*** F9 June 2011 Exam was … Post your comments here and vote in Instant Poll ***

Q3 Con’t figure out what calculations to do, .’. had nothing to seriously discuss. Time pressed, Damn! Hoping for 50.

@rizenzo i do not remember 6 marks for exch rates question? i remember it 4 mrks…..because money mkt & forw contract was 7 mks, Work Capital policy was 7 mks and bulk purchase and early settlement was 7 mks, which leaves only 4 for exch rates…..from what i remember.

Exch ques was for 5 marks. Hedging and forward was 6 marks

it ws hell a hell paper…. 🙁 tricky hell triicckkyy….:@

@grassrotts said:
oh yeh i think u are right mcwilliams, exch rate question was 5 mrks actually 🙂 ……my mistake. Anyway i think the question pper will be online 2morrow so know for sure then.

I think Q1 (a) NPV was worth 13 marks. Did you get NPV $1,2m? If yes that would be a good start.

Also queston on working capital policy is to do with aggressive/conservative and management attitude to risk.

Scrip dividend I wrote about issuing shares instead of taking dividends – effectively still raising equity. I think this was worth 5 marks.

@grassrotts said:
@joevassallo well i got 791000 for npv but that is because i did not incorporate inflation 🙁 so i think ur npv is right.
i think work capital answer wuld b aggresive/conservative etc, but i also wrote abt expected Work capital needs for period such as debts to b paid etc and whether mgmt wants to improve liquidty position and to possibility 2 attract new customers with discounts or longer repayment periods etc. …..i hope i get 7/7 mrks here cause i wrote a lot :p
and yeh scrip dividends are issuing shares in lieu of dividend but i 4got 2 write it is an option, and not mandatory for existing shareholders. They choose between cash & new shares.

I think you wrote more about working capital management rather than policy. I hope you score good marks just the same. Do you remember how may marks it had? Also re NPV did you release the working capital in year 4? I did but I saw some comments that it should not. Not sure here. If released hope to get full marks here. I think you will only lose 3 marks for the inflation part.

I messed up big time with question 1 and 3.Praying for a 50%

@adrienn said:
working capital had to be released in the 4th year because the project calculation was prepared only for 4 years (although the director expected sales after the 4th he didnt incorporate it into the calculations as they were too uncertain). and we had to reperform the director’s calculations.
in part (b) WC had to be ignored (and also tax).
i got an NPV of 1,2 m USD.

in part (c) i wrote about liquidity and profitability as the question was not about working capital FUNDING policy.

I agree 100% with you – I got NPV $1.2m as well. My interpretation was NPV for a 4 year project.
Regarding WC Policy – you are right aggressive/conservative is FUNDING but again my interpretation is about funding. Because that is what WC is all about really, also management attitude to risk, previous policy decisions, size/organisation.

@frank26 said:
NPV
Selling price
V c
F c, all in current price term they all must inflated by 3%
For Example,
In calculation of profit year 3.
Selling price was 5 per box, so increase in selling price 3% , 3 times,
Variable cost in sales volume in year 3 were in current price, so increase vc 3% 3 times.
Fixed cost in year 3 was higher then year 2. Because sales volume increase in year 3. FC was increamental Fc, it was increasing with sales volume. Fc in year 3 increase by 3% 3 times. To obtain year 3 Fc.
Tax was 1 year in arear. 1 year tax take in year2.
Capital allowance 25 reducing method.
Working capital in year 0 was 750000. Increase 3% for 4 yr, ignore working capital recovery because buisness is cont aft 4 year mentioned in frst para.
Nominal discount factor use
Npv arrive

I think you are wrong about Selling price – to me it should be $5+3% Year 1, then $5.15+3% Year 2, $5.30+3% Year 3 and $5.46+3% Year 4.
I agree with the VC/FC workings.
WC though has to be released in Y4 because the NPV was for 4years (and there was uncertainty).
Part b I thought was about project continuing for the foreseeable future.

you are right about selling price this exactly i am saying

when do they pubish the answers? when we get the results or earlier?

@tzxsean said:
should be Aug 22nd this year

Do you know when they put the questions/answers on the Acca website?

@joevassallo said:
Do you know when they put the questions/answers on the Acca website?

that was my question, thanks 🙂
i know that exam results are coming on th 22nd, but it would be good to see the answers a bit earlier.