A frequent obstacle for students preparing for CPA Canada’s PEP and CFE exams is whether is an AO needs need to be discussed both quantitatively (quant) and qualitatively (qual), or just quantitatively (quant). Here’s my strategy on approaching these AOs correctly.
How to tell if both quant and qual are needed?
There are two triggers that you can use to find out whether you need to write quant, qual or both:
- The way required is phrased.
- Information in the appendix.
Let’s take a look at these one by one.
Look at the required’s wording
The phrasing of the required is a hint how to approach it. For example, if it says: “Please prepare a quantitative analysis and provide a recommendation”, then it’s quants only.
If it says: “Please prepare a qualitative analysis and provide a recommendation”, then it’s qual only.
When it says: “Please prepare a quantitative and qualitative analysis, and provide a recommendation.”, then it’s both.
Below is an example from CFE W2C case where they requested both:
Clearly, both quant and qual are needed.
Look at the information in the appendix
Second trigger is the type of information provided in the appendix. If the appendix contains qual data, it’s a clear hint that qual information should be incorporated into the analysis.
For example, below is a case with make vs. buy required:
The required is ambiguous and doesn’t tell us if we need quant, qual, or both. So we’ll look at the Appendix:
The first part has lots of numbers, which we’ll use for quants. The rest of the appendix is full of words such as: extremely strong, impossible to break, safer, long lasting, survey.
These are all qual terms, so the only possible reason they’ve given this information is to have us prepare a qual analysis.
Conclusion
In summary, if the required says “quant and qual,” or the information in the appendix has qual items, then you need to perform both quant and qual. However, if the required explicitly asks you not to perform qual, or there are only numbers in the appendix, then perform quants only.
Extra resources
Extra resources are available at PEP and CFE Review courses.
