CPA Atlantic School of Business would like to provide clarification on the reference material cut-off date and testable material used for the PEP and CFE examinations to be delivered in 2022. You are expected to use the reference material electronically provided.
As specified in the examination blueprints for the CPA PEP modules and the CFE, you are only responsible for the standards and regulations that are actually “in effect or substantively enacted” as of December 31st of the prior year. For the CFEs and for all CPA PEP module exams in 2022, this should be interpreted to mean that the following versions of standards and legislation are testable and are therefore included in the CPA Canada Standards and Guidance Collection (Exam Reference) material:
- IFRSs in the CPA Canada Handbook – Accounting that are in effect up to and including January 1, 2022.
- All other standards in the CPA Canada Handbook – Accounting (ASPE, ASNPO) and all standards in the CPA Canada Handbook – Assurance with an effective date of December 31, 2021, which are included in the December 2021 Handbook release (or prior).
- Tax legislation substantively enacted (which includes legislation passing third reading in the House of Commons during a minority government) up to December 31, 2021.
To align with recent updates made to the competency map, the Excise Tax Act will be added to the reference materials this year to provide candidates with authoritative literature that they can consult and reference during the exam. The Management Discussion & Analysis – Guidance on Preparation and Disclosure section has also been added to provide an additional resource for candidates.
In addition, you are responsible for an awareness of changes that occur subsequent to the cut-off dates or that have been issued but are not in effect, at a Level C proficiency level at Core, and moving to Level B for the Assurance and Taxation Electives, based on the following competencies:
- 1.1.4 Explains implications of current trends, emerging issues and technologies in financial reporting (IFRSs issued but not yet effective fall into 1.1.4)
- 4.2.2 Explains the implications of current trends, emerging issues and technologies in assurance standards and methodologies
- 6.1.3 Explains implications of current trends, emerging issues and technologies in taxation
Reminder: You may always apply a more current standard than what is required (recognizing that the reference material provided is only updated once a year) on the CFE and case portion of the CPA PEP examinations. However, this is not possible with the CPA PEP objective-format examination questions, where the effective date must be known. Therefore, objective-format questions follow the cut-off dates outlined above.
Additional information regarding COVID-19
Candidates are reminded that they will be instructed to consider and respond to the case as presented and ignore the potential impacts of COVID-19 when writing the CFEs and PEP module examinations.
FURTHER DETAILS ON FINANCIAL REPORTING AND ASSURANCE CHANGES
IFRS: IFRS 16, Leases, was revised to extend beyond June 30, 2021, the permission for the lessees not to assess whether particular COVID-19-related rent concessions are lease modifications and, instead, account for those rent concessions as if they were not lease modifications. Candidates are not responsible for this change as it is COVID-19 related.
ASPE and ASNPO: Section 3065, Leases, was amended in December 2021 to extend the optional relief for both lessees and lessors on accounting for lease modifications received or granted as a result of the COVID-19 pandemic. Candidates are not responsible for this change as it is COVID-19 related.
ASSURANCE: No exceptions noted.
FURTHER DETAILS ON TAXATION CHANGES
The Finance Minister released the 2021 Federal Budget on April 19, 2021. This budget included a proposal to allow the immediate expensing of certain capital assets by Canadian-controlled private corporations. Several other tax measures were also identified in the budget, only some of which were enacted during 2021. The legislation to enact the remaining changes, including the immediate expensing provisions, has not been introduced into parliament as of December 31, 2021.
However, following the principle that candidates may apply a more current standard than what is required, on the CFE and on the PEP exam cases candidates may use the new rules in their case responses. Objective-format questions follow the cut-off dates outlined above.
Candidates are advised that, while many of them are enacted through the Income Tax Act, COVID-19-specific measures such as the Canada Emergency Rent Subsidy, Canada Emergency Wage Subsidy, and Canada Recovery Hiring Program will not be testable on the CFE or PEP exams in 2022. Likewise, the determination of other temporary benefits such as the Canada Emergency Response Benefit and Canada Recovery Benefit will not be testable.