Assessment and evaluation are integral parts of any educational and training process, and students at all levels of training respond by studying more seriously for the parts of the course or training that are assessed. To promote and enhance effective learning successfully, simulation and other teaching methods should be both formative and summative, because the ultimate goal is to ensure professional competence. This article describes a model of medical competence, and focuses on the use of medical simulation in assessment and evaluation of different levels of clinical competence using examples from experience.