As you’re preparing for your CPA Canada exams, including the CFE, you may feel that CPA modules are very fast-paced. How do you build technical review into your already packed study schedule? This guide offers simple tips to efficiently study Financial Reporting (FR) and Management Accounting (MA) concepts and boost your performance on the CPA exams.
Technical Study Tips and Tricks
There are lots of resources and you don’t have a lot of time! Choosing the right material to focus on can be tricky. To make the most of your time, focus on 2-3 reliable sources and stick with them while you prepare for the exams. For example, you can focus on:
As you’re reviewing these materials, it’s important that you develop your personal notes. We’ll look at developing flashcards and summaries.
Flashcard is a small card that has information written on it to help you learn and learn. One side has a question or a term, and the other side has the answer or explanation. For example, one side of the card might have a term, like “Equity,” and the other side might have the definition: “Ownership interest in the assets after deducting its liabilities.”
If you’re in Capstone 2, take advantage of CPA Canada’s flashcards! These are given for free in the module. You can print them out, review the contents, and add your personal notes. This is a strategy that has been used by many CPA honour roll students in the past.
If you’re in Core 1, Core 2 or elective modules, you can build the flashcards yourself by writing down key terms, formulas, and concepts from the module readings and practice cases.
Another effective strategy is to create short, simple summaries of key topics. Here’s an example for a FR topic:
For FR technicals, align your summary with the relevant standard per the CPA Canada Handbook. Identify important criteria from the handbook like definition, measurement, recognition and disclosure, and write down notes in your own words. This method helps you not only review the technical content but also practice locating information in the Handbook.
Here’s an example for a MA topic, a make vs. buy decision, which requires net present value or NPV calculation:
To make sure you really understand the concepts, shuffle through your flashcards and summaries and practice recalling the criteria and steps without peeking. This study method is called “active recall” and it’s been proven by cognitive science as an effective study strategy.
Financial Reporting Study Tips
There’re a lot of FR concepts you are required to know for the CPA exams, especially CFE, so FR study should make up a large chunk of your review. To avoid getting overwhelmed, start by identifying commonly tested FR topics. Focus on these first and gradually add more as you progress through the modules.
For theoretical subjects like FR, it’s important that you don’t just memorize, but also understand the concepts. As you’re reading, ask questions:
- How does it compare to other standards?
- Why do we recognize this way?
- How is it different from other criteria?
- Under which scenario can this standard be tested?
Once you understand the concept deeply, you can then choose to memorize the standard or look them up in the Handbook. For standards that are simpler, I suggest to memorize to save time on the exam. For example, topics such as inventory, non-monetary transactions, related party transactions, impairment, ASPE revenue recognition, and so on, can be memorized to save time during the exams. For others, practice navigating the Handbook so you’re ready to find what you need quickly.
Also, make sure you understand FR technical under both IFRS and ASPE. For example, if your notes are based on IFRS, include a section that highlights the ASPE differences.
Management Accounting Study Tips
MA is a very practical subject, like mathematics and calculus. It’s not much about knowing the theory, but on understanding the terms and following the correct formula/approach.
Being a practical subject, I don’t recommend reading too much of the theory. Instead, first understanding what the terms mean. For example, what does “joint costing” really mean? What does “machine overhead” men? Understand these by reviewing the examples in your readings and ask your CPA facilitator or tutor if you don’t fully understand. Secondly, build notes of how to solve these problems step-by-step (see sample picture above). Lastly, do lots of practice through exercises, drills, practice problems and cases. Write cases and if time permits re-write the MA sections of past cases too. As part of your debrief, identify what kept you from scoring a C and think of strategies to improve your speed on each type of MA AO. For example, can you format your quantitative analysis for a cost allocation AO more efficiently? Identify changes and add these points to your notes and summaries.
Extra Resources
In addition to developing strong case-writing skills, having solid FR & MA technical knowledge will prepare you to tackle these AOs on the CPA exams with the depth and speed necessary to score Cs. Regularly practice applying your FR and MA technical knowledge by writing cases. As you debrief, think about whether you’ve really grasped the FR & MA concepts, and if not, add to your flashcards or summaries and keep going until you are consistently scoring Cs on those AOs.
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