T10-Investing Surplus Funds

Companies may face situations where they have surplus funds.What to do with these surplus funds?To hold it or to invest it?According to Keynes,business holds cash for 3 motives:
(i)Transaction motive-hold money to meet regular commitments such as paying employees
(ii)Precautionary motive-hold money for emergency purpose such as demand from payables (iii)Speculative motive-hold money for investment purpose

Companies may invest surplus funds to earn return.Four factors need to be taken into account when deciding how a company should invest its surplus funds:

(i)Risk
(ii)Liquidity
(iii)Maturity
(iv)Return
When we talk about risk of an investment,we are really talking about the extent to which its value is likely to fluctuate.There is a strong link between risk and return:the higher the level of risk taken,the greater the return of the investment.The risk can be divided into two components:
(i)Systematic risk-risk that cannot be diversified away,variability of returns caused by factors affecting the whole market,eg.macroeconomics such as inflation.
(ii)Unsystematic risk-risk that can be diversified away,variability of returns caused by factors just affecting a specific market sector.This element of risk can be diversified by holding a well-diversified portfolio of investments(more than one investment).
Liquidity described how easily the money invested can be converted into cash.There is also a link between liquidity and return.An investment that is highly liquid will generally result in a lower return on the investment.On the other hand,an investment with a low level of liquidity will generally provide a higher return.If the amount and duration of surplus funds are subject to change,then only very liquid investments should be considered.
Maturity means the duration of investments.A company's investments should mature so that the surplus funds is available when the business needs it.This can be assessed by preparing a detailed cash budget to cover at least a six-month period into the future.There is also a link between maturity and return.A longer maturity will generally provide you with a higher return.On the other hand,an investment with a shorter maturity will result in a lower return.
The rate of return is the last factor to consider when investing surplus funds.This is because it is largely dictated by the three aforementioned factors-risk,liquidity and maturity.Once you have decided on the appropriate level of risk,liquidity and maturity,you have substantially narrowed down the types of investment that are appropriate.The market then dictates the rates of return on these investments to you.

There are numerous types of investment available for company with surplus funds.Surplus funds can be deposited in interest bearing accounts offered by banks,finance houses or buiding societies.Interest amount between such accounts can be compared by calculating the compound annual rate of interest(CAR):

CAR=[(1+x/n)^n-1] X 100%

x=% interest as in decimal figure

n=number of times interest paid per year

So let's understand this formula by looking at an example:nominal interest rate is 12% and is compounded quarterly.

nominal interest rate is the same meaning as interest rate per annum.In this example,it was received quarterly,so the n=4 meaning one year we received 4 time,then do as follow

CAR=[(1+0.12/4)^4-1] X 100%=12.6%

Other than this,we may also invest in the money market.Money market is a market for short-term debt securities.The yield(profitability) of a money market instrument depends on

(i)Its face value

(ii)interest rate or coupon rate offered

(iii)period of time before it is redeemed(ie.converted into cash) by the issuer

The interest yield=coupon rate/market price X 100%

let's see an example:On 5th january 2010 the market price of 5% treasury stock 2011 is $145.Calculate the interest yield.

So,the market price was given $145,but what about the coupon rate?You need a face value first but most of the time it is not given in exam,therefore always assumed it is $100.So the coupon rate=5% X $100=$5 and interest yield=$5/$145 X 100%=3.45%

Okay let's consider the securities in the money market.Gilts are one of them which are marketable British Government securities.The government issues them to finance its spending,but also uses them to control the money supply.Government promises to buy the gilt back on a specific date in the future.Gilts usually have fixed interest rates,although there are various index-linked gilts.If a company buys a gilt and holds it until it is repaid by the government,the return received will be fixed from the outset.As the government will not default on the debt and the interest to be earned is known in advance,this makes it a low-risk investment.

A certificate of deposit(CD) is a negotiable instrument issued by an institute(bank or buiding society) that indicate a sum of money deposited with a bank and will be repaid at a later specific date(as short as 7 days and as long as 5 years).CD is in bearer form which means title belongs to the holder and can be transferred by delivering the CD to the buyer.CDs can be bought and sold easily and offer attractive interest rates and low credit risk.They are useful for investing funds in the short-term since they can be sold at any time on the secondary market.They are liquid type of investment.

A bill of exchange is like a cheque.It is an unconditional order in writing from one person(the payee) to another,requiring the person to whom it is addressed(the drawee) to pay a specific sum of money on demand(sight bill) or at a future date(term bill).Bank and non-banking institutions are the main buyers of bills on the secondary market.The buyer makes a profit by purchasing the bill at a discount to its face value,then receiving the full value at maturity,or reselling it before this time.The level of risk attached to bills depends on the credit quality of the drawer.If the drawer is a large company or institution,the risk will be lower than if the drawer is relatively small and unknown.

Bonds are fixed interest security issued by government,company,a bank or other institution.May or may not be secured.

Commercial paper is a certificate issued by company promising to pay a fixed sum to the person bearing the note on a specific date.Commercial paper is an unsecured type of investment.

Loan stocks is issued by company in return for loans secured on a particular asset of the business.The loan is for long term.

Permanent interest bearing securities(PIBS) are securities created by building societies to raise funds and are quoted in the stock exchange.

Although there are more ways of investing surplus funds such as shares,high interest accounts,option deposits and more,but students are not required to know all,just some understanding of the investment options is sufficient.The important point to remember is that only after a company has assessed risk,liquidity and maturity,it is then in a position to consider the investment options available to it.I had provided a comprehensive explaination on different kinds on investment options above,it is up to you to decide how you are going to invest your surplus funds in future.Do not just hold the cash as you will suffer holding cost such as opportunity cost and theft of cash.Please have a throughout understanding on what this topic is trying to teach you.This article is applicable not only to CAT T10 students but also anyone who are doing business :)

CAT T4

CAT T4-Accounting for Costs is one of the intermediate level papers of CAT,which is the paper that give you knowledge about management accounting and most of the knowledge from this paper is going to be brought forward to CAT T7-Planning,control and performance management,therefore it is important to truely understand what is learnt in this paper.

This paper builds up the knowledge from CAT T2-Information for management control,but there are a very huge difference between CAT T2 and T4.In CAT T2,you will learn about IT and a little of costing concepts only,but in CAT T4,it was expanded widely,IT is not important in T4,T4 builds up the costing concepts and plus more costing techniques to learn.Therefore you may find that there are a lot to learn from this paper,but actually nothing is difficult,what you need is to have open-mind always to learn new things.

The aim of this paper is to develop knowledge and understanding of how organisations record,analyse and report current and future costs and revenue data for use within the organisation.As you can see,examiner stated that all areas of the syllabus are equally important,it means that the knowledge that is provided by this paper can help you a lot in future,so it is essential not to skip any topics.

In this paper,you will find that the material chapter learnt in T2 are way too easy compare to the one in T4.In T4,you will learn even more like how to value the inventory and what amount of inventory to order so that you will minimise holding cost and ordering cost.Labour chapter does not differ much,almost the same.In the overhead chapter of T4,you need to be able to do the 3 steps of overhead absorption costing and also determine the over or under absorption.

Remember to understand the absorption and marginal costing well because in T7,you must do well for it.In T4,you also get to learn about the T account for costs for intergrated accounting system and interlocking accounting system.You will also learn job costing,batch costing and service costing to calculate costs respectively.Next is process costing which is a big area of the syllabus,you have a lot of things to learn from this topics,be prepare.

Beside these costing techniques,you will also learn CVP analysis which will be brought forward to T10 later.You will also learn short-term decision-making which you need to determine the relevant costs to charge the customers,this is called relevant costing.Limiting factor and make-or-buy decision can be learnt in decision-making topic too.Finally you have a chance to learn how to appraise a capital investment,this is a long-term decision and will also be brought forward to T10.

Therefore,you can see that whatever things that are included in T4 are very important,you should value this paper and study well of it.This paper is to give students knowledge about management accounting but it is not an application paper yet,therefore if you study the books enough,you can pass easily.Try to score well for this paper,the better you are for this paper,the easier for you in CAT T7 and T10.Good luck :)

CAT T7

Now let me introduce what is all about in this paper.CAT T7-planning,control and performance management aims to develop knowledge and understanding of the application of management accounting techniques to support the management processes of planning,decision-making,control and performance measurement.Again this paper requires students to apply the knowledge into different situations.Knowledge will be brought forward from CAT T2(variances calculation part) and all of CAT T4.This paper actually contains broad area of syllabus but short-term decision-making and CVP analysis were removed and included in CAT T10 from june 2009 which has reduce the load of this paper.

So why is it useful to learn from this paper?Do you all know that what kind of accountant in an organisation make most profit?It is actually management accountant and treasury accountant.In this paper,you will learn the skill that is needed to become a management accountant in the future.After you completed this paper and have some relevant working experience,you are able to become a management accounting technician in an organisation.

The key areas of the syllabus are forecasting,budget preparation,flexible budgets,variance computation and interpretation,performance indicators,cost reduction and value enhancement.It was important that students remember the knowledge that is learnt from CAT T4 such as absorption costing,marginal costing and more.In CAT T7,you will learn even more costing techniques which are useful to determine the pricing of the product,analysing variances and investigation of variances,prepare a budget and more.Not only costing techniques,you also have the opportunity to learn performance measurement and use performance indicators to measure quality of service,unit costs,profitability,economy,effectiveness,efficiency and more.

Beside of using absorption to charge product,we will learn one more method,activity-based costing(ABC) which is the upgrade version of absorption costing,it eliminates the 3 steps of getting the Overhead Absorption Rate and able to charge a more realistic price especially for big companies which have a lot of overheads rather than direct costs.We also learn to apply standard costing,which will compare the actual with budget and calculate the variances and interpret it.All of these are useful in organisation,especially the most common used standard costing.

Therefore,don't be demoralised by this paper,keep your mind open to accept any new costing techniques and performance measurement method so that finally you are ready for managing the performance of an organisation.Guidance may be given when I found the difficult areas of CAT T7,have fun :)

CAT T3,T6 and ACCA F3-Accounting concepts

In preparing accounting statements,whether they are external "financial accounts" or internally-focused "management accounts",it is essential that the accounts depict a "true and fair view".To support the application of the "true and fair view",accounting has adopted certain concepts that help to ensure that accounting information is presented accurately and consistently.These are rules and guidelines that the accountant lives by.All formal accounting statements should be created,perserved and presented according to the accounting concepts.

The accounting concepts are included in CAT paper 3 and ACCA F3 as knowledge to students.Students need to understand all the accounting concepts and be able to explain it.In CAT paper 6 or ACCA F7,these accounting concepts are then applied when preparing financial statements.Therefore,I will explain the concepts that students should understand.

Firstly,let's consider business entity concept.According to this concept,business should be separated from owners.For example,when the owner withdraws money from the business for personal use,this is accounted separately in the drawing account and deducted from the capital.

Next,we will consider going concern concept.According to this concept,business should be assumed that it is continuing its operations for the foreseeable future.Accountants should not draw the accounts on "winding up" basis.For example,we will record the cost of the non-current assets into account but not the residual value of it.

Next,we will consider historical cost concept.According to this concept,transactions should be recorded at the original costs.In this concept,only the costs paid to acquire asset are relevant and thus should be the only costs to be shown in the accounts.Historical cost is useful when there is no inflation.

Beside that,we also follow monetary measurement concept.Accountants do not account for items unless they can be quantified in monetary terms.Items that are not accounted for include things like workforce skill,morale,market leadership,brand recognition,quality management and more.

One important concept to follow is the materiality concept.In this concept,accountants should concern themselves only the matters that are significant because of their size and should not consider trivial matters.For example,$100 for an individual would be important and MATERIAL,but it would be IMMATERIAL for multinational company.Therefore if the multinational company found that their account is not balance by $100,they may just leave it aside as it is not material for them.

In preparing financial statement,we should follow prudence concept too.Whenever there are alternative procedures or values,accountant will choose the one that results in a lower profit,a lower asset value and a higher liability value.The concept is summarised by the well known phrase "anticipate no profit and provide for all possible losses".

Accrual concept is also an important concept to follow.This concept basically means recognise income when it is earned not when the money is received and recognise expenses when it is incurred not when the money is paid.Sometime,this concept also known as matching concept which means income should be properly matched with the expenses incurred to earn that income in a given accounting period.

Do you know that we always follow duality concept?This is the very foundation of the universally applicable double entry book keeping system and it stems from the fact that every transaction has a dual effect on the position of a business as recorded in the accounts.This concept is on the basis of the accounting equation which is assets=capital+liabilities

Although there are still some concepts which I didn't explain but I had explain most of the common one.Students should be able to explain all of these if it was asked in the exam.Don't memorise but understand all,let the concepts stay in your mind forever because you are going to follow it in preparing financial statements for the exam and for the future as these concepts are important so that financial statements are produced with "true and fair view".Remember auditor will produce the audit report for your organisation only if your financial statements show "true and fair view".

Therefore learn the concepts as knowledge in CAT T3 or ACCA F3 before able to produce correct financial statements in CAT T6.ACCA F7 and P2.These were basics to understand :)

CAT T10-Projected Statement of Cash Flows

Firstly,let's understand what is statement of financial position based forecasts.It is usually prepared for strategic purpose in which cash surplus or fund deficit is the balancing item after a forecast has been made for all other items in the statement of financial position.It is not an estimate of cash inflows and outflows.Projected/Forecast/Estimated statement of cash flows is prepared according to the forecast statement of financial position,historical statement of financial position and forecast income statement.

Why do we need projected statement of cash flows?According to former examiner,Ann Irons,forecast income statement reflects the 'profit' that a business hope to make,whereas projected statement of cash flows reflects the increase or decrease in cash that a business anticipated over a period of time.Projected statement of cash flows play a key role in the management of business's finance and therefore a key role in CAT paper 10 syllabus.

When the question asks for projected statement of cash flows,there will be forecast income statement,forecast statement of financial position(which show the closing balance of the items) and historical statement of financial position(which show the opening balance of the items) given.Students are required to use the information given to produce a projected statement of cash flows(format of IAS 7 is not required).The problem is how to determine the cash movement from these items?Let me guide you step-by-step.

Most of the time you should start from using the operating profit figure,then remember to add back the depreciation because it is a non-cash adjustment.Next check the additional information given carefully,if information given was "all interest charges are paid in the year in which they are incurred",then you can straight away deduct the interest charges because the information shows that money is paid for the interest.

Next,the more complicated items are tax and dividends paid.This is because the charge for tax and dividends in the income statement is not the same as the actual amount of cash to be paid out in the year.Therefore how to determine the actual cash paid by the company?Simple,just open an account for both of the items as working,so for example,in tax account,the debit side will be the balance b/d which is the balance given in historical statement of financial position's current liabities and also the tax charge in the forecast income statement,the credit side is the balance c/d which is the balance given in forecast statement of financial position,the balance of the tax account is the actual amount of cash paid for tax and it will be deducted in the projected statement of cash flows.Using the same method to find out the actual cash paid for dividends.

Next,another complicated one is to find out the cash paid for non-current assets.It is not possible to simply look at the difference between closing and opening balance of the assets because this amounts are net of depreciation(Net Book Value).Therefore,you need to know the amount of depreciation that is included in the forecast income statement,and any disposals that are anticipated during the year.After that,you need to use the closing balance of the assets to add back the depreciation because it is a non-cash adjustment and also add the disposal figure because you get money from sales of non-current assets,then only minus the opening balance of the assets,the balance will be the purchase of non-current assets.

After that,the items left to be considered should be the inventory,receivables in current assets and payables in current liabilities.So how to determine our cash inflows or outflows from these items?These items need your understanding,to find out the cash inflows or outflows from these items,you just need to take their closing balance and minus opening balance,that's all,simple right?But why it does not need to consider the sales,purchases or cost of sales value?The reason is because we are starting from OPERATING PROFIT,which means sales,purchases and cost of sales are already taken into account,so the things left is to find out the difference between closing and opening balance of these items.Ok here's the key point to understand,an increase in current assets such as inventories or receivables will cause a CASH OUTFLOW.This is because the company has brought more inventory or has effectively lent its customers some cash.Therefore for example,after using closing balance of inventory to minus opening balance of it,if you get a positive amount,it means increase in inventory,you will then need to include this inside the projected statement of cash flows as a deduction to operating profit.Another key point to understand is increases in current liabilities such as payables will cause a CASH INFLOW.This is because suppliers have lent the company money to buy supplies.Therefore for example,after using the closing balance of payables to minus opening balance of it,if you get a positive amount,it means increase in payables,you will need to include this inside the projected statement of cash flows as an increase to operating profit.

Finally you will get the projected cash balance after adding or deducting these items.To check whether your projected cash balance is correct or wrong,simply just perform a reconciliation of cash amount in the historical and forecast statement of financial position to get a cash balance,if your projected cash balance is same as this cash balance,you are doing a right thing and full marks are going to go into your pocket.

Seems like the projected statement of cash flows is not easy to do right?But it is not true,this type of question can be easily scored if you had understand how to treat different items in different ways rather than memorising like formula.I had provided some explaination on different items and I hope students can understand it,not memorising it.

It came out before as a 16 marks question in june 2006 exam and it was quite easy to score it if you follow the steps,I will provide a format of projected statement of cash flows.

Projected statement of cash flows

Operating Profit

Add depreciation

Less interest payment

Less tax payment(use account)

Less dividend payment(use account)

Less purchases of non-current assets(balance c/d+depreciation+disposal-balance b/d)

Less increase in inventory(balance c/d-balance b/d)

Less increase in receivables(balance c/d-balance b/d)

Add increase in payables(balance c/d-balance b/d)

Projected cash balance

I had fully explained how to do a projected statement of cash flows and as I said in previous blog that advance level papers of CAT require you to apply the knowledge,actually you need to analyse it too,when you really understand how to do it,you do not need to memorise anything,it comes naturally.Remember this was useful when working too,know what you are doing rather than do for passing exam.I hope this guidance is able to help students of CAT paper 10,good luck :)

CAT T6

Most likely that students will think CAT paper 6 is not hard because they have accounting background before,but it is not true.This paper is not about gaining knowledge only,it goes beyond this level,it requires you to apply the knowledge that you had learnt especially from paper 3-Mainataining Financial Records,you need the knowledge such as accounting standards,concepts,irrecoverable debts and allowance for receivables,accrual and prepayment,depreciation and more,most of the syllabus of paper 3.But why you need this knowledge?Of course for some important reasons.

Before telling you the reasons,let's see the aims of this paper,which is to understand and apply the techniques used to prepare year-end financial statements of partnerships and limited companies which comply with legislation and accounting standards,and to interpret financial statements and the relationships between their elements using ratio analysis.

What can we learn from this aim?This aim tells that students need to know to prepare financial statements of partnerships and limited companies according to International Accounting Standard,International Financial Reporting Standard and concepts.Students should also know how to interpret the financial statements using ratio and draw a valid conclusion.Appart from this aim,students must also know how to prepare statement of cash flows according to the format stated in IAS 7,remember this is not paper 10,this time the purpose of producing his statement of cash flows is to present it to auditors as it was required by IAS 1.Statement of cash flows came out every sittings too!!!

Beside that,students should also be able to produce simple consolidated financial statement following IAS 27,although it was updated to IFRS 3-business combinations.You will learn more about this in ACCA F7.

Therefore,you can see that IAS/IFRS and concepts are important and in this paper,students are required to study 10 IAS and 1 IFRS so that students can produce a 'true and fair' financial statement.Be ready to APPLY what you had learnt from earlier studies about the year-end adjustment,it was a basic to prepare a correct financial statement for partnerships or limited companies.

In conclusion,as far as I understand,students do not have much problem on financial accounting paper maybe because of having accounting background.By the way,this paper is very important and if you can pass this paper,you are consider to have enough knowledge to be a financial accounting technician in an organisation,therefore learn from this paper well not only for exam purpose,but also your future.Keep in mind that this paper will help you in ACCA F7-Financial Reporting,so take this opportunity to get your basics good before something really challenging is coming soon.For now,I don't think that any guidance is needed for students,maybe next time when I discover which topics are harder,I will provide guidance here,I wish all CAT T6 students good luck in this paper and enjoy it :)

CAT T5 December 2010 exam tips

Actually for any professional exam,we should not try to spot the questions,but we can prepare for certain topics that are more important in case the topics came out in the exam so that our efforts of 5 months are not wasted.Therefore I am going to provide some topics which students may expect to see in the forthcoming exam.This exam tips are just some analysis from past year papers,remember to study all chapters first and not just study according to tips,because if you are depending on tips only,you are like betting and this will waste your 5 months time.

Ok let's get started,let's see,for the first question I think most likely it should be questions like advantages and disadvantages of computerised accounting system or the coordination between accounting department and other departments.

For question 2,you may expect to see questions like asking you to do comparison of management report,such as compare with previous period,compare with corresponding period and vice versa.You may also expect the question to ask you to explain the use of management information,which is planning,control and decision-making.

For question 3,motivation chapter may come out this time and Herzberg's two factor theory remain unexamined,so it may be important.Vroom's Expectancy theory is also unexamined in previous exam.

For question 4,you may expect performance appraisal question to come out because it's been a long time it remains unexamined.This topic causes problem to students maybe because of it requires mature thinking,try and read through the technical articles of T5 which are about appraisal.Even if the question does not ask for this topic,this topic is very important in an organisation.You may get question that ask for barriers to effective appraisal and purpose of appraisal.

For question 5,most likely is about health and safety.Be prepare for key components of health and safety policy,this was frequently asked by the examiner and you may need to prepare for emergency procedures or accident reporting procedures.

So the topics that I GUESS were accounting function,management information and reporting system,motivation,performance appraisal and health and safety.Remember although it was analysed,but I will consider it as a GUESS.No one in this world is able to predict what is going to come out in exam accurately,so study through all the chapters,only then you may refer to these topics and make sure you are good at it.Good Luck :)

CAT T10

CAT paper T10 aims to develop and understanding of the way organisations finance their operations,plan and control cash flows,optimise their use of working capital and allocate resources to capital expenditure projects.Therefore when students saw this aim,students should roughly know what will be learnt in this paper,such as ways to plan and control cash flows,how to manage the working capital,capital investment appraisal and so on.Well although this paper does provide a lot of important knowledge to students,but students tend to try to pass this paper by just memorising,without understanding much.

There are 6 key areas of the syllabus which students should be familiar with source of finance,cash budgets,working capital management,credit management,short-term decisions and capital investment appraisal.The syllabus is big,but let's focus on the main thing that the examiner wants you to learn,which you can find it in http://www.accaglobal.com/ website,you may print it out and study according to the study sessions provided by examiner,with this,you have a better chance to score more marks in exam as examiner asks according to the study guide.

There are also some syllabus of T10 which are brought forward from earlier paper,especially paper T4-accounting for costs.In T4,students would have learnt short-term decisions(relevant costing,CVP analysis) and capital investment appraisal,you should remember these knowledge as they helped in T10 too.The other key areas of the syllabus were the one that you haven't learn before in earlier paper,be prepare.

For now,I will just provide some introduction to T10,next time I might include some guidance on this paper if I have time to do it,good luck to every students :)

CAT T5

Well CAT T5-managing people and systems is not an easy paper for most of the students,most likely reason is because it was full of theory which did not motivate students.Students must start to train their skills on reading and learning theory,rather than rely on numbers.This paper provides students the knowledge to manage system,manage people,manage yourself and mange health and safety and security of the organisation,I will briefly talk about each parts.

For managing system,T5 provides you knowledge such as how to analyse environment,what structure is suitable for your organisation,what should be taken into account when doing business planning,how to design the internal control system for your organisation and so on.These introduce how our business environment works and are therefore very important when working too.I know students may be bored by these part of the syllabus but remember,these were an invaluable chance for you all to start to understand on the important role of being able to manage the system of your organisation,especially when you had became a manager one day.

For managing people,T5 provides you some good knowledge on leadership,team management and motivation issues.You have opportunity to learn about the theories or models written by famous writer such as Henri Fayol,Peter Drucker,Henry Mintzberg,Abraham Maslow and so on.The theories written by them are important as their analysis on human had made them able to produce these theories which tell you about how to deal with different types of people.For example,in Hersey and Blanchard's situational leadership model(1988),you can understand that to lead people effectively,we should take into account the readiness of people to perform and choose different leadership styles for different readiness of the people or teams.Another example,you will also have opportunity to learn about 9 team roles as identified by Belbin who also said that a good team should have a balance of the team roles.In addition to these,you will also learn that appraisal in an organisation is not just an annual event,but it is part of the performance management.Appraisal has 3 main purpose,reward review,performance review and potential review althought it often goes wrong as many managers do not appreciate the objectives of the appraisal.Therefore T5 tells you that the true purpose appraisal is to improve individual and organisational performance,not to create troubles to employees.Furthermore,you will understand that communication is important in an organisation for good coordination,you will also learn the source of conflicts and how to manage it so that relationship is maintained.Beside that,you will also learn to conduct training programme in a systematic ways which can help to meet the training objectives.These essential skills for managing people are provided by T5 and therefore this paper should be studied well.

For managing yourself,it basically mean managing your own effectiveness on the job.T5 will provide you the knowledge on soft skills such as time management and good communication.You will also learn to plan your personal work better.I think you should already know how to manage yourself well but to improve your effectiveness such as time management,you can follow the suggestion provided by T5,such as using action plan or to-do lists and remember,make yourself follow your plan.Your interpersonal skill must be well trained too and this is an on-going process.

For managing health and safety and security,T5 provides you some guidance on what should be included in the health and safety policies,emergency procedures,accident reporting procecures and security procedure manual.You will also understand what are the responsibilities of individuals(employees and employers) and organisation to health and safety of the organisation.Furthermore you will also learn about some examples of risks to data and what controls you can implement to prevent it.

In conclusion,this paper provides invaluable knowledge for every students who study it.Students should therefore never try to ignore this paper,but try to love this paper.I can say that this paper was special and it does covered a very broad area of the syllabus,but remember,don't say hard,because ACCA paper P1 and P3 are even harder!!!Start to learn on how to study theory paper now,if the problem is caused by your english proficiency,visit http://www.accaglobal.com/ and try the self-check module,you can learn your english there too.I had provided the outline of the T5 syllabus,next time I will provide more guidance for this paper as I do wish to help students to pass this paper easily. :)