Financial Accounting & Reporting...the OMG! exam. So many candidates get nervous about FAR because there's so much content. The good thing is you’ll see repeats of content in other exam sections that really help you get better in practice.
When you think about a section like FAR, granted it’s a lot of information but the information builds as you go. Transactions happen with customer statements, vendor statements, cash receipts. Those become journal entries. Journal entries create your trial balance. The trial balance is the basis for your financial statements. From there you learn how to analyze and report the data contained in the financial statements - even beyond the numbers. This also includes the footnotes and disclosures.
The one thing I tell my students about FAR is this….this section has some of the most hands-on learning to make it easier for you. Here’s a good start to studying FAR content: find your favorite publicly-traded company. Download and print their most recent 10K. From here you can see actual financial statements, footnotes/disclosures and the audit report. Look through these things, get familiar with the format, the specific verbiage being used, the level of detail management is providing, the order of paragraphs in the audit report.
This was my favorite section because the information was easy for me. When I first started studying, I was a senior accountant in securitization which involves bond discount & amortization, journal entries, financial statements, and account analysis. There were some things that I had to dig into but overall I had a good understanding of the content because of my job.
Another tip: if you’re working in accounting already, thing about what you do on a daily basis and how that can help you prepare for the exam. Those working in public accounting may have a good start with the audit exam. Those in tax may do well with regulation. If you work in manufacturing, the Operations Management section in BEC will be very familiar to you.
Are you studying for FAR? I took all of my FAR study tips and tutorials and created the FAR Exam Review Intensive course for you. FAR was the easiest exam section for me because of my corporate accounting experience - now I’m sharing all of my CPA exam secrets in this course. It’s a great supplement to your study materials. Check it out right here.