March 8, 2017 at 10:59 am
opentuition_teamKeymasterMarch 8, 2017 at 4:29 pm
I was struggling what to answer in Q1 to be honest any one else?March 8, 2017 at 4:34 pm
Sailed through Q1, nothing complicated. Q2 went over my head so attempted Q3 AND Q4. Q4 net profit margin calculation was needed. I readjusted it for exchange difference and deducted machine cost from cost of sales. Anyone else?March 8, 2017 at 4:43 pm
Well I lost plot other then building block model.March 8, 2017 at 4:44 pm
The first part asked to link KPIs to Mission. How did you miss that?March 8, 2017 at 4:46 pm
I got blank was struggling what to say same with part 3 about dashboard.March 8, 2017 at 4:52 pm
Happens when you are underpressure, I personally think Question 1 was do-able. What did you do in question 4? Guess theres only two of us hereMarch 8, 2017 at 4:54 pm
Did adjustment for exchange rate difference but not for machinery.March 8, 2017 at 4:56 pm
Question 4 I adjusted revenue for exchange rate movement (down by 7.5%). Removed head office allocation, bad debt expense (noted I was assuming this is finance’s fault) and depreciation as they are not controllable by the manager. That gave a controllable margin of 11%March 8, 2017 at 4:58 pm
Time managed pretty badly. Expecting a fail for the second time sadly. It’s frustrating when I have passed the other 13 exams first timeMarch 8, 2017 at 5:01 pm
I did questions 1, 3 & 4. I generally found I struggled to have enough points for most of the questions to go with the mark allocation.
Q1) part i – I think was to comment on the kpi’s and did they fit with the mission statement. I think I picked up 3 parts to mission statement a) profit b) staff training c) to be the best (my memory is a bit hazy now). I didn’t think any kpi’s measured the first part. Manager retention sort of for the middle part and there were some that did measure the first part.
ii – can’t remember this part
iii – I pointed out points about the dashboard eg.no nfpi, no narrative,
iv – I remembered the building block parts but struggled to link it to the question
v – I said scheme 2 was best couldn’t find many positives about scheme 1
Q4) I said she deserved the bonus. I said she was right as npm should not include head office costs struggled to say much else so said roi and right should be used for the import division – don’t know if this was going off track
b – I calculated npm adding back head office costs, calculated the wacc but can’t remember why now, calculated roce. Said she deserved the bonus but felt I was clutching at straws to make valid points
c – I said Eva should be used in import division not export tho. I listed some Eva adv and disadv not sure if this is what was wanted???
Q3 came up with some random kpi’s for part course struggled with the qMarch 8, 2017 at 5:11 pm
I adjusted cost of sales for machinery, How I do not recall any baddebts for export division, they were for import division only chris. Head office costs were equal in both divisions so I believe it did not make a difference. I only adjusted cost of sales and revenue as the machinery was not part of second division.
I wrote EVA was better choice as it did relate to shareholder wealth. I also wrote it would facilitate conparison since import divion was expensing out marketing and provisions but using EVA these would be added back hence yileding a different resultMarch 8, 2017 at 5:16 pm
Was it mentioned that machine cost included as part of cost of sale?:March 8, 2017 at 5:18 pm
It was not mentioned but this purchase has to be added somewhere and what better place than cost of sales? Thats my assumption though, It could be differentMarch 8, 2017 at 5:20 pm
Well I was out my mind today I took out overhead arguing that no explanation provided for export division when provide for domesticMarch 8, 2017 at 5:23 pm
I think we’ve got to assume that they treated the machine purchase correctly and put it in fixed assets and hence it won’t affect the P&L so no adjustment is needed for this.
I also added that once we removed the uncontrollable costs, hitting the 8% target becomes significantly easier so the company may wish to raise this thresholdMarch 8, 2017 at 5:28 pm
I did question 1 3 and 4. Question 1 was fairly easy but lengthy.
3 was easy too but i got stuck in the last requirement of 12 marks which had part of KPIs of political situation of Jayland.
In the q 1, I used the reward management system (strategic focus, reward objective, reward options, reward techniques and reward competitiveness) for the analysis of scheme 1 and 2.
Did anyone else do this? Pleaasee tell me! 🙂March 8, 2017 at 5:29 pm
I did same thing since it was not saying its included in COS I did not accounted for. I also argue if using EVA the threshold should be different as some cost will be remove from calculation.March 8, 2017 at 5:34 pm
What was the NP Margin level after the adjustments? My answer was 11%.
I adjusted the cost of sales with the exchange rate for the last six months and first six months. Used algebra to get to the answer: 6x + 6(1.15)x = 4800 then inputted the cost of sales ajusted. Sales remained 8k. I did not take the overhead adjustments cuz needed to make the profit controllable. Did not include machinery cost cuz it was supposed to be added in balance sheet. Took the other overheads and also took the depreciation expense.
With this my profit figure was around 900 something and the NP margin was 11% so bonus should be granted.March 8, 2017 at 5:34 pm
Q1 reward system appraisal I did this badly but I tried to relate the two bonus schemes to the building block model described in the previous part of the question.
Basically scheme 1 was had no clarity and appeared to be unfair and uncontrollable so would not motivate employees. Only good thing was it involved shares
Scheme 2 involved employee participation so was more motivating and basically agreed with all other points of the building block model
Also the 50% bonus size should be a sensible amount to align the risk attitudes of the employees with the owners who wanted to see growthMarch 8, 2017 at 5:34 pm
For question no 4 i wrote she deserved the bonus since she has considered the long term objective of the company and has purchased the machinery which has in return has improved the overall efficiency of the division by jeopardizing her bonus pay. Where as the other division has postponed their decision to purchase the machinery since they will not achieve their short term objective of maximizing divisional performance.March 8, 2017 at 5:38 pm
Hold on, Why would you reduce the revenue by 7.6% due to exchange rate difference? The currency had weaken which meant that during half of the year we received less money than we would receive if our currency had not weakned, So we do actually adjust 15% and increase the revenue to remove this uncontrolable event.March 8, 2017 at 5:40 pm
I think it said the domestic currency had weakened and hence the revenue in the overseas currency would translate to a larger amount of domestic currency.
Therefore we need to reduce the revenue figure to get a fair comparableMarch 8, 2017 at 5:41 pm
If primary currency weak you receive more money means revenue increased by 15% for six months 4000 X1.15 = 4600 for six months and 4000 for first six monthsMarch 8, 2017 at 6:36 pm
Q1 was easy..
part a b n c was related to mission
Part d building block model explain n relate to scenerio
Part e scheme was also fine drawbacks n good points for both
Why dont anyone attempt part b
I thought it was damn easy
Target costing and its implication
Kaizan costing and its implication simple
Relate to scenerio
Why u guys dont attemp this question
Am worried did i done something wrong??
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