How do I decide whether an accounting error also creates an audit issue?

First determine the correct recognition, measurement or disclosure and quantify the difference from the draft statements. Then identify the affected assertion, such as completeness for an omitted liability or valuation for an overstated asset. Consider the amount alongside its nature and context, obtain evidence that addresses the assertion, and ask management to correct the error. If it remains uncorrected, assess its effect individually and with other misstatements before reaching a reporting conclusion.

Why can a project with positive accounting profit have a negative NPV?

Accounting profit includes noncash charges and follows accrual timing. NPV uses incremental cash flows, their dates and a discount rate reflecting the project’s risk. For example, an investment of 100 that returns cash of 60 in each of two years has an NPV of approximately 4.13 at 10%: 60/1.10 + 60/1.10² − 100. At 15%, its NPV is approximately −2.08. The same cash flows can therefore support different decisions when the required return changes.

How should I use a tax example when my pathway covers a different jurisdiction?

Carry across the method, then apply the law of the relevant jurisdiction. Separate the taxable person, transaction, tax base, timing, available relief and applicable rate before calculating the liability. A Republic of Ireland corporation tax example cannot establish a Northern Ireland result, and Australian GST treatment does not establish New Zealand GST treatment. Hypothetical rates in this guide show arithmetic, not a current statutory rate.

Chartered Accountant Study Guide Across Five Pathways

Start with concept 1 Choose a topic

Chartered Accountant study combines technical rules with decisions made under imperfect information. A reporting adjustment can change a lending ratio; an audit finding can change the evidence needed; a tax calculation can change the cash available for investment. This guide develops those connections through five distinct pathways: ICAEW, ICAS, Chartered Accountants Ireland, SAICA and CA ANZ. Each section follows its provider’s subject areas and jurisdiction, then moves from classification and calculation toward judgement and advice. Use the worked examples to check both the number and its meaning. Where a tax rate or other variable depends on the facts or period, the example supplies a hypothetical input. The aim is to explain the reasoning you can reuse when the figures, risks or stakeholder priorities change.

ICAEW ACA: current Certificate and Professional curriculum

1. Accruals and prepayments

An expense belongs to the period in which the business receives the related benefit, even if cash moves at another time. At each reporting date, identify what has already been consumed and what remains available. A payment for future service creates a prepayment asset; the asset is released to expense as the service is received. Conversely, a service received but unpaid creates an accrued expense and a liability. Work from the service dates and the reporting date, then calculate the appropriate fraction of the total charge. Check that the expense and closing asset or liability together reconcile to the transaction. In ICAEW Accounting Fundamentals, this period-based approach matters because cash records alone cannot show the period's performance or closing position. The ICAEW transitional arrangements identify Accounting Fundamentals within the current Certificate curriculum.

Worked example: A business pays £12,000 on 1 October for insurance covering 12 equal months and closes its accounts on 31 December. Three months have been used, so expense is £12,000 × 3/12 = £3,000. The remaining nine months give a £9,000 prepayment. If all £12,000 were expensed, both closing profit and assets would be understated by £9,000.

Watch the distinction: Payment does not make the whole amount a current expense. First locate the benefit period; cash timing determines settlement, while accrual accounting determines the expense.

Reference: [2]

2. Risk, assertion and control

Start with the event that could cause a misstatement, then name the affected assertion. Occurrence asks whether recorded sales represent genuine transactions; cut-off asks whether they belong in this reporting period. A control should interrupt the route from the risky event to the accounting entry. For goods whose sale depends on delivery, matching an invoice to dated delivery evidence before posting revenue addresses both assertions. Assess the control's design by asking who performs the match, what evidence they inspect and how exceptions are resolved. Assess operation by inspecting transactions around year end, including those just before and after it. A sales target is an incentive and may increase pressure to record revenue early; it cannot establish that the control worked. In Assurance and Risk Fundamentals, a strong answer links the risk, assertion, control and evidence in one chain.

Worked example: An ICAEW case shows goods dispatched on 30 December, invoiced that day and delivered on 3 January. Assume the contract transfers control on delivery. Recording December revenue risks occurrence for that period and cut-off. Require the signed delivery record before posting the sale. The dated January receipt supports January recognition; a December invoice and a sales target do not establish December delivery.

Watch the distinction: An invoice is evidence that billing occurred, not necessarily that revenue was earned. Identify the contractual transfer event and test evidence of its date.

Reference: [2]

3. Contract authority

Actual authority comes from the company's grant of power to its agent, whether express or implied by the role and conduct between them. An internal spending limit restricts that authority. Apparent authority is different: it concerns what the company has represented to an outsider through its words or conduct, and whether the outsider reasonably relied on that representation. Repeatedly allowing an employee to conclude larger orders can create such an appearance, but the employee's own claim of authority is insufficient. Work through the sequence: identify the company's internal limit, examine its outward conduct, ask what the supplier knew, then consider whether reliance was reasonable. A supplier aware of the limit has a weaker apparent-authority argument. This analysis helps an ICAEW Business Law candidate assess potential contractual liability without treating every unauthorised signature as automatically binding or void.

Worked example: A buyer has an internal £20,000 limit. The company has repeatedly accepted the buyer's £30,000 orders and never corrected its supplier. The buyer now signs a £25,000 order. Actual authority is exceeded by £5,000. The company's pattern may nevertheless support apparent authority if this supplier reasonably relied on it and did not know of the limit. The supplier's knowledge is decisive evidence to investigate.

Watch the distinction: An internal limit alone does not settle the supplier's rights. Equally, a buyer cannot create apparent authority merely by saying they have it.

Reference: [2]

4. Taxable profit bridge

Accounting profit follows financial reporting rules; taxable profit follows the applicable tax rules. Build a bridge from one to the other rather than applying a tax rate directly to the accounts figure. Add back expenses included in accounting profit that the stated tax assumptions disallow. Add back accounting depreciation when tax relief for capital spending is instead given through a specified allowance. Deduct that allowance, plus any other qualifying deductions not already reflected. Check each item once: a cost already excluded from accounting profit should not be added back again. Distinguish permanent differences, such as an assumed nondeductible expense, from timing differences, such as accounting depreciation and a tax allowance occurring in different periods. In ICAEW Tax Fundamentals, label hypothetical assumptions clearly because the mechanics of the bridge are more useful than an unsupported current rate.

Worked example: Suppose ICAEW Tax Fundamentals supplies accounting profit of £100,000, including £4,000 of assumed nondeductible costs and £10,000 depreciation. It also specifies a £14,000 tax allowance. The bridge is £100,000 + £4,000 + £10,000 − £14,000 = £100,000 taxable profit. The matching total is coincidental: the two add-backs, £14,000, equal the allowance.

Watch the distinction: Do not deduct a tax allowance while leaving accounting depreciation deducted unless the problem's rules permit both. Reconcile each accounting charge to its tax treatment.

Reference: [2]

5. Contribution and the limiting factor

Contribution is selling price less variable cost. When demand is sufficient but one resource is scarce, maximise contribution earned from each unit of that resource. Divide each product's unit contribution by the resource it consumes, then allocate capacity in descending order of that ratio, subject to demand and contractual constraints. A larger contribution per product can be inferior if it consumes disproportionately more machine time. Fixed costs usually remain unchanged over the short decision horizon, so they do not alter the ranking unless choosing a product changes them. Once the bottleneck is relaxed, the ranking may change; the calculation is conditional on the stated constraint. For ICAEW Business Insight and Performance, present the resource unit alongside the ratio, such as pounds per machine hour, and reconcile the selected output to total hours available.

Worked example: Product A contributes £30 and uses two machine hours, giving £15 per hour. Product B contributes £24 and uses one hour, giving £24 per hour. With 100 hours, sufficient demand and no other constraints, produce 100 B units for £2,400 contribution. Using all hours for A makes 50 units and £1,500 contribution. B has priority while machine hours are scarce.

Watch the distinction: Ranking A first because £30 exceeds £24 ignores the bottleneck. Divide contribution by the scarce resource used, then check demand before allocating all capacity.

Reference: [2]

6. Ethical threats in sustainability claims

A sustainability claim needs a defined boundary, a consistent baseline and evidence for each component. Moving production outside a site can make direct emissions fall while leaving the wider activity's emissions largely unchanged. Before approving a percentage claim, identify what emissions were counted in the prior and current periods, whether output changed, and whether outsourced activity is comparable. Recalculate on the same boundary, then describe any narrower site-only result explicitly. Pressure from a director to use the larger number creates a threat to integrity and objectivity; the response is to document the data, challenge the wording and request correction through an appropriate review route. In ICAEW Sustainability and Ethics, the professional judgement is about whether a reader would understand the stated measure, not merely whether one arithmetic subtraction is accurate.

Worked example: Assume a company produced the same output in both years. Its prior emissions were 100 units within the reporting boundary. Current site emissions are 70 units, and outsourced production adds 25 comparable units. Site emissions fell 30%, but total current emissions are 95 units, a fall of (100 − 95)/100 = 5%. Describe the site measure separately; an unqualified 30% reduction claim misleads.

Watch the distinction: A true site-only figure can still mislead if presented as the whole company's improvement. Match boundaries and explain exclusions before approving the percentage.

Reference: [2]

7. Controls versus substantive evidence

Controls testing asks whether a designed safeguard operated throughout the period on which the auditor proposes to rely. First confirm that the approval control addresses a relevant purchasing risk and that the approver has appropriate authority. Then test evidence of operation across the period and investigate exceptions. Missing approvals may indicate a failed control, missing documentation or an alternative authorised process; their cause matters. If reliance is no longer justified, revise the risk assessment and obtain more direct evidence, such as supplier invoices, receipt records, subsequent payments and cut-off tests. Increasing substantive work does not repair a failed control; it supplies evidence about balances and transactions despite that weakness. In ICAEW Assurance, Risk and Reporting, distinguish the conclusion about control reliability from any eventual conclusion about whether the financial statements are misstated.

Worked example: Purchase orders require approval, but four of 20 selected ICAEW case orders have no approval evidence. That is a 20% observed exception rate, not a proven population rate. Investigate who raised those orders, their values and whether an alternative approval existed. Pending that work, do not rely on this control for the tested period; expand direct testing of purchases and payables.

Watch the distinction: Four exceptions do not prove that four purchases are misstated. They challenge control reliance and direct further work; transaction accuracy still requires substantive evidence.

Reference: [2]

8. Intragroup profit elimination

A group reports transactions with outsiders, so a transfer between a parent and subsidiary cannot create group revenue or profit. Eliminate the internal sale and purchase in full on consolidation. If the buyer still holds some inventory, remove the seller's profit embedded in that unsold portion because no external customer has yet earned it for the group. Calculate the seller's total profit, then multiply by the fraction remaining at the reporting date. Reduce group inventory to the group's original cost and reduce group profit by the same amount, subject to any relevant tax effects in a fuller question. Identify which entity sold the goods when analysing effects on parent and non-controlling interests. For ICAEW Corporate Reporting, Data and Assurance, the key diagnostic cue is inventory still held inside the group at year end.

Worked example: A parent sells inventory to its subsidiary for £120; it cost the parent £90. The internal profit is £30. Half the goods remain unsold at group year end, so unrealised profit is £30 × 50% = £15. Eliminate the internal sale and purchase, then reduce consolidated inventory and group profit by £15. The unsold goods' group cost is £45, rather than their £60 transfer value.

Watch the distinction: Eliminating only the internal sale leaves profit inside closing inventory. Check how much remains in the group and remove that portion of the seller's margin.

Reference: [2]

9. Digital investment choices

A digital investment case begins with the process being changed and the measurable benefit expected from that change. Separate one-off implementation spending from recurring licence, support and staff costs. A simple payback calculation tests how quickly net cash savings recover the initial outlay, but it ignores cash flows after payback and the time value of money; use a discounted cash-flow analysis for a fuller financial decision. Then examine the dependency chain: source data quality, integration with existing systems, staff adoption, exception handling and controls over automated output. Poor input data can lower realised savings even when the software works as specified. Decide what evidence a pilot should produce and what conditions would justify broader rollout. The ICAEW ACA study guide can support focused preparation for this pathway.

Worked example: An ICAEW Business and Digital Strategy proposal costs £200,000 initially. Forecast annual labour savings are £80,000, with £20,000 annual support costs. Assuming both recur and there are no other cash effects, net savings are £60,000 yearly and simple payback is £200,000/£60,000 = 3.33 years. Test whether source records and exception rates support the £80,000 saving before committing.

Watch the distinction: A short payback does not establish value if benefits depend on unreliable data. Include recurring costs and test the operational assumptions behind the forecast.

Reference: [2]

10. Cost of capital and financing

Weighted average cost of capital combines the required return on equity with the after-tax cost of debt, using the financing weights relevant to the business. Multiply each component cost by its weight and add the results. The equity return compensates investors for risk; the after-tax debt figure reflects the assumed financing cost after any modelled tax effect. Use consistent market-value weights where those are supplied, and check that weights sum to 100%. WACC can be a discount-rate benchmark for projects with risk similar to the existing business and a financing structure consistent with its assumptions. A substantially different venture may need a risk-adjusted required return; blindly applying the group rate can accept a risky project too readily or reject a safer one. In ICAEW Corporate Financial Strategy, state the assumptions behind the rate before using it to judge a project.

Worked example: Assume an ICAEW case gives 60% equity with a 12% required return and 40% debt with a 5% after-tax cost. WACC is 0.60 × 12% + 0.40 × 5% = 7.2% + 2.0% = 9.2%. This is a benchmark for comparable business risk. A venture in an unfamiliar market needs separate risk analysis before 9.2% is its hurdle.

Watch the distinction: WACC is not a universal hurdle for every proposal. Check the project's risk and financing assumptions before treating the calculated group average as decisive.

Reference: [2]

11. Tax planning versus compliance

Tax planning chooses the timing or structure of genuine transactions within the applicable rules. Tax compliance reports the resulting position accurately and retains support for claims made. For a proposed relief, verify three separate matters: the expenditure occurred, it has the required character, and it belongs to the claimed period. An invoice can establish an amount while leaving questions about eligibility; a budget cannot establish that money was spent. Reconcile the ledger, contracts, invoices and payment or delivery evidence, then quantify the supported claim and the effect of any unresolved balance. If further documents later establish eligibility, the claim may change through the proper filing route. In ICAEW Tax Compliance and Planning, a defensible recommendation distinguishes a legitimate opportunity from an unsupported return entry and records the assumptions used in any estimated tax effect.

Worked example: Assume relief is available for qualifying expenditure of up to £40,000. A business proposes claiming £40,000, but invoices currently support only £32,000. The unsupported amount is £8,000. At an expressly hypothetical 20% tax rate, claiming it would reduce reported tax by £8,000 × 20% = £1,600. Claim the documented qualifying amount and investigate the remaining £8,000 before filing.

Watch the distinction: A planned purchase is not automatically qualifying expenditure already incurred. Establish amount, character and timing before turning a planning opportunity into a return claim.

Reference: [2]

12. An integrated business recommendation

An integrated recommendation should keep financial performance, near-term cash and execution risk distinct. Contribution estimates the contract's revenue less variable operating costs. Remediation is an additional cost; working capital is cash tied up in operations, usually recoverable later rather than a permanent expense. Calculate the expected profit effect and the initial cash effect separately. Then test whether capacity, delivery dates, customer obligations and data handling support the forecast contribution. Identify conditions that could change the decision and assign evidence or actions to them. A recommendation can be conditional when the financial case is attractive but a material operational or ethical risk remains unresolved. In the ICAEW Fundamental Case Study context, the candidate should show how evidence changes the decision, rather than append a generic risk list to an arithmetic answer.

Worked example: A contract offers £90,000 contribution, requires £25,000 remediation and ties up £15,000 extra working capital. Assuming immediate payment and no other cash effects, the near-term net cash benefit is £90,000 − £25,000 − £15,000 = £50,000. Profit contribution after remediation is £65,000 because working capital is not itself an expense. Proceed only after confirming delivery capacity and resolving the customer-data risk.

Watch the distinction: Treating working capital as a permanent cost confuses cash with profit. Show both measures, then address risks that could prevent the forecast benefit.

Reference: [2]

ICAS CA: 2026 assessed curriculum

13. Revenue with distinct obligations

When a customer buys distinct goods and services for one price, first identify the separate promises and decide when each is satisfied. Allocate the total transaction price using their relative standalone selling prices, rather than assigning the invoice balance to the later service. The allocation fraction for an obligation is its standalone price divided by the total standalone prices. Recognise the goods allocation when control of the goods passes; recognise the service allocation as service is supplied over time when the facts support that pattern. Check that allocations add back to the contract price and that any deferred amount corresponds to unsatisfied obligations. The 2026 ICAS syllabus covers Reporting and Performance; this exercise applies revenue allocation within that reporting context.

Worked example: An ICAS Reporting and Performance case bundles equipment and one year of support for £110,000. Their standalone prices are £100,000 and £25,000, totalling £125,000. Equipment receives £110,000 × £100,000/£125,000 = £88,000; support receives £110,000 × £25,000/£125,000 = £22,000. The allocations total £110,000. Assuming equipment control passes immediately, recognise £88,000 then and recognise £22,000 as support is provided.

Watch the distinction: Do not assign the full equipment list price and give the discount only to support without a reason. Relative standalone prices allocate the discount across obligations.

Reference: [1]

14. Flexible-budget variance

A static budget compares actual spending with a cost allowance based on planned output. That comparison mixes two effects: producing a different volume and performing differently at the volume actually produced. A flexible budget recalculates allowed variable cost at actual output, using the standard cost per unit. Compare actual cost with that flexible allowance to isolate an aggregate spending or efficiency variance. To diagnose its cause, split the result further when quantity and price data are available: did the business consume more input per unit, pay more per input, or both? Check the sign convention. For a cost, actual spending above allowed spending is adverse. ICAS Reporting and Performance candidates should report the monetary variance with its cause still open to investigation, rather than equating a single aggregate number with a specific purchasing failure.

Worked example: Standard variable cost is £8 per finished unit. Actual output is 1,200 units and actual variable cost is £10,100. The flexible-budget allowance is 1,200 × £8 = £9,600. Actual cost exceeds allowance by £10,100 − £9,600 = £500, an adverse variance. Without input quantity and price details, it cannot yet be split between usage and price effects.

Watch the distinction: Comparing actual cost only with the original volume budget may blame managers for producing more units. Flex the allowance to actual output first.

Reference: [1]

15. Materiality and audit sampling

Materiality frames the size and nature of misstatements that could affect users, while sampling supplies evidence about a larger population from selected items. A simple ratio projection divides observed error by the sampled book value and applies that rate to the population. It is an estimate, not a finding that every unsampled item has the same error rate. Before interpreting it, examine how the sample was selected, whether the error is isolated or systemic, and whether the population contains unusual strata. Compare projected misstatement, plus sampling uncertainty and other known errors, with the applicable materiality threshold supplied by the case. Qualitative features can matter even below that amount. In ICAS Assurance, an unexpectedly large projected error calls for investigation and more evidence, potentially including expanded or targeted testing, before concluding on the population.

Worked example: A random sample with £100,000 recorded value contains a £10,000 overstatement; the population has £1 million recorded value. The observed error ratio is 10%. Simple projection gives 10% × £1 million = £100,000, above the case's hypothetical £75,000 materiality. Investigate the error's cause and obtain further evidence. £100,000 is a projection with sampling uncertainty, not a proven population misstatement.

Watch the distinction: Do not report the projected figure as a known error. Separate detected misstatement from estimated population error, and consider selection, cause and uncertainty.

Reference: [1]

16. Discounted project cash flows

Net present value compares cash flows at a common date. Record the initial investment as a cash outflow at time zero, forecast incremental after-tax cash flows at their expected dates, and discount future amounts at a rate consistent with their risk and currency assumptions. Include terminal proceeds or release of working capital if the case supplies them; do not invent a terminal value. For a year-end receipt, divide by one plus the discount rate raised to the year number. Add discounted receipts and subtract the initial outlay. A positive NPV indicates that the stated project cash flows exceed the required return, but it does not validate the forecast itself. In ICAS Business Management and Finance, check sensitivity to the largest uncertain inputs and distinguish the financial result from strategic or operational constraints.

Worked example: Assume an ICAS project costs £100,000 now and pays £60,000 at each of the next two year ends, with no other cash flows. At a hypothetical 10% rate, present values are £60,000/1.10 = £54,545.45 and £60,000/1.10² = £49,586.78. NPV is £54,545.45 + £49,586.78 − £100,000 = £4,132.23, supporting acceptance on these financial assumptions.

Watch the distinction: Adding the two £60,000 receipts without discounting overstates value. Also check for stated terminal cash flows; include them only when the case provides them.

Reference: [1]

17. Tax depreciation differences

Accounting depreciation spreads an asset's cost over the periods receiving its service. A tax allowance follows the specified tax rules and may give relief at a different pace. Starting from accounting profit, add back depreciation if the case treats it as nondeductible for the tax calculation, then deduct the stated allowance. The net adjustment shows the difference in this period's taxable profit. A larger early tax allowance lowers current taxable profit, but it may leave less deduction for later periods; the total lifetime treatment must be examined separately. Keep the tax computation distinct from deferred tax accounting, which may reflect future consequences of a temporary difference. In ICAS Taxation, state the hypothetical allowance given in the question rather than assuming a current rate or asset category.

Worked example: An ICAS case gives £12,000 accounting depreciation and an assumed £18,000 year-one tax allowance for the same asset. Starting with accounting profit, add back £12,000 and deduct £18,000. The net adjustment is −£6,000, so taxable profit is £6,000 lower than accounting profit before other adjustments. This is a timing effect if later allowances reverse the difference.

Watch the distinction: The £18,000 allowance does not replace the asset's accounting depreciation in the financial statements. It changes the tax bridge for the stated period.

Reference: [1]

18. Cash flow and insolvency signals

A balance-sheet surplus says recorded assets exceed recorded liabilities at a date. It does not show whether enough cash will be available when debts fall due. For a cash-flow assessment, place obligations and reliably available resources on a dated schedule. Distinguish committed receipts and facilities from hoped-for sales, negotiations or assets that cannot be realised quickly. A near-term funding gap calls for prompt review of forecasts, refinancing options, creditor positions and the effects of continuing to trade. Directors should assess creditor interests and obtain appropriate advice as circumstances deteriorate; the precise legal consequence depends on the facts and applicable law. In ICAS Business Law, the decision cue is timing: an illiquid asset can support a positive net asset position while leaving a payment due next week unmet.

Worked example: A company reports assets £80,000 above liabilities, yet £100,000 must be paid next week. It has £25,000 cash and £20,000 committed receipts due before payment. Available cash is £45,000, leaving £100,000 − £45,000 = £55,000 short. The asset surplus does not cure this immediate cash-flow warning. Directors need a dated funding plan and should assess creditors' interests.

Watch the distinction: Positive net assets do not prove the company can pay on time. Test liquidity against actual due dates and count only funds realistically available then.

Reference: [1]

19. Impairment of an asset group

An asset or cash-generating unit is impaired when its carrying amount exceeds the amount recoverable from use or sale. Recoverable amount is the higher of value in use and fair value less costs of disposal. Taking the higher figure reflects the better recovery route available under the stated assumptions. Compare it with carrying amount on a consistent basis, including the same assets and liabilities in each measure. If carrying amount is higher, recognise the difference as an impairment loss. For a cash-generating unit, allocation follows applicable accounting rules, including treatment of any goodwill and limits on reducing individual assets. ICAS Advanced Reporting and Performance requires both the calculation and an explanation of which valuation supports recoverability; a low value-in-use figure alone does not establish the loss when a higher disposal value exists.

Worked example: An ICAS cash-generating unit carries £500,000. Its value in use is £440,000 and fair value less costs of disposal is £460,000. Recoverable amount is the higher figure, £460,000. The impairment is £500,000 − £460,000 = £40,000. Recognise that loss, subject to the applicable allocation rules; using £440,000 would overstate the loss by £20,000.

Watch the distinction: Do not choose the lower valuation because it seems more cautious. Recoverable amount uses the higher supportable route, provided the compared amounts have consistent boundaries.

Reference: [1]

20. Group audit component risk

A group auditor plans evidence around the risk that a component could materially affect consolidated statements. Size matters, but so do unusual transactions, estimation uncertainty, fraud indicators and specialist accounting. Identify the assertions exposed at each component, decide what work the group team or component auditor must perform, and communicate the scope, materiality, reporting timetable and significant risks clearly. Review the results, challenge unresolved findings and assess whether further group-level work is needed. A component with a small revenue share can still hold a material asset or high-risk transaction, so a single percentage is insufficient. For ICAS Advanced Assurance, the answer should connect component selection to group risks and specify the evidence requested. The ICAS CA guide provides a focused route into this curriculum.

Worked example: One component generates 45% of group revenue and holds the group's only complex derivatives. Its revenue scale and specialist valuation risk justify targeted component work, including revenue testing and derivative valuation evidence, with clear instructions to the component auditor. Review findings at group level. A second component with little revenue still needs risk assessment if it holds a material balance or unusual transaction.

Watch the distinction: Component revenue share is not a complete risk measure. Consider balances, transactions and qualitative risks before deciding the scope of group audit work.

Reference: [1]

21. Model sensitivity and break-even

In ICAS Corporate Finance and Modelling, sensitivity analysis asks which assumption makes a proposal miss its target. Build the model from drivers: volume multiplied by contribution per unit, less fixed costs, gives operating profit. Break-even volume equals fixed costs divided by contribution per unit, provided contribution stays positive and the stated costs remain fixed over that range. Compare forecast volume with break-even volume in both units and percentage terms. Then test whether demand, price, variable cost or capacity could erase that cushion. A break-even calculation is only one decision boundary: a lender may also require a cash payment or return target. Model that target explicitly, allowing for payment timing and financing terms. The ICAS 2026 syllabus identifies Corporate Finance and Modelling as a course; the assumptions drive the conclusion in any particular proposal.

Worked example: A project earns £30,000 contribution per 1,000 units, or £30 per unit, and incurs £120,000 fixed costs. Operating break-even is £120,000 ÷ £30 = 4,000 units. At the forecast 4,500 units, profit is 4,500 × £30 − £120,000 = £15,000. The cushion is 500 units, or 11.1% of forecast volume. A demand fall beyond that cushion would produce an operating loss, assuming costs and unit contribution remain unchanged.

Watch the distinction: Ranking the proposal by forecast profit alone hides how little demand can fall. Calculate the break-even driver and cushion, then test whether the forecast is credible within that range.

Reference: [1]

22. Data quality before prediction

Before judging a prediction model, check whether its data represent the decision it will face. Define the outcome precisely, establish when it becomes known, and exclude inputs recorded only after that point. Reconcile records across sources, inspect missing values and duplicates, and ask whether training data cover the borrowers on whom the model will be used. Set aside later observations for testing so the evaluation resembles deployment. For rare defaults, overall accuracy can reward a model that predicts every borrower will repay. A confusion matrix separates correctly identified defaults from missed defaults and false alarms. Recall measures the share of actual defaults detected; precision measures the share of flagged loans that actually default. Choose measures in light of the relative costs of missed risk and unnecessary intervention, while checking whether data quality differs across borrower groups.

Worked example: Of 100 loans, 90 repay and 10 default. A model predicts repayment for all 100. It gets 90 outcomes right, so accuracy is 90 ÷ 100 = 90%. Yet it detects 0 of 10 defaults, giving default recall of 0%. It offers no default warning despite its high accuracy. Check whether earlier, relevant borrower information can improve detection without creating excessive false alarms.

Watch the distinction: A high accuracy figure does not establish that a model finds the events you care about. Inspect the underlying counts and evaluate missed defaults before recommending its use.

Reference: [1]

23. Sustainability impacts and enterprise risk

A sustainability decision has two connected views. First, identify what the activity does to people and the environment, including effects outside the entity's accounts. Second, trace how changing conditions can affect the entity through interruptions, input prices, financing, customer demand or reputation. Set a clear baseline and boundary before comparing water use: production may have risen, moved sites or shifted to suppliers. A percentage increase without its denominator can obscure the physical pressure on a water-stressed area. For financial analysis, distinguish an expected annual loss from a worst-case loss and avoid subtracting a possible event's full impact as though it were certain. Compare alternative production methods, water reuse and contingency capacity using consistent time periods. State the evidence and uncertainty separately from the recommendation so a decision-maker can see both the business exposure and the community effect.

Worked example: An ICAS Sustainability for Accountants case reports water use rising 20% as local supply tightens. A proposed process saves £40,000 annually, but its estimated expected interruption cost is £60,000 annually. On those assumptions, the expected financial effect is £40,000 − £60,000 = a £20,000 annual loss. The team should test a lower-water option and assess local users' exposure, even if that impact has no reliable monetary estimate.

Watch the distinction: Treating water solely as a future operating cost overlooks effects on other users. Assess the physical impact and affected people alongside the entity's financial risk.

Reference: [1]

24. Professional scepticism in a case

In an integrated ICAS case, professional scepticism means following conflicting evidence to its source, not automatically rejecting management's view. Identify exactly what each figure measures, its period, and whether costs, ramp-up time and implementation risks are included. A pilot may cover fewer sites than a full forecast; management may have assumptions that could explain part of the gap. Test those assumptions against contracts, capacity, observed performance and independent records. Separate supported benefits from plausible but unverified upside. A defensible response quantifies the supported case, describes the remaining uncertainty and proposes a decision that can be revisited when evidence improves. Pressure to present a favorable figure makes transparency especially important. For further application, use ICAS CA practice questions to practise stating both a recommendation and the evidence needed to change it.

Worked example: Management forecasts £200,000 annual savings. A comparable pilot supports £120,000, and annual implementation costs are £50,000. The supported net benefit is £120,000 − £50,000 = £70,000; management's gross savings exceed pilot evidence by £80,000. Recommend a staged rollout based on £70,000, subject to checking whether scale, site differences or further evidence justify any of the additional £80,000.

Watch the distinction: Calling the £200,000 forecast a proven net benefit combines an unsupported saving with an omitted cost. Show the supported net figure and investigate the specific gap.

Reference: [1]

Chartered Accountants Ireland: financial reporting, assurance, finance and tax

25. Control and the acquisition date

For Chartered Accountants Ireland Financial Reporting, consolidation starts when the investor obtains control, which is a matter of substantive rights rather than a mechanical shareholding test. Assess whether the investor has power over the activities that most affect returns, is exposed to variable returns, and can use that power to affect those returns. Voting rights are strong evidence, but shareholder agreements, board appointment rights and the practical ability to exercise them may change the answer. Distinguish a right exercisable when decisions are made from a protective right that only guards another party's interests. Record the date control becomes effective because results before that date do not belong in the group's post-acquisition performance. The CAP2 Financial Reporting overview places group reporting within the course; the contract and governance facts determine the treatment.

Worked example: An investor purchases 45% of an entity's votes on 1 July. From that date, an enforceable agreement lets it appoint most directors, and that board directs the activities producing returns. Assuming no other party has overriding substantive rights, the investor controls the entity from 1 July and consolidates its results from then. The 45% holding alone would not settle the question.

Watch the distinction: Assuming consolidation requires more than 50% of shares ignores contractual power. Examine who can direct relevant activities, whether those rights are substantive, and when they took effect.

Reference: [3]

26. Equity accounting for an associate

An associate is an investment over which the investor has significant influence but not control. Under equity accounting, the group initially records the investment at cost, then adjusts its carrying amount for its share of the associate's post-acquisition profit or loss and other relevant movements. The investor's share of profit enters group profit; a dividend reduces the investment's carrying amount because that profit has already been recognised through the equity method. Adding the dividend as fresh group income would count the same return twice. Check the ownership share, the dates over which influence existed and whether reported results need adjustments for consistent accounting policies or transactions with the group. Also consider whether losses or impairment affect the carrying amount. The method reports a single investment line rather than consolidating the associate's assets and liabilities line by line.

Worked example: A group acquires 30% of an associate for €200,000 at the start of the year. The associate earns €60,000 and pays total dividends of €20,000. The group's share of profit is 30% × €60,000 = €18,000; its dividend receipt is 30% × €20,000 = €6,000. Closing investment carrying amount is €200,000 + €18,000 − €6,000 = €212,000, before other adjustments.

Watch the distinction: Recording the €6,000 dividend as additional group profit double counts earnings already included through the €18,000 profit share. Treat it as a recovery of the investment.

Reference: [3]

27. Foreign operation translation

When a group reports in euros but a foreign operation uses another functional currency, translate different statement elements at rates suited to their timing. Closing assets and liabilities use the closing rate; income and expenses use transaction-date rates, with an average rate only when it reasonably approximates them. Opening net assets carry their previously translated amount. These choices create a translation difference when exchange rates move, even if the subsidiary's local-currency books balance. Reconcile closing translated net assets to opening translated net assets, translated profit and any capital movements. The balancing amount is generally recognised in other comprehensive income for a foreign operation, subject to the applicable accounting requirements. Do not force the difference into operating profit or treat it as a cash flow. Check the functional currency and transaction dates before applying any translation rate.

Worked example: Assume a subsidiary starts with 80 foreign-currency units of net assets, translated at €0.80 per unit, with no capital movements. It earns 20 units, translated at the €0.85 average, and ends with 100 units at €0.90. Opening net assets are €64, profit is €17, and closing net assets are €90. The translation difference is €90 − €64 − €17 = €9, shown separately from operating profit.

Watch the distinction: Using the closing exchange rate for both profit and closing net assets erases the timing distinction. Translate performance at appropriate period rates, then reconcile the exchange difference.

Reference: [3]

28. Basic earnings per share

Basic earnings per share relates profit attributable to ordinary shareholders to the ordinary shares outstanding during the period. Start with the appropriate profit numerator, allowing for claims ahead of ordinary shareholders where relevant. For the denominator, weight each share count by the portion of the reporting period it was outstanding. An issue for cash partway through the year contributes only from its issue date; a bonus issue or share split needs different retrospective treatment because it changes the unit of measurement without adding resources. Keep the period basis consistent and use the actual date when a midyear approximation would be misleading. Present the resulting amount per share, with sensible rounding. The calculation helps compare periods, but changes in EPS may reflect share issuance as well as operating performance, so interpret both numerator and denominator.

Worked example: Profit attributable to ordinary shareholders is €900,000. One million shares are outstanding for six months, then 1.2 million for six months after an issue for cash. Weighted-average shares are 1,000,000 × 6/12 + 1,200,000 × 6/12 = 1,100,000. Basic EPS is €900,000 ÷ 1,100,000 = €0.818 per share, rounded to three decimals.

Watch the distinction: Dividing annual profit by the year-end 1.2 million shares would treat newly issued shares as outstanding all year. Weight them from their issue date.

Reference: [3]

29. Audit materiality in context

Audit materiality concerns whether a misstatement could influence users' decisions, individually or with other errors. An overall monetary benchmark helps plan work, but the nature and context of an item can make a smaller error important. Ask whether it changes profit into loss, affects a covenant, conceals a related-party transaction or alters a key disclosure. Investigate the cause as well: an isolated recording error and a deliberate omission call for different responses. Compare the corrected figures with the original statements, accumulate identified misstatements and consider whether similar omissions may exist elsewhere. A stated threshold is a planning and evaluation tool, not permission to leave every smaller error unexamined. Communicate proposed corrections and assess the remaining uncorrected items collectively before forming an audit conclusion.

Worked example: A draft income statement shows a €5,000 profit. The audit finds a €12,000 expense omitted from the same year, while hypothetical overall materiality is €50,000. Corrected profit is €5,000 − €12,000 = a €7,000 loss. Although €12,000 is below the planning benchmark, the sign change may affect users or covenants. Investigate the omission and ask management to correct it.

Watch the distinction: Calling the omitted expense immaterial solely because €12,000 is below €50,000 ignores its effect on the reported result. Consider its nature and consequences.

Reference: [3]

30. Revenue cut-off evidence

Revenue cut-off asks whether a sale belongs before or after the reporting date. Begin with the contract's performance obligation and the point at which the customer obtained control; an invoice date alone does not establish either. For goods, inspect dispatch records, delivery terms, customer acceptance evidence and any right to redirect or reject the goods. For services, examine evidence of work performed and the basis for recognising progress. Test transactions on both sides of year end, including credit notes and subsequent reversals, to detect premature or deferred recording. If revenue was booked too soon, consider the matching receivable, inventory and cost-of-sales entries so the correction is complete. The audit evidence must support the accounting conclusion rather than simply confirm that a document exists.

Worked example: A company invoices €40,000 on 30 December and records the full sale. Its contract says control transfers on delivery, and the customer's signed receipt is dated 3 January. With no other evidence of earlier transfer, December revenue and the related receivable are premature by €40,000. Reverse them at year end and recognise the sale in January, checking the related inventory and cost entries too.

Watch the distinction: An invoice issued before year end is evidence of billing, not necessarily completed performance. Read the transfer terms and corroborate the actual transfer date.

Reference: [3]

31. Going concern and audit implications

A going concern assessment tests whether the entity can continue operating and meet obligations over the period management assesses. For audit work, start with a cash-flow forecast, then challenge its opening cash balance, receipts, payments, timing and sensitivity to weaker trading. Reconcile forecasts with recent results and signed contracts. Separate committed finance from a proposal under discussion, and inspect conditions attached to any facility. Consider realistic responses such as delaying expenditure, raising funds or selling assets, including how long each would take. A forecast shortfall is a warning that requires evidence and judgement; it does not by itself dictate the reporting outcome. Evaluate whether the going concern basis remains appropriate, whether a material uncertainty requires clear disclosure, and whether the audit report adequately communicates the conclusion reached.

Worked example: A company's three-month forecast reaches a €70,000 cash deficit. Management points to a €100,000 bank facility, but negotiations are unfinished. Available committed funding remains €0 from that proposal, leaving the €70,000 forecast gap. Obtain lender correspondence, test collection and payment assumptions, and assess credible alternatives. The accounting and audit reporting conclusions depend on the resulting evidence and disclosures.

Watch the distinction: Treating a proposed €100,000 facility as cash available today conceals the funding gap. Distinguish an approved, usable commitment from a negotiation and test forecast timing.

Reference: [3]

32. Transfer pricing with spare capacity

An internal transfer can be acceptable to the supplying division when its price covers the resources it sacrifices. The minimum transfer price is incremental production cost plus opportunity cost. With spare capacity and no external sale displaced, opportunity cost may be zero; allocated fixed overhead that does not change with the transfer does not set the minimum. When capacity is fully used, producing internally may displace external sales, so add the contribution forgone per component. The receiving division should compare the internal transfer with the cost of its best feasible alternative, allowing for quality, delivery and any group-wide costs. A negotiated price between these bounds can support both divisions' decisions. Distinguish the price used for divisional performance measurement from the group's relevant cost, since a transfer itself is an internal movement rather than new group revenue.

Worked example: A division can make a component for €30 variable cost and has spare capacity; no external sale is displaced. Its minimum transfer price is €30 + €0 opportunity cost = €30 per component. If capacity later becomes scarce and each internal unit replaces an external sale yielding €12 contribution, the minimum rises to €42. The change reflects the forgone contribution, assuming the €30 incremental cost remains unchanged.

Watch the distinction: Adding unavoidable allocated overhead to the minimum price can reject a transfer that benefits the group. Include costs that change and contribution genuinely forgone.

Reference: [3]

33. Inflation-consistent NPV

A discounted cash-flow model must use a consistent treatment of inflation. Nominal cash flows include expected price changes and are discounted at a nominal rate; real cash flows exclude general inflation and use a real rate. Convert between the rates through one plus nominal rate divided by one plus inflation rate, then subtract one. Apply specific inflation assumptions to revenue and cost categories where they differ, rather than increasing only sales while holding related costs fixed without reason. Include tax and working-capital effects on a consistent basis if they matter to the project. The resulting present values should agree whichever approach is used, apart from rounding, when the underlying assumptions are equivalent. Mixing real cash with a nominal rate makes future value appear too small and can reverse a marginal investment decision.

Worked example: Assume next year's real cash receipt is €100, inflation is 5% and the nominal discount rate is 10%. Nominal cash is €100 × 1.05 = €105, worth €105 ÷ 1.10 = €95.45 today. The equivalent real rate is 1.10 ÷ 1.05 − 1 = 4.7619%; €100 ÷ 1.047619 also gives €95.45. Discounting €100 at 10% would incorrectly give €90.91.

Watch the distinction: Applying a nominal rate to an unchanged real receipt combines incompatible bases. Inflate the cash flow or convert the rate, then keep the choice consistent throughout.

Reference: [3]

34. Relevant costs in a pricing decision

A special-order decision depends on future cash flows that differ between accepting and rejecting it. Identify the order's incremental materials, labour, delivery and other avoidable costs. Then ask what scarce capacity would otherwise earn: contribution lost from displaced work is an opportunity cost even though no separate invoice records it. Exclude spending already incurred, because today's choice cannot recover or alter it. Also check whether accepting the order changes regular customers' prices, contractual commitments or future demand; those effects belong in the decision if supported by evidence. Compare relevant incremental revenue with the sum of incremental costs and forgone contribution. A positive short-term gain may justify acceptance only when quality, capacity and strategic effects remain acceptable. Keep accounting allocations separate from economic sacrifice.

Worked example: A one-off order brings €15,000 revenue. It requires €9,000 of new cash costs and occupies capacity that would earn €4,000 contribution on another job. Relevant gain is €15,000 − €9,000 − €4,000 = €2,000, so it is financially attractive on these facts. A €3,000 design fee paid last year changes neither option and is excluded.

Watch the distinction: Subtracting last year's design fee while ignoring displaced sales reverses the logic. Sunk spending is fixed; forgone future contribution is a real decision cost.

Reference: [3]

35. Republic of Ireland corporation tax bridge

For a Republic of Ireland corporation tax computation in CAP2 Tax, begin with accounting profit and bridge to taxable profit under the stated facts. Add back expenses included in profit that the assumed tax rules do not allow. Deduct qualifying tax allowances or other permitted amounts, taking care not to deduct an item twice. The accounting charge and tax deduction may fall in different periods, so a profit-and-loss expense is not automatically the tax deduction for that year. Keep permanent disallowances separate from timing differences because they have different implications beyond the current tax computation. Once the tax base is established, apply the rate specified by the problem and identify any payments or credits separately from the gross liability. In a real case, the character of the income, expenditure, period and applicable legislation must be established before using a rate.

Worked example: Assume Republic of Ireland accounting profit of €200,000 includes €5,000 of costs that this hypothetical problem disallows. It also permits a separate €15,000 deduction not reflected in accounting profit. Taxable profit is €200,000 + €5,000 − €15,000 = €190,000. At the problem's explicitly hypothetical 20% rate, gross corporation tax is €190,000 × 20% = €38,000, before any credits or payments.

Watch the distinction: Multiplying accounting profit directly by the assumed tax rate skips the tax-base adjustments. Build and label the bridge first, then apply the stated rate.

Reference: [3]

36. Northern Ireland inheritance tax computation

For Northern Ireland inheritance tax analysis in CAP2 Tax, first establish what property belongs in the estate and its appropriate valuation. Then apply any qualifying exemptions and reliefs to the relevant transfers or assets, followed by the available tax-free amount under the assumptions supplied. Keep these stages distinct: an exemption removes a qualifying amount from the chargeable calculation, while a tax-free band shelters a remaining amount. Prior transfers, liabilities, ownership and beneficiaries can change the result, so they must be identified before a live computation. Only after finding the chargeable value should you apply the rate specified by a question. Show the order of deductions so a reader can see whether the same amount has been removed twice. The example rate and available amount are hypothetical figures for calculation practice, not current legal thresholds.

Worked example: Assume a Northern Ireland estate is valued at £600,000, with £100,000 of qualifying exemptions and an available tax-free amount of £300,000. Remaining value after exemptions is £500,000; chargeable value is £500,000 − £300,000 = £200,000. At an explicitly hypothetical 40% rate, tax is £80,000, before considering any other transfers, debts, reliefs or payment rules.

Watch the distinction: Applying a tax rate to the entire £600,000 estate ignores the specified exemptions and available tax-free amount. Establish the chargeable value in sequence before calculating tax.

Reference: [3]

SAICA CA(SA): integrated technical competencies and professional judgement

37. Capitals and sustainable value

In the SAICA CA(SA) framework, sustainable value requires attention to more than the current year's financial saving. A decision can strengthen financial capital while consuming natural capital, weakening relationships with communities or reducing future productive capacity. Map the activities causing each change, the people affected, and the time at which consequences emerge. Quantify reliable cash effects, but describe material impacts that cannot sensibly be converted into rand. Check whether apparently independent costs share a cause: unreliable water access may affect both output and reputation, so avoid double counting one interruption. Compare feasible alternatives and mitigation, including their effect on longer-term resilience. A recommendation should show why a near-term gain survives, or fails, once expected operating losses and external effects are considered. The SAICA competency framework frames these integrated judgements across technical and enabling competencies.

Worked example: A plant change saves R2 million a year but increases pressure on water needed for production and nearby users. Assume the resulting interruptions have an estimated expected annual cost of R2.5 million. The expected financial effect is R2 million − R2.5 million = a R0.5 million annual loss, before community effects. Compare a lower-water design and test the interruption estimate before approving the change.

Watch the distinction: Reporting only the R2 million saving treats water as freely available. Include the expected production consequence and explain the wider resource impact even where it lacks a reliable price.

Reference: [4]

38. Business-model resilience

Business-model resilience asks whether an organisation can keep delivering its product when a key input or relationship fails. Identify the critical activity, how concentrated its supply is, the time to replace it, and the cash effects of a disruption. Lost sales are not automatically lost profit: subtract the variable costs avoided to find contribution at risk. Compare a backup supplier's recurring fee and any quality or transition costs with the probability-weighted contribution loss it can actually prevent. A backup that covers only part of demand should receive credit only for that part. Also consider whether customer contracts, inventory or alternative products change the exposure. State the break-even disruption probability rather than claiming a backup is always worthwhile; resilience decisions depend on the severity, likelihood and consequences of failure.

Worked example: One supplier provides 80% of critical inputs. A six-week interruption would reduce sales by R6 million. Assuming a 30% contribution margin, contribution at risk is R1.8 million. An alternative costs R0.4 million annually and fully prevents that loss. Its financial break-even interruption probability is R0.4 million ÷ R1.8 million = 22.2% per year, ignoring other costs and benefits. Test whether that probability and full protection are credible.

Watch the distinction: Comparing the R0.4 million backup cost with R6 million sales lost overstates the avoidable loss. Use contribution, event likelihood and the backup's actual coverage.

Reference: [4]

39. Governance and delegated decisions

Delegation lets managers and directors act, but it does not remove accountability for a sound governance process. When a director has a financial interest in a supplier, identify the interest before evaluating the bid. The conflicted person should disclose it, and an independent decision-maker should assess the proposal through an authorised process, with participation managed under the applicable governance rules. Compare price, quality, delivery risk and alternatives using evidence available to all evaluators. Record who approved the transaction, the basis for selecting it, and how the conflict was handled. The analysis should consider effects on the organisation and stakeholders, including trust in procurement. A fair price may reduce financial concern, but it does not cure a compromised approval process. Equally, a conflict does not automatically prove that the chosen supplier's bid is inferior.

Worked example: A director owns a company bidding for a R10 million supply contract and joins the approval vote. The ownership interest gives the director a personal stake in the outcome. Record the disclosure, remove the director from the independent evaluation and vote as required by the applicable process, and compare bids on documented price, quality and delivery evidence. Reconsider the approval if the conflicted vote affected it.

Watch the distinction: Assuming the bid is acceptable because its price looks competitive overlooks who made the decision. A documented, independent assessment addresses the conflict and supports accountability.

Reference: [4]

40. Controls across a business process

An inventory discrepancy should be traced through the whole transaction path: ordering, receipt, storage, dispatch, recording and reconciliation. First confirm the physical count and the unit of measure, including items held elsewhere or owned by another party. Then reconcile receipts and dispatches around the count date with posted transactions, returns and authorised adjustments. This distinguishes a timing difference from loss, damage, counting error or unauthorised movement. Quantify the difference at the relevant carrying cost to assess the reporting effect, while investigating why the control failed. An unexplained write-off may make the ledger agree with the count but leaves the process vulnerable. Design a response aimed at the failure point, such as matching receiving records to postings or independently reviewing adjustments. Repeat counts or trace a sample when evidence conflicts, and document any corrected balance.

Worked example: The ledger lists 1,000 units at R50 each, but a verified physical count finds 940. The shortage is 1,000 − 940 = 60 units, with a provisional carrying value of 60 × R50 = R3,000. Check unposted dispatches, receipts, returns and count sheets before adjusting inventory. If no timing or counting explanation remains, record the supported loss and investigate access and approval controls.

Watch the distinction: Posting a R3,000 write-off immediately may correct the balance while concealing a timing error or recurring control failure. Reconcile the movement records before assigning a cause.

Reference: [4]

41. Risk response and residual exposure

A risk response changes the chance of an event, its impact, or both. Start with the exposure before controls, then estimate the exposure remaining after a proposed control. Expected loss equals probability multiplied by financial impact over the same period. Add the control's cost to the remaining expected loss when comparing options. This calculation helps rank responses, but it does not describe the worst outcome: a low probability event may still exceed the organisation's capacity to absorb a single loss. Check whether the probability estimate is credible, whether the control will operate as designed, and whether any loss is transferred through insurance. Then compare the residual exposure with risk appetite and available cash. A CA(SA) recommendation should state the assumptions, the financial case, and any exposure that remains unacceptable despite a favourable average cost. The SAICA competency framework places risk decisions within stewardship and integrated judgement.

Worked example: Assume a cyber incident has a 10% annual probability and would cost R4 million. Expected loss without action is 0.10 × R4 million = R400,000 a year. A control costs R150,000 annually and reduces the estimated probability to 3%, leaving 0.03 × R4 million = R120,000 expected loss. Total expected annual cost is R270,000, a R130,000 improvement. Recommend the control if the estimates are sound, while assessing whether a possible R4 million incident remains tolerable.

Watch the distinction: A control does not eliminate risk merely because its expected saving exceeds its price. Test the remaining severe loss against risk appetite and liquidity.

Reference: [4]

42. Capital allocation under a constraint

When capital is limited, evaluate combinations of projects rather than ranking each project by its return percentage. Net present value measures the value created after discounting future cash flows and deducting investment. List every feasible combination, sum its initial cash requirements, and exclude combinations above the funding limit. Select the feasible set with the highest total NPV if projects are independent and their cash flows do not change when undertaken together. A percentage return can favour a small project even when a larger combination creates more rand value. Also check whether projects are indivisible, mutually exclusive, dependent on shared resources, or affected by financing terms. A budget constraint may apply in more than one year, so a single initial spending limit can be insufficient. Explain the chosen set, unused capacity, and assumptions that could reverse the decision.

Worked example: A company can invest R100 million. Project A needs R70 million and has R15 million NPV; B needs R50 million with R12 million NPV; C needs R50 million with R11 million NPV. A cannot be paired with either B or C because each pair costs R120 million. B plus C costs exactly R100 million and creates R23 million NPV. Assuming independence and no later funding constraint, choose B plus C over A alone.

Watch the distinction: Choosing the project with the highest percentage return can waste scarce capital. Compare feasible portfolios by total NPV, allowing for dependencies and later cash needs.

Reference: [4]

43. Connected reporting

Connected reporting tests whether a strategy narrative is consistent with operational results and financial consequences. Identify the intended outcome first, then trace the resources spent, activities performed, outputs delivered, and outcomes observed. For a training programme, expenditure and attendance are inputs and outputs; retention, capability and productivity are possible outcomes. Compare each measure with a suitable baseline, period and population. A negative outcome does not automatically prove the programme failed, because hiring patterns, labour markets or timing may explain the change. It does mean the claim needs investigation and qualification. Reconcile the narrative with figures elsewhere in the report, including recruitment expense and any provision or forecast affected by turnover. State what the evidence supports, what remains uncertain, and which measures management should monitor next. This gives readers a fairer account of value creation than spending figures alone.

Worked example: Management spent R3 million on training and calls it successful. Staff turnover rose from 12% to 20%, an increase of 8 percentage points, while recruitment costs increased by R1 million. The report should disclose the R3 million investment alongside both adverse measures. It should test whether trained and untrained employees had different outcomes before attributing the change to training. Expenditure alone establishes that training occurred, not that it retained staff.

Watch the distinction: A large programme budget is evidence of effort, not evidence of success. Report the intended outcome and observed result, including contrary indicators.

Reference: [4]

44. South African VAT classification

For South African VAT analysis, classify each supply before calculating tax. Taxable supplies can give rise to output VAT, while exempt supplies require different treatment. Input VAT on purchases depends on the nature and use of the purchase, the supplier documentation and the purchaser's entitlement; a purchase amount alone does not establish a credit. Keep VAT exclusive and VAT inclusive figures distinct. For an exclusive taxable amount, multiply by the stated rate. For an inclusive amount, extract the tax using rate divided by one plus rate. Net VAT for a period is output VAT less creditable input VAT, with adjustments where relevant. Purchases used for both taxable and exempt activities may require allocation rather than a full credit. In an assessment, show classifications and assumptions before arithmetic so the result remains understandable if a transaction is later reclassified.

Worked example: Assume, solely for this calculation, a 15% VAT rate. A registered business makes R500,000 of taxable sales and has R200,000 of qualifying purchases, all stated before VAT and supported by appropriate records. Output VAT is R500,000 × 15% = R75,000. Creditable input VAT is R200,000 × 15% = R30,000. Net VAT is R45,000 payable. If some sales are exempt or purchases do not qualify, revise the relevant tax and credit first.

Watch the distinction: Applying the rate to every receipt and deducting VAT on every purchase ignores classification and entitlement. Resolve those questions before calculating net VAT.

Reference: [4]

45. Deferred tax from a temporary difference

Deferred tax follows the future tax effect of recovering an asset or settling a liability. For an asset, compare its accounting carrying amount with its tax base, which represents the amount relevant for future tax deductions under the assumed tax treatment. If carrying amount exceeds tax base, recovery generally produces a taxable temporary difference and a deferred tax liability. If tax base exceeds carrying amount, the difference may produce a deferred tax asset, subject to recognition criteria. Multiply the temporary difference by the tax rate expected to apply on reversal, using a rate supplied by the problem. This is separate from current tax on this period's taxable profit. Trace why the difference arose, such as different depreciation schedules, and test whether a specific recognition exception applies. The balance changes as the asset is used, sold or written down, so the reversal pattern matters.

Worked example: Equipment has a R100,000 carrying amount and a R70,000 tax base. The R30,000 excess is a taxable temporary difference: accounting recovery exceeds the future tax deduction represented by the base. At an expressly assumed 25% tax rate, deferred tax liability is R30,000 × 25% = R7,500. If the asset is later recovered and the difference reverses as expected, the liability unwinds. This calculation assumes no applicable recognition exception.

Watch the distinction: A tax allowance greater than accounting depreciation does not make the difference permanent. Compare carrying amount and tax base to identify its future reversal.

Reference: [4]

46. Pressure to alter a forecast

A forecast should represent supportable expectations, not the number needed to trigger a bonus. Identify the incentive, isolate the disputed assumption, and seek evidence for contracts, pricing, delivery capacity and timing. Forecast revenue requires a reasoned probability and period; recording revenue in financial statements raises a separate recognition question about an existing transaction and satisfied obligations. Unsigned negotiations are not completed sales merely because management expects success. Quantify the effect of the proposed change so reviewers can see whether it drives a target or covenant result. Document the evidence and communicate a corrected forecast to the decision makers. If pressure continues, use the organisation's escalation route and maintain an accurate record of the concern. Professional scepticism means challenging favourable assumptions consistently, including when the unsupported figure benefits your team.

Worked example: A manager's bonus requires forecast profit of R10 million. The supported forecast is R8 million, and the manager proposes adding R2 million from unsigned sales. The addition exactly closes the R2 million gap, making its evidential basis particularly important. Exclude it from the supported case, show it separately as a conditional scenario if appropriate, and explain what signed terms and delivery evidence would change the assessment. Escalate pressure to present it as secured revenue.

Watch the distinction: A plausible future contract is not a signed sale or automatically recognisable revenue. Keep conditional prospects separate from supported forecasts and recorded transactions.

Reference: [4]

47. Algorithmic bias in a credit decision

Aggregate model accuracy can conceal unequal mistakes. For a credit decision, first define the outcome of concern: rejecting an applicant who would have repaid is a false rejection. Calculate that rate separately for relevant groups using qualified applicants in each group as the denominator. A gap calls for investigation, not an immediate assumption about its cause. Check whether groups differ in missing data, sample size, historical labels, proxy variables or the way qualification was established. Compare performance across time and at the decision threshold actually used. Then assess who can override a decision, how overrides are documented, and whether applicants can have errors corrected. A CA(SA) advising on deployment should connect the measured error gap to customer harm, credit losses, operational controls and the organisation's objectives. Reassess the model after changes rather than treating one fairness statistic as a complete solution.

Worked example: Suppose 100 applicants in group A and 100 in group B are independently known to qualify. A model rejects 10 qualified A applicants and 30 qualified B applicants. False rejection rates are 10/100 = 10% and 30/100 = 30%, a 20 percentage point gap. Investigate data and decision rules before using the model without review. These figures alone do not reveal why the gap arose or how often unqualified applicants were accepted.

Watch the distinction: A model can have strong overall accuracy while rejecting qualified people unevenly. Calculate error rates by group and investigate causes before approving automated decisions.

Reference: [4]

48. Integrated professional judgement

Integrated judgement brings the financial case, execution risk and stakeholder effects into one decision. Start with cash flows that can be supported, then identify uncertain estimates and whether they are one-off or recurring. Separate the central case from plausible downside cases. For outsourcing, consider service quality, employee effects, customer obligations, data access and the ability to reverse the arrangement. A positive expected benefit may justify a staged pilot rather than an immediate full commitment if the downside is large or hard to detect. Specify safeguards, measures and a decision point: for example, verified service levels, complaint rates and a contractual remedy. Communicate which facts support the recommendation and which would change it. SAICA's APC guidance describes multidisciplinary professional judgement; the response should therefore connect technical analysis with ethics and practical action.

Worked example: Assume outsourcing saves R5 million over the decision period, costs R1 million to transition and could cause R3 million of quality loss over that same period. The supported net benefit is R5 million − R1 million − R3 million = R1 million. Because the quality estimate is three times the net benefit, recommend a limited rollout with measured service standards and a decision to expand only if actual losses remain controlled.

Watch the distinction: A positive net estimate is not a complete recommendation. Explain uncertainty, stakeholder effects and the controls that make proceeding defensible.

Reference: [4]; [7]

CA ANZ: seven core subjects and elective learning

49. Ethical sustainability disclosure

An emissions claim needs a clearly defined measurement boundary. Identify which activities, entities and periods the figures include, and check whether the comparison uses the same boundary in both periods. A fall in direct emissions can coexist with a smaller fall, or even a rise, when activities move to a supplier. Verify the underlying activity data, estimation methods and any material exclusions. State the unit, baseline and percentage calculation: change divided by baseline. An accountant should also consider whether wording implies a company-wide improvement when it describes only one category. If the scope changed, present a comparable figure or explain the difference plainly. Ethical disclosure requires a claim that readers can reconcile with the supporting data and with the organisation's actual operating changes. The CA ANZ programme places ethics and sustainability together for this kind of judgement.

Worked example: A company reports direct emissions falling from 100 to 80 tonnes, a 20-tonne or 20% direct reduction. It also acquires transport that adds 15 tonnes in the current period. Assuming the prior comparable boundary total was 100 tonnes and there are no other changes, the current comparable total is 95 tonnes. The broader reduction is 5/100 = 5%. Report the direct result with its boundary and explain the 5% comparable change.

Watch the distinction: A true 20% reduction in one emissions category can mislead when presented as an unqualified company-wide result. Reconcile the boundaries first.

Reference: [5]

50. Technology risk and AI oversight

An automated invoice control needs reliable inputs, a measured error profile and a human decision process. Define the target event precisely, such as a duplicate payment rather than any similar-looking invoice. Validate supplier identifiers, invoice numbers, dates and amounts before scoring; inconsistent formatting can create false matches. Recall measures the share of actual duplicates flagged, while precision measures the share of flags that are genuine. Both matter: missed duplicates leak cash, and false flags delay valid suppliers. Set a review queue with evidence for each flag and record the reviewer's decision. Restrict who can change model rules, monitor performance as supplier behaviour changes, and investigate overrides. Automation can prioritise work, but approval to reject or pay should have an accountable owner. Assess the cost of review against the expected loss avoided.

Worked example: A model flags 30 of 40 true duplicate invoices and also flags 20 valid invoices. Recall is 30/40 = 75%; precision is 30/(30 + 20) = 60%. Reviewing 50 flags could prevent 30 duplicates if reviewers confirm them, but 10 duplicates remain unflagged. Rejecting every flagged invoice automatically would disrupt 20 valid payments. Use review, sample unflagged items and monitor both error types.

Watch the distinction: A flag is a prompt for examination, not proof of duplication. Measure missed duplicates and valid invoices caught by the model.

Reference: [5]

51. Lease liability and right-of-use asset

A lease commonly creates an obligation to make future payments and a right to use an asset. At commencement, measure the lease liability as the present value of payments included in its measurement. Discount each payment according to when it falls due; a payment at the first year end is discounted once, while one at the second year end is discounted twice. The right-of-use asset initially reflects the liability plus or minus applicable items such as upfront payments, incentives, initial direct costs and restoration obligations. Later, interest increases the liability and cash payments reduce it; depreciation normally reduces the asset. This differs from treating the entire payment as a single period expense. Before calculating, identify the lease term, payment schedule, rate and any options whose treatment depends on the facts. Keep initial measurement distinct from later accounting.

Worked example: Assume two lease payments of $11,000, each due at a year end, and a 10% annual discount rate. Present value is $11,000/1.10 + $11,000/1.10² = $10,000 + $9,090.91 = $19,090.91, or about $19,091. That is the initial liability under these simplified facts. If there are no other initial adjustments, the right-of-use asset also starts at about $19,091, although no $19,091 cash payment occurs at commencement.

Watch the distinction: Adding the two payments gives $22,000 of undiscounted cash, not the initial liability. Discount by payment date and assess asset adjustments separately.

Reference: [5]

52. Australian GST on a taxable purchase

For an Australian GST purchase, separate the supplier's price from the tax component before recording cost or considering a credit. If the quoted price includes GST at an assumed rate, divide the total by one plus that rate to obtain the pre-tax price. The difference is GST. A potential input tax credit is a separate question: establish the buyer's registration and entitlement, the acquisition's business purpose, the supply's classification and adequate supporting documentation. If creditable, the equipment cost for this simplified calculation excludes recoverable GST; if it is not creditable, the unrecovered amount may affect cost under the applicable accounting treatment. Mixed business and private use can require apportionment. Keep the Australian analysis distinct from other jurisdictions' systems; the Ireland CA tax guide addresses a different tax setting.

Worked example: Assume a registered Australian business buys qualifying equipment for A$11,000 including GST at a hypothetical 10% rate, with full business use and suitable documentation. Pre-tax price is A$11,000/1.10 = A$10,000. GST is A$11,000 − A$10,000 = A$1,000. On those assumptions, the potential input tax credit is A$1,000 and the equipment's tax-exclusive purchase price is A$10,000. Different use or entitlement facts would change the credit.

Watch the distinction: Multiplying a GST-inclusive price by 10% would give A$1,100 and overstate the tax. Extract it by dividing by 1.10 first.

Reference: [5]

53. New Zealand GST on mixed supplies

New Zealand GST analysis begins with the character of each supply. Taxable sales can generate output GST; exempt sales are treated differently and may restrict related input credits. Separate the sales categories before applying the rate supplied in a problem. For figures stated before GST, multiply taxable consideration by that rate. For GST-inclusive consideration, extract the tax rather than multiplying the gross figure by the rate. Consider whether a transaction is genuinely exempt, zero-rated or outside scope, because those classifications have different consequences even when no GST is charged to the customer. Record a defensible basis for allocation where purchases support both taxable and exempt activity. Output GST is only one part of the eventual net payment: input credits and adjustments require their own facts. This classification sequence is more reliable than applying one percentage to total turnover.

Worked example: Assume NZ$80,000 of taxable sales and NZ$20,000 of exempt sales, both before GST, at an expressly hypothetical 15% rate. Output GST is NZ$80,000 × 15% = NZ$12,000. Applying the rate to all NZ$100,000 would produce NZ$15,000, an overstatement of NZ$3,000. No net GST payable can be calculated without facts about creditable purchases and any required adjustments.

Watch the distinction: Exempt sales are not simply another taxable line with a zero amount of output tax. Their classification can also affect input credits.

Reference: [5]

54. Performance measures and strategy

Performance measures should reveal whether an operational saving advances the strategy overall. Begin with the stated objective, such as profitable customer retention, then connect leading measures, including service capacity and response times, to lagging measures, including retention and contribution. Compare periods and customer cohorts on a consistent basis. A saving from fewer staff is only one cash-flow effect; lost customers can erase it. Use contribution per customer, rather than sales per customer, when estimating the profit impact of churn. Check whether retention changed because of service cuts or other factors such as prices and market conditions. A useful scorecard therefore combines financial results with service quality and customer outcomes, and names the person responsible for investigating deviations. The decision should reflect the net economic effect and the uncertainty in the causal link.

Worked example: A service reduction saves $400,000 a year. Across 10,000 comparable customers, retention falls from 90% to 85%, meaning 9,000 retained customers before and 8,500 after: 500 additional losses. At $1,000 annual contribution per lost customer, the estimated contribution loss is $500,000. Net annual effect is $400,000 − $500,000 = a $100,000 loss, assuming the retention change is attributable to the cut and contribution is comparable.

Watch the distinction: A lower staffing cost is not automatically better performance. Measure customer loss and contribution alongside the saving, then test causation.

Reference: [5]

55. Audit analytics and corroboration

Audit analytics identifies patterns that help direct procedures; it does not by itself establish a misstatement. Define a complete population of journal entries and reconcile it to the ledger before analysing dates, users, accounts and reversals. A concentration near year end may be routine closing work or a signal of management override. Select entries based on risk characteristics, especially manual postings to revenue, unusual preparers, weak approval trails and entries reversed soon after reporting date. Inspect supporting contracts, delivery evidence and authorisation, then trace relevant amounts to the financial statements. Compare recorded activity with what the business normally does, and seek explanations for exceptions. A CA ANZ Audit and Analytics candidate should distinguish the pattern detected, the assertion at risk, the evidence needed and the conclusion justified. Document why selected entries were tested and how unexplained exceptions affect further work.

Worked example: Suppose 70% of annual manual journals are posted in the final week and 15 of those entries credit revenue. Obtain the full journal population and verify the 70% calculation. Examine all 15 revenue credits for preparer, approval, contract terms, delivery or service evidence, amount and subsequent reversal. If a credit lacks support, investigate and quantify its effect. The concentration raises a targeted audit question; it does not prove that all 15 entries are wrong.

Watch the distinction: An unusual journal pattern is not an audit conclusion. Corroborate selected entries with transaction evidence and assess any exceptions against the relevant assertion.

Reference: [5]

56. Integrated business advice

Integrated business advice should put cash timing, accounting consequences, tax assumptions and execution risk on one decision page. Build an incremental cash-flow schedule: separate initial working capital from annual operating inflows and outflows, and state whether working capital is recovered at the end. Then assess funding needs at the moment cash is required, not just annual profit. Accounting profit may differ from cash because of depreciation, accruals and recognition timing. Tax effects require jurisdiction-specific facts about deductions, allowances and the transaction structure; do not apply a rate to cash savings without that analysis. Test demand, prices, operating capacity and collection periods in a downside case. A recommendation should specify the decision condition, such as a minimum order pipeline and a committed funding source. The CA ANZ study guide can help place this integrated task among its core subjects.

Worked example: An expansion is forecast to bring in $300,000 cash annually and require $220,000 annual operating cash. Net annual operating cash is $80,000. It also needs $100,000 working capital upfront, so the initial cash requirement remains even though the recurring figure is positive. Ignoring discounting and assuming no other cash flows, $100,000/$80,000 = 1.25 years of net inflows to cover it. Test demand and financing before committing.

Watch the distinction: An $80,000 annual cash surplus does not mean the expansion needs no funding. Show the upfront $100,000 requirement and its timing.

Reference: [5]

57. Advanced tax transaction sequencing

Advanced tax analysis depends on transaction character and timing before it depends on arithmetic. Identify the jurisdiction and taxpayer, then establish what asset was disposed of, how and when disposal occurred, and whether the amount is a capital gain, revenue item or another category. Calculate each result from supported proceeds, cost base and allowable adjustments under the rules specified in the problem. A loss may be usable only against particular gains or in particular periods; never assume all losses offset all income. Sequence transactions chronologically because the recognition date can determine the relevant period, rate or relief. Then apply any permitted offset and calculate the remaining amount subject to tax. Document the legal assumptions separately from the calculation so a change in classification can be traced through the answer. This is especially important when comparing Australian and New Zealand tax questions.

Worked example: Assume an Australian elective scenario states that two eligible asset disposals fall in the same relevant period and that a loss on one may offset the gain on the other. One produces a $70,000 gain; the other produces a $20,000 loss. Net gain is $70,000 − $20,000 = $50,000 before any other stated adjustments. If either asset has a different tax character or disposal date, reassess the offset before applying a rate.

Watch the distinction: Netting gains and losses first can hide a classification error. Establish each asset's character, disposal date and permitted loss treatment before offsetting.

Reference: [5]

58. Assurance engagement purpose

An assurance engagement requires a clear subject matter, suitable criteria and enough appropriate evidence to support a conclusion. A grants schedule is the subject matter; the agreed reporting rules, grant agreements and definitions of eligible spending might form the criteria. Identify the intended users and who prepares the schedule before agreeing scope. Reasonable assurance aims to reduce engagement risk to a suitably low level through more extensive work and normally uses a positive form of conclusion. Limited assurance involves less extensive procedures and normally expresses whether anything has come to the practitioner's attention indicating a material problem. Neither level means certainty. The procedures must respond to the risk of material error or noncompliance, including tracing grants to agreements, receipts and eligible expenditure. If criteria are vague or records inadequate, clarify or narrow the engagement before promising a conclusion.

Worked example: A client requests assurance over a $2 million grants schedule but supplies no eligibility rules or supporting records. First identify the grant agreements and reporting criteria, then establish whether evidence can be obtained for amounts and permitted use. If appropriate criteria and records become available, agree whether reasonable or limited assurance meets users' needs and design procedures accordingly. The $2 million total alone establishes neither the correct scope nor a conclusion.

Watch the distinction: Limited assurance is not a promise to do casual work, and reasonable assurance is not a guarantee. Both require suitable criteria and evidence.

Reference: [5]

59. Data insight from a misleading average

An aggregate increase can conceal deteriorating performance when the population changes. Divide total sales by the number of operating stores to form a simple productivity measure, then compare like with like. Store openings alter the denominator, and new stores may have had only part of the year to trade. For a stronger analysis, separate continuing stores from new stores, use comparable periods, and examine regional mix, floor area and margin. An overall average may also rise while most segments decline if high-volume locations gain weight. Show both total sales growth and unit-level change, since they answer different questions: scale and productivity. Investigate whether lower average sales reflect normal start-up time, cannibalisation or weak demand before recommending closures or further expansion. Check source totals and denominators carefully; a small counting error can reverse the apparent trend.

Worked example: A chain reports sales rising from $1 million across 10 stores to $1.1 million across 20 stores. Total sales grow by $100,000, or 10%. Average sales per store fall from $1,000,000/10 = $100,000 to $1,100,000/20 = $55,000, a 45% drop. Ten stores were added, not 100. Because new stores may have opened during the year, compare full-year equivalent and continuing-store sales before judging productivity.

Watch the distinction: Higher total sales do not prove each store improved. Reconcile store counts and compare like-for-like periods before interpreting the average.

Reference: [5]

60. Financial model scenario design

A scenario model should expose the drivers that determine its result. For a simple operating profit model, profit equals units sold multiplied by contribution per unit, less fixed costs. Contribution is selling price less variable cost per unit, so price, variable cost and volume can change independently. Calculate a base case, then alter a plausible driver while holding the others constant to reveal sensitivity. Break-even volume equals fixed costs divided by unit contribution, provided contribution is positive and capacity can meet that volume. Check whether fixed costs step up at higher output or unit contribution changes with discounts, because either would shift the boundary. A useful downside case links assumptions to evidence such as demand forecasts and capacity. State the decision rule and the margin of safety, then identify which assumptions require monitoring before funds are committed.

Worked example: Assume 10,000 units, $50 contribution per unit and $420,000 fixed costs for the same period. Base profit is 10,000 × $50 − $420,000 = $80,000. At 8,000 units, profit is 8,000 × $50 − $420,000 = a $20,000 loss. Break-even is $420,000/$50 = 8,400 units. The base case has a 1,600-unit cushion; the downside case is 400 units below break-even.

Watch the distinction: A profitable base case does not make volume risk immaterial. Calculate the break-even boundary and test whether demand could fall below it.

Reference: [5]

Official references and further reading

All study guides

Choose your exam version

ICAEW ACA

ICAS CA

CA Ireland

CA ANZ

SAICA IAC

SAICA APC

ICAEW ACA: current Certificate and Professional curriculum

1. Accruals and prepayments

2. Risk, assertion and control

3. Contract authority

4. Taxable profit bridge

5. Contribution and the limiting factor

6. Ethical threats in sustainability claims

7. Controls versus substantive evidence

8. Intragroup profit elimination

9. Digital investment choices

10. Cost of capital and financing

11. Tax planning versus compliance

12. An integrated business recommendation

ICAS CA: 2026 assessed curriculum

13. Revenue with distinct obligations

14. Flexible-budget variance

15. Materiality and audit sampling

16. Discounted project cash flows

17. Tax depreciation differences

18. Cash flow and insolvency signals

19. Impairment of an asset group

20. Group audit component risk

21. Model sensitivity and break-even

22. Data quality before prediction

23. Sustainability impacts and enterprise risk

24. Professional scepticism in a case

Chartered Accountants Ireland: financial reporting, assurance, finance and tax

25. Control and the acquisition date

26. Equity accounting for an associate

27. Foreign operation translation

28. Basic earnings per share

29. Audit materiality in context

30. Revenue cut-off evidence

31. Going concern and audit implications

32. Transfer pricing with spare capacity

33. Inflation-consistent NPV

34. Relevant costs in a pricing decision

35. Republic of Ireland corporation tax bridge

36. Northern Ireland inheritance tax computation

SAICA CA(SA): integrated technical competencies and professional judgement

37. Capitals and sustainable value

38. Business-model resilience

39. Governance and delegated decisions

40. Controls across a business process

41. Risk response and residual exposure

42. Capital allocation under a constraint

43. Connected reporting

44. South African VAT classification

45. Deferred tax from a temporary difference

46. Pressure to alter a forecast

47. Algorithmic bias in a credit decision

48. Integrated professional judgement

CA ANZ: seven core subjects and elective learning

49. Ethical sustainability disclosure

50. Technology risk and AI oversight

51. Lease liability and right-of-use asset

52. Australian GST on a taxable purchase

53. New Zealand GST on mixed supplies

54. Performance measures and strategy

55. Audit analytics and corroboration

56. Integrated business advice

57. Advanced tax transaction sequencing

58. Assurance engagement purpose

59. Data insight from a misleading average

60. Financial model scenario design

Official references and further reading

Frequently Asked Questions

Related Study Guides

Chartered Global Management Accountant (CGMA)

Association of Chartered Certified Accountants Qualification (ACCA)

Certified Management Accountant (CMA)