AAT Q2022 Syllabus Update

From February 2022, the AAT are introducing a bookkeeping and accounting qualification that features a new syllabus, known as Q2022.

What is AAT Q2022?

Industry bodies that develop qualifications will continuously look to ensure that the credentials and awards they offer are still relevant and meet the needs of their audiences.

This continuous review, which has laid the foundations for the new Q2022 qualifications, ensures that organisations and students benefit from a new bookkeeping and accounting qualification that is up-to-date and in line with employer and industry requirements.

The Q2022 will enhance the relevance and value of the AAT qualification which is widely used by entry-level and senior accountancy professionals.

When can I study the AAT Q2022 qualifications?

The first date you can register for the new AAT Q2022 qualification is the 1 February 2022. If you’re studying the AQ2016 qualification, there will be a transition period until 30 June 2023 to sit and complete the existing assessments. Both qualifications will run simultaneously until June 2023 when the AQ2016 will end.

The June 2023 deadline is for you to complete the AQ2016 Level you are studying. Once you complete the level you are on, your next level will be studied under Q2022, meaning there will no longer be a time restriction to complete your subsequent level(s).

The last date for registration on the AQ2016 qualifications will be 31 January 2022.

• 31 January 2022 – last date for registration under the existing AQ2016 qualification

• 1 February 2022 – first date for registration under Q2022

• 30 June 2023 – final date for sitting an AQ2016 assessment

Main Changes / Syllabus Changes / FAQs

What are the differences between AQ2016 and Q2022?

Q2022 is being introduced to ensure future accounting professionals have the skills and technical knowledge to be well prepared for evolving and future business environments. It will also look to enhance future career options for prospective professionals in bookkeeping and accounting. In addition, there are four ‘themes’ which run throughout the qualification:  technology, communication, ethics, and sustainability.

The main differences are:

• Removal of repeated syllabus content between levels

• Fewer assessments per level

• Removal of Level 2 Accounting Software, Level 3 and Level 4 Synoptic Assessments (for non-apprentices)

• Introduction of new units, these being Level 2: The Business Environment and Level 3: Business Awareness

Some units have also been combined

• Level 3: Advanced Bookkeeping and Financial Accounts Preparation have been combined into one unit called Financial Accounting: Preparing Financial Statements (FAPS)

• Level 4: Budgeting and Decision & Control have been combined into Advanced Management Accounting (AMAC)

Additional changes

The End Point assessment (EPA) will now sit outside of the qualification for Levels 3 and 4, meaning the synoptic assessment at these levels only needs to be taken by apprentices.

Guided learning hours have been reduced for both Level 3 and 4, while the Level 2 and 3 Bookkeeping qualifications will also be graded as either Pass, Merit or Distinction.

New: AAT Level Subscription Fees for Q2022

Unlike AQ2016, annual membership fees will be removed for Q2022. This will be replaced with a one-off subscription fee that’s payable to AAT upon becoming a student member. This is valid for the full level being studied, rather than a fee that is paid on an annual basis. However, if you were to switch from studying AQ2016 to Q2022, you would still need to pay the full fee for that level, regardless of the number of units you had left to study.

What does the Q2022 syllabus change mean for apprentices?

As an apprentice, you should look to complete the level you're on with AQ2016. When you progress to the next level of the apprenticeship, after February 2022, you would continue your studies under Q2022 for the next level of the apprenticeship.

While it is possible to transfer from AQ2016 to Q2022 while midway through a level, we don't recommend it. This is because a maximum pass mark of 70% from AQ2016 is transferable to Q2022. However, should you still wish to pursue transition arrangements, please refer to AAT’s transfer rules.

Main syllabus changes in full

Level 2 Certificate in Accounting:

Introduction to Bookkeeping (ITBK) and Principles of Bookkeeping Controls (POBC)

The content will not change significantly from the current material, but has been rewritten to enable a more relevant and varied assessment that will better equip learners for both the workplace and the financial accounting unit at Level 3.

Principles of Costing (PCTN)

The changes mostly focus on the introduction of budgeting and have been developed so that students are introduced to a fixed budget and associated variances at Level 2 and then a flexed budget with more complicated variance analysis at Level 3. A new Learning Outcome has been introduced to support students in familiarising themselves with formatting and mathematical formulae used to support cost calculations.

The Business Environment (BESY)

This is a new unit that has been introduced and is the only synoptic assessment at Level 2. Working effectively in finance continues to be assessed under this unit, but it also introduces business environments and ethics. The Business Environment unit contributes towards 70% of the synoptic asses

Level 3 Diploma in Accounting

Financial Accounting: Preparing Financial Statements (FAPS)

There will now be a single financial accounting unit at Level 3 that replaces the Advanced Bookkeeping and Final Accounts Preparation units from AQ2016. The unit content will be largely unchanged. However, the funding of investments in non-current assets will move to Management Accounting Techniques and the units of production method of depreciation will be removed from the syllabus, as will changes in partnerships. There will be a new learning outcome on calculating and interpreting basic profitability ratios.

Management Accounting Techniques (MATS)

This unit will no longer include the last-in-first-out (LIFO) method, process costing (although accounting for wastage will remain), just-in-time, long-term investment appraisal or limiting factor decision making. The high-low calculation for semi-variable costs will now be included.

Standard costing and budgeting will be made more explicit and will build on the fixed budgets introduced at Level 2 to include flexing for volume and an understanding of rolling budgets. Variances will be tested for changes in revenue as well as costs and will include a basic operating statement. Financing investments will be moved from the financial accounting under AQ2016 and a new Learning Outcome on cash management and liquidity ratios will be introduced. Spreadsheet skills, like those tested under SPSH under AQ2016, will be tested in this unit. Human marking will therefore be required for the exam.

Tax Processes for Businesses (TPFB)

Coverage of VAT will be largely unchanged from Indirect Tax, except that Making Tax Digital (MTD) will be specifically referenced, and there will be slightly more content on the special schemes that affect small businesses. There will be a new, knowledge-based learning outcome on payroll. The Q22 assessments in 2022 will be based on FA21.

Business Awareness (BUAW)

This is a new unit that has been introduced at Level 3 but most of the AQ2016 Ethics for Accountants content, including pared down coverage of money laundering, will continue to be assessed here.

The law content currently in AQ2016 Final Accounts Preparation relating to preparation of financial statements for different entities, including the content and effect of partnership agreement has been included alongside analysing the external environment using the PESTLE model, the micro-economic environment, importance of sustainability, the Impact of technology & data within an organisation and communication to relevant stakeholders.

Level 4 Diploma in Professional Accounting

Applied Management Accounting (AMAC)

This unit is a combination of the MABU and MDCL units under AQ2016 with the syllabus for the new management accounting unit being much the same as currently for MABU and MDCL. However, there are a few changes being introduced, including calculations for linear programming, investment appraisal being brought in from the Level 3 MMAC unit, and a small amount on data analysis and cognitive computing. Backward variance calculations will however be removed.

Drafting and Interpreting Financial Statements (DAIF)

The content remains much the same as FSLC under AQ2016.

Internal Accounting Systems and Controls (INAC)

The unit is largely unchanged but with big data being introduced and the impact of technology on accounting systems.

Optional Units

Business Tax (BNTA)

For the new Business Tax unit, IR35 and Research and Development have been removed and duplication with Personal Tax has been addressed as appropriate. Understanding the tax implications of business disposal has been introduced. The Q2022 assessments in 2022 will be based on FA21.

Personal Tax (PNTA)

The new Personal Tax unit will remain largely unchanged however learners will only be required to gain an understanding of inheritance tax (IHT), the requirement for IHT calculations has been removed. Some new reliefs have been introduced for CGT. The Q22 assessments in 2022 will be based on FA21

Audit and Assurance (AUDT)

Additional content will include corporate governance and the role of the audit committee.

Credit and Debt Management (CRDM)

The content will remain largely unchanged from AQ2016.

Cash and Financial Management (CSFT)

Cash and Financial Management will have less focus on treasury management. Instead, there will now be a greater focus on managing finance and liquidity.

What are the AQ2016 and Q2022 transitional arrangements?

Details of the transitional arrangements are explained in the tables below:

*Unit assessed as part of the synoptic assessment

*Unit assessed as part of the synoptic assessment.

*Unit assessed as part of the synoptic assessment.