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IPA Students up to the Mark autumn 2005 student bulletin IPAIPA Students up to the Mark In this edition CPI and Early Entry Commenting on the 23% increase in students sitting this year’s Certificate Examinations June 2005 of Proficiency in Insolvency Examination, IPA President Louise Verrill said: Results “It is hugely encouraging for the future of the profession that more people than ever before are taking the CPI to acquire a now well recognised and CPI Examiner’s Report valued insolvency qualification.” There was also an increase in the pass rate – 69% compared with 61% in 2004. JIE: The Price of Success – A Season without Spurs Jonathan Birch, Chairman of the Examinations & “More sat the EEE Training Committee, said that the CPI represented a good test of all round practical Accounting paper in June E&T Student Issues insolvency knowledge, and it was evident that Sub-Group students had worked hard to build on their desk 2005 than in the previous work and deliver some excellent results. He particularly congratulated the prize winners – year’s two sittings, with a Kiri Jimmieson, Begbies Traynor (first); Mark Patterson, BDO Stoy Hayward, and pass rate of 81% and 13 of Amanda Jones, Begbies Traynor (joint second); Please pass this on and Brendan Hogan, Unity (third) – and the the 21 pass students achieving nine students who had achieved distinctions. If you know someone in your firm The full CPI June 2005 results are on the back distinctions or merits.” who might be thinking about, or page of this edition. could be encouraged to think There were also increases in the numbers about, studying for an insolvency sitting the Early Entry Examinations as a Antoinette Thorpe, McCambridge Duffy & Co; qualification, why not pass this preliminary step towards the Joint Insolvency and Ivy Yeap, K S Tan & Co. bulletin on to them, or order an Examination. More sat the EEE Accounting The full EEE results are also on the back page. additional copy (or copies) from paper in June 2005 than in the previous year’s the IPA or download from the IPA two sittings, with a pass rate of 81% and 13 of the website. 21 pass students achieving distinctions or merits. There was a similar increase in those sitting Contact: Maria Weemes, the Taxation paper, with a pass rate of 83%; while IPA Student Officer at: those sitting the Business Law paper, and facing IPA, 52-54 Gracechurch Street, what was generally judged to be a tough London EC3V 0EH challenge, still markedly improved on last year’s 020 7623 5108 results with a highly creditable 56% pass rate. [email protected] Particular congratulations to those who have website: completed the three EEEs this time round, and www.insolvency-practitioners.org.uk now move on to the JIE – James Baggley, BDO Stoy Hayward; Clare Davies, Deloitte; Michael Durkan, Findlay James; Simon Edel, Ernst & Young; Steven Illes, Baker Tilly; Nicholas Nicholson, RSM Robson Rhodes; John Radford, Tenon Recovery; Dominic Startup, The Pay Plan Partnership; Francesca Tackie, Budsworth & Co; Eliot Mosafi on JIE success at page 3 Examiner’s Report CPIThe time has come round again to offer some comments on the CPI Examination. 197 candidates sat2005 the paper in June 2005, drawn from a wide range of firms, both in terms of size and location, as in previous years. The number of candidates represented an increase of 23% on 2004. The pass rate was 69%, a noteworthy increase on the pass rates of 61% and 63% in the previous two years. by David Thorniley General comments to be dealt with in an administrator’s statement of Claims adjudication From the feedback I received, this year’s paper proposals are set out in Para 49 Sch B1 IA86 and This question asked candidates how they would was considered accessible, and provided ample R2.33 IR86. adjudicate claims involving retention of title, opportunities for candidates to demonstrate their The second part of the question on adminis- contractual interest, set-off, employee/sub- knowledge of insolvency law and practice. It is tration exit routes required a little more thought. contractor rights and a bank’s claim for wages pleasing to report that candidates dealt with the Paras 49, 76 and 79-84 Sch B1 IA86 provide at advanced. It gave an opportunity for candidates bankruptcy questions in particular with far least nine potential exit routes: to apply their practical experience under greater confidence than in previous years. By examination hall pressure, and produced a contrast, however, understanding of the new – in • company voluntary arrangement; mixed crop of answers. Examination technique fact not so new – administration procedure was • scheme of arrangement; was quite poor in some cases: if a question is disappointingly sketchy. • automatic termination after one year; broken down into five sections with the available I am always surprised how many candidates • court order on the administrator’s application; marks indicated for each, candidates have got to throw away easy marks by not observing the key • notice of termination by out of court apportion their time accordingly to maximise mantras of examination technique – read the administrator; their mark scoring potential. question carefully, allocate time proportionately • court order on application alleging improper and set out your answers with clarity. Candidates motive; Deficiency account/investigations who did generally achieved good results, and in a • winding up order made, or provisional The final optional question appeared to scare off number of instances really outstanding results. liquidator appointed, by court on public many candidates, probably because it had a interest grounds or on application by the FSA; computational aspect. But it is always possible Multiple choice questions • conversion into creditors voluntary liquidation; with this type of question to notch up some By and large, these were answered well. • dissolution where there is no prospect of a marks for a clear layout, and all candidates sitting Candidates were sure of their ground on most areas, distribution to unsecured creditors. the CPI must be capable of preparing basic although should perhaps brush up on matters such financial statements such as statements of affairs as time limits for antecedent transactions and the Candidates who put down all of the above and deficiency accounts. destruction of company books and records. points probably also remember that Horst The second half of the question raised Remember, too, that administrative receivership is Bucholtz was one of the Magnificent Seven, but certain matters requiring investigation, in still an examinable area of the syllabus. it was not necessary to set out all these items to particular voidable transactions under S238/239 score full marks. IA86 and re-use of company name under s216 Short compulsory questions Schedule B1 and the new Pt II Rules are at the IA86. Again, some candidates’ basic technique These four short questions accounted for 16% of heart of the syllabus and of fundamental practical let them down. Candidates must tailor their the marks, and provided good opportunities to pick relevance, and candidates must ensure they are answers to the question, and not waste precious up marks. The first two questions (Schedule 4 up to speed on these procedures. time churning out information which is not powers exercisable with sanction, and the statutory required by the examiner. In this case, the requirements for a debtor to apply for an interim Bankruptcy – trustee’s interest in property question specifically told candidates to ignore order) were answered consistently well, and typi- Perhaps it is indicative of the market that candi- issues of wrongful trading. fied the standard of knowledge expected for the CPI. dates answered this question very well indeed, By contrast, the question on the information to and certainly much better than bankruptcy ques- Summary be included in a debtor’s petition for his own tions have been attempted in recent years. There Overall, the paper concentrated on mainstream bankruptcy was answered unaccountably badly, was a good appreciation of the necessary proce- areas of the syllabus. It was pleasing to see candi- given that most of the information required is dures to establish and protect the trustee’s inter- dates demonstrating a sound knowledge of pretty straightforward – see R6.38/R6.39 IR86. est, and of the options available to the trustee to bankruptcy law and practice, but there is consid- For the prescribed fund calculation, candidates realise his interest. erable room for improvement in knowledge of tended to fare either very well or very badly, and Again, this question tested practical issues at administration procedures. And candidates need in most cases it was the latter. The basis of calcu- the heart of the syllabus. to avoid basic examination technique pitfalls to give lation for the prescribed fund is not in itself compli- themselves the best prospect of getting through. cated – where the net property is over £10,000, 50% Advantages/disadvantages of of the first £10,000, plus 20% of the excess over individual voluntary arrangements v Congratulations £10,000 up to a maximum of £600,000 -and candi- bankruptcy Congratulations to everybody who passed and dates need to be confident they can apply it. This was a bread and butter question which was good luck to everybody intending to sit the paper generally fielded pretty well by most candidates, next year. Administrator’s proposals/exit routes and provided a good opportunity to pick up from administration marks.
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