Will Boardman: Exam Tips for AAT Level 2 Business Environment (BENV)

The AAT level Business Environment exam will be the first taste of written tasks for a student.

This is exam will be different to the your other level 2 exams but with the right preparation shouldn’t cause too many issues!

For the Business Environment exam you’ll have 2 hours to complete 8 tasks. There are 100 marks on offer and as usual, you’re required to achieve 70% or above meaning you’ll need a minimum of 70 marks to achieve that all-important pass.

The Business Environment exam currently sits at a UK average of 72.9%. The main difficulty that students face with this exam is the wider range of topics that can be tested, this means that the mock exams can differ more significantly than they can in the other level 2 units.

Having a good idea of what could come up on each task can really help to settle your nerves. Let’s take a look at what you can expect to see on each task.

Task 1 – is worth 10 marks and is on the impact of setting up different types of business entity and the different functions of a business. Here I’d expect to see multiple-choice or true/false questions on the characteristics of different types of businesses. The legal requirements of different types organisation and the responsibilities of departments within a business.

Task 2 – is worth 13 marks and covers the role of the finance function how the finance team contributes to the success of an organisation and the role of information in the work of the finance function. Here I’d expect you to see questions planning workloads, so being given a number of jobs and having to plan them in. Multiple choice questions on the use of technology within accounts and what the benefits and considerations could be.

Task 3 – is worth 14 marks and covers key principles of corporate social responsibility (CSR), ethics, and sustainability. Here I’d expect to see questions on the benefits of a business acting responsibly. The code of professional ethics set out by AAT and questions in relation to the ethical principles.

Task 4 – is worth 22 marks and is on covers communicating information. It also covers elements of bookkeeping. This will be your first task which includes a written element. I would expect you to see questions on the accounting equation, accounting elements and discounts. I would also expect to see one written element based around communication. Make sure that when you’re practising these that you write your answers out in full and compare your answers to the model answers.

Task 5 – is worth 10 marks and covers areas of bookkeeping controls. Here I would expect to see questions on the control accounts so being able to complete the receivables, payables and VAT control will be essential. Also make sure that you’re comfortable with completing journals to correct errors because I would definitely expect to see something on these.

Task 6 – is worth 7 marks and covers principles of contract law. On this task I would expect to see multiple choice and drop down style questions rather than any calculations. This will test your knowledge on the legal structures in the UK. Take extra care reading over these sections within your materials and go over them multiple times to commit them to memory.

Task 7 – is worth 10 marks and covers the importance of information to business operations. Here we have another written and it has been picked up that students are losing marks on this task due to writing generic points. Please make sure when you’re answers to the written elements are tailored towards the question. I would recommend as part of the revision process for this task that you read up on the differences between a digital accounting system and manual system.

Task 8 – is worth 14 marks and covers the external business environment. Here I’d expect to see questions on supply and demand, make sure you familiarise yourself with factors that increase/decrease both supply and demand. I would also expect to see questions on the Government’s role within the accountancy sector.

The examiner’s report is available to all students and to access this you can head over to the AAT lifelong learning portal and go to the Business Environment unit where you can find the PDF to download.

The report shows the performance on the exam by task and gives keys strengths and weaknesses for each task.

There are two points that jump out at me are firstly on Task 5 it has been noted that students struggle with reconciliations and identifying differences in control accounts. Both of these were covered in the Principles of Bookkeeping controls exam. Do make sure that you go back over areas within your Introduction to Bookkeeping and Principles of Bookkeeping Controls. It’s very easy to forget certain aspects over time so spending some time to revisit these will be essential to passing this task.

The other point which I have briefly mentioned above is on task 7 which is the weakest performing task on the exam, is a student’s ability to write about the benefits and drawbacks of a digital accounting system. By understanding the differences between manual and digital systems this will make it much easier to answer these questions.

Final Thoughts

The business environment exam is different to any other level 2 exam. It will be the only exam with written elements and the only exam to combine knowledge from multiple units which can make it feel quite overwhelming when studying. Take your time, work back through your other units methodically; it shouldn’t take too long with it being the second run through. Then remember to practise written questions in full, write them out in full points and compare them to the model answers.

Stay tuned for more updates, success stories, and insights from our community.

Together, let’s continue to strive for excellence and make a difference through hard work and dedication.

Will Boardman