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I just realised I never once used AEA in my exam and I’m thinking was it because I made a massive mistake but I guess it’s mostly because I wasn’t asked to do a gains computation myself. I was asked base cost or sale proceedings or given the gain directly except for the last question Sliving Ltd total taxable profit computation question. I think it was easier than I expected or at least easier than the mock but overall there were few questions I had never seen before. For example I had no idea what difference it made to have dividend income after retirement
68% Now onto many others left… Thanks Opentuition, couldn’t have done it without you.
Ah yes S1ngh that makes sense.
saulatr
When we buy pesos with dollars we have to pay more in dollars as the bank will profit. 1800/50.5=35.6 vs 1800/50=36 so it’s 36 that we need to pay.If we were buying dollars with 1800 pesos we had, the the bank would have paid us 35.6 dollars.
I don’t remember purchase power parity and devalue question. I mean I remember something, but not entirely
I don’t think that’s correct.
But monetary and fiscal policy I answered the same. In expansionary monetary policy money supply increases and in contractionary fiscal policy gov spending decreases.
Spot rate was $1 50 – 50.5 pesos since we were buying pesos we should have used 50. No?
Could you help me to remember? So with lead payment, the spot rate was 50? 1800/50=36m but then we need to borrow this at what rate? 5%? 36*1.05=37.8?
I’m really not sure.
I can’t remember Money market hedge figures at all.I don’t remember leading and money market hedge. I need to try to write them down. Give me some time.
I think it was 33.7 but I’m sure I just divided by 6 month forward rate and left it there. Maybe I made a maths error or maybe it was 33.2
No I can’t remember it but I remember currency exchange question. I think I’m better at remembering numbers. What was the dollar amount of forward contract? I couldn’t decide whether to just write the value in 6 months by dividing 6 month forward exchange rate or the amount to deposit now to pay in 6 months. I answered with 6 months time amount 1800/53.42=33.7 if I remember correctly.
Nothing I decided at the time makes sense now 🙁Ah yes consequences of delayed payment I think I selected where they may have to pay cash. It didn’t make sense to me that delayed payments wont effect reputation but now from outside it actually makes sense right? I don’t know.
Yes I chose one with receivable too, how to reduce working capital cycle? And I think answer was like by offering early settlement discount to receivables which would reduce the time they take to pay so reduce the cycle.My benefit was 12.1 [1+(.75/99.25)]^(365/24)-1 but for the life of me I couldn’t figure out whether to take it or not, said to accept in the end.
saulatr
I had that question re pref shares being difficult to value and I think I selected that option. What was the other choices that were presumably incorrect?The working capital q I had in section B asked for average trade payables day or average of something where we had previous year end value and this. I took the weighted average to calculate days, was it 40 days. (215+275)/2/2250*365. What were the other questions of that case I’m trying to remember.
I couldnt write anything for DCF with inflation discussion and neither for Islamic finance. Overall I lost 13 marks from word processor parts. So disappointed. I mean I wasn’t that well prepared but I could have discussed different types of risk or working capital. My NPV was I think ~141
There was a question about money markets. One option was that it was for smaller companies. Is that correct? I thought why wouldnt it be for larger companies with short term borrowing needs and didn’t choose it to be correct.
This was my first applied skills exam. Do AM and PM sessions get different questions? There’s a mention in replies of a floor value convertible loan question and really really don’t remember seeing such thing. There was think in part B a question with convertible loans, share price was something like $6.5, expected to grow 5% and in 7 years time you could convert loan notes to 15 shares and that was higher than the nominal value so one should have opted for that. But I can’t remember it mentioning a “floor value” 🙁
I wish they told us our results from part A and B immediately, so if we scored below 30 there we would know we’d have to resit. The wait’s gonna kill me. Also are we allowed to discuss questions in detail. I think I remember almost all numbers in section C questions.As far as I remember, Section C NPV spreadsheet part was 13 marks and discussion of DCF and inflation rates was 7 marks (NPV was positive in my answer, sensitivy to sales volum 4.5% and sensitivity to discount rate 45%). Then rights issue q spreadsheet was 14 marks including discussion of directors and shareholders’ view. And then Islamic finance discussion was 6 marks. I wont be getting any marks from that part. I am a practising muslin but have absolutely no idea, hadnt found it an important part of the syllabus…
Part A working capital financing question with 3 different companies, I selected aggressive to be with highest profit lowest current ratio and conservative to have highest current ratio and lowest profit. I didnt select any to be matching one.
Part A fintech q had three options AI, big data and face to face interaction. I can’t find an answer to it in Kaplan’s study text.
Part A islamic finance q I think it was a credit agreement with supplier so I selected murabaha. Hope that’s correct.
It was the discount rate as in discounting factor. I think you were supposed to find the IRR and then find percentage change in discount rate to IRR as that percentage change would have reduced the NPV to zero.
I can’t be sure if my percentage was correct for the sales volume sensitivity. I divided the NPV by the PV of contrbutions over 4 years. I think I found 4.5% but I can’t be sure whether I should have added the tax 🙁 I think I should, right?