2010 Paper by Paper Guide

CIMA 2010 SyllabusThe definitive paper by paper guideA detailed guide to the new CIMA 2010 syllabus for students taking future exams, including paper by paper information and knowledge gaps between the existing and new syllabus.

We hope over the past twelve months that we have given you enough information to get ready and get set for the new CIMA 2010 syllabus. It’s now time for you to get ready to go!

Following our recent survey to students, it’s clear you wanted to know what’s new, what’s been removed and what the knowledge gaps are for each paper. In this guide, you’ll find exactly that, as well as lots more helpful information about each paper. It goes without saying that the knowledge gaps will all be covered in our new redesigned courses for 2010.

In addition, from this guide you’ll also get:4 A summary of each paper4 A full breakdown of the syllabus4 The weighting for each syllabus area to your final exam mark4 Information about the exam, including format and timings

Don’t forget, we’re sending out updates to students about the CIMA 2010 syllabus change so make sure you’re registered by visiting www.bpp.com/cima/2010

Good luck with your studies in 2010 and remember, we’re here to give you maximum support through the syllabus change.

It’s time to get ready to go!

Syllabus change - quick facts4 It’s the same number of papers4 It’s the same number of exam sittings4 No changes at CIMA Certificate level4 Paper names are changing – similar content but with some changes4 New Operational and Management level – existing Managerial level split in

two4 Successful passing Operational level = Diploma in Management Accounting4 Clear link between work based practical experience and the Test of

Professional Competence in Management Accounting (formerly TOPCIMA) exam

Your journey through the new CIMA Qualifi cation

Award - CIMA Diploma in Management Accounting

Award - CIMA Advanced Diploma in Management Accounting

Award - Member of the Chartered Institute of Management Accountants

Part AInitial Professional Development - Work Based Practical Experience

Part BCase Study Examination based on

pre-seen and unseen material

T4 - Test of Professional Competence in Management Accounting

Pre-requisite entry requirements (eg CIMA Certificate in Business Accounting, degrees in business or accounting or AAT Technician/Diploma level).

Award - CIMA Certificate in Business Accounting

Paper E3Enterprise Strategy

Paper P3Performance Strategy

Paper F3Financial Strategy

Paper E2Enterprise Management

Paper P2Performance Management

Paper F2Financial Management

Paper C01

Fundamentals of Management Accounting

Paper C02

Fundamentals of Financial

Accounting

Paper C03

Fundamentals of Business

Mathematics

Paper C04

Fundamentals of Business

Economics

Paper C05

Fundamentals of Ethics,

Corporate Governance and

Business Law

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Paper P1Performance Operations

Paper F1Financial Operations

Enterprise pillar Performance pillar Finance pillar

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This paper addresses several business functions and will introduce you to the economic, social and political context of international business. The business functions you will address are information systems, operations management, marketing and managing human capital. You will look at major developments in each function as well as the tools and techniques important to them.

E1 (previously P4) - CIMA 2010 syllabus change

E1 Enterprise Operations

What’s new in Enterprise Operations?

A brand new Syllabus Area called ‘Global Business Environment’. This covers the international aspects of today’s dynamic corporate world, looking at topics like multinational markets and economies, offshore outsourcing, the changing face of regulation and impacts on corporate governance.

What’s gone from the old P4 syllabus?

Change Management has moved in its entirety to the new E3 paper. The scope of Managing Human Capital has also been reduced (from 30% to 20% of the syllabus).

4 Explaining the social, political and economic context of business

4 Analysing the relationship between the internal governance of the firm and external sources of governance and regulation

4 Discussing the wider business context within which information systems operate

4 Analysing how information systems can be implemented in support of the organisation’s strategy

4 Explaining the relationship of operations management to other aspects of the organisation’s operations

4 Applying tools and techniques of operations management

4 Explaining developments in marketing

4 Applying tools and techniques used in support of the organisation’s marketing

4 Explaining the relationship of Human Resources (HR) to the organisation’s operations

4 Discussing the activities associated with the management of human capital

Our study options towards E1 are designed to focus on the most important aspects of the syllabus including:

Paper E1syllabus summary

Topic Weighting

A The Global Business Environment 20%

B Information Systems 20%

C Operations Management 20%

D Marketing 20%

E Managing Human Capital 20%

About the exam

4 Written exam

4 Three hours (plus 20 minutes of pre-exam reading time)

4 Three sections

• Section A (20 marks) – variety of compulsory objective questions, each worth between two and four marks. You may be given a scenario that relates to a group of questions

• Section B (30 marks) – six compulsory short answer questions worth five marks each. You may be given a short scenario which applies to some or all of the questions

• Section C (50 marks) – one or two compulsory questions. You may be given a scenario relating to the questions

Syllabus structure

P1 Performance OperationsThis paper will introduce you to the tools and techniques that generate information needed to evaluate and control present and projected performance. You will forecast key variables and evaluate potential uncertainties about future events. Budget construction then uses the budget in conjunction with costing systems in order to evaluate actual performance. Similarly, project appraisal requires future financial projections to evaluate expected performance and actual outcomes. You will explore both concepts with the emphasis on the critical importance of optimising cash flow. The final section of the paper continues this theme with a focus on working capital management.

P1 (name unchanged) - CIMA 2010 syllabus change

This paper has probably seen the most significant changes in the transition to the new syllabus.

What’s new in Performance Operations?

4 Project appraisal (NPV/IRR) and dealing with uncertainty constitute 40% of the new P1 syllabus, topics previously examined in their entirety in P2.

4 The management of short term finance has also come into P1 from the old P7 paper, now making up 20% of the new P1.

4 The majority of the fundamental cost accounting techniques remain in P1, although environmental accounting is a brand new sub-topic in the new syllabus.

What’s gone to make space for all of this?

4 Process costing is no longer in the P1 syllabus at all (although still covered at Certificate Level in C01).

4 The majority of the discussion around different budgeting techniques has moved out to P2, as has performance measurement techniques like non-financial performance indicators.

4 The whole syllabus area on Control and Performance Measurement of Responsibility Centres has also moved to P2, so new syllabus P1 students will not have to deal with transfer pricing just yet.

4 Discussing costing methods and their results

4 explain the role of MRP and ERP systems

4 Apply principles of environment costing.

4 Explain the purposes of forecasts, plans and budgets

4 Prepare forecasts of financial results

4 Prepare budgets based on forecasts

4 Prepare information to support project appraisal

4 Evaluate project proposals

4 Analyse information to assess the impact on decisions of variables with uncertain values

4 Analyse the working capital position and identify areas for improvements

4 Identify short-term funding and investment opportunities

Our study options towards P1 are designed to focus on the most important aspects of the syllabus including:

Paper P1syllabus summary

Topic Weighting

A Cost Accounting Systems 30%

B Forecasting and Budgeting Techniques 10%

C Project Appraisal 25%

D Dealing with Uncertainty in Analysis 15%

E Managing Short Term Finance 20%

Syllabus structure

About the exam

4 Written exam


4 Three sections




F1 Financial OperationsIn Paper F1, you will learn how to prepare full financial statements for a single company and also principal consolidated financial statements for a simple group. This will cover a wide range of international standards. In order to ensure that financial statements meet the users’ needs, you will also learn about the regulatory and ethical context of financial reporting. The Principles of taxation are covered to support accounting for taxes in financial statements and as a basis for examining the role of tax in financial analysis and decision-making in subsequent papers (Paper F2 Financial Management and Paper F3 Financial Strategy).

F1 (previously P7) - CIMA 2010 syllabus change

4 Under the new 2010 syllabus F1 Financial Operations replaces the old P7 Financial Accounting and Tax Principles.

4 The syllabus changes have been generally good news for this paper.

4 F1 has lost the Managing Short Term Finance area of the syllabus. The topics covered within this area were: working capital and the operating cycle, cash flow forecasts, cash management, borrowing and investing, receivables and payables, and managing inventory. These have all moved to paper P1, Performance Operations where they are a much more logical fit.

4 F1 has gained a couple of new topics – professional ethics and basic group accounts.

4 Professional ethics is a brand new topic which is often covered alongside audit, one of the topics which remain unchanged in this paper.

4 With regards group accounts - under the old syllabus students were introduced to this in paper P8 Financial Analysis, the paper that was the natural follow on from P7.

4 Now you will get a gentle introduction to group accounts in F1 and then move on to develop this knowledge by covering the more complex aspects of group accounts in F2 Financial Management.

4 The tax element of the paper remains unchanged.

4 Explain the types of tax that can apply to incorporated business, their principles and potential administrative requirements

4 Explain fundamental concepts in international taxation of incorporated business

4 Prepare corporate income tax calculations

4 Apply the accounting rules for current and deferred taxation

4 Explain the need for and methods of regulating accounting and financial reporting

4 Apply the provisions of the CIMA Code of Ethics for Professional Accountants

4 Prepare the full financial statements of a single company and the consolidated statements of financial position and comprehensive income for a group (in relatively straightforward circumstances)

4 Apply international standards dealing with a range of matters and items

Our study options towards F1 are designed to focus on the most important aspects of the syllabus including:

Paper F1syllabus summary

Syllabus structure

About the exam

4 Written exam


4 Three sections




Topic Weighting

A Principles of Business Taxation 25%

B Regulation and Ethics of Financial Reporting 15%

C Financial Accounting and Reporting 60%

E2 Enterprise ManagementPaper E2 will move from the emphasis on functional knowledge in Paper E1 towards a holistic and integrated view of management across the organisation. You will be building on important concepts in strategic management and identifying the key types of competitive environment through tools and techniques. Finally, you will look at project management and team management with the legal aspects of managing individuals and the softer elements of negotiation and leadership skills.


The three major areas covered in this paper have not changed in the new syllabus – they remain Management of Relationships, Strategic Management and Project Management.

At the detailed level, the major change is the addition of material on the competitive environment. In line with CIMA’s approach of pushing more knowledge down from strategic level papers, this has moved from the old P6. It includes Porter’s Diamond and competitor analysis. Management of the finance function and management of professional relationships have moved in from P9.

To balance this, corporate governance and corporate social responsibility have moved to E1. There is also a reduced emphasis on management styles and techniques, with topics such as time management, information gathering and managing conflict being removed from the syllabus.

4 Discuss different competitive environments and key external characteristics of these environments

4 Discuss developments in strategic management

4 Discuss tools and techniques of project management

4 Evaluate the relationship of the project manager to the external environment

4 Discuss concepts associated with the effective operation of an organisation

4 Discuss the activities associated with managing people and their associated techniques



Topic Weighting

A Strategic Management and Assessing the Competitive Environment 30%

B Project Management 40%

C Management of Relationships 30%

About the exam

4 Written exam


4 Two sections

• Section A (50 marks) – Five compulsory medium answer questions worth ten marks each. You may be given a short scenario which applies to some or all of the questions

• Section B (50 marks) – One or two compulsory questions. You may be given a short scenario relating to the questions

Syllabus structure

P2 Performance ManagementIn Paper P2, you will focus on the application of information in managing processes of decision-making, control and performance optimisation. The first two sections introduce you respectively to the key contributors to operational performance – revenue (how to make a decision of what to produce at what price) and cost (how to manage them to maximise profitability). In the final two sections, you will then look at the control in monitoring, improving performance and the principles and practices in the use of responsibility centres and budgeting.


4 60% of the current P2 syllabus topics remain in P2 under the new syllabus.

4 Investment appraisal and risk and uncertainty are no longer in P2 instead featuring in the new P1 syllabus.

4 There are 2 new syllabus areas in P2. These are:

• Budgeting and Management Control

• Control and Performance Measurement of Responsibility Centres.

4 Broadly, the topics concerned here are feedback / feedforward control, rolling budgets, flexible budgets, behavioural impacts of budgeting, beyond budgeting, performance measurement using financial and non financial indicators, performance measurement within decentralised businesses and transfer pricing. These were all previously examined within P1.

4 Discuss concepts of cost and revenue relevant to pricing and product decisions

4 Analyse short-term pricing and product decisions

4 Discuss pricing strategies and their consequences

4 Evaluate techniques for analysing and managing costs for competitive advantage

4 Explain the principles that underlie the use of budgets in control

4 Evaluate performance using budgets, recognising alternative approaches and sensitivity to variable factors

4 Discuss the broader managerial issues arising from the use of budgets in control

4 Discuss the use of responsibility centres in devising organisation structure in management control

4 Discuss information suitable for management decision-making in responsibility centres

4 Discuss the broader managerial issues arising from the division of the organisation into responsibility centres.



Topic Weighting

A Pricing and Product Decisions 30%

B Cost Planning and Analysis for Competitive Advantage 30%

C Budgeting and Management Control 20%

D Control and Performance Measurement of Responsibility Centres 20%

Syllabus structure

About the exam

4 Written exam


4 Two sections


• Section B (50 marks) – One or two compulsory questions. You may be given a scenario relating to the questions

F2 Financial ManagementPaper F2 extends the scope of Paper F1 where you will move to more advanced topics in financial accounting and developments in external reporting. You will prepare full consolidated financial statements and deal with more complex issues in the principles of accounting standards. The advanced material provided in this paper will allow you to achieve more meaningful analysis and interpretation of accounts.


The syllabus content of Paper F2 is almost identical to that of the old syllabus equivalent, Paper P8.

New topic

IFRS 2 Share-based payment is examinable in the new paper. This topic has not been examinable under the old syllabus.

Technical changes

A number of accounting standards have recently been revised and these revised versions become examinable from the first sitting of the new syllabus. The standards affected are:

4 IAS 1 Presentation of Financial Statements

4 IFRS 3 Business Combinations, and

4 IAS 27 Consolidated and Separate Financial Statements

The changes introduced in IAS 1 have a wide-ranging effect, as they change some of the layouts and terminology used in preparing financial statements. If you have already studied Paper P8 under the old syllabus you will notice a number of changes to aspects of group accounting as a result of the revisions to IFRS 3 and IAS 27.

4 Prepare the full consolidated statements of a single company and the consolidated statements of financial positions and comprehensive income for a group (in relatively complex circumstances)

4 Explain the principles of accounting for capital schemes and foreign exchange rate changes.

4 Discuss accounting principles and their relevance to accounting issues of contemporary interest

4 Produce a ratio analysis from financial statements and supporting information

4 Evaluate performance and position

4 Discuss contemporary developments in financial and non-financial reporting



Topic Weighting

A Group Financial Statements 35%

B Issues in Recognition and Measurement 20%

C Analysis and Interpretation of Financial Accounts 35%

D Developments in External Reporting 10%

Syllabus structure

About the exam

4 Written exam


4 Two sections


• Section B (50 marks) – One or two compulsory questions. You may be given a scenario relating to the questions

Paper E3 continues with the integration of skills across functions and focuses on developing the knowledge and skills used in designing and implementing strategy. You will explore how strategy is developed in a context and how it can be affected by the organisation’s external environment and stakeholders. Implementing strategy involves tools and techniques associated with change management. You will cover tools and techniques which will assist in the evaluation of the performance implications of a given strategy.


There have been some significant changes to the old strategic level Business Strategy (P6) paper in the CIMA syllabus. A summary of the main ‘ins’ and ‘outs’ for the new Enterprise Strategy (E3) paper are outlined below:

In: Change Management – this was formerly found in the old managerial level paper P4 OMIS. The syllabus content looks similar covering well known theories such as Lewin’s ‘forcefield analysis’ and ‘unfreeze, move, refreeze’ model. However questions in E3 will focus on your ability to identify the triggers for change and advising on how to implement strategic change.

Out: Making room for change management is ‘assessing the Competitive Environment’, this being pushed down to the replacement paper for Integrated Management called Enterprise Management. As such an awareness of environmental analysis models such as Porter’s Five Forces, Porter’s Diamond, and PEST will be assumed in E3

4 Evaluate the key external factors affecting an organisation’s strategy

4 Evaluate the impact of information systems on an organisation

4 Advise on important elements in the change process

4 Evaluate tools and methods for successfully implementing a change programme

4 Recommend change management processes in support of strategy implementation

4 Evaluate the process of strategy development

4 Evaluate tools and techniques used in strategy formulation

4 Evaluate the tools and processes of strategy implementation



E3 Enterprise Strategy

Syllabus structure

About the exam

4 Written exam


4 Three sections

• Section A (50 marks) – Four compulsory answer questions worth fifty marks. You will be given a pre-seen case study and unseen case material. (Note: The pre-seen case study is common to all three of the strategic level papers i.e Paper E3, P3 and F3)

• Section B (50 marks) – Two questions from a choice of three worth twenty five marks. You may be given a short scenario which applies to some or all the questions

Topic Weighting

A Interacting with the Competitive Environment 20%

B Change Management 20%

C Evaluation of Strategic Options 30%

D Implementation of Strategic Plans 30%

P3 Performance StrategyYou will explore two key issues which underpin Paper P3 – what financial and non-financial risks face the organisation and how those risks can be managed and controlled? The paper provides you with the management strategies of risk identification and management which involves establishing and monitoring appropriate systems of internal control. With the growing importance of ‘new’ sources of risk, you will pay particular attention to risks arising from governance, ethical and social/environment issues.


The overall theme of P3 remains unchanged – this paper deals with risks that organisations face and how they can be controlled. The syllabus topics are also unchanged.

At the detailed level, most of the syllabus changes are minor and are not expected to change the content examined very much. CIMA have introduced a new learning objective alongside Corporate Governance, which is evaluating ethical issues as a source of risk and control mechanisms for their detection and resolution. Ethical issues have always been a part of P3, but this may indicate that it will have an increased emphasis in the new syllabus.

One topic has been removed from the syllabus, which is the role and management of the Treasury function, including how it should be organised. This has been transferred to Paper F3, Financial Strategy.

4 Evaluate control systems for organisational activities and resources

4 Evaluate types of risk facing an organisation

4 Evaluate risk management strategies and internal controls

4 Evaluate governance and ethical issues facing an organisation

4 Discuss the importance of management review of controls

4 Evaluate the process and purposes of audit in the context of internal control systems

4 Discuss corporate governance and ethical issues facing an organisation

4 Evaluate financial risks facing an organisation

4 Evaluate alternative risk management tools

4 Evaluate the benefits and risks associated with information-related systems.



Topic Weighting

A Management Control Systems 10%

B Risk and Internal Control 25%

C Review and Audit of Control Systems 15%

D Management of Financial Risk 35%

E Risk and Control in Information Systems 15%

Syllabus structure

About the exam

4 Written exam


4 Two sections



F3 Financial StrategyPaper F3 will introduce you to the key elements in managing the organisation’s financial strategy to achieve its objectives within the external constraints such as the general regulatory and investment environment. You will cover the features and implications of a full range of major financing instruments and investment decisions. These decisions will help you to take account of financial analysis in the context of the broader strategic issues.


What’s new?

The only new area is ‘short-term hedging strategies’ which appears in section A of the syllabus, this area was covered in the old syllabus in paper 3 risk and control strategy and is still covered in the new syllabus version of this paper (paper P3 Performance Strategy).

What’s gone?

Management of the finance function has been moved to paper E2 Enterprise Management - but note that discussion of the Treasury function is still examinable in this paper.

4 Discuss potential strategic financial objectives, and the relationships among and constraints on the elements of financial strategy

4 Evaluate the financial strategies and objectives of an organisation and the extent of their attainment

4 Evaluate the financing requirements of an organisation and strategies for meeting those requirements

4 Discuss the treasury function

4 Evaluate investment choices

4 Evaluate opportunities for merger, acquisition and divestment

4 Evaluate procedures for investment projects



Topic Weighting

A Formulations of Financial Strategy 25%

B Financing Decisions 30%

C Investment Decisions and Project Control 45%

Syllabus structure

About the exam

4 Written exam


4 Two sections



Test of Professional Competence in Management Accounting78% of our TOPCIMA students pass their exams*

The Test of Professional Competence in Management Accounting (formerly TOPCIMA) comprises two component parts that you must complete.

4 Part A - Initial professional development and work based practical experience

4 Part B - Case study examination

Credits are used to measure success, rather than marks. To pass the Test of Professional Competence in Management Accounting, you must achieve an aggregated minimum of 75 credits – comprising a minimum of 50 credits for Part A (maximum 50 credits) and a minimum of 25 credits for Part B (maximum of 50 credits).

You should undertake Part A and Part B concurrently, although either can be taken in any order once you have completed Strategic level. The overall result for the Test of Professional Competence in Management Accounting can only be given once you have completed both parts.

*Based on 840 students sitting TOPCIMA on PC in September 2009

CIMA 2010 syllabus change

Currently, students who complete The Test of Professional Competence in Management Accounting exams obtain the ‘Passed Finalist’ title until they complete submission of their practical experience. New changes going forward mean that there will be increased importance placed on also having completed the practical experience requirements. The title “Passed Finalist” will no longer be in use and students will have to complete both exams and practical experience requirements in order to receive recognition of this qualification.

Syllabus structure

You must gain a minimum of three years’ relevant work based practical experience. Experience may be drawn from any of the following three areas shown in the table below, but a minimum of 18 months must be gained within the ‘Core’ area.

You must record your practical experience within a Career Profile and submit this to CIMA for assessment. Your approved Career Profile is awarded 50 credits – the amount needed to meet the requirements for Part A of the Test of Professional Competence in Management Accounting.

Part A

The examination is based upon a case study that is set within a simulated business context relating to one or more fictionalised organisations. However, the context described in the case material is based on a real business or industry.

The examination comprises a three hour assessment of competence, completed within a supervised examination environment. It provides you with an integrated test of syllabus content that is mainly included within the three strategic level papers – E3, P3 and F3. However, it will also draw upon content you have covered within the Management and Operational level papers. The Case Study Examination therefore has no specific syllabus content of its own.

The Case Study Examination primarily involves your application of strategic management accounting techniques to analyse, recommend and support decisions. You will be required to deal with material in a less structured situation than those encountered in previous strategic level papers, and to integrate a variety of skills to arrive at a recommended solution. It is unlikely that there will be a single right answer to such a complex business problem, and you will be expected to recognise the possible alternatives in dealing with a problem.

The emphasis will be on assessing your capabilities and competence in the application of appropriate, relevant knowledge, the ability to demonstrate the higher level skills of synthesis, analysis and evaluation, and skill in effectively presenting and communicating information to users.

Part B

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2010 Paper by Paper Guide