ACCA P3 Revision Course Dec 2014

Objective is 50 marks in 3 hours

Which 50 marks the easiest

To be on safe side go for 60%

Targets

Q1 30 / 50 Time 25 minutes reading and planning + 80 minutes writing = 2.67 mins per mark

Q2 15/ 25 Time 15 minutes reading and planning + 30 minutes writing = 2.0 mins per mark

Q3 15/25 Time 15 minutes reading and planning + 30 minutes writing = 2.0 mins per mark

Q1a) Aim for 90% eg 18/20 = 48 minutes writing

b) Aim for 50% eg 10/20 = 27 minutes writing

c) Dont get zero eg 2/10 = 5 minutes writing

Q2 and 3a) Aim for 80% eg 12/15 = 24 minutes writing

b) Aim for 30% eg 3/10 = 6 minutes writing

Different types of Q

Answer is in the Scenario Write What is in scenario and Why it matters

What do you think Write What is in scenario and Why it would be good

Theory Keep brief

Stages in Strategic Planning

Analysis S W O T Financial Stakeholders

Choice S F A

Implementation Efficient and Effective

Change Drivers and resistors

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Stakeholder analysis

Mendelow

Stakeholder group

They are high power because

They are low interest because

They expect

Stakeholder Management

The company should keep them satisfied by doing

The companys strategy will be acceptable to them because

If not acceptable then use driving / resisting forces to change mind

Forget the rain forest

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 External Analysis

PESTEL 5 forces

Macro Market / Competitive / Industry / ???

Opportunities Threats Threats (how severe)

Easier Harder Is industry attractive?

to meet objectives

What do you do This is what you told me and this is why it matters

This is what you told me and this is why it will increase / decrease revenue

This is what you told me and this is why it will increase / decrease costs

Have summary at the end

Overall things are getting worse / better

(Tie in with numbers)

KISS

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Financial Analysis

Profitability Liquidity Gearing

ROCE * Current Gearing *

Revenue % change Quick Interest cover

Gross Margin % change Receivables

Net profit Absolute Payables

Net Profit % change (Compare above two)

Do answers to 2 DP (be careful of rounding)

*= Show workings

Uses of above;

In part a) to look at impact of changes in external environment (do just before your
conclusion- see external analysis)

In part a) to look at success of past strategies (benchmark against industry)

In part b) to look at potential acquisition (benchmark against purchaser or other potential

targets)

Integrated reporting (new in syllabus)

Think Twice Write Once

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Internal Analysis

Strengths mean you are better than rivals = competitive advantage

Weaknesses mean you are worse

How do you identify these?

Examiner tells you

Calculate some numbers (could be financial or non-financial and benchmark)

What do you do This is what you told me and this is why it matters

If you have a strength then Build on it (suitable strategy)

If you have a weakness then fix it (this links with improving business processes)

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Models to use

9Ms (never tested)

Value Chain

IL / OP / OL / M / S

I / HRM / T / P

Remember upstream and downstream

Value adding costs are ones which justify higher prices

Often there isnt one (the no-model model)

This is what you told me and this is why it leads to increased revenue / decreased costs

This is what you told me and this is why it leads to increased costs / decreased revenue

Could also use

This is what you told me and this is why it is efficient / effective / inefficient / ineffective

Remove / reduce all non-value adding costs (i.e. be more efficient)

Make sure you do not fall below threshold levels

Improve effectiveness

Beware of the tiger

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Strategic Options

1 Use Ansoff (what do you think)

Market penetration

Market development (attractive?)

Product development

Diversification
o Related = Build on strengths / Obtain synergies

o Unrelated = Exploit Opportunities / Reduce Threats (life cycle / external

analysis)

2 What method

Organic growth

Acquisition

Alliance

Joint Venture

Franchising

Strategic Choice (What do you think about my option)

Is it

Suitable

Feasible

Acceptable

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Finance

Ratio (Financial Analysis)

Management Accounting

Key factor analysis (Outsource?)

Make or Buy (Acquisition?)

Close or Continue (Divest?)

Special contracts

Will a strategy be Acceptable to stakeholders?

Remember that external factors may mean we cannot do what we would like

Using numbers to predict the future

Linear regression
Time Series

Remember that external factors may mean the past cannot be used to predict the future

Decision trees

Remember that the probabilities will be estimates and the expected value cannot occur

May have to criticise the

Method used
Data (rows) used (Ward and Daniels)

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Marketing

Market segmentation

The Marketing Mix

Product

Price

Place

Promotion

People

Process

Physical evidence

ALL MUST BE SPECIFIC AND RELEVANT TO THE SEGMENT

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Business Processes

Aim is to make these more efficient and effective

Swim lane diagrams

Process Improvement =change one box

Process redesign = remove a row

Process re-engineering = remove many rows

Rummler and Brache

Harmon

How can you improve business processes

Simple / Low = Generic package (cheaper / quicker / less faults)

Simple / High = bespoke (do functional / non-functional / technical / design / Supplier

Stability / Implementation etc.)

Complex / Low = Outsource to a specialist (more effective / more efficient)

Complex / High = Improve staff (see People)

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E-Business

Use IT to transform high importance processes (see BPR above and bespoke above)

e-procurement = dealing with suppliers

e-Marketing (Improving the effectiveness of a website)

Interactivity

Independence of location

Individualisation

Intelligence

Integration

Industry structure

BE SPECIFIC AND MAKE IT RELEVANT TO COMPANY

Blackcurrant bushes

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People in organisations

Recruitment and selection (what do you look for in candidates)

Training (knowledge management) must be efficient and effective i.e. train them in what
they need / when they need it

Structure / culture
o Functional =efficient
o Divisional = effective

o Centralisation = efficient
o Decentralisation = effective

o Mintzberg
Machine bureaucracy = role culture
Professional bureaucracy = task culture

o Cultural web
Stories
Rituals
Symbols
Control
Power
Structure
Paradigm

Leadership

Retention = motivation = job design

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Project Management

Aim is to meet

Objective

Deadline

Quality

Cost

In the Exam it is about preventing things going wrong.

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Before the project starts

Project gateways are stages we go through to try and prevent having projects go wrong

1 Initial Screening

Identify why project is needed at all (i.e. abandon the project)

Identify any stakeholders who might be affected (will it be acceptable)

2 Risk Assessment

What would happen if we did not meet;

Objective

Deadline

Quality

Cost

Should we avoid these risks (i.e. abandon the project)

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3 Business Case (Saw this is Management Accounting)

What if business case is prepared poorly (Ward and Daniels from Finance)

If business case is negative should we abandon the project

4 Project Initiation Document

States as specifically as possible

Objective (end-users)

Deadline

Quality

Cost

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5 Choose the workers

Project sponsor (the client)

Project Manager (soft skills)

Project Team (complementary skills, leave time for Tuckman, range of Belbins personalities)

During the project

Solve problems quickly

If you have to break one of the constraints break the least risk one

Benefits realisation

After the project

Post-implementation review (fix the mistakes)

Post-project review (avoid making the same mistakes again)

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Change Management

Used for big changes (culture / strategy etc.)

Balogoun and Hope Hailey

How likely is it that change will be successful

From the point of view of the people wanting things to change

Time

Capability

Power

Capacity

From the point of view of the people being changed

Scope

Preservation

Readiness

Diversity

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Other models that can be used

Lewin

Unfreeze Change Refreeze

Lewin Johnson and Scholes

Driving Participation

Resisting Coercion

Education

Johnson and Scholes

Major / sudden changes (imposed from outside) = Revolution = needed but may go wrong

Minor / sudden changes (through choice such as BPR) = Transformation

POPIT and business change lifecycle (new in syllabus 2014)

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Professional Marks

1 Report format?

To

From

Date

Subject

2 Introduction

Definition and model

What are you going to look at and model you will use

3 Use paragraph headings

4 Conclusion

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Remember

Who needs exam tips?

KISS

Tigers and trainers

Blackcurrant bushes

Forget the rain forest

Measure twice / cut once = Think twice / write once

(195 35 20 20) = 2.0 mpm

60

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