How is the CFE ACTUALLY marked? The CAP 2 Feedback Guides vs the CFE Board Report

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Are the Cap 2 Feedback Guides scaring you just a little (or maybe a lot)? If you are finding it near impossible to score a C within the tight case time limits, according to the Cap 2 feedback guides, you are in good company. Literally, everyone is having this same issue. Now just because everyone is finding it hard isn’t going to make you sleep easier at night but this will…

Did you know that the Cap 2 feedback guides are NOT used at the CFE marking centre? There is a myth floating around that those Cap 2 guides come directly from the CFE marking centre, but it is simply not true. They are created after the marking centre is over by a completely different team that is not allowed to talk to the CFE team. The Cap 2 marking guides are definitely HARDER than what is actually used to mark the CFE. That doesn’t mean that they are not helpful. Just don’t let them kill your confidence.

The CFE Board Report

So what then is used to mark the CFE? That is where the board reports come in. These reports are issued by the CFE marking team after marking has wrapped up and tell us exactly how that year’s CFE was actually marked.

Let’s walk through how to use the board reports efficiently, to understand exactly what went on at the CFE marking centre, so you can adjust your CFE plan of attack accordingly. We’ll talk about the differences between the Capstone 2 marking guides and how each question is actually marked at the CFE marking centre. Let’s start with a bit of background on the process of creating the guides.

One thing that everybody needs to get clear on is that The CPA Canada team that creates the CFE cases, the suggested solutions and the marking guides used at the CFE national marking centre is completely different than the CPA Canada team that creates the Capstone 2 and other PEP materials. And this is by design. It is critical in the interest of fairness that these teams are different and each team maintains the confidentiality of their work product, since CFE candidates can qualify to write the CFE by a variety of different routes. One is to complete the CPA Canada PEP program. But you could also qualify via an accredited Canadian University Program or a Memorandum of Understanding with another accredited international accounting body. So because there are these different routes, it’s important that everyone have access to the same information from the CFE marking centre. And that is why the CFE marking centre releases a board report every year. This is a document that is free and publicly available and explains exactly what happened at the CFE marking centre. And since everyone has access to it, it maintains a level playing field across all routes to writing the CFE.

So if you want to know exactly what happened at the CFE marking centre, get your hands on that board report. You can download them here, all the way back to Sep 2015: CFE Board Reports

Now I know you are busy. Probably busier than you have ever been since you are studying for the CFE, perhaps still working full time, and you may also be juggling a bunch of family responsibilities (ex: kids!). So you probably don’t want another thing to add to your list of materials that you need to review during your debrief. I know there is a lot.

But let me point you to the most critical pieces of the board report, so you can use only the important pieces. And you won’t look at this for every case or every AO. But if you are reviewing a Cap 2 Feedback guide and you think it seems crazy or if you totally bomb an AO, it is helpful to go have a look at these parts of the board report to see how everybody else did and understand what the marking centre was looking for to award C and compare that to what the Cap 2 feedback guide said you need at C. 

Ex: The Sep 2022 CFE Board Report

As an example, let’s have a quick look at the Sep 2022 Board Report. You can download it here (look for Sep 2022 Part A):

https://www.cpacanada.ca/en/become-a-cpa/certification-resource-centre/resources-for-cpa-evaluation

There are always some general comments at the start about what candidates did well and what they are struggling with. It’s pretty much always the same…Time Management, Lack of case facts, Lack of the so what. 

Then we get into the cases and solutions. You can see there are basic levels for each AO of what an RC / C / CD level response looks like. But these are pretty general, not like the line by line guides that you are used to from the Cap 2 feedback guides.

The cases and solutions are the same as the cases and solutions you will find in Cap 2. The only difference is that for the older CFEs, Cap 2 will update the dates and will update the solution for any changes in accounting standards or tax amounts.

But the piece that you will not find in the Cap 2 materials comes after all the cases and solutions, at the end. 

The Results Tables

First, you’ve got the breakdown of how everyone did on each AO, at the CFE marking centre. Just scroll down until you see these colorful tables. Usually about 80% of the way through the report.

So as you can see above some AOs are more challenging. Generally, any AO where more than 60% of candidates were at C and CD combines, this is a very accessible AO, and you really want to make sure you hit those and get your C. Any AO that is in the 40% to 60% range is pretty average difficulty, forgive yourself if you get some RCs here, these are tougher and you won’t be perfect but you can still pass overall. Now anything 40% or below, these are very hard. You may even get some NCs here. But you can absolutely still pass.

The Board of Evaluators Comments

The next section in the board report that you don’t get with Cap 2 but can be helpful are these board comments. These come right after the results tables showing the marks spread that we just looked at, and look like this:

You will not have time to read all of these but when you come across an AO that really threw you off or you think the Cap 2 feedback guide is particularly unreasonable, come have a look here.

STH AO1 FR: Investment Property – Cap 2 Feedback Guide vs CFE Marking Centre

As a quick example, comparing the Cap 2 Feedback guide to what was required at the CFE marking centre, let’s look at STH, AO1, the FR AO about Investment Property. 

The Cap 2 guide was:

The suggested solution: 

It’s about 3 pages long, small font. And lots of writing too not just handbook. Which takes time. 

When reviewing this, it is easy to get overwhelmed and fast.

The expectation at C seems completely wild and disconnected from reality, the reality that this is a 90 minute case with 7 AOs. So even if you keep your ROP to 20 min, which is super fast for a 90 min case, that still just leaves 10 min per AO on average. Now some AOs will be faster and some slower but MAX you have for this FR AO is 15 min. 

So this is a good example of where it can help to have a look at the board report. When you are feeling this overwhelm during your debrief because it really seems like the expectations are impossible.

Furst, let’s have a look at the results table and focus on STH AO1 – Investment Property:

You’ll notice that this investment property AO is clearly the hardest FR AO on the Sep 2022 CFE, if you look at % in C/CD and %in NA/NC. The Inventory AO on TFS was also very difficult. So don’t be too hard on yourself if you missed either of these. Chances are you needed 3-4 FR Cs….honestly I would put my money on 3 for this CFE, just looking at these results, and since there were only 6 chances (often there are 7).

Now let’s look at the board comments and what exactly was required at C, at the CFE marking centre.

Look for “To demonstrate competence…” in the first paragraph. The comments for each AO all include this sentence. For AO1 above, the board report says the following was required at C:

Competence:

  1. Recognize that property needed to be accounted for as Investments property (likely = definition and / or recognition criteria)
  2. Discuss Accounting policy choice (likely = FV gain / loss goes through P&L at each year end vs cost requires annual depreciation)
  3. Supported conclusion on whether to use FV or cost. (Focus seems to be on support , so would need to explain impact on users – likely upcoming IPO OR on financial statements – likely tie to covenants. Just saying that FV info is available so should use the FV model = not enough)

      Next, the board talks about what a strong vs a weak candidate would look like:

      A strong candidate is a Clear C or CD (but if you don’t fall in this bucket, you may still have gotten to C but it would be a judgment call). For STH, AO1, a Strong Candidate would also have included the AJEs for FV at June 30, and/or calculated depreciation correctly for the Cost model)

      A weak Candidate is likely an NC, possibly a weak RC. For STH, some examples of weak candidates were those that did not consider that there were two options (FV vs Cost). Or those that tried to use IAS 16 or IFRS 5 or ASPE. These examples were all likely NC since no value to the client.

      HELPFUL LINKS & DOWNLOADS:

      Past board report back to 2015: 

      https://www.cpacanada.ca/en/become-a-cpa/certification-resource-centre/resources-for-cpa-evaluation

      For some reason googling “CFE board reports” gets you to a page that only goes back to 2019, so be sure to make note of this link above, as this has the complete list back to 2015.

      For our listing of all case names and what year they were offered (critical as your Cap 2 case won’t tell what CFE the case showed up on, so you won’t know which board report to look at, without this case listing),

      and, if you want a copy of my answer to the STH Investment Property FR AO, completed in 14 min, and falling in the Clear C bucket per the board report, I will email it to you. Just tell me where to send it by clicking here: STH Sample C Response + Case List