[aliansari14]

Effective rates for the interest risk management questions i got
Fwd-4.75%
futures-4.8%
premium-4.91%

[aliansari14]

Hey, i did it the same way,
Al though i didn’t use the Kei formula, i used Ba and Be , the weighted average beta was already given which was the total Ba of Zuchhi , it was like zucchi beta =0.6x + 0.4* wind power company beta,

I ungeared both companies equity betas to get Ba of both companies and then we used it in the above equation to get the x (beta of motor manufacture) , It took some thinking to solve this question , but i am confident i got it correct and so did you.

Also for the APV part, the tax shield discount factor had to be used from 2-5 because of one year delay, I got APV as +5 million, NPV -1 million

[aliansari14]

Hi , hope you are doing well,
I’m writing AFM in march as well , I am based in Bahrain , let me know if you want to communicate together for AFM, email
At aliansari_14@yahoo.com

[aliansari14]

Thanks to the opentuition lectures they helped me alot to understand audit and assurance ,I used the Bpp revision kit, Ot notes and OT lectures and the Vimeo practicetopass webinars 2018 September recorded ones.
I passed with 66 exactly what I predicted
So happy to clear all Fundamental levels and now moving on to P levels with SBR.

For AA the technique’s I used:
Past paper questions from the revision kit on audit risk note the repeated risks or the risks which are new note them down and their responses from answers and try to understand and learn the way they have responded and explained those risks to financial statements
And for Internal control understand each system is vital and same way practicing questions.
For substantive procedures the past paper answers and the general procedures for each account balance make notes of them print them out review them practice past paper questions.
Knowledge parts learn memorize
Good luck

[aliansari14]

@gavinhenson10 said:
Part a was very difficult- think I’ve let myself down with my answers to this part.

What did people write for the substantive analytical procedures in respect to the increase in revenue of $3.2m from 20×5?

From what I remember

Recaculate and compare sales per key product for 20X4 and 20X5 to identify any significant differences and assess the reasons .

Compare sales per store and compare with other stores to identify if there are any slow moving inventory of products.

Then I wrote something similar the other too

[aliansari14]

Passed with 68 ,
Chris you are the best! I hate Liverpool fans (I’m a city fan) but i like you man you are the best chris.

[aliansari14]

@tasbihak said:
Waiting for SBR results, it was my first professional paper. Really nervous, couldnt attempt 20 marks of the paper, did the rest really well. Hopefully it is a pass.
Sort of disappointed, did so great in my F levels but the start of P level wasn’t so good. Fingers crossed.

You’ll pass it insha’Allah. You were the prizwinner for PM and AA in KSA I know you hehehe

[aliansari14]

Passed 72% , the opentuition notes were amazing thank you opentuition.

[aliansari14]

I got 76 days because they mentioned that inventory is kept to minimum which is the finished goods so for finished goods we use cost of sales but i didn’t do that because they mentioned that they buy the material from supplier and the inventory is mostly in W.IP don’t u think that we had to use the purchases they gave which we had to increase by 1.2.
as W.I.P inventory is calculated by W.I.P/cost of production,
And however you can’t make an assumption if purchases and cost of sales are given that they will both increase by the same percentage.

@snell123 said:
I got 58 days

40 days receiveables
Less 30 days payable
Plus 48 days inventory days

Inventory 2.4 multiplied by 1.2 (growth) = 2.88

Cost of sales 18.3 multiplied by 1.2 = 21.96

2.88/21.96 multiplied by 365 = 48

[aliansari14]

@snell123 said:
Would of given a slightly high cost of equity, but that’s not to say my answers was correct

What did you get for the cash operating cycle ?the days

[aliansari14]

R & D costs are already been spent (sunk) well they were not added as investment so no worries about that but their amortization was deducted to arrive the forcast profits/(losses),
So what i did is i added the amortization yearly ,and the depreciation on the original investment of 600000 was not adjusted so no need to add it back but they said that information for tax saving purposes which was just in the first year as they mentioned that 100% is initially charged so over all of this gave me a Positive NPV.

Let me know what you think off this.

[aliansari14]

For section A ,did anybody get that question which related to indivisble capital rationing where u had to to do trial and error method ,
The most maximum NPV according to the combination of projects under the capital required , I got the answer of 91000

[aliansari14]

For the cost of equity using the DGM
I got 25. % Something also I think, don’t remember the one with asset beta oh wait I think 8.something

For section B , the working capital question went bad for me couldn’t find the cash operating cycle days and quick ratio so I guessed,the other risk management and market value business valuations were simple but the thoery was abit tricky.

[aliansari14]

I assumed this aswell and only adjusted the tax saving from dep’n in full and that related to first year ,then the remaining inflows were R & D’s amortisation which was included I added it back because it’s dep’n and also infact it’s on the sunck cost , then the original depreciation was also added in calculating forcasting profits/losses so I added this back also since depreciation should be added back it’s irrelevant, and that’s it I discounted the Net cash flows at the rate , and got a Positive NPV ,and the number started with 9 something idk how many thousands

[aliansari14]

I agree but they gave a debt to equity ratio also of 25% so instead of putting market values which they didn’t give I I calculated WACC by taking the ratios 25(Vd)/25(Vd)+75(Ve) into the cost of debt and vice versa for equity , I got a WACC of 18. Something %

[aliansari14]

Section A was quiet comparably easy then section where this quick ratio & cash operating cycle were were troubling ,other section B was fine
Section C had Investment appraisal ,capital rationing,
WACC,DGM,CAPM,ROCE,Islamic finance were tested.

[aliansari14]

I had mixed questions in section A
Section B VAT IHT CGT
Section C
That 10 mark income tax saving question with chargeable gains
15 mark question on CT losses and Trading profit and CGT for companies
15 mark question on Income tax in which there was properly income with mortgage payments
And employment income with job related accomodation.

[aliansari14]

Thank you 🙂

[aliansari14]

This makes it more clear thank you so much 🙂

[aliansari14]

Thank you so much

[aliansari14]

I did but I couldn’t get it ,
Thanks sir for the explanation 🙂

[aliansari14]

Yes sir i started practicing,
thank u so much for the information 🙂

[aliansari14]

1)yeah in the question specific fixed costs was mentioned for the product which is not produced so i think i would have to deduct it from the total budgeted fixed cost ?

2)A company produces 2 products, TJ and TS. For every TJ, 5 TS are sold. Budgeted fixed cost is supposed to be $100,000. C/S ratio for TJ and TS is 25% and 30% respectively.
what is the breakeven revenue?

this type of question i mean,pls reply 🙂

thanks

[aliansari14]

Yes I understood,
But in the question the number of workers are not given so can I calculate the no. Of workers by dividing bottleneck 400 hours diving by 38 will that make sense to get the no.of workers?
Bcz it says direct labour workers are paid for 38 hour period?

[aliansari14]

its not mentioned how many workers are there so how would i calculate the number of workers

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