The Importance of WHY???

 The Importance of WHY???

 

How often have you asked this question before doing something, why? We are a generation that has been programmed to follow orders and ensure we do as we are told. However have you ever wondered why you are doing something, why is it that we have to study, why is it we have to do well in exams, why are you doing ACCA?

 

 

So now since we have gotten you to start thinking, it’s important that you start following this approach from now on. The world is moving towards conceptual learning, and before you realise it, the robots would have taken over everything that could be programmed and automated. Therefore don’t just rely on the simplistic tasks that can be done by robots or simple computer software, but ask the question why to every task so that you don’t just learn the task but understand the reason behind it. Eventually you will be able to come up with better solutions than any robot or computer software.

 

In our ACCA/CA world, we are often given lots of theory, but we love doing a rote answer. Unfortunately the exams are such that you just do a simple regurgitate of the knowledge, but have to apply the knowledge to the practical scenario’s given in the question hence it is imperative you understand the concepts. While teaching at FPA (Financial Planning Academy) I have always been a strong proponent of concepts and quote “don’t run after the how’s, look for the why’s. The how’s can always be learnt through practicing, however if you don’t understand the why’s from the theory, you can never apply these principles to the ever changing and dynamic finance and accounting world and similarly to the very challenging ACCA exams.”

 

Therefore look for the logic behind why is something being done. For e.g. one of the standards IAS 16 Property Plant and Equipment under which whenever the land or building gets revalued, in case of the gain it gets recorded to the Other Comprehensive Income and not the Profit and Loss account. This is because the gain isn’t realised and it’s notional. However since the financials should show a true and fair view, we will take the gain to OCI. However if the same building gets devalued, the loss in this case in the value of the property gets taken to the Profit and Loss and not OCI. Now this is where the principle of prudence comes in which says if there’s any chance of a loss, show it, as the investors should never see a rosy picture when things can go wrong. The same doesn’t apply to Profits. Now unless you understand the concepts in standards like these, you can never really clear the reporting papers in ACCA.

 

So to conclude, please always ask the question why when you learn and try and understand the concepts. When you understand the concepts, it’s easier to make changes and make things even better, because the robots may be able to do that. Therefore until the robots learn to replicate our intelligence, learn the concepts.

About Author

Zaheer Sayed, is one of the oldest ACCA members in India having passed out ACCA exams in December 2007 from London. Has vast work experience of over 14 years, having worked with Ernst and Young in Stat Audits to working as Associate Director at the UBS Bank, has in-depth knowledge of finance and accounting world. On academics side, has been teaching for almost 10 years, with ACCA teaching experience of over 6 years specialising in Reporting, Tax and Audits. Has also co-authored over 20 titles for a leading publication house in Pune on varied topics like Economics, Audit, Accounting, etc.