Assessment Report

Level 3 Accounting 2021

Standards 91404  91406  91408

Part A: Commentary

Candidates who engaged with the context of the questions and who are familiar with a variety of entities were able to achieve higher grades across all Level 3 papers.

Candidates need to understand the ‘why’ as well as the ‘how’ of processes for company and management accounting.

Part B: Report on standards 

91404: Demonstrate understanding of accounting concepts for a New Zealand reporting entity

Examinations 

The examination included three questions. Each question referred to the resource information provided relating to Kathmandu Holdings Limited: a New Zealand reporting entity. Candidates familiar with the Level 3 Appendix of the Accounting Teaching and Learning Guide and the terminology used in the New Zealand Equivalent to the IASB Framework for the Preparation and Presentation of Financial Statements (New Zealand Framework, 2018), as stated in the Assessment Specifications, were able to apply the resource information appropriately to answer the questions as required.

Observations 

Candidates who attempted each question, were familiar with New Zealand reporting entities’ annual reports, and applied the resource material about Kathmandu Holdings Limited in their evidence reached higher grades.

Grade awarding  

Candidates who were awarded Achievement commonly:

  • used the Kathmandu Holdings Limited resource material in their answers
  • applied the resource material to the concepts in each question. 

Candidates whose work was assessed as Not Achieved commonly:

  • did not use the Kathmandu Holdings Limited resource material in their answers
  • missed out questions or parts of questions.

Candidates who were awarded Achievement with Merit commonly:

  • made detailed reference to the Kathmandu Holdings Limited resource material in their answers
  • understood the concepts being asked about, for example, the difference between limited liability for ‘general public’ shareholders and directors with shareholding in Kathmandu Holdings Limited
  • understood that recognition criteria refer to when an expense can be recognised in the statement of comprehensive income rather than what defines the expense in the first place
  • were familiar with the different measurement bases used by reporting entities such as historical cost and fair value.

Candidates who were awarded Achievement with Excellence commonly:

  • Comprehensively integrated the Kathmandu Holdings Limited resource material in their answers, demonstrating clear understanding of the different concepts and their application to a New Zealand reporting entity’s annual report.

 91406: Demonstrate understanding of company financial statement preparation

Examinations 

The examination included three questions. The assessment specifications indicated that candidates may be asked to prepare full financial statements, financial statement extracts, or extracts from the notes to the financial statements. These are also the requirements of EN5 of the standard.

Question One focused on selecting company accounting entries as specified in Explanatory Note 5, and as stated in the Assessment Specifications.

Question Two required the preparation of a full cash flow statement.

Question Three required the preparation of an extract from the statement of financial position.

The questions included a component requiring the explanation and justification of accounting entries (Question One) or entries in the financial statements (Questions Two and Three).

Observations 

Candidates who could explain and justify the accounting entries and entries in financial statements demonstrated understanding at Merit and Excellence level.

Candidates familiar with company terminology, accounting entries, and financial statements were able to attempt all the questions contributing to gaining Achievement for this standard.

Grade awarding 

Candidates who were awarded Achievement commonly:

  • completed some accounting entries and / or adjustments correctly for each question
  • classified items correctly within the financial statements.

Candidates whose work was assessed as Not Achieved commonly:

  • missed out questions or parts of questions
  • were unfamiliar with company terminology used in accounting entries and financial statements.

Candidates who were awarded Achievement with Merit commonly:

  • completed the majority of accounting entries and / or adjustments correctly for each question
  • understood the impact of accounting entries and / or adjustments on the financial statements.

Candidates who were awarded Achievement with Excellence commonly:

  • engaged fully with the resource material for each question so their accounting entries and financial statements had few, if any, errors or omissions: making them fit for purpose.
  • justified the impact of accounting entries and / or adjustments on the financial statements.

 


 91408:  Demonstrate understanding of management accounting to inform decision-making

Examinations 

As per the Assessment Specifications all three questions related to management decision-making for the same entity. Each question provided opportunities for candidates to apply management decision-making.

Observations 

Candidates familiar with the management accounting terminology related to CVP analysis and cash budgeting demonstrated their understanding of management accounting to decision making for an entity. Candidates exposed to a wide variety of contexts were better able to apply the unfamiliar examination context when answering the questions, and were more likely to attain Merit and Excellence grades.

Grade awarding 

Candidates who were awarded Achievement commonly:

  • completed several management accounting calculations correctly
  • used the context in their answers
  • used financial and non-financial information to support their decisions.

Candidates whose work was assessed as Not Achieved commonly:

  • missed out questions or parts of questions
  • were unfamiliar with company terminology.

Candidates who were awarded Achievement with Merit commonly:

  • completed most management accounting calculations correctly
  • used detailed contexts to support explanations of management accounting concepts and the cash budget
  • used detailed financial and non-financial information to support their decisions. 

Candidates who were awarded Achievement with Excellence commonly:

  • integrated accurate management accounting calculations and financial and non-financial information relevant to the context into the justification of their decision.

 

Accounting subject page

 

Previous years' reports

2020 (PDF, 301KB)
2019 (PDF, 340KB)
2018 (PDF, 139KB)
2017 (PDF, 60KB)
2016 (PDF, 254KB)

 
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