*** ACCA Paper AFM December 2019 Exam was.. Instant Poll and comments ***

i guess 6-7 marks of 14 were for sensitivity ,var and analysis, probably rest for the npv,working cap,wda etc.
i put in the var formula but completely forgot how to calculate the figure,hopefully get 1 mark for the attempt.
anyone figure out yet what a profit centre does or was it some myth to scare the bejesus out of everyone as conviently it was 1a?

i know seems that they tested alot of stuff that the majority would just tend to skim over such as that and delta/gamma for 14 marks, funny thing is that i knew the variables of rho theta delta and vega but of course they asked gamma

Very frustrating due to time pressure. This is not the fair way of testing our knowledge. There were a lot of calculations with few marks which were time consumming and when I got to the highly marked requirements I could not focus due to time pressure. Regarding changes needed for profit centre treasury departement I have written about specialized highly prepared employees to hedge against forex and interest rate risk and to invest the company’s cash. The gains from hedging and cash investments to be considered as incomes. This is the only thing that came to my mind.

Ireland along with few set others are starting CBEs in March for STrategic Pro papers…
If it comes to it, I may even jump over to London to repeat in March if I really dont fancy CBE, cross that bridge if and when haha

For question 1, should we use 5.20% or 5.20% (+/-0.8)? in the final outcome for FRA and the options?

Because the question said to use 5.20% if interest rate increases or decreases.

If i’m not mistaken. Kinda confusing

2-7 FRA

Thank for the details

I have used 6% and 4.4%, 2 scenarios.

Thought it was quite hard if im honest particularly question 3 – also the depth of the course that was actually tested didnt seem that large – bar one or two small things there was no need to consult the formula sheet at all which i found strange.

Q1 – Was happy initially when I saw it in comparison to some of the previous Q1 , part a ) was about the profit centre v cost centre – hadn’t seen this tested before – changes that i went through that were required were personnel, attitude to risk, technology to allow it , mgt structure – but these could be miles off. b) the computations of the currency and ir hedging went well , as did the inter co netting , the gamma and delta – went through what this was but didnt address it greatly , the report wasnt great due to time constraints. part c) the 20% equity holder asking about risk – agreed that they may be correct that shareholders themselves should hedge against risk in their portfolios but in this case with IR and FX risk being an everyday part of business it was prudent to do so and expected.

Q2 – Relatively ok on the NPV Calcs – made a few silly errors down to pressure nothing else but thats going to happen . VAR -messed up the formula again just exam pressure , and covering sensitivity wasn’t great – b) on the possible downfalls in there evaluation – i think that they had said the price was guaranteed by the goverment and this was one of the factors that if under 10% they would reject but though as guaranteed price it was rash to reject if this element below the threshold and all else good

Q3 – Nightmare from start to finish if I got 5 from it i would take it – havent seen a q like this set out and was expecting some CAPM, Asset Beta, WACC etc but not to be .

Anyway would be doing very well to get over the 50 but such is life – let us know any thoughts.

Please do anyone remember the business names used in AFM December 2019 P4 paper:

I remember Loilita restaurants
Enjin, curzeteck, dramanleo but the spelling is not correct. Please help if you can

Can anyone tell me the formula to calculate investment cost?

@khill101 said:
Ireland along with few set others are starting CBEs in March for STrategic Pro papers…
If it comes to it, I may even jump over to London to repeat in March if I really dont fancy CBE, cross that bridge if and when haha

Belfast still has the paper exam in March 2020 .That’s my plan B in case I fail. Would be much cheaper than flying into London

@willis1951 said:
This was a simple exam technically except for Q.3 but was unnecessarily time pressured with very few marl allocation!It seems this examiner has missed point of setting this particular exam because he seems more inclined to testing time management rather than the skills.Even in offices,you need time to think and analyze the problem and organize your solution before writing it out.In this exam,this was missed out instead questions were designed with so much details but with little time to assemble the information.I HAVE SERIOUS RESERVATIONS WITH MARK ALLOCATIONS IN THIS SITTING.TOO MUCH QUESTION REQUIREMENTS WITH MASSIVE INFORMATION WITH VERY FEW MARKS.LOOK AT Q.3 a)2 marks to calculate the net cash flow from restructuring,4marks to construct a Revised statement of Financial position following the Restructuring.!This paper was unnecessary time- pressured for no good cause!If the examiner has run out of good technical questions,he/she should step aside and leave a new examiner to take over the setting.THIS PAPER WAS PURE EXAGGERATION OF TIME PRESSURE.Candidates should be tested on a reasonable balance between technical aspect and time management.I will fail this paper not because of lacking knowledge but the reasonable time pressure created by the examiner asking too many small questions which require a lot of information for little marks.The examiner missed the point here.By the way,who is the current examiner for AFM?

I agree to this entirely, I studied everything and knew how to answer but just time was an issue and my passing mark has been risked. And so when i left the room i just thought and it clicked i forgot to calculate the basic things and include the easiest of marks.