(Posted July 2025)
Writing a response for the CPA Canada Common Final Examination (CFE) Day 1 case is very different from a Day 2 or Day 3 case since it starts with a situational analysis update. Many candidates struggle with preparing a situational analysis since there are only a few opportunities to practice writing them, so here are some tips to help you out.
Memorize where to find key case facts in the Capstone 1 case
The CFE Day 1 case is set several years after the Capstone 1 case some of the key case facts may still be relevant, such as the company’s mission, vision, values, and the industry key success factors. Memorize where these key case facts are in the Capstone 1 case since you will be given this case in the rough notes booklet on Day 1 of the CFE. For example, you may memorize that the company’s mission, vision, and values are located on page 18 of the Capstone 1 case, so that you can quickly find them if needed.
Focus on what has changed
Focus on what has changed from the Capstone 1 case since it suggests the factor is currently a priority to the users of your Day 1 response.
Address multiple areas
There is not enough time to address every possible situational analysis factor in your response. However, you need breadth in your response by addressing factors each of the following categories:
- The mission, vision, and values of the organization
- The goals, objectives, and key success factors of the organization or key stakeholders
- The strengths, weaknesses, opportunities, and threats (SWOT)
- Constraints (e.g., available cash, financing, management time)
- Financial assessment of the organization if information is provided (e.g., ratios compared to loan covenants, industry benchmarks, or prior year)
Tailor your situational analysis to what is most relevant to the company now. Also, include factors that are relevant to the strategic issues discussed later in your report so that you can integrate the situational analysis into your discussion.
Use specific case facts
To avoid making generic statements that are applicable to any organization, you should mention specific facts from the Day 1 case to help you get depth in your response. This means stating what specifically changed from the Capstone 1 case when you identify changes (e.g., which part of the vision was removed and what was added). In your SWOT analysis, you should clearly state the case fact from the Day 1 case and briefly explain why it is a strength, weakness, opportunity, or threat for the company.
Spend no more than 25 minutes
Some students who fail Day 1 of the CFE spend too much time on their situational analysis update and not enough time assessing the strategic issues. It is easy to lose track of time since there are so many possible factors to discuss in your situational analysis. Remember to stick to your time allocation since the situational analysis update serves to only introduce the important factors for the company, which you need to discuss in more detail when analyzing each of the strategic issues later in your report.
You only need to give brief explanations in your SWOT analysis. When listing factors that have not changed since the Capstone 1 case (e.g., mission, vision, values, KSFs), you can simply say there are no changes and list what they are without explanation.
Reference key factors from the situational analysis when you discuss each strategic issue
Integrating situational analysis factors throughout your response means referencing multiple items from your situational analysis and explaining how they impact each strategic issue.
Students are sometimes confused by this since this does not mean copying and pasting the same text from the situational analysis to the qualitative discussion for an issue. For example, a weakness in the situational analysis may identify that the company does not sell any products in a specific high-growth industry, so it may have slower growth than its competitors. On the other hand, the qualitative discussion for a strategic issue may point out that an investment option operates in the high-growth industry, so investing in it mitigates the company’s weakness of no exposure to that industry.
Summary
While the Day 1 situational analysis may seem daunting at first, keeping in mind these tips will help you structure your response and give you the confidence to pass!
Our Densmore CFE Prep course provides more details on how to write an effective situational analysis update as part of your CFE Day 1 response.