Student Guidance Notes

Guide C03
September 2004

Guidance notes for students planning to sit

C03 Fundamentals of Business Mathematics of the
new 2006 CIMA Certificate in Business Accounting
syllabus

This guide outlines the issues relating to transition from C03 Business Mathematics of the
2000 syllabus to CO3 Fundamentals of Business Mathematics of the new 2006 CIMA
Certificate in Business Accounting syllabus.

The first section of this guide compares the two syllabuses, highlighting the differences
between them.

The second part of this guide focuses on the assessment strategy for the new C03
Fundamentals of Business Mathematics exam.

The third part of this guide lists additional (or changed) learning outcomes in the new
syllabus.

If you have any further queries relating to this guide, please contact the CIMA Contact
Centre:

Telephone+ 44 (0)20 8849 2251

Email: cima.contact@cimaglobal.com

1 February 2006
 Syllabus Comparison
New Syllabus Old Syllabus Comparison and Comments

C03 Fundamentals of C03 Business

Business Mathematics Mathematics
A. Basic Mathematics 3 (i) Basic Basic Mathematics rises from 10% to 15%
15% Mathematics 10% with the inclusion of inequalities and the
reference to the learning curve.
B. Probability 15% 3(iii Probability 20% Probability falls from 20% to 15% but
concentrates on probability and expected
values. The normal distribution is dealt with in
section C.
C. Summarising and 3(ii) Summarising and Summarising and analysing data falls from
Analysing Data 15% Analysing Data 25% 25% to 15% and now focuses on the analysis
and presentation of univariate data. It
excludes primary v secondary data and
sampling.
D. Inter-relationships A new section dealing with correlation and
between Variables regression.
15%
E. Forecasting 15% 3(v) Forecasting 25% Forecasting falls from 25% to 15% but it
previously contained correlation and
regression, now in the new section D.
F. Financial 3(iv) Financial Financial mathematics falls from 20% to 15%
Mathematics 15% Mathematics 20% with the reduction in requirements for
investment appraisal. This is covered in depth
at Managerial level.
G. Spreadsheets 10% A new section.

Aims
There are two specific aims not seen in the old syllabus:

i) correlation coefficients and simple regression analysis were previously included under
forecasting, and
ii) the use of spreadsheets, in recognition of their importance in quantitative analysis.

2 February 2006
 Assessment
There will be a computer-based assessment (CBA) of 2 hours duration, comprising 45
compulsory questions, each with one or more parts.

The current paper requires a CBA of 90 minutes duration with 35 questions with one or more
parts.

A variety of objective test question types and styles will be used within the assessment. As well
as the conventional multiple choice format other possible styles include:
• filling in the blank in a sentence
• listing items in rank order
• stating a definition (in not more than __ words)
• identifying a key issue, for example advantage/ disadvantage (in not more than __
words)
• calculating one specific figure, for example profit for a period.
• completing a blank or partially completed prescribed format using terms and/or
numbers, for example an overhead cost table
• identifying points on a graph or diagram, for example a break even point
• identifying a specific term describing action/valuation seen in a scenario, for example
the conditions for a recession
• matching items together or with a description, for example “are the following cash or
non-cash items”
• interpreting numerical or graphical data.

For further information about computer based assessment please visit the website at
www.cimaglobal.com/cba

3 February 2006
 Learning Outcomes
Additional (or changed) learning outcomes

The following learning outcomes were either not included in the corresponding “old” syllabus
or have experienced a change:
• calculate for both ungrouped and grouped data: arithmetic mean, median, mode,
range, variance, standard deviation and coefficient of variation;
• explain the concept of a frequency distribution;
• prepare graphs/diagrams of normal distribution, explain its properties and use tables of
normal distribution;
• apply the Pareto distribution and the ‘80:20 rule’;
• calculate indices using either base or current weights;
• use indices to deflate a series and explain how and why they are used
• prepare a scatter diagram;
• calculate the correlation coefficient and the coefficient of determination between two
variables;
• calculate the regression equation between two variables;
• apply the regression equation to predict the dependent variable, given a value of the
independent variable.
• prepare a time series graph;
• identify trends and patterns using an appropriate moving average;
• prepare a trend equation using either graphical means or regression analysis;
• calculate seasonal factors for both additive and multiplicative models and explain when
each is appropriate;
• calculate predicted values given a time series model;
• identify the limitations of forecasting models.
• calculate the future value of regular savings and/or the regular investment needed to
generate a required future sum using the formula for the sum of a geometric
progression;
• calculate the NPV and IRR of a project and explain whether and why it should be
accepted;
• explain the features and functions of spreadsheet software;
• explain the use and limitations of spreadsheet software in business;
• apply spreadsheet software to the normal work of a Chartered Management
Accountant.

4 February 2006
 Transition Arrangements

Exams based on the CIMA Certificate in Business Accounting 2006 Syllabus, will be available
at CIMA approved CBA centres from 2 October 2006.

Exams based on the CIMA Certificate in Business Accounting 2000 Syllabus, will be available
at CIMA approved CBA centres until the 1 March 2007.

Exams based on the 2000 and 2006 Syllabus will be available concurrently between the 2
October 2006 and the 1 March 2007.

Conclusion

This syllabus has undergone some re-arrangement of material into different sections and there
is an addition of a new section on spreadsheets.

However the bulk of the previous syllabus remains. The majority of the learning outcomes
listed above have experienced changes of wording or emphasis rather than signalling new
topic areas. The computer based assessment is now two hours duration (from 90 minutes) and
there are 45 compulsory questions (previously 35).

5 February 2006