*** F9 December 2014 Exam was.. Instant Poll and comments ***

I think Npv dcf should be 10%[1-T].
I’m just waiting for the questions to be sure.
While, this F9 was tough.

I think I forgot to tick the questions on the front of my answer booklet in the exam will it still get marked?? 🙁

Thanks Steve

me also did not include loan and interst becuse the effect of loan and interest is alresy included in cost of capital percentage

The MCQs were tricky, I got ‘B’ mostly :/ The ‘correct’ statement ones were the real killers, I initially left half way through Part A and went on with B, Question 1 and 2 were alright, infact, Q1 was probably the easiest, 3 and 5 were somewhat difficult, 5 being my poorest one. 4th Question was best, nothing unusual about it.

Now, I believe I’ll get some 30-35 marks from long questions, I just hope I get 20 out of the MCQs.

@Cardine said:
Colleagues; Please stop calling fail on yourself; it will come automatically – just ask for love and mercy, which every way you preferred; pass.

Let me correct those who use the interest on loan in their appraisal – it is incorrect! The cost of capital – normal at 12% has taken care of that already and general inflation. Please remember the reasons for cost of capital ant that it is the overall cost of obtaining financing (debt/equity) for business operation. The bank loan is debt and MUST be ignore in investment appraisal.

Do not aggravate yourself and get your friends on the edge. There is nothing to hold or hedge against until February 8, 2015 – 06.00AM UK time.

The paper should be up by Tuesday, after this we can just take the time to revisit the questions – assessing how we function under the pressure of the MCQ’s; they destroyed the peace and tranquility!!!! It is also important that we look at some CFA questions too. I presumed ACCA is competing; but the US base technical exam is much easier than ACCA!!!!! This is the BEST for GLOBAL qualification – practical in nature.

The pass rate for ACCA F9 is extremely LOW and the administrative body should take note – average 42% pass this paper (2007 – 2014). This dictate the difficulties that we face and need LOVE & MERCY from ALL those who will handle our papers. Everyday you rise say – Thank you markers for the required pass mark and anything extra you have available!!!!!!!!

Hahhahah best comment so far 😀

and some much more realistic discussion there, Yes this is true… Indeed, Qualifications are competing and there is a huge fuss out there about CPA, CFA, ACCA, ACA etc….. the US and rest of the world… and as far as I know anything that competes with CFA level questions is the P4 of ACCA

after the question published

Depreciation? What depreciation are you talking about. You calculate capital allowances for that

MCQs seemed generally obscure, I found myself thinking I would have struggled even with the full text in front of me. I’ve not looked but convinced some of it wasn’t.

For 1st MCQ got $3.50, others on here have the same so should be correct
Abnormal return I put ‘semi strong’ as I could not remember any reference to the others.
For expected value I got £11,100, others have confirmed the same

What about the very last MCQ re markets, something about imperfect information etc…where was this in the notes!?

B Q1 a) scared me initially, ended up rushing through it after doing Q3 , 4 & 5 as seemed long winded for 5 marks. I ended up with £917k, the trick was only doing the three months but working out time of sales and production as there were timing differences.

Current ratio 3.48, think I was missing a liability, but could only see the payables on production as a valid one, the other was a long term loan so not a current liability, I thought?

B Q2 a) also tough i recommended conversion based on MV of 1.31 by compounding the share price based on growth of 5% from DVM comparing the share growth.
b) mutiplied P/E ratio provided by EPS, then spoke about it being subjective measure assuming same level of risk across businesses when not always the case etc.

B Q3 a) confusing, expecting to see a money market hedge but think it compared spot rate to forward rate, resulted in loss of $3.5k.
b) I rearranged the IRTP formula provided to get 6.6%, as you divided by 4% provided, I thought.
c) removal of risk with certainty of forward rate, which does not occur with hedge as subject to interest rate movements.

B Q4 a) I did not include any inflation as you were provided WACC, which is ‘real’ rate and question did not provide with a general inflation rate to use, only ones for the cashflows.
Also removed depreciation, recalculated tax saving (to be received a year in arrears so finished YR5, did anyone else do this?)
Removed loan interest as this should be factored into WACC.
Got an NPV of £2547 I believe.

B Q5 a) I thought the most straightforward Q if you knew WACC. I got 10.4%, the co was heavily equity financed 400M shares at $5 odd each meant 91.1% in equity compared to debt. I had 7% for book value as it was most geared with cost of debt being 5% on the bonds.
b) Talked about cost of equity being greater than cost of debt, the moved onto speak about control, accessibility, interest being tax deductible, basically advised not to do a rights issue.

Hope this helps others, it’s been good reading everybody’s opinions, and answers, giving me more confidence. I scored 72% on Kaplan QBD, but don’t think I’ll come close on real thing as was much more difficult!

Capital allowances were claimed at the end of year 4

Guys I think for Q5 to calculate the cost of equity, the equity risk premium has already been multiplied by the beta value there for it is called Equity risk premium, we only need to multiply the beta value if they had given ‘risk premium’ instead.

I worked through f9 very hard,but still i found it very tough,n the Mcq part it was a nightmare…
fingerx crossed . .