CA FAR Overview

In this blog, we cover the following key areas:

1.      FAR Content Overview

2.      Requirements to Pass the Module

3.      Core Competence

Our next blog will explore some of the most frequently tested topics and provide tips on how to best prepare for the exam.

Content Overview

The Financial Accounting and Reporting module consists of three comprehensive chapters encompassing 14 topics, and introduces approximately 15 accounting standards. The final Online Assessment (OA) predominantly focuses on Chapters 2 and 3, with some questions also drawing from Chapter 1.

Below is a high-level summary of the module, followed by an overview of frequently tested topics.

Chapter 1 Overview

Chapter 1 provides foundational knowledge of the four primary financial statements and covers essential standards, including IFRS 13 Fair Value Measurement and IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors. This chapter lays the groundwork for understanding the more complex standards and applications discussed in later chapters.

Chapter 2 Overview

Chapter 2 delves into six key topics, each of which carries a strong likelihood of appearing on the Online Assessments (OAs). Among the most critical areas covered are tax reconciliation, deferred tax worksheets, asset impairment, leases (both in arrears and in advance), revenue with contract and financial instruments.

Candidates often find Chapter 2 significantly more challenging than Chapter 1. Each topic introduces several essential concepts that require thorough understanding. However, by mastering these concepts and practicing with pre-populated journal and calculation templates, you can make this chapter more manageable and build confidence in tackling exam questions.

Chapter 3 Overview: Consolidated Financial Statements

Chapter 3, Consolidated Financial Statements, is considered the most intellectually demanding part of the Financial Accounting and Reporting (FAR) module and, arguably, the entire CA program. The same preparation methodology used in earlier chapters can be applied here: focus on understanding the critical topics and practice with delicate templates.

By doing so, you'll find that journals and calculations can often be automatically populated with only some adjustments, making the preparation process more efficient and manageable.

Requirements to Pass the Module

To successfully pass the Financial Accounting and Reporting (FAR) module, candidates must meet the following criteria:

* Complete both Online Assessments (OAs)

*  Achieve an overall score of 50% or higher

*  Pass the final OA with a score of 50% or higher

While there are two OAs, the final OA is the most critical. Even if a candidate scores 100% on OA1, failing to achieve at least 50% on the final OA results in not passing the module, regardless of an overall score above 50%. Most candidates who do not pass the module face this challenge, as it is the final OA that often proves to be the hurdle, not the overall score requirement.

Core Competence

The most essential core competence for the FAR module is a strong understanding and practical application of accounting standards.

Exam questions frequently involve the preparation of journals, often accompanied by written analysis. The main objective is to test a candidate’s ability to understand and apply accounting standards effectively.

Memorizing entire accounting standards is neither practical nor necessary, as each standard spans dozens of pages. Instead, focusing on the critical topics within each standard is crucial. Mastering these key areas and practicing their application will greatly enhance your chances of success.

In Summary

Many candidates find the FAR module challenging due to its extensive scope and depth. However, with dedicated practice and a solid understanding of the key concepts, success is achievable. In our next blog, we will delve into some of the most frequently tested topics and share tips on how to best prepare for the exam.