Everything you need to know about ACCA Advanced Audit and Assurance (AAA)
My name is Steve Chen, the Fellow member of ACCA, the founder of GlobalAPC, the author of 4 accounting books, a technical writer of ACCA AB magazine, and hold two markers position in 2 major accountancy bodies. I have been teaching ACCA Advanced Audit and Assurance paper for more than 10 years, and in this guide, I will cover everything you need to pass this paper effectively.
Here is a list of contents:
- ACCA AAA Pass Rates
- AAA Exam Variants: (INT) and (UK) Versions
- Optional papers
- Order of the exam
- SBR and AAA
- Exam Duration, Marks Allocation
- Exam format
- AAA Syllabus – Main capabilities from ACCA Official Syllabus and Study Guide
- AAA Examiner Reports and Technical Articles
- AAA Exam Strategy
- Past Exams
- AAA Exam technique (Our own three top tip activities)
- Examiner highlights
ACCA AAA Pass Rates
The published AAA exam global pass rate is around 34% (32% in December 2022, and 34% in March, June, September and December 2023 exams).
AAA Exam Variants: (INT) and (UK) Versions
There are two exam variants of AAA, ie International (INT) and United Kingdom (UK) versions. If you do not want to apply Audit Qualification (AQ) from ACCA to work in practice, you can simply choose the INT version. However, if you want to obtain AQ later, you must choose SBR and AAA both in the UK version.
Here is the flowchart about whether you should sit the UK version or not.
Optional papers
AAA is one of the four optional papers:
1. Advanced Financial Management (AFM)
2. Advanced Performance Management (APM)
3. Advanced Taxation (ATX)
4. Advanced Audit and Assurance (AAA)
ACCA students must complete 2 optional papers out of 4 before they can qualify as ACCA affiliates.
Here is the diagram showing all 4 optional papers, and the validity of papers.
Order of the exam
ACCA students can complete papers at Strategic Professional (SP) level in any order, including SBR, SBL, and two Optional Ones (AFM, APM, ATX, AAA).
SBR and AAA
I highly recommend students to sit ACCA Strategic Business Reporting (SBR) paper before the Advanced Audit and Assurance (AAA) paper, or at least to sit both papers together.
Contents in the AAA exam, including IFRS, ISAs, Ethical and Exposure Draft documents.
The reason is that there are 36 IFRS to be tested in the AAA paper, whilst these IFRS were covered in the SBR paper.
The in-depth understanding of IFRS in the SBR study will help AAA candidates shape a solid framework when answering the risks question, audit procedures questions, review questions and audit report questions.
However, in AAA paper, students are required to apply IFRS knowledge from the auditor’s perspective.
good news
The good news is that in AAA exam, the IFRS knowledge will not be tested in depth. For example, in SBR exam, IFRS 9 Financial instrument standard, where hedge accounting is heavily tested. But in the AAA paper, basic initial measurement, and subsequent measurement of financial assets and liabilities are tested. Besides, fair value determination by experts needed to be checked carefully, and this is usually covered in ISA 620 Using the work of an auditor’s expert.
I recorded a session of SBR for the required level of IFRS knowledge (IAS 36 Impairment of assets)
Our ACCA AAA Video Course for the required level of IFRS knowledge in the AAA exam.
Exam Duration, Marks Allocation
Exam Duration
AAA paper is 195 minutes (3 hours and 15 minutes). There are 80 technical marks in this paper, and 20 professional marks.
Professional marks are split into:
1.Communication;
2.Analysis and Evaluation (A&E);
3.Professional scepticism and professional judgement;
4.Commercial acumen.
Mark Allocation
My top tip regarding the mark allocation is to use the first 15 minutes to plan the Q1 in Section A.
Then use the 180 minutes/80 marks = 2.25 minute per mark when planning the answer.
CBE
AAA exams are computer based, with exams scheduled in March, June, September and December.
Exam result is usually released one month after the exam ends.
Exam format
There are two sections in the AAA exam, ie Q1 in Section A, and Q2 and Q3 in Section B. All of the questions are compulsory.
Section A usually covers the following areas:
- Business risks;
- Risks of Material Misstatement (ROMM), or Audit Risk;
- Audit procedures on certain IFRS issues such as classification of investment (Sept 2022 AAA Past exam question); PP&E (Sept/Dec 2021 AAA Past exam question) etc.
- Certain audit related areas, such as impact outsourcing the credit control function (Dec 2022 AAA Past exam question); Auditor’s responsibilities regarding compliance with laws and regulations (Sept 2022 AAA Past exam question).
- Ethical issues such as money laundering (March/June 2022 AAA Past exam question); Conflict of interest (Sept/Dec 2021 AAA Past exam question).
- Besides, 10 professional marks are in Q1, with standard communication marks covering Briefing note format and structure; Style, language and clarity; Effectiveness and clarity of communication; Adherence to the specific requests made by the partner.
- Other professional skills are also included in this question, including Analysis and Evaluation; Professional scepticism and professional judgement; Commercial acumen.
Section B usually covers the following areas:
- Practice management issues such as acceptance stage, combining with Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Agreements and ISA 220 Quality control for an audit of Financial Statements.
- Ethical related questions.
- Particular issues in audit, such as group audit.
- Non audit engagements such as ISAE 3400 The Examination of Prospective Financial Information, the most common area is the intended use and format of the Prospective Financial Information (PFI) as well as the related procedures to check the PFI information.
- Review and report stage, common areas include Subsequent Events, Uncorrected Misstatements, Going Concern Assessment.
- Professional marks are 5 marks each for Q2 and Q3, covering some of the following areas: Analysis and Evaluation; Professional scepticism and professional judgement; Commercial acumen.
AAA Syllabus – Main capabilities from ACCA Official Syllabus and Study Guide
Recognise the legal and regulatory environment and its impact on audit and assurance practice
Demonstrate the ability to work effectively on an assurance or other service engagement within a professional and ethical framework
Assess and recommend appropriate quality management policies and procedures in practice management and recognise the auditor’s position in relation to the acceptance and retention of professional appointments
Identify and formulate the work required to meet the objectives of audit assignments and apply the International Standards on Auditing
Evaluate findings and the results of work performed and draft suitable reports on assignments
Identify and formulate the work required to meet the objectives of non-audit assignments
Understand the current issues and developments relating to the provision of audit-related and assurance services
Apply a range of professional skills in addressing requirements within the Advanced Audit and Assurance exam, and in preparation for, or to support current work experience
Demonstrate employability and technology skills
AAA Examiner Reports and Technical Articles
you should read aaa examiners’ report as the reports cover the common weaknesses made by acca students, detailing the performance of each question.
You can also get access to the examiner reports here
Technical articles of AAA are also useful to recap the key areas of AAA syllabus with insightful analysis. You can get access to these articles here
AAA Exam Strategy
How frequent each IFRS and ISAs are tested over the past 10 ACCA AAA exam sittings (Lecture)
1. Summary of IFRS (International Financial Reporting Standards):
As I mentioned, you should pass the SBR paper before the AAA exam, or at least to sit these two papers together. You should understand the specific accounting treatment related to IFRS and the impact on client’s Financial Statements, as this is vital when auditors are performing preliminary assessment of the client when analysing risks at the planning and even at the review stage of audit.
Here, I selected 8 of the most commonly tested IFRS in the last 10 exam sittings, with how many times each standard has been tested, for your reference:
- IAS 16 PP&E-5 times
- IFRS 15 Revenue-4 times
- IAS 37 Provisions-4 times
- IAS 36 Impairment of assets-4 times
- IAS 2 Inventories-3 times
- IFRS 16Leases-3 times
- IAS 38 Intangible assets-3 times
- IAS 40 Investment properties-3 times
ACCA Course: Key UPDATED ISA Summary with my own mnemonics, specifically applied to the AAA exam.
- ISA 240: The Auditor's Responsibility to Consider Fraud and Error in an Audit of Financial Statements.
- ISA 250: Consideration of Laws and Regulations in an Audit of Financial Statements
2. Updated ISA (International Standards on Auditing) knowledge:
You must have passed the Audit and Assurance (AA) paper before, or at least have got exemption from this paper before you sit AAA. AA is at the Applied Skills level, whist AAA is at the optional level. These two papers test students from different perspectives, where AA focuses on learning the ISA with a bit application to the case, but AAA heavily focuses on application. This means you need to refresh your ISA knowledge as these keep changing over the years.
Referring back to the previous note or course, articles from ACCA could help. During the last 10 AAA exam sittings, we have summarised how many times each popular ISAs are tested, here are the top 8 ISAs that AAA students need to cover in depth:
- ISA 260 Communication with those charged with governance-4 times
- ISQM 1 Quality Management for Firms that Perform audits or Reviews of Financial Statements or Other Assurance of Related Service Engagements- 5 times
- ISA 600(Revised), Special Considerations-Audits of Group Financial Statements (Including the Work of Component Auditors)-3 times
- ISA 720 Auditor's responsibilities relating to other information - 2 times
- ISA 250 Consideration of Laws and Regulations in an Audit of Financial Statements-2 times
- ISA 220 QC for an audit of FS-2 times
- ISA 315 Identifying and Assessing the Risks of Material Misstatement (ROMM)-2 times
- ISA 570 Going Concern-2 times
PREPARATION TIME:
If you are self studying AAA paper using ACCA Study Hub resources, please make sure you will allocate about 9 weeks to cover the whole syllabus, and the chapter questions at the end of chapter from there, plus another 3 weeks covering the revision questions from the Study Hub.
If you choose to study AAA with GlobalAPC, we have a tailored AAA study plan aiming to complete the whole Tuition Phase using our precise Education Book which summarises all the IFRS and ISA which are most relevant to the upcoming exam sitting, covering the Full Syllabus (If you are sitting AAA for June 2024 exam, we have covered the September 2023 to June 2024 syllabus; if you are sitting AAA for September 2024 exam onwards, the latest September 2024 – June 2025 Syllabus is covered), and revision practice to make sure you will learn our unique exam approach with proforma answer to pass the AAA paper.
We will spend about 4 weeks covering the Tuition Phase and 2 Weeks covering the Revision Phase of the study, with our ACCA online course which proves to be effective helping more than 6,000 students pass their Advanced Audit and Assurance Exams.
Your mindset – always balance Risks and Rewards
You need to have a holistic approach when doing exam questions of AAA, because your role is the audit manager, or the partner. Therefore, always balance risks and rewards in your answer, and you will be rewarded with quality marks.
"This mindset will always be applied in questions like Business Risks; Acceptance considerations; Ethical Questions; Going Concern assessment during the review stage of audit; and procedures."
Steve Chen, FCCA
Past Exams
Past Exam Questions
Make sure you will cover at least 5 recent exam sitting past exam questions, answers, examiners report, and marking scheme. Nowadays, ACCA will only publish these via the Practice Platform
However, you need to focus on basic exam approach. The reason I do not call this as Exam Technique is because 1 mark per point is very basic, at least throughout the ACCA Applied Skills level right to the Strategic Professional level exams.
At least leave a line for each point you make. Therefore, when you read examiner’s answer, you may find the answer look lengthy, and these answers are just for illustrative purposes, rather than the required students’ answers style.
Do make sure when you are reading examiner’s answer, enjoy it like when you are in charge of the real firm, learn the detail and apply them to your future exam. This helps.
AAA Exam technique (Our own three top tip activities)
Activity 1.
Plan the time
Activity 2.
Plan the standard answer and approach
Activity 3.
Plan the content
1. Plan the time
Style 1 – use 195 minutes to do the whole paper, ie you should allocate 195 minutes/80 marks = 2.4 minutes per mark.
Style 2 – use 15 minutes time to read and plan the question, and the 180 minutes to tackle the whole paper, ie 180 minutes/80 marks = 2.2 minutes per mark. I would certainly prefer the style 2.
2. Plan the standard answer and approach
Make sure you are aware that if you are asked about Audit Risk in Q1, make sure you will notice there are:
- 3 Marks for Materiality (2 marks for calculation, and 2 marks for comment why you choose this materiality level);
- 2 Marks for conclusion (1 mark for prioritisation of risks; 1 mark for listing out risks and responses).
Make sure you understand that when you are commenting on implications questions, you need to include Quote from relevant standards (IFRS, ISA, or ethical standards), Implications to Audit Quality, and Recommendation.
I highly recommend my students to practice these during the mock exam stage, as we provide Three sets of mock exams before AAA exam. Our students complete these mock exams, send them to us and our expert tutors at GlobalAPC will mark for them with detailed constructive feedback.
Video Session:
Best AAA Exam Technique | Advanced Audit & Assurance (AAA) Business & Audit Risks: Past Exam Pale Co
Presented by ACCA Tutor Guru - Steve Chen
I was invited by ACCA to present IFRS 16 Leases as the Tutor Guru, to students and members from all around the world, at ACCA London Office.
Plan the content and with application from the case information When I was an AAA student over a decade ago, I found exam questions to be quite lengthy and I can’t really remember the question content after I finished my first reading over the case, especially for Q1.
Therefore, I would firstly read the requirement, and I will find the word ‘AND’, to break a sentence with severa. Plan the content and with application from the case information When I was an AAA student over a decade ago, I found exam questions to be quite lengthy and I can’t realll sub-requirements.
Then I will plan the answer using these subheadings before I read through the case. When I read through the case, I would open the ‘Scratch pad’ on screen, and when I read the information which I think it’s relevant to the requirement, I would copy them to the scratch pad, then I will add my thoughts next to that, ie when to relate them in my answer. This really helps.
I would also prefer the HIGHLIGHT function on screen when I read through the AAA exam case background, using different colours. I usually use colour red standing for requirement a, blue for b, green for c, pink for d and yellow for e.
There are a lot more Exam Techniques for AAA paper, and below, I published 2 of my popular Youtube Videos explaining about this:
1. General exam techniques for ACCA AAA (15 Types of Exam Questions)
2. Exam Technique for Risk Questions (Focus on Section A Q1)
In each AAA exam, ACCA AAA examiner will surely include the following comments. Make sure that you will focus on the general weaknesses from other students, and be aware of lots of easy marks actually exist in this paper.
‘Some candidates continued to produce very vague answers which were not tailored to the scenario and, therefore, did not achieve high technical or professional skills marks.’
Dec 2023 Examiner Report for Q1
‘In additional to the professional skill marks described within the different sections of the question, three marks were available for communication overall. These marks were awarded for the use of a report header and introduction, presentation and relevance of answer and clarity of explanations. The majority of candidates achieved maximum marks in this area.’
Dec 2022 Examiner Report for Q1
