FM*** F9 December 2015 Exam was.. Instant Poll and comments ***

Sorry ment ACCA release their answers! They said they admit releasing MCQ back in the new year and they have!

@sams1987 said: Sorry ment ACCA release their answers! They said they admit releasing MCQ back in the new year and they have!

Wont be releasing MCQ's questions so definitely no answers ... but for section B I guess they will release answers near result day.. questions are already released in hybrid foam (which i hate though)

I think leading was correct...benefits overweight cost in settlement discount...waac decreases after new debt 12% to 11%(roundings)...NPV was positive ...and atleast 6 to 7 mcqs have answer B...

Fab thank you! What does hybrid mean? Where do I find them? TIA

What he is trying to say is that from now onwards Acca will select questions from sept/dec sittings and only publish the selected ones on the website. No more full question papers for sept or dec. hybrid is like combining both elements. Google it for a clearer picture. Nothing to do with f9 though

The exam was fairly ok. q1 was tricky.multiple choice questions where a bit tricky because of the time pressure i wasnt able to read thoroughly what did you guys choose for these mcqs calculating project specific cost of capital EAC money market instruments using purchasing power parity to calculate future spot rate calculating shareholders return calculating the working capital of a business financial objectives of a company macro economic targets translation risks valuing a company for selling

Just realised I forgot to squeeze this into any of the answers "present value of future receipts discounted at the investors required rate of return" :( :( :( Can't be a good sign!

Guys the leading was correct but you all forgot to multiple by the interest rate as it specifically mentioned in the question that it would borrow the money, thus making forward as the cheapest hedging method

With the wacc as i mentioned depends on the rates used to calculate the positive and negative value to use in the IRR calculation of the loan

@6shahir said: Found this paper quite hard.... Mvs oh gosh........... :( MCQs pls save me and the last two questions....

The exam was a good paper. The question with the dividend policy was exactly as the one on the specimen exam. If anybody did that paper they would gain easy marks by jus rewriting what Mr moffat said and/ or write as the moddle answer.

Hi Few questions- anyone do the same? anyone remember the MCQ with dividend of .12 cent 4 years ago & .17 cent current dividend. The growth worked out something crazy like 28% which threw off the DVM model for Market Value. Did anyone get this right? Also in the section B NPV question I disregarded the €150k Working Capital amount & only put in the INCREMENTAL amount of inflation @ 4.7% as it wasn't an outgoing relating to Year 1. Then I made a notation saying no refund of €150k will occur in Year 5 as production has not ceased & this W/C will continue to be needed.

For the MCQ on working capital of company - should the cash & cash equivalents & the short term borrowings have been included? If you only included trade receivable & inventory - payables you got answer= 20 If you included T/R & inventory & cash equivalents - payables - short term borrowings you got answer =16.

MCQ when someone selling a company - was the answer - the cost of replacing the assets?

Did any of you guys discounted the cost of the machine in year 1 and not year 0 as it was mentioned in the question that the machine is going to be paid on the first year of its life. I found that part tricky. The rest was easy...

Yes i did

What was the Equivalent Annual cost for 5 years asset? 5th year NPV was 777140. MCQ F9

Reading all these feed backs, I am scared stiff. Fingers crossed and trusting in God to see me through.

I did same

Anybody used in NPV question real WACC, not nominal? I used and didn't add any inflation. Since the inflation is general it must gives the same result as using nominal rate with inflation, but it much more faster in calculations.

The paper wasn't bad at all. MCQ where not that bad at all. Managed to get through q1-q4 pretty ok. But then realised I was running out of time for q5. I then firstly answered part b of the question and talked about the irrelevant theory. Then with 10mins left tried to do the wacc but my mind stopped working cz I was panicking. Managed to only calculated the cost of debt of the original loan note using irr. By the time everything started coming back to me time was out. So I did not calculate cost of equity which was easy marks or the the market values or the actual wacc, so I'm so disappointed tht I didn't finish a question I know perfectly well how to do. In my head I'm like surely they won't let someone pass who didn't even do the wacc ahhhhh This is depressing

@chris1975z said:

Thank you @chris1975z for the positivity. Goodluck to you too!

I thought this was a much fairer paper than the September one though I didn't have much time to revise. I used the reading time to work out answers to the MCQs. I remember thinking the first 4 seemed easy and overall were better than last time. Not a lot of calculations. I didn't look at part B until we were allowed to start. I went really badly over time with Q4 NPV which I started with. Tied myself in knots when this should have been straightforward. Don't know if I wrote enough about rationing. Cant remember mark allocation. Did Q5 next and couldn't get brain to work out equity cost of capital. I did the redeemable loan notes and just filled in what I could for the weighted bit without the equity. I hope I get some marks. Did the receivables question next but didn't complete it. Some of my calculations may have scored marks. For part B I had answered and then read question again. Realised they were asking something else and tried to throw some stuff down. Q on Foreign Exchange I messed up. I did Q1 last and was really short of time. Couldn't complete again. :(

when will result be known? and may I register (if I fail ) for march session ?

I just divided it by the number of years which is 5 and ended up with the lowest figure.

I thought it was a fair enough exam also. I did not have a lot of time to study on this one. Maybe 6 weeks with an F5 repeat. F5 took probably 60% of my attention. I am also due to start P1, but I am going to keep going over F5 and 9, particularly f9. I kind of froze in the exam and made some silly mistakes. It wasn't a lock of knowledge, just a total brain freeze. But to be fair, the exam itself was straight up and fair. If I pass F5 I will be happy and take F9 in March with correct preperation. Who knows though, I may be over the line.

It was lead payment to be accepted not the money market hedge.

i dint remember mcqs

@rockstar.skans said: It was lead payment to be accepted not the money market hedge.

I got the same result, the company gets in dollars more using the forward rate .

Q1a. Gearing calculation. 4 marks. This one took me particularly long to work out, somehow I got a bit confused. I believe is was 38.5% D:E. Q1b. Discussion on previous question. 6 marks. I calculated interest cover would have gone down (4.6 times if I remember correctly), and gearing would have gone up to about 58% I think. Spoke about how they should consider using equity finance and that the competitors are probably using more short term debt as their interest cover is high comparison to their level of debt. Q2a. Forex. 5 marks. Hedging most expensive, forward 2nd most, and leading (500,000 pesos x spot rate) cheapest. Q2b. Pros and cons of futures. 5 marks. I basically said they're forwards which can be traded and discussed the pros and cons. Q3a. Receivables management. 6 marks. Really kicking myself on this one for forgetting to include the increase in profit, so I got a negative figure. Q3b. Foreign receivables management discussion. 4 marks. I mentioned that the main risk is bad debts, and ways of countering was export factoring and export insurance and some discussion on those. Didn't mention transaction risk though, didn't seem relevant. Q4a. NPV. 10 marks. I forgot to inflate the working capital. I inflated selling price, variable and fixed cost. Some are saying FC shouldn't be inflated but I'm quite sure every past question inflated FC. Discounted using 11%, came to something like 1122 positive I believe. I'm also not entirely sure what the examiner meant by calculate in nominal terms, never came across an NPV question worded that way. Q4b. Capital rationing. 5 marks. I discussed hard cap, i.e. economy wide and company specific; and soft cap, internally imposed such as budgets etc. Q5a. WACC. 10 marks. Also kicking myself for this one. I forgot to calculate the WACC before. I think it came to around 11%. Interest on bank loan had to be tax adjusted, the loan notes had to have their IRR found, the new loan notes (bond?) had the cost of debt and market value already given. And of course equity, the number of shares was 12m/0.50 x 3.45 I think, definitely excluding reserves cause its market value. Q5b. Dividend policy. 5 marks. I think I messed this one up as I spoke about the dividend valuation model and the limitations of the figures involved in it. I didn't even mention M&M, but I think I put something in regarding the signalling effect. From what everyone else said, I think I went off point. As for MCQs, I know I got a lot of As in the beginning and q15 and q20 both had me stuck for some time. In fact, I couldn't arrive to any of the answers for no. 15 and 20, they drove me mad. The MCQs seemed OK, but I had a habit of feeling like I did OK in them and messing up big time. Quite concerned about this one.