There is a good blog posted today on the Schweser site. It has a good summary of FSA topics at a high level and key points to know and study. It’s worth a look. http://www.schweser.com/online_program/blog.php?item_id=267
Celtics - Could you paste the complete thing out here?
Exam Taking Tips - (Borrowed from Level 2 Blog) By Jodi Joachim, CFA - Director of Content Development Greetings everyone! I’ve been posting on the Level 2 blog and thought that this might be a good cross-over subject, please note that it’s written from a Level 2 perspective. Several of the points apply to all levels, though. Jodi Hello again! In this blog, I’ll share a sample of some tactics I used when taking the exams. I know many of you have already started taking exam, so I though I’d post this now. I apologize a bit for the rambling nature, I also might seem like I’m a bit nuts here, but I’m all about strategy on exam day. If studying the material = passing, the pass rates would be in the 90 percentile, IMO. I rarely encounter candidates who do not study hard for the Level 2 exam. It’s more than knowing the material, it’s getting the right answers to the right questions. At Level 2, each question is worth 3 points, not the 1.5 like at Level 1, anything you do to up your chance of getting each question right is worth a few seconds of your time. First, read the question. Then, you may want to rephrase the question to make sure you answer what is being asked. For example, we have all seen the phrase “least likely” and on most days, we can comprehend that really means “false.” On exam day, though, I recommend you actually write “which is FALSE” on that question. Why? The question before it may have asked you which was “most likely” and your brain may still have that likely word stuck in there (of course, I would have written “which is TRUE” for that one.) I know this tactic gained me several points on each of my exams. After that, read all the choices. Don’t answer until you have read all the choices. This is particularly important for qualititative questions. Pick the best answer. Don’t forget that they really do mean "least likely. The questions avoid words like “always” on purpose - you want the choice that is appropriate nearly all the time. Some of us have minds that can think of all kinds of exceptions to things and it makes these questions quite a challenge sometimes. Don’t worry if you think you read once somewhere about if x and y an z happens, then k happens, go with what is the case nearly all the time. Keep the “players” straight. Some questions are full of names. When you get to the question, circle the names or do something so you know you are supposed to be using Tim’s forecasts instead of Jodi’s, for example. If the question says, “Using the data for the coefficients in Figure 4 and the intercept from Figure 1”, I write out to the side of the question, "Intercept from Figure 1?____ Coefficients from Figure 4? ___and them make myself check it off when I answer the questions. On exam day, it’s too easy to make silly mistakes like taking everything from Figure 4. If the question mentions a year, circle it in the question and write it out to the side, as in “USE 2006 NUMBERS” in big letters. Likewise, if they say to use beginning of period data, mark that too and write it down. (in this case, I’d write myself a note like “use END 2006 Bal Sheet #s.” After you have performed your calculations, double check that you used the right data. That’s all for now. Take Care,
dinesh- you aren’t missing much you don’t know already… except the pic of the lady blogging and the fact that she likes horses (which if you looked at her pic, you might’ve guessed anyways) speaking of the celts, game 3 tonight? i say after a tough loss, mo-town best watch out! the 3 amigos are in town! i say ray-ray heats up and drains like 5 from behind the paint tonight.
Not the one posted above, it was this one: ============================================= First, if you are wishing that FSA will go away, stop. There is only one way to get rid of it and that is to pass Level 2. Then, you are free and clear of FSA at Level 3. If for any reason you have NOT studied FSA “much”, STOP what you are doing and carve out the next 3 days to hit it hard! Read the notes. Work very problem you can get your hands on. You cannot ignore FSA. Second, with the exam weighting at 15 - 25%, there will be 3 to 5 item sets on the exam. Whether you want to hear this or not, this is the “lightest” volume of FSA material that I have seen in my way too many CFA seasons here. What that means is, even at 3 item sets, you are basically drawing from a pool of intercorporate investments, business combinations, pension accounting, and multinational operations (and don’t forget the synthesis reading). Or, put another way, something you don’t like in FSA and don’t quite “get” will be on the exam. You will not get 100% on this section. But, that’s OK. You can still do well. Just prepare yourself now. Third and last, it’s hard to “summarize” FSA in a blog, so I am only hitting a few items here. This really is not an “all you need to know” by any means. So, here it goes: * Held-to-maturity, available for sale, trading securities: unless you sell something, changes in value of AFS securities do not impact income (they are unrealized gains/losses in equity). Changes in value in trading securities do whether you hold them or sell them. The way we calculate the market value adjustment may “bother” you, but it’s right and it will save you time on the exam. If it’s just driving you nuts, let it go. * Equity/Consolidation, etc…If you know nothing else, know the information in Figure 13 on page 168 of Book 2 of our notes. Acutally, all the figures of summary information (meaning, up down, higher lower) in that reading (#22) are “must knows.” * Purchase and Pooling: Remember, you can’t use pooling anymore under US GAAP or IAS, but you may see a question about a company that used to use it or is located somewhere that still allows it for some odd reason. Know the information in Figure 1 on page 160. * Impact on ratios: If you know the impact of accounting methods on the numerator and denominator components, you can figure out nearly all the ratios. * VIEs - this is a new reading this year and I’d know the conditions under which a VIE must be consolidated and how to identify if a firm is a primary beneficiary. Sometimes these questions are “disguised” as just comparing equity (the old way to account for a VIE) and consolidation (what the primary beneficiary must now use) questions. * Pension accounting: Pay attention to whether the company in the question is using “old” US standards or the “new” ones. Under the new standards, the balance sheet account (remember, they have “weird” names, such as the asset might be called prepaid pension cost). Don’t forget that the reading this year wants you to offest say an increase in pension liability by a decrease in deferred taxes and a decrease in equity (if the logic of the decreases bothers you, just remember that the balance sheet has to balance and if you increase liabilities, you have to decrease something else on “that side” of the balance sheet). * Multinational operations: This is my all-time favorite Level 2 reading!Know Figure 3 on page 243, Figure 4 on page 245, the exposure under each method (page 246), and how to calculate the flow and holding effect for both the temporal and all-current methods. Figures 15 and 17 that appear later in that reading and may be helpful. If you feel dizzy looking at them at this point, know Figure 3 and do your best with the ratios. Use numerical examples, such as, if the LC is appreciating, write down 0.5other/LC and then 0.8other/LC and try to think the problems through. That may help you if you are asked if a ratio is “increasing” or “decreasing.” * Synthesis: This is an old stand by reading and primarily tests your Level 1 retention for items such as capital and operating leases, LIFO/FIFO conversions and capitalized expenses. I think the best prep (other than reading our review) is to read the FSA section in Book 0 that came with our notes this year. * I know there are a few other reading in FSA, but again, the point of this blog was to hit the high points. If you have time, reread those others, but don’t get bogged down in the details of stock option accounting, for example.
Thanks cfaboston28 and CelticsFA11 bannisja - I have no idea why I keep forgetting silly things if I don’t refresh them every couple of days. Hope I am able to recall atleast 70% of the mammoth curriculum, to sail the boat across the windy storm on 7th. I just knocked of around 40 pages for Ethics from CFAI book and my head is still spinnin’ with that boring stuff.