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MBO

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › MBO

  • This topic has 3 replies, 2 voices, and was last updated 4 years ago by AvatarJohn Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
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  • October 16, 2021 at 7:34 pm #637820
    Avatarhumai
    Participant
    • Topics: 757
    • Replies: 248
    • ☆☆☆☆☆

    Sir in In Dec 11 a Qs came that discuss the possible benefits to Proteus Co of disposing Tyche Co through a management buy-out

    Then in June 15 a Qs came that discuss the relative benefits and drawbacks to Okazu Co if it is disposed through a MBO instead of a MBI

    In June 15 , examiner answer mentioned MBO benefits such as

    Existing management is likely to have detailed knowledge of the business and its operations. Therefore they will not need to learn about the business and its operations in a way which a new external management team may need to.

    MBO will cause less disruption and resistance from the employees when compared to a MBI. If Bento Co wants to continue doing business with the new company after it has been disposed of, it may find it easier to work with the management team which it is more familiar with.

    The internal management team may be more focused and have better knowledge of where costs can be reduced and sales revenue increased, in order to increase the overall value of the company.

    However, In Dec 11 Examiner answer mentioned different points rather than above points.
    My question is that In Dec 11 answer can we write the same 3 points mentioned in above answer of J15 except name of companies which would obviously be different?

    October 17, 2021 at 9:12 am #637839
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54836
    • ☆☆☆☆☆

    Yes, appreciate that the examiners answer is only a suggested answer and other sensible points would get marks. You could have made the same points 🙂

    October 17, 2021 at 1:44 pm #637876
    Avatarhumai
    Participant
    • Topics: 757
    • Replies: 248
    • ☆☆☆☆☆

    Thanks sir

    October 17, 2021 at 2:49 pm #637885
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54836
    • ☆☆☆☆☆

    You are welcome 🙂

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Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘MBO’ is closed to new replies.

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