What you can learn from the Level 3 Examiner’s reports

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This review is of the examiner’s reports that were published in October 2023 and has been written to help you familiarise yourself with the Level 3 Diploma in Accounting units.

The reports “provide information on the performance of students in assessment tasks” and “are intended to be constructive, informative and promote a better understanding of the specification content and assessment requirements.”  They highlight key areas of strength and, more importantly, areas for improvement.  Therefore, they contain useful nuggets of information.  Because if you know in general which topics/tasks most students find hard, you can use that information to guide your learning and revision and help you avoid common mistakes. Although, be careful not to neglect topics just because people generally perform well in them!

So, to motivate you to use them, here is a summary of the weak areas in each unit and links to other articles* that will support your understanding of the topics.  The reports contain lots of extra information so you are strongly encouraged to read them in full.  They can easily be found in the learning portal.

Financial Accounting: Preparing Financial Statements (FAPS)

Overall percentage of students achieving required competence level: 54%

Use of time: only 79% used on average

Strongest tasks: 1  – Using Day Books, and Accounting for and Monitoring Non-current Assets (73% reached competency level), and 4 – Producing Financial Statements for Sole Traders and Partnerships (76%)

Tasks in need of improvement: 2 (only 35% reached competency level) and 3 (37%)

Competency in the other tasks: 5 (55%) and 6 (51%)

Areas of weakness:

Task 2 – Recording Period End Adjustments

  • valuing and posting closing inventory
  • calculating the amount to be accrued or prepaid where an invoice covers two accounting periods
  • posting transactions to the accrued expense accounts or the prepaid expenses accounts (rather than the relevant expense or income account)

Task 3 – Producing, Adjusting, Checking and Extending the Trial Balance

  • identifying the effects of transactions on the accounting equation
  • correcting errors
  • completing a trial balance from written information

There are lots of Comment articles to support this unit, and whilst they were originally written to cover tricky areas in the AQ16 units, the topics are fundamentally the same and the report shows that students are still finding the same key areas difficult.  Therefore, the following are a good place to start.

Relevant AQ16 articles:

Management Accounting Techniques (MATS)

Overall percentage of students achieving required competence level: 61%

Use of time: 84% on average

Strongest tasks: 2  – Attributing Costs (72%), and 3 – Short Term Decision Making (64%)

Tasks in need of improvement: 6 (with 46% reaching competency level)

Competency in the other tasks: 1 (57%), 4 (60%) and 5 (55%)

Areas of weakness:

Task 6 – Budgets and Deviations (using a spreadsheet)

  • freezing rows and columns as required
  • using the forecast function to create a line chart, forecasting sales using averages and a confidence interval as required
  • identifying which variances were adverse or favourable and using data validation to select from a list
  • calculating the net income/loss per month as a percentage of actual revenue

Relevant AQ16 articles:

There are also lots of articles to support tasks 5 and 6 which assess spreadsheet skills.  However, they are under the ‘Resources’ section of the Comment website where you can find Excel Tips. It might be good to start with this article about data validation as it is mentioned in the report as a significant area of weakness.

Business Awareness (BUAW)

Overall percentage of students achieving required competence level: 62%

Use of time: on average students only use 72% of the time available to them but spend more than the notional time allocated on the written tasks.

Strongest tasks: 1  – Organisations and Ethics for Accountants (79% competency), and 5 – Micro-economic Environment and Sustainability (92%)

Tasks in need of improvement: 4 (34%) and 6 (29%)

Competency in the other tasks: 2 (50%), 3 (65%) and 7 (64%)

Areas of weakness:

Task 4 – Ethical and Legal Compliance

This tasks requires written answers and weaknesses include:

  • not providing an answer which was targeted to the requirement asked
  • stating all ethical principles and threats in hope to gain marks. Students’ need to ensure that they identify the relevant principles and threats, explaining them in the context of the scenario
  • not providing an explanation of the process of money laundering and the regulations around the reporting of any suspicions
  • not demonstrating knowledge and understanding of the actions which can be taken to address unethical behaviour

Task 6 – Communication and Visualisation

This tasks requires written answers and weaknesses include:

  • not identifying or explaining the trends and patterns in data presented
  • not identifying the appropriate format for visualised data and for communications to meet the needs of the user
  • not identifying the relationships in the presented data and not understanding the information that can be drawn from a visualisation
  • not interpreting performance across a range of information provided in different formats

Other remarks regarding Task 2 – Analysing the External Environment

This task includes written answers in relation to completing a PESTLE analysis and the report states that students struggle to apply their analysis to the given scenario.  In particular they are weak at identifying relevant threats and then explaining why they are threats and what appropriate actions can be taken to address them, especially in relation to environmental issues.

The report makes a number of other points about exam technique in relation to written answers including the fact that students:

  • don’t always answer the question asked and/or don’t answer it fully or in enough detail
    • Try to use the number of marks available to help you gauge how much to write and always check your answer against the question once you’ve written it to ensure you’ve answered it completely
  • don’t pay attention to the command verb used
    • Ensure you know what the command verbs mean as they indicate the kind of answer the examiner is looking for.  Check out the writing skills e-learning unit and associated videos on the learning portal if you are unsure.
  • don’t use the information given in the scenario and/or make unrelated general comments
    • Ensure you always refer to the scenario to support your points, that way you’ll maximise the marks you can be awarded.

Q22 articles specifically about this unit:

Relevant AQ16 articles:

Tax Processes for Business (TPFB)

Overall percentage of students achieving required competence level: 62%

Use of time: 87% used on average

Strongest tasks: 2  – Calculating and Accounting for VAT, (76% reached competence level), and 3 –  Recovery of Input Tax (73%)

Tasks in need of improvement: 5 (47%) and 7 (39%)

Competency in the other tasks: 1 (58%), 4 (62%), 6 (57%) and 8 (62%)

Areas of weakness:

Task 5 – Verifying VAT Returns

  • reading the task and instructions correctly
  • reconciling the VAT return to accounting records

Task 7 – Principles of Payroll

  • understanding the content of FPS and EPS
  • calculating the amounts due to HMRC
  • performing reconciliations to net pay

Q22 articles specifically about this unit:

This unit has been changed from the previous AQ16 one to better address the needs of employers.  It therefore includes payroll principles and puts emphasis on the administration, compliance, and verification of VAT processes rather than VAT calculations.  It has accompanying reference material that can be accessed during the assessment, with which I suggest you should be as familiar as possible so that you know what is in it, as well as maybe more importantly, what is not!

With that in mind, the following AQ16 articles are relevant as they should help you improve your underpinning knowledge:

Whilst these will help improve your calculation and adjustment skills:

The report also mentions that students need to be more familiar with the implications for non-compliance of VAT regulations, in particular the penalty regime, an area that is covered in Task 6.  So, you should also be aware that the unit is based on a specific Finance Act which is changed annually but is usually a year behind the actual tax year.  This means that some of the details you will be assessed on, such as thresholds or penalties, may be different to those that you apply at work. Therefore it’s vital you use the reference material, even if you regularly prepare VAT returns!

General comments made in all reports

As you read the reports you will notice that there are some general themes that come up in each one.  Notably that students’ answers imply that they haven’t read the questions carefully enough and sometimes fail to understand the task requirements.  They also state that students don’t always complete all the components of a task.  Given that on average most people finish with between 13% and 28% of the allocated time left, going slowly and double checking your answers is likely to be a good assessment strategy.


The purpose of this qualification is to ensure that you are well prepared to progress into a career in business, finance or professional accountancy, or into further education. Therefore it develops the skills needed for financial processes, including accounting principles and concepts, advanced bookkeeping and preparing financial statements. It also covers the business environment, technology used in finance and accounting, business issues regarding payroll and value added tax (VAT), issues in business, management accounting techniques, ethical principles and sustainability considerations for accountants.

In order to successfully pass this qualification, you will need to use a range of study techniques.  The FAPS and MATS units require you to learn theory and then apply it in practice, usually through calculations; skills traditionally within the comfort zone of accounting students.  However, BUAW and a significant proportion of TPFB, requires you to understand topics, recall and apply facts, more than they need you to be able to do things, such as calculations.  Therefore, you will need to adjust your learning techniques so that they are appropriate for each unit.

*  Note that articles published before September 2022 will have been written in line with the AQ16 specification therefore, they could use different terminology, for example, sales ledger/control account as opposed to receivables ledger/control account, but the theory will still be valid.

Gill Myers is a self-employed accounts consultant. She has taught AAT qualifications since 2005 and written numerous articles and e-learning resources.

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