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@davidlemonhhl said:
I agree. And I used 3E value for money as a guide for analysisI thought about using Three E’s but there is not enough data to establish relevant metrics.
Also, i believe in the scenario, it stated that the CEO did not want us to establish new metrics therefore use what was provided.
I compared the three main metrics used and obviously B stood out as the better organisation.
However, i also mentioned its important to note that B was in another country and unlike, it did not state the countries, population therefore it may not be directly comparable like A may be.
Furthermore, C did not have enough data therefore relevance and reliability is in question.
However, it could still be possible for the company to learn from B in terms of their methods and processes as they are still performing better despite the higher costs.
@eagledave said:
I calculated them and did a quick narrative, they weren’t really required, although the question says to incorporate the financial information into the contextual features answers? I wasn’t really sure how to do that, but I thought, the data was given, so I might as well do something with it, so time consuming, that paper was a nightmare.I think the examiner needs to have more consideration in the marking process, cause the questions and case were too vague and unclear.
You can calculate them for Time and preservation.
For time, the declining ratios and for preservation the current and quick ratios which were slightly above industry average which they should try to retain as part of the change if considered.
There is no right answer for that question.
Literally any of them could be argued and chosen.
I chose Merger which was one of the options as it is similar to acquisition but the fusion between two companies is mutual with synergy benefits and the main costs (transactional) are cheaper than an acquisition despite there previous experience in it.
The upfront cost in an acquisition would seriously stall the benefits to the shareholders especially if the high cost are outweighed by quick dividends which would mean that that company is performing better than the current company which makes them more stronger so acquiring them would the opposite of reality.
@eagledave said:
No, it didn’t but the CEO would like to understand the implication of the proposed change and wants to have holistic view of this.. We therefore have to look at the current situation based from the case, the proposed change, and then the impact. So by explaining all this, you have to somehow express your opinion by critical analysis and also we are allowed to disagree and then justify why.This was part b i believe using POPIT, which is the holistic view.
@adeoluomosanya said:
did Q1 tell us to choose if we were for or against the radical change proposal by TCA for FMC? I dont think I chose a side…Q1a was asking us how the 5 contextual factors of change would need to be considered when managing the proposed change by TMA.
This part has come up many times.
@dvyn07 said:
if they apply big bang the board will be reluctant to change…They wouldn’t be reluctant if their financial position is unstable.
Revenues were falling, direct and indirects where doing up…
A past paper in the kit said that if there are financial troubles then Time Contextual factor would be considered to require immediate attention.
@hassanatcams said:
no doubt this one got to be one of the lengthiest case studies to appear in P3 historyYou reckon marks are available for the remaining professional marks if the report format wasn’t adhered to i.e. just the start bit with the from and to…
@dvyn07 said:
plus change was supposed to be incremental not big bangI agreed with TMA in that it is a revolutionary change.
Reason being that they should predominantly be an e-commerce business.
Therefore the scope changed dramatically meaning a transformational change.
The fact that they are there financial statements and profitability ratios were falling meant that the change needed to be quick and with simultaneous tasks as it a change in the entire process being online.
Did 1a ask for a particular format?
OR was is just general professional marks?
I can’t remember if it said report format or not?
@kireeti said:
Dividend expected is used in calculation.BTW, anyone remember the very 1st mcq?
Dividend paid is always considered. Check open tuition notes, all questions on TSR include dividend paid.
Q1 was about corporate governance. Answer was option C. A is a close second but it is wrong.
@aqillos said:
regarding quesrion 5 I remember got 3836, but do not remember whether it was in option A or B.I have looked at exam kit in relation to shareholder return. there was dividend declared, not paid. I considered dividend paid and got 22 %. hope it will not be mistake.
If I am not wrong remember, option related to transaction risk mentioned accounts… something like this… I think it is translation risk… that’s why I chosed economic risk…
Answer for TSR is option A. Always chose dividend paid over declared as it isn’t guaranteed payment.
@sahil1234 said:
For the SME question I chose (B) that is debt finance only. As in the notes it was clearly mentioned that small companies might find it difficult to raise equity finance as not many people would be interested in buying their shares. So they would be inclined towards debt finance.But Debt finance includes long term finance such as bonds so the choice isn’t justified.
If you look at the technical article on acca website on Business Finance for SME’s, it shows a variety of different ways they could get finance. Most of them implying towards, business angels, venture capitalist, crowdfunding, etc. This all indicates that they will take their finance however way they can get it.
@pinkyjovin123 said:
In q no .32 should we add bac TA Depreciation..We add back 28% of the T.A.D in arrears (starting from T2).
@gawcram said:
Net assets = equity I thinkCorrect. Thats if its the Book Value of Equity.
The option state the Market Value of Equity which is using the Market Share Price, not whats all the Balance Sheet.
@gawcram said:
Do u remember other options?Opt 1 – Market Value of Equity (Obviously Wrong)
Opt 2 – Book Value of NCA
Opt 3 – CA – CLSo Both even though both opt 2 and 3 don’t give overall Net Asset value, both options added together give most of it. Just NCL is missing basically, so logically both 2 and 3 should be the answer…
@save said:
It is NCA + net current assets less liabilities.So i presume you also chose the options 2 and 3?
What was the answer to the question about the best description of upward yield curve?
@twistedheat said:
I don’t remember the question, or what answer I gave.I just remember doing 365/turnover ratio to get the days, but everything else is blank about that question.
The answer to that question was D. it was in the 300K’s. It asked how much working capital would need to reduce by to get another turnover ratio.
You have to work out the days with the current, days with what the new turnover ratio would have been, the difference between the two is the reduction in days and that over the total number of days in a year assumed multiplied by the sales would give the overall reduction.
@adlupu said:
Net asset value – I choosed only B, NCATechnically Net Asset Value = Total Assets – Total Liabilities.
There both elements of NCA and CA-CL would be important.
All thats missing is the NCL which would be the last figure needed.
So i would assume it was atleast options 2 and 3?
@kbourne said:
That’s what I did. Think its the correct oneI would agree that we did it correct, however given tom above said that the first statement said “sum of discount factors” which is the same as annuity factors, so then both would have been true. Im just not sure if it said that but it seems like he is sure, then it would be both statements are true.
Only if someone can confirm that they know it didn’t say sum of discount factors but just discount factor for that first statement then we did it correct.
@tomlloyd393 said:
Isn’t it divided by the sum of the discount factors?That is right, I’m just not sure if it said that. You might be right if it said sum of discount factors as thats the same as Annuity Factor.
@kbourne said:
I chose PV of costs divided by annuity factor for that yearI chose the same answer. It was the option that only statement 2 is true?
What about the value of the company using PE Ratio? I chose A) $72m which i think is wrong (PE*Earnings = 12*$6m)
@kicek7 said:
I remember that i chose 90, but wasn’t sureI chose that too. But I can’t remember for the life of me if i used the before tax rate because that is what is meant to be used when finding MV of bonds, not after tax rate.