AAT - Association of Accountancy Technicians

...ended up studying for the AAT and it was great, it has opened so many doors and I wish more people were aware of it. So, here we go…

The AAT is split into three years, foundation, intermediate and technician.

In the first, foundation, year you study for three main units;
Unit 1 – Recording income and receipts
This unit covers preparation of invoices and credit notes, the banking of payments and the chasing of ...
...four, you may receive you AAT Foundation certificate, NVQ Level 2.

Unit 5 – Maintaining financial records and preparing accounts
This unit takes the principles of double entry bookkeeping taught in unit 3 are moved on from the initial trial balance to accruals, prepayments, year end adjustments and final balance sheets and profit and loss accounts.
This unit is assessed by formal examination. The pass rates for this exam ... more

I never wanted to be an accountant, but somehow I fell into it. I ended up studying for the AAT and it was great, it has opened so many doors and I wish more people were aware of it. So, here we go…

The AAT is split into three years, foundation, intermediate and technician.

In the first, foundation, year you study for three main units;
Unit 1 – Recording income and receipts
This unit covers preparation of invoices and credit notes, the banking of payments and the chasing of payments. You need to be able to competently complete the cash book, the sales ledger account, and the sales ledger control account and VAT accounts. You also need to understand the basics of cash transactions, credit transactions, discounts, in their various forms, coding and the sales process, from letters of enquiry, quotations through to payments.
This unit is examined by skills test; this is an informal exam, usually carried out at college over several hours. Tutors will then mark the paper, to pass you must be competent is every task of the test, if you are not competent further questions must then be completed; these can either be verbal or supplementary. Supplementary questions require you to complete additional tasks, whereas verbal questions are just brief questions.

Unit 2 – Making and recording payments
This unit covers handling purchase invoices and credit notes, payments to suppliers and others, payroll payments and petty cash payments. You will need to be able to complete the cash book, the purchase ledger account, the purchase ledger control account, VAT accounts and the petty cash book. There may also be elements of unit 1 included this unit.
This unit is examined by skills test.

Unit 3 – Preparing ledger balances and an initial trial balance
This unit contains elements of the first two units, but takes them to the next level, moving the transactions from the double entry accounts, into a trial balance.
This unit is examined by a skills test and examination. What is examined in the skills test will not be covered in the exam and vice versa. The exams can be sat in June or December. Each exam last three hours and fifteen minutes, however you are able to leave after the first hour, except in the last half an hour. You must answer 60% of the paper to pass. The pass rates vary between 82% and 95%.

Unit 4 – Supplying information for management control
This is a very basic unit which is primarily concerned with coding
This unit is examined by skills test

Once you have completed units one to four, you may receive you AAT Foundation certificate, NVQ Level 2.

Unit 5 – Maintaining financial records and preparing accounts
This unit takes the principles of double entry bookkeeping taught in unit 3 are moved on from the initial trial balance to accruals, prepayments, year end adjustments and final balance sheets and profit and loss accounts.
This unit is assessed by formal examination. The pass rates for this exam vary between 76% and 79%.

Unit 6 – Recording and evaluating costs and revenues
This is a costing based unit and covers stock control systems i.e. last in first out, first in first out and average costing; it also covers allocation, apportionment. This means the distribution of costs to various departments to find the cost of units produced.
This unit is assessed by examination. The pass rates for this exam vary from 82% to 90%

Unit 7 – Preparing reports and returns
This unit covers VAT reports, letters and memos regarding tax, divisional branches and the accounting procedure for transactions between them, graphical interpretations, time series analysis and statistics.
This unit is assessed with a skills test.

Once you have completed Foundation, NVQ 2 and units 5, 6 and 7 you may receive your AAT Intermediate certificate, NVQ Level 3.

Unit 8 and 9 – Managing costs and allocating resources
These units cover various costing systems, including ABC, standard costing and cost pools. Ratios and variances between budget and actual spends, as well as direct material, labour and overhead variances are covered in these units. You must be able to calculate and analysis performance indicators, as well as writing realistic reports.
Both of these units are examinations.

Unit 10 – Managing people and systems in the accounting environment
This is a project written about an issue within your workplace; there are strict syllabus criteria which must be covered, including management theories
For those people studying who are not working there is a simulation, which fills the same requirements.

Unit 11 – Drafting financial statements (accounting practice, industry and commerce)
This unit continues from unit 5, but focuses on final accounts i.e. preparing cash flow statements, balance sheets and income statements. It also deals with concepts of holding companies and the preparation of group accounts.
This unit is examined by external examination. Pass rates for this exam vary between 68% and 81%

Unit 12 – Drafting financial statements (central government); Unit 13 – Drafting financial statements (local government) and Unit 14 – Drafting financial statements (National Health Service)
These are basically variants of unit 11; there is an option to take one of these four options. However some colleges do not offer all four options. Some options may be more beneficial than others, depending on what sector you work in.

Unit 15 – Operating a cash management and credit control system
This unit deals with variances, ratios, credit facilities, cash flow, debt collection, aged creditor and debtor analysis.
This unit is examined by a skills test only

Unit 17 – Implementing audit procedures
To be considered competent in this unit you must be aware of procedures, when planning an audit, carrying out an audit and completing an audit. You must be able to identify weaknesses in current business systems, audit objectives and types of test, sample types and reconciliations.
This unit is examined by a skills test

Unit 18 – Preparing business tax computations
This unit covers corporation tax, capital allowances, capital gains tax, national insurance, taxable trading profits, tax returns and shares.
This unit is assessed by examination. The pass rates for this exam vary between 70% and 83%.

Unit 19 – Preparing personal tax computations
This unit covers income tax, personal allowances, capital gains tax, savings income, principal private residences and benefits in kind. A lot of the material in this unit overlaps with unit 18. This is a really interesting unit as you will learn many loopholes in the tax system. I would highly recommend this unit.
This unit is assessed by examination

Once you have completed units 8 and 9; unit 10 project; unit 11, 12, 13 or 14 and two of units 15, 17, 18 or 19 you may receive your AAT Technician certificate, NVQ Level 4.

Unit 21 – Working with computers
This unit is evidenced by a coursework style portfolio. To complete the unit you must complete a few smaller assignments demonstrating ability to use Microsoft Office, followed by a number of larger assignments using specialist accounting software. The preferred software program is Sage Line 50 or 100. This is the sort unit that can be passed for marking several times.

Unit 22 – Health and safety
This unit can be a workplace assignment, a one day course, a multiple choice test or a coursework style portfolio. This is very dull.

Unit 23 – Achieving personal effectiveness
This unit is similar to a skills test, but is completed at home. This focuses on time management, staff management, preparing memos and formal letters. This can also be marked several times before being completed.

In order to receive your full membership you must also complete units 21, 22 and 23. Once you have been granted full membership you can put the valuable letters MAAT after your name.

There is also an AAT Payroll course; if you complete both AAT qualifications you can put the letters FMAAT after your name. AAT Payroll consists of NVQ Levels 2 and 3; both levels can be taught or learnt within one year.

My story with the AAT
I started working at Cornwall County Council (soon to be Cornwall Council 01/04/2009) in February 2006 as an accountancy trainee. I found the job through an apprenticeship agency. The Council sent all their AAT students to Cornwall College, at the time, but the courses started in January; however I was assured that I could start at Camborne College, having only missed a few weeks. The college weren’t so keen, which I understood, though I was a bit annoyed that the apprenticeship agency had told me I could definitely start going to college. Nevermind, they then enrolled me in the same course at St Austell College, I didn’t mind this, although it was a little bit further from home. But, that course was then moved to Saltash, this was simply too far to travel one day every week. I was very keen to start my studies though so I badgered work and the apprenticeship agency, until they agreed to take me to Plymouth to enrol in a distance learning course. This was great because it meant I got a day off each week to study at home….

Things didn’t go quite as planned, I was an eighteen year old, with a car and a day off every week, and commitment was limited. Eventually, when I released that I really did have study, I started sending unit 1 assignments to a tutor in Plymouth. I sat the unit 1 skills test in June 06, however the apprenticeship agency were then taken over and became part of Cornwall College. I sat the unit 2 skills test in September and studied units 4, 21, 22 and 23.

Unit 21 (working with computers) used the IAB (International Association of Bookkeppers) levels 2 and 3 with voluntary exams. This was a nice touch by the college as it allows students to gain complementary qualifications to the AAT and also gains them some much needed additional funding. You were also given the opportunity to study for Microsoft specialist, I came away with IAB level 2 (I got an F in level 3) and Microsoft specialist in Word and Excel.

Unit 22 (health and safety) was a one day course followed by a quiz of 30 multiple choice questions, plus some workplace evidence. This was very simple and any moron could have taken the test without the course. The alternative to the course is a complex coursework assignment.

Unit 23 (achieving personal effectiveness) was a scenario based project, with questions on dealing with staff, time management, etc. This could be handed in several times before being submitted for a final marking.

In the meantime I studied for unit 3 at home and took the skills test in November and the exam in December. I got my results in February 07 and to my amazement I passed. However I did not receive my level 2 certificate until May 07 as Plymouth College did make the AAT aware that I had completed unit 1.

In January 07 I started my studies for Intermediate. I studied for unit 5 (maintenance of financial records and preparing accounts) in my spare time, while I learned Unit 6 (recording and evaluating costs and revenues) and unit 7 (preparing reports and returns). I took the unit 7 skills test in April and passed with flying colours, no verbal or supplementary questions. In May I took the unit 6 skills tests and also passed with surprising ease. Then, in June I took exams for unit 5 and unit 6. When I got my results in August I was disappointed that I had failed unit 5, but luckily I had passed unit 6.

In September 07 I started my studies of Technician level. I studied unit 5 at an evening class. While studying unit 9 (managing costs and allocating resources), unit 19 (preparing personal tax computations) and project, unit 10 (managing people and systems in the accounting environment) at college. I based my unit 10 project on a system of stock control used in my area of work. In December I took exams for unit 5, 9 and 19. I was ecstatic when I received my results in February 08 to find I had passed all my exams, meaning my Intermediate level qualification was now complete. As ever there was a problem at the college and I did not receive my certificate until April 08. I then completed my unit 9 (managing costs and allocating resources), unit 11 (drafting financial statements) and unit 17 (implementing audit procedures) in June and received my results and certificate for Technician, NVQ Level 4, in August 08.

Cornwall College only offer unit 11 as the drafting financial statements option. I decided to take unit 19 (personal tax computations) and unit 17 (implementing audit procedures) as my other two options as I was keen to continue my studies onto ACCA (Association of Certified Chartered Accountants) and wanted a basic knowledge of tax and audit.

AAT was traditionally studied in the NVQ format; however there is now a diploma option, though this has only been available for approximately eighteen months.

As well as being a very helpful qualification for anyone interested in accounts or bookkeeping, the AAT also publish a monthly magazine, which both student and full members receive by post, as no cost.

The AAT also put on conferences around the country every month to allow members to receive updates on relevant issues, usually due to changing legislation. I have attended talks on VAT, CIS tax and professional ethics. If you are able to attend any of these events I would strongly recommend them, as they are very useful, a good networking opportunity, good fun and often catered, yum yum. The AAT also offer CPD (continuous personal development) master classes which cost £99 per one day course. Full members are required to provide evidence of 30 hours of professional development activities each year. However, if you work for an accredited employer this is not a requirement as your workplace will provide you with the necessary hours.

There are fees payable in order to be an AAT (student) member. To become a student member there is a registration charge of £32, plus £69 annual subscription. Exams cost £39 for foundation level, £41 for intermediate level and £43 for technician level. There is a £25 charge to become a full member.

There is a fantastic website which may prove helpful to anyone interested in the AAT
www.aat.org.uk
You can find lessons, skills tests and past exam papers online, as well as discussion forums for students and members.

Please let me know if I have missed any crucial information, I know it’s likely as I am fairly forgetful.
Hope to have helped, thanks for reading

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