Hello Benoy,
For Paper 1
Allocate time at the beginning of the exam for:
– reading and understanding the paper;
– planning the model;
– creating the model itself; and
– maintaining the audit trail (perhaps in sections).
A possible split is:
– Reading – 15 minutes.
– Planning – 30 minutes.
– Modelling – 1.5 hours.
– Audit trail – 1 hour.
For Paper 2
Allocate time for:
– reading and understanding the paper;
– planning the spreadsheet work required;
– doing this work; and
– writing the summary.
A possible split is:
– Reading – 15 minutes.
– Working through the model and planning the extra work – 30 minutes.
– Spreadsheet work – 30 minutes.
– Summary – 2 hours.
Paper 1
For the model in Paper 1
Read the question very carefully to ensure you know what is being asked. Note the results required and plan your approach well.
It is recommend you spend about 45 minutes on reading and planning before you start your model. Keep your model simple and show all the calculations. Do not spend too long working with the data (unless this is clearly indicated in the question)
but make sure that you do some basic checks. Do not get too involved in the detail of the model. If you get stuck, make a reasonable assumption, document it, and move on. Include adequate signposting and labelling in your model and audit trail so that the work on each sheet is clear, and references are provided. Be alert for checks you can apply. Test output frequently for accuracy and reasonableness – as you would do at work – and document these checks. If an answer does not look reasonable, check your formulae against the question. If you cannot find the error, note it in your audit trail and move on. Remember: CP2 is not about determining the ‘right’ answer.
For the audit trail in Paper 1
Make your audit trail as comprehensive as you can, making sure that you cover:
– all steps in your methods;
– the assumptions; and
– the reasons for your decisions. Include your checks – auto-checks and reasonableness checks on the various scenarios. Highlight any areas where special care needs to be taken, e.g. where a Goal Seek has been used. Keep in mind the requirements of your two audiences:
– a fellow student: and
– a senior actuary.
Paper 2
For the spreadsheet work in Paper 2 Read the question very carefully to ensure you know what has been modelled and the additional work which is required. Note the results required and plan your approach. It is recommended you spend about 30 minutes on working through the model and
planning the additional work before you start work on the spreadsheet. Keep your spreadsheet work simple and show all the calculations. Do not get too involved in the detail of the model. If you get stuck, make a reasonable assumption, document it in your summary, and move on. Be alert for checks you can apply. Test your output for accuracy and reasonableness – as you would do at work – and use the results of the reasonableness checks in your summary. If an answer does not look reasonable, check your formulae against the question. If you cannot find the error, note it in your summary. Remember: CP2 is not about determining the ‘right’ answer. You will not be required to add to the audit trail provided for this paper, but your summary will
need to cover the whole project in the question, not just the additional work you have carried
out.
For the summary in Paper 2
Focus on using the summary as a communication to your audience, a senior actuary. Include the approaches you have used for the whole project, not just for the additional work you have carried out. Give sufficient and accurate details of these (and the data) so that a senior actuary could check your methods and assumptions (however they do not need to be able to check your Excel spreadsheet using this document). Do not simply ‘copy and paste’ the text given to you in the audit, but amend the content to be appropriate to a senior actuary. Have consideration of the purpose of the Summary document and the target audience. For example, the Summary document is not intended to be used to help check the model, therefore Excel references are inappropriate. Candidates who copy large sections of the information in the exam question and/or the audit trail provided into their Summary document are likely to gain very little credit from the examiners for this. Follow the instructions in the question carefully. In particular, ensure you include all the results which have been requested for the whole project. You need to include any added value comments that explain the results you have obtained and conclusions on the results, and any comments that follow from the reasonableness checks. You also should include a comprehensive set of possible next steps.
Ps: If i were you, i would go in the order the exam paper questions' are scheduled. Completing the model and then doing the relevant sections. For example, doing 'Next Steps' first might not well get you clear the idea in your head. Whereas if you have already written methodology, talked about the results and conclusion, it might be well in your head what further work could have been done (that's my personal p.o.v). The whole point of to be able to do the assignment and report in 3 hours 15 minutes is to plan your work.
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