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Thank you John Moffat! Thanks to your perfect lectures and constant support, I passed the exam with flying colors in my first attempt – 71%.
i did not come across a question concerning business valuations
why do not we discuss FM Paper as you said?for repayment after 18 month, the spot rate was 10.01 to $1. inflation in two countries : 8% and 3.5% for 12 months, then another rate was: 14% (but we take half of it -7% cos we should find the six month rate), and 3%.(six month rate – 1.5%). so, what i did was to find the spot rate for the first year: 10.01 * 1.08/1.035=10.4452
spot rate for the next six month: 10.4452 * 1.07/1.015=11.011
givent that loan amount was 1250 pesos, the result will be : 1250/11.011=$113.5i thought answer A: transaction risk results from expected changes in exchange rates
choice B: Economic risk is the long-term version of transaction risk. i did not know whether it was trueby the way, did you also get the answer choice $113.6 to the question with repayment after 18 month?
weaken, cos as far as i remember, the previous exchange rate was higher than rate, meaning that dollar decreased in value
A curiosity is that often, with smaller businesses, longer-term loans are easier to
obtain that medium term loans because the longer loans are easily secured with
mortgages against property. The fact that medium term loans are hard to obtain
is a well-known feature of SMEs and is known as the maturity gap. Its main
problem arises in a mismatching of assets and liabilities.
this statement is obtained from Kaplan. based on the information here, it can be concluded that short and medium finance is hard to obtain for SME.how did you calculate the convertibles? did you also find the conversion value to be $100.998 -i mean, number of shares * MV of shares* growth rate (if i remember right, it was 6% every year)
so, overall, 20*$4*1.06^4=100.998
was the number of years 4?in section A there was a question with the impact of raising interest rates on the company’s project. so, i selected the option saying that demand will reduce as consumers choose cheaper import goods. is it true?
By the way, Dear John Moffat, I would like to express my deep gratitude to you for everything. Your amazing lectures and constant support greatly contributed to answering the questions in the exam easily. I believe that the results will be satisfactory.
Hyuga wrote:How was your March 2022 ACCA FR exam?
What was the effective interest rate of convertible loans in Section C? Was it 7 or 8%, I cannot remember?
Anyway, I don’t whether it is a mistake, but instead of using the 3 year discount factor, which I wasn’t familiar with, to be honest, I myself drew up discount rate table year by year for 3 years. However, mind you, the final figures did strike a balance in SFP. Assuming that I made a mistake by adopting this way, how will it affect the marking? Adjusted retrained earnings contains one element “finance cost”, which, as a result, will be affected, plus, in SFP, year end loan liability, equity component will be wrong. . So does that mean I am gonna lose all the marks allocated to them just because I approached a little bit differently although concepts and calculation were just right?