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

hard questions surely wil fail..:(

it was more of a scenario based paper. in whole paper students view were asked… hoping for 50.. fingures crossed!

F9 is the most difficult fundamental, F7 is just a baby with it…

@mschembri said:
hope so 🙂

Too good to be true. ACCA won’t hesitate to fail. Not subjected to moderation / bell curve. That’s why it’s tough.

@tsigdinos said:
does anybody know if i’m eligible for the exams of p4 and p5 without having finished with the fundamentals???

i don;t thing soo

The paper had quite a wide coverage….lets wait for all the best….NO ACCA paper is not time presured

@tzxsean said:
Q1) Investment Appraisal with inflation, Capital allowance + Working Capital
Perpetual Succession – PV of cash flows
Discussion whether 4 year evaluation period appropriate
3 ways to incorporate risk into investment appraisal

Q2) Calculate WACC before and after bond issued and comment findings
Factors that influence market value of traded bond
Evaluate director view that issue bond will reduce WACC and increase
market value of company

Q3) Ratio analysis- achieve maximising shareholders wealth or not
Dividend policy – pay or no pay under ratio analysis condition
Explain and discuss Equity finance and Sale & Leaseback to raise fund
Nature of Scrip Dividend and Adv & Disadv

Q4) Money Market vs Forward Contract
relationship between exchange rate with interest rate & inflation rate
Factors that influence formulation of Working Capital Policy
Inventory cost- savings from bulk purchase and early settlement

Very good memory, i messed up potential 19 marks in Q3 because i saw “maximising shareholder wealth” and i didn’t see rights issue to calculate TERP in order to calculate maximisation of wealth. Instead if all financial performance [P&L] & position [BS] had caught my eye, i wouldn’t have been so thrown off because calculate ratios from P&L and BS, you can still determine if wealth is getting worse or better.

By the time i realised what the question was asking, i was only able to see to do 2 ratios with rushed analysis. Made 1 point for whether to pay dividend under current ratios but exam finished and i couldn’t put anything for funding with Equity or leaseback for funding based on company’s current state. [really annoying when you know the answer but no time to do it]

Q3d wasn’t linked to to the ratios calculations in part a so i did this first when i was still contemplating what to right for part a.

Another potential 7 marks messed up in Q4d, i answered the question for not sure it really supposed to be done. [does anyone know]

I answered everything else well so i am hoping they wouldn’t fail me for not attempting Q3c.

@manishapatwal said:
It was a fair paper…

Q1 (a) – NPV was positive, hence acceptable… Inflated sales price, variable cost, fixed cost and working capital (i too realized WC it 4th yr, although after reading comments not sure abt my treatment)
(b) – used CFs after tax and divided by 12% to get perpetuity flow
(c) – sensitivity analysis, probability analysis, and simulation

Q2 (a) – there was approximately 1% fall in WACC after issue of bonds
(b) – expectancy theory, risk exposure, etc (and little more crap)
(c) MM approach and MM after tax approach

Q3 (a) – calculated EPS, PE ratio, and wrote few stuff.
(b) – calculated gearing level and commented on equity finance
and talked abt liquidity to associated with fixed finance payment under sale and leaseback
(c) wrote all possible crap abt scrip dividend as was completely out of ideas and time after attempting its part (a) & (b)

Q4 (a) – PPT & IRT
Forward hedge was better

(b) Talked abt liquidity and profitability balance, investment req to maintain CA, industry, etc (not sure about my answer after reading comments)
Bulk purchase discount was better.

Fingers crossed for 22 August…

Sensitivity analysis doesn’t incorporate risk, SA is more linked to uncertainty. Probability analysis and simulation are okay. The question actually said either “explain” so we couldn’t just list it out.

Q4c My 3 sub-heading was credit analysis [assessing credit worthiness], credit control and debt collection because it said “working capital cycle”.

Credit analysis – assess this by checking customer’s credit rating through rating agency, bank reference & trade reference. Used to determine if customer should be given credit

Credit control – Setting credit limit based on credit analysis, and review regularly [customer breaking limits can be established and dealt with accordingly]

Debt collection – checking efficiency of debt collection [is debt balance’s age reviewed] and which type of debt collection methods are available.

@josey said:
did anyone cal an amount for working capital in yr4? by this i mean not releasing the 750 as the sales wld continue beyond the 4yrs used in the question.

Used the working capital in Yr 0 then regained it in Yr 4, the 1200 positive NPV sounds about right for that 13 marks in Q1a

npv for first question 1231

@neutral07 said:
Uncertainty [Cannot be assessed] – Sensitivity Analysis, Discounted Payback

Risk [Can be assess with information from the past] – Adjusted cost of capital, certainty equivalent, hurdle rate, probability analysis, expected values and simulation

https://www.slideshare.net/ProfesorHariSeldon/ch14-5005600

go to page 22

The time allocated for F9 is too little

The Exam was reasonable but in short of time