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Sir in case of horizontal integration can it take place between 2 companies in different industries? At least investopedia seems to suggest so. However it clearly contradicts what’s given in my Kaplan study text, which alludes that lateral or horizontal integration takes place only between companies in same industry.
many thanks!
This is a Paper SBL topic, and I presume that you have already taken Paper SBL if you are now attempting Paper AFM. (Kaplan will have including it in their Study Text because, of course, anything from earlier exams can be asked in any Professional level exam).
Horizontal integration is expanding into related businesses. For example, and airline taking over a chain of hotels. They are related even though they are not the same business and there would be a real chance that the combined business could achieve efficiencies (but, for example, offering accommodation when people go into the airline booking system).
No sir i have not taken SBL or SBR either. I just loved FM and since i had time in my hands(relaxation from college), so decided to take up AFM(which is deemed very rigorous). Are there any more chances of ACCA team asking SBR/L questions in AFM than there are for ACCA team to ask questions relating to F1-F4 in F5-F8??
I dont have much guidance per se, just peers and OpenTuition.
Do you think it will be hard for me to crack this subject in Dec 2020?
your response would be much appreciated!
There is not so much written in Paper AFM and certainly anything in the exam that could be regarded as being from SBL has been more common sense discussion rather than remembering anything specific from SBL (for example, the term ‘horizontal integration’ has never been relevant – the exam does not test knowledge of specific terms like that).
As far as Paper SBR is concerned, on many occasions the examiner has required you to prepare forecast SOFP and SOPL’s taking into account an action such as the acquisition of a new company.This is pure financial accounts but knowledge remembered from Paper FR (was F7) is sufficient.
I disagree with you about the earlier exams. Paper LW (F4) is the only paper that is never examined again. Paper FA knowledge is needed for Paper FR, Paper MA knowledge is needed for Papers PM and FM, and Paper BT background knowledge is relevant for all later exams.
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