THE INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS IN IRELAND

EDUCATORS’ BRIEFING 2008/2009

FORMATION 1

BUSINESS MATHEMATICS & QUANTITATIVE METHODS

1. Comments on Performance in 2008 Examinations

1. Comments on the general standard: The standard in the April examination was
similar to 2007. 25% of candidates attempted less than 5 questions but a number of
these candidates were successful due to the quality of their responses to questions
1, 2 and 3. In the September examination, eight candidates (53%) answered less
than 5 questions and the calibre of the responses was poor. In both examinations a
number of candidates did not make any realistic attempt at any question. The
overall standard may be summarised by comments placed on examination papers
by the examiner: ‘limited understanding of any of the questions’, ‘limited knowledge
of the subject matter’, ‘lack of structure’, ‘very scrappy’, ‘no headings on columns in
answer’.

2. Significant areas of strong and weak performance in examinations: The overall

performance on question 1 (present value/discounting techniques/investment
appraisal) in both examinations was good and a substantial improvement on
previous years. Many of the problems apparent previously, particularly relating to
tabulation of cash flows, have been overcome with a greater understanding of the
subject matter.
However, one key weakness remains. This is the inability to use the statistical
formulae. The problem is high-lighted in q2 with regards to the derivation of the
standard deviation. This ongoing problem demonstrates lack of practice in solution
of numerical problems.
In the April examination, q4, candidates were asked to use linear regression
analysis to derive a trend line. The majority attempting this question used time-
series analysis, generally incorrectly, and some candidates attempted to de-
seasonalise the data.
Refusal to address the question asked, or misreading the question, limits the
candidate’s opportunity to succeed.
The responses to the qualitative question, generally q6. in both papers was
extremely poor with candidates lacking the knowledge to provide either content or
quality.

3. Suggestions for educators to address the weaker areas: The weaker areas
highlighted can only be improved by candidates attempting practice questions
during their course. As emphasised in previous years, in order to apply formulae
and derive quantitative solutions, experience of calculations and the development of
structures for solutions are essential. The Institute assists by making available past
examination papers and solutions on its website. Students should avail of these and
gain experience on both the content and context of exam papers and solutions.
Calculations relating to the standard deviation, and the use of formulae, are
continuous problems where many candidates do not seem to understand the
concept of ∑xy.
 With regards to ‘linear regression analysis’ candidates should be familiar with the
dependent and independent variables rather than assuming that the first column is
the dependent variable!
The answers to qualitative questions, generally q6, are poorly attempted. These
questions are generally framed to address a number of terms covering various
sections of the syllabus. In the majority of cases, very inadequate information is
provided.

2. Syllabus Objectives

The objectives remain unchanged. The aim of this subject is ensure that students
acquire, understand and apply quantitative techniques that are used in business
decision-making. The syllabus also confirms these objectives by setting out the
learning outcomes on completion of the subject. In this context the objectives are:

- to test the students understanding of mathematical techniques in the analysis of

business data,

- to test the students ability to use quantitative methods

- to test the students understanding of the principles of the subject areas as set out.

The examinations reflect these objectives.

3. Syllabus Changes

The syllabus content for 2009 remains unchanged. All sections of the syllabus require
knowledge at Competency Level 2, that is, “the ability to apply knowledge and
understanding effectively to the analysis of complex and unfamiliar situations”.

4. Format of the Examination Papers for 2009

The format of the examination paper remains unchanged. The structure of the paper is
similar to previous years and is set out as follows:

 The paper is 3 hours in duration. Each paper will contain six (6) questions; each
question will have a number of sub-sections. Part (i) will require quantitative
analysis. Other sub-sections may require qualitative analysis, that is, to provide
an interpretation of the quantitative data already derived.

 All questions carry equal marks (20). Sub-sections are awarded marks based on
difficulty. Marks for each question and section are set out on the examination
paper. The total for the paper is 100.

 Students are required to attempt five (5) questions.

5. Education Focus for 2009

 The focus of the papers remains unchanged. The questions will be framed in a
business context. Since the syllabus comprises nine sections, all sections of the
syllabus will be covered between the April and September examinations. Questions
are equally distributed over the syllabus and sub-sections to questions may cover
more than one area, particularly in q.5.

 Question 1 will relate to financial mathematics. Two questions generally relate to the
descriptive area of statistics. One question will relate to inferential statistics. One
question with three parts will be quantitative. This question will offer smaller
questions on financial mathematics and confidence intervals. All three parts should
be completed.
One question will be qualitative and will deal with a range of terms and/or
expressions broadly covering all sections of the syllabus.

 Students should be aware that articles published on the subject in the Students
Bulletin are examination focussed.