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I dont think company can use it.
Securitization was used by banks to sell their financial assets (mortgages) and transfer the risk of mortgage default to another person. This allowed banks to raise funds to issue further bonds or mortgages.
The credit rating on these securitised assets reflected the selling banks rating and not the real risk of mortgage default, and thats what led to the credit crunch.
Hope that helps.
current liabilities = payable within a year.
24000 will be paid in 2013, and the remainder will be paid in 2014.
i am also planning to sit CFA Level 1 in June 2015 provided i pass P4 offcourse.
How did you get your hands on the CFA curriculum ? Did you get yourself registered at the CFA ? Just curious.
BTW, passing P4 by just relying on opentuition would be hell of an achievement. Good Luck.
Every student wants that. Its not rocket science, you just have to prepare. Practice as much as you can.
if Cost of Capital is 10%, co needs to earn more than 10% to be profitable. Agree ?
Reinvestment Assumption :
If company has excess funds, where will it invest ? In a project that has a return of at least 10% otherwise company will make a loss.
What if all available projects generate < 10% ? Co will still invest bcuz something is better than nothing. right ? NPV isn’t aware of that proverb. lol
Hope that helps.
Impairment won’t hit NCI but FV adjustment will. If you dont take FV adjustment, your SFP wont balance. Give it a try 🙂
In reporting questions, you have to mention the name of applicable standard, say, IAS 37.
I havent heard anyone saying that i dont remember the name or the number of IAS.
Can you upload both Q & A ?
I think i have done this question. Co is in hotel business. Right ?
I picked Kaplan. I had very limited time so bpp was not an option.
If you need any kind of help, i’d be glad to help 🙂
Do not rely soley on past papers. Try reading techincal articles & study text.
BTW, i passed F5 without practicing Past Papers.
There is an inverse relationship between interest rate and inflation. Therefore, inflation rate will decrease when the interest rate increases and vice versa.
Nominal rate is actual interest rate whereas real rate is ( Nominal rate + inflation ) – adjusted for the effect of inflation.