Tanya Barman, CIMA Head of Ethics 2 February 2017 EXAM PREP Guess few folk do. And perhaps that may be the impetus for a small minority to act dishonestly or unfairly in order to get through their exams. But once you do that you lose, whatever the circumstances. The overarching principle of the Code of Ethics is that of Integrity. This imposes an obligation on all professional accountants to be straightforward and honest in all professional and business relationships. So trying to take an unpermitted short cut in your paper and therefore breaching exam regulations, you may find that instead of awaiting your results you are awaiting a date for a conduct hearing. All registered students are bound by the Code and it is worth considering how it applies to your approach in all your working life – including your studies. The Code has much to offer in guiding you through challenging times in business, helping safeguard the reputation of profession
The BA3 syllabus introduces the student to a wide range of financial accounting topics. 10% of the syllabus is dedicated to the interpretation of financial statements. This involves performing some ratio analysis on figures in the financial statements and being able to identify reasons for the changes in these ratios over a period of time. It is an important skill for any accountant to develop during their career. This article is going to concentrate on the profitability of an entity. This will involve reviewing three ratios: gross profit margin, operating profit margin and return on capital employed. Analysis begins with an understanding of how the ratios are calculated as this will help determine reasons for the changes in the ratios over time. Once we have considered this, we will then work through a list of business practices that an entity may introduce between one year and the next and think about how these affect the profitability ratios. Finally, we will consider