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ACCA F9 Examiner's Report
08 November 2017
F9 - inbrief
The examples used here covered cum interest and the operations of the money market.
remember that if you are asked to select two correct statements than marks can only be awarded if two statements have been selected. There is no partial marking, so an answer, which only selects one statement, will be awarded no marks.
Common errors made on numerical investment appraisal. Some candidates couldn't identify relevant cash flows for an investment project or made mistakes with the timing of future cash flows.
Sitters also need to consider cash outflows when selecting investment projects.
Can you choose the appropriate discount rate to be used in a lease versus buy evaluation?
When it comes to business valuation a common error was students did not understand the dividend growth model can be used to value a company that doesn't currently pay dividends. You also need to include the value of a dividend about to be paid if the share was a cum dividend. PQs need to deduct preference dividends before applying a price earnings multiple.
The examiner wants you to know the features of risk management derivatives. Be careful about the selection of exchange rates and don't time apportion interest rates in a money market hedge calculation!
Can you work out the cost of a lead payment to be able to validly compare with the cost of a forward exchange contract?
For the financial management environment there is a gap in knowledge when it comes to the measure that help reduce stakeholder conflicts and what a company should do to maximise shareholder wealth.
Section C next story!
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