) – Defines the computation of income for tax purposes.
• ITA 9 – Calculation of income from a business or property
• ITA 18(1) – Limitations on deductions from income
• ITA 39(1) – Capital gains/losses
• ITA 118(1) – Personal tax credits.
• ITA 245(2) – General Anti-Avoidance Rule (GAAR)
• ITA 250(1) – Residency
• ITA 150(1.1), ITA 150 (1), ITA 248(1), ITA 165(1) – Filing requirements/deadlines

Capital Cost Allowance (CCA) is also an important section. This is in Schedule II, on the bottom of ITA.

Use the Exam Reference Schedule 

There are several formulas provided to you during both the PEP exams and the CFE. These will save you time from having to memorize or lookup in the ITA. Below is an example of what’s provided on the CFE:

Other information provided in the reference schedule include:

• How to calculate CCA tax shield
• The individual federal income tax rates include the ranges with the corresponding tax rates.
• Common tax credit amounts. Note that the maximum amount allowable is provided.
• The prescribed interest rate (base rates) for the last 3 tax years, split by quarter.
• The maximum CCA rates for selected classes. Note here that common classes are provided, but not all. Also, there is not a description of each class, so you need to find this section in the ITA (see where above).

The full CFE Reference Schedule is available on CPA Canada’s website. I recommend downloading, printing and reviewing the full Reference Schedule from CPA Canada’s website and use it during your studies.

Conclusion

Understanding the commonly tested topics and the structure of the ITA are crucial skills for success in CPA Canada exams. The study strategies I outlined above—strategic memorization of key tax formulas, understanding the pros/cons of common tax decisions, and familiarizing yourself with frequently tested ITA sections—will improve your ability to navigate the dense material efficiently under exam conditions. 

Extra resources

More tips on how to succeed in the Tax elective are available here. Extra tax resources are available at Tax Review.

While you may be familiar with using the CPA Canada Handbook for Financial Reporting issues, Assurance has its own set of standards to refer to, known as the Canadian Auditing Standards (CAS). But do you really need to study these? Let’s get into it.

Level of knowledge

Unlike FR standards, you don’t need to know CAS standards inside and out. Instead, you should know where to find specific standards in Knotia. This applies to Assurance elective and Assurance role writers in CFE Day 2.

For other modules (Core 1, Core 2, other electives, other CFE roles, CFE Day 3), there’s no need to read the CAS standards at all. The reason is that the CAS standards are very technical and these are not tested in-depth in these other modules. The exception is Core 1, you may get theoretic questions on various audit topics in the MCQ portion, however these can studied from the EBook or the EBook summary notes.

So for all modules, except Assurance elective and CFE Day 2 Assurance role, you should study the commonly tested topics from other simplified resources, such as the EBook. These commonly tested topics include: procedures, assertions, audit planning memo, WIR, audit vs review vs compilation, sampling.

How to use CAS

The CAS standards are located in Knotia, below the Accounting standards.

The sections you need to know are:

• Canadian Standards on Quality Management
• Canadian Accounting Standards
• Other Canadian Standards

The Canadian Accounting Standards section is the largest, but all 3 sections are equally important:

Every CAS is made of an introduction, an objective, and a set of definitions, along with application of the requirements pertaining to the subject.

As noted, these are very technical, written in legal language.

I recommend studying these by reading them in conjunction with other study resources, such as the EBook. Your goal is tie the simplified explanations from the EBook to the CAS in Knotia. For example, Chapter 12 “Planning — Assertions and Procedures- Materiality” in the EBook explains that assertions are in paragraph A190 of CAS 315. Using the “Find” function (CTRL + F, or Command F in Mac) in Knotia, we find this:

Another example is Chapter 11 “Planning – Materiality” in the EBook. It explains that CAS 320 does not specify exact percentages, but it indicates that professional judgment should be applied. Using the “Find” function in Knotia, we see it’s in section A2. We can take a screenshot of this section and save to our notes for future reference.

By doing an initial run through before the exam, we get more familiar with the CAS structure and where the important things are.

Referencing CAS

Do you need to give the specific CAS # during the exams? Yes and no. Here’s what I mean.

For commonly tested Assurance AOs, such as audit planning memo, procedures, control weaknesses, you don’t need to put the CAS #. Instead, use the appropriate format (eg. WIR, RAMP).

For uncommon topics, such as special reporting, going concern, fraud, expert opinion, key audit matter, you do need to specify the CAS. You should reference CAS like you would FR standards, for example: “According to CAS 701…”. Note that I put special reporting in this list because it requires referencing the CAS #, but I would not classify it as uncommon topics otherwise because it’s tested often.

Let’s look at a feedback guide as an example. Using CFE Day 2 case TankCo case, this AO is about the bank requesting that TankCo provides a special report audited by an independent public accountant calculating the provisions of the agreement. You can see that the feedback guide specifically requires you to discuss CAS 805 or CSAE 3530, allowing for one other alternative.

Not putting these reports by CAS # and description will result in a lower than C score. Writing just the CAS # and description will not give you C either. You need to both refer to the correct CAS sections and discuss it. You would discuss it by speaking about the bank’s needs/objectives and explaining pros and cons of the reports, incorporating case facts as support.

For a list of all the special reports, check out this blog post.

Conclusion

In summary, if you’re in the Assurance elective or writing the CFE Assurance role, you should study CAS by reading a simplified assurance study resource and linking it to technical CAS standards. You should become familiar with the layout of CAS in Knotia, including where to find key information, how the CAS are structured, and how to navigate through it.

Most of common assurance AOs tested in the CPA Canada exams require you to use formats, rather than CAS, such as the audit planning memo and control deficiencies. For the complex assurance AOs and special reports, you need to know the specific CAS requirements and how to apply them effectively.

Extra resources

Simplified CAS summaries, including special reports, are available at CAS Summaries resource.

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.