PQ ICAEW spotlight
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ix-monthly reviews are a mandatory requirement for all ACA students during a training agreement period. The reviews take place with your qualified person responsible for training (QPRT), counsellor or principal and they provide the perfect opportunity for you to discuss what you have learnt so far and to discuss your progress and development. Here are six top tips you need to know to be best prepared for your six-monthly review: ONE Practical work experience: calculate the number of practical work experience days you have accrued within the last six months. At the review, you will discuss and agree the number of days. Remember, a day is seven hours long. TWO Professional development: review your progress within the seven ladders since your last six-monthly review. If you have met one or more skills, ensure that you have provided adequate examples within your online training file. In order to record a skill as achieved you will need to discuss the skill at the review. Be sure to record the feedback your QPRT, counsellor or principal gives you and add it to your training file. If you are following a three-year training agreement, you should aim to provide examples for all skills around 30 months into your agreement. You should complete the skills relating to the Case Study before you sit this exam. THREE Ethics and professional scepticism: before your six-monthly review assess your ethical development and the progress you have made through the online Ethics Learning Programme. You will need to consider all the ethical scenarios from the Practising Ethics webinars you have viewed to date and be able to discuss one scenario – you will need to be able to discuss a real ethical situation at your review. As you complete a module within the Ethics Learning Programme, remember
Are you prepared for your
six-monthly review? Here are six pertinent tips to help you prepare for your twice-yearly appraisal
to watch the corresponding Practising Ethics webinar. When you have completed the learning programme, you will need to complete the ethics assessment and score at least 70%. Do ask your QPRT, counsellor or principal for permission before taking this
assessment. FOUR Exams: review and prepare to discuss your progress and results so far, any re-sit plans and specific areas of interest or relevance. FIVE Audit Qualification: calculate your audit work experience, if relevant, within the last six months. If you want to become a Responsible Individual to sign audit reports you will need to gain the Audit Qualification. If you haven’t recorded audit experience you have gained to date and obtained the required approvals you will lose the experience. SIX Further guidance: be ready to discuss any areas which you would like to develop, for example, on-the-job guidance, coaching or mentoring. Please note that if your employer is accredited by ICAEW for professional development and/or ethics, you will follow their development programme(s). Access your online training file at icaew.com/trainingfile. It is your responsibility to keep your training file up to date. ICAEW will review your training file as part of an arranged review visit or as a random check. So be sure to keep your online training file up-to-date at all times. If you neglect your training file, you could be putting your ACA qualification at risk. Go to icaew.com/how-to for guidance on how to navigate your online training file and how to log progress, check out the how to use your online training file guide and webinar. PQ • Thanks to the ICAEW for this article
THE TROUBLE SHOOTER IS GUNNING FOR...
The internal rate of return In the first in a new series, PQ’s trouble-shooter Philip Dunn is on hand to help readers who are worried about tackling internal rate of return calculations Question: I am currently studying ACCA F2 and am struggling to understand the significance of the internal rate of return (IRR). Can you help? Answer: Crescent Feeds discounted a project at 15% (its cost of capital) and it had a net present value (NPV) of £3,407. It was then subjected to a rate of 20% that resulted in a NPV of £(9,641). The fact that the NPV at 15% is positive indicates that the project is achieving a discounted cash flow (DCF) return of a least 15%. Whereas at 20
20%, as the NPV is negative, the DCF Return is less than 20%. Here we see a range of present value of £13,048 from £3,407 to £(9,641) and a range of rates of 5% (15% to 20%). The IRR is that point at which the NPV would be equal to zero or the DCF return the project is yielding based on the projections prepared by management and lies somewhere between 15% and 20%. This can be determined by interpolation (formula): Lower Rate % + ((NPV at Lower Rate/Range of NPV) x Range of Rates) 15% + ((3407/13048) x 5) = 16.31% The internal rate of return (IRR) is greater than Crescent Feeds cost of capital and therefore this would be a favourable investment. If the project was discounted at 16.31% the NPV would be approximately zero. I do so hope that this answers your concern. This may also be useful to AAT, ICB and ACCA F5 students. PQ • Philip Dunn is a freelance assessor and author at Kaplan PQ Magazine April 2017