Criterion referenced assessment (CRA) is currently being implemented in the Faculty of Health Science at the University of Tasmania for all assessment items. Different models of CRA in tertiary education have been proposed, but there has been little discussion regarding the theory of grading by this method, or the use of the online environment for CRA. The ability to allow criteria to be weighted is an important feature of CRA which puts limitations on the grading method. This factor becomes even more important when determining final grades across several assessment items within a university unit. In a university environment it is essential for a CRA program to be able to be implemented online.