*** P4 December 2011 Exam was: Post your comments and vote in Instant Poll ***

@melly1982 said:
The general consensus is that time is a limiting factor to which I endorse. The paper was a challenging one…Question 1 in particular took some time to evaluate. I would like to know however if within question 1 part a. the evalution of the decision to stop the production of the X-IT immediately required a Black Scholes calculation since what I understood was that the decision could be one to abandon which is akin to a put option and would need a Black Scholes evaluation. ANY ONE INTERPETED THIS ALSO????

I believe it was an APV calculation, especially as we were given enough enough information to ungear the equity beta. The loan subsidy was another clue.

I agree…. the first time I’ve had to leave questions out of an exam. Time just disappeared! I fear another attempt in June will be necessary 🙁

I really appreciate the new examiner Shishir Malde. His question style for the past two sittings are very fascinating and they give new insight and very nice model answers, which I really enjoy. Yet the past sittings questions are quite time pressured and a bit unfair for people who can’t process information quickly.

But this time it’s a fair paper. I am hoping to read his model answers, I always get impressed to read his answers, clear and well explained, logical and to the point.

any possble answers that u guys recall?
Q2 on int rate..for options what was the exercise price? i left collar part blank =S
q1 u remember the cost of capital? and y was int rate for borrowing given? 🙂
gd luck to u all! may we all pass!!!

My few cents worth of tots:
For the option, it a borrowers hedging. Just hedge against the upward movement and ignore the downwards. If rates goes downwards, all the better for borrower, why waste money on margin calls and premiums.

For Q1 ; option to abandon can be valued using put option. I can’t remember if volatility is given. Anyway, you can just use the contribution’s NPV to evaluate. In financial management, anything can be use to evaluate. There is no black and white or right or wrong on what methods you use to evaluate as long as you hoghlight the weaknesses or pitfall of the evaluation method you use.

It was a fair exam.
Started from 4 then 3, 2 and 1.
Q2 was my best questions. Thanks OP for the tutoring on this subject.
Q1 was lengthy. Did not finish 3 but attempted all of 4.
I tried good time management.
Just want 50%. I am really tired of this paper.

Thank God for assisting me to make a very reasonable attempt. Also,open tuition helped me in many ways but the paper was fair and gave us a chance to pass this time round.

2nd Attempt but tried, hopefully the almighty God grants me success. pressure from the little time confuses that you fail 2 attempt what you knew. But i think this is the hardest paper in the ACCA qualification. May GOD grants us all success and Big thanks to open tuition.

Little time for the questions. Only a robot could answer all the questions. I don’t know what is in their minds. It’s a shame

is this paper suitable for self-study? with just materials online and study text?

Hats of to Prof. Malde! He has brought another fair but mostly time pressured paper.
But my advice to all sitting this paper is that you can not pass P4 without doing a lot of question practice under exam condition. The other sure way to fail is trying to find correct answers for all questions within the time allocated in the exam. This is impossible because you need at least least 7hours to do that.
All one needs to do is have a go at 100% of the paper within time allocated addressing all the examiner’s requirements and just hope one will be 50% correct.
I employed this strategy and just hope the minimum best result comes out.
I wish you all good luck and God’s blessings.

It was my 2nd attempt for P4, both times I was pretty certain of passing during the first half of the exam and then onwards disaster in time management. Failing in an exam coz it was difficult or something is not as depressing as this thing, not being able to put-in wat one knew coz of the time constraints. I don’t really like this examiner’s approach. He categorically pointed out abt the previous examiner, that his last papers were not do-able in the allotted time and now wat is he doing, he picks the longest of questions from past exam papers (hedgng questions in both the attempts and the MBO thing), or hints for questions in the magazine with the expectations that students will just reproduce the crammed-up solutions in the allotted time coz only then will such papers be doable in the given time if we just start putting ink to the paper with least involvement of the intellect. Both these papers posed more of a physical challenge rather than an intellectual one. I am sure if another hour was added to the time at-least 80% of the students who really came with a bit of preparation would have passed. I am already missing Bob Ryan. I am sure his papers didn’t cause this much depression cause thr seemed to be a lot of time to express watever fraction of his paper examinees did know 🙂 .

(And please no body give lecture about able to managing the time pressure and shit, coz I’ve been in the profession for over 7 yrs and have worked under bulliest of managers with an attitude just short of holding a gun to one’s head and even that was less time-pressured than this freakin P4)