ACCA F9 Key Examinable Areas for December 2014 .
Investment appraisal:
This is a key topic which is highly likely to be examined every time. The most common technique assessed is NPV with inflation and taxation. It is worth bearing in mind that IRR has not been tested for over three years so may pop up in some form. It is wise to be prepared for applications of NPV such as replacement analysis as well as the more general discussion aspects relating to risk and uncertainty. In the most recent sitting capital rationing carried a substantial number of marks.
Working Capital Management:
Another key topic which is likely to examined every time. In recent sittings, the examiner has seemed fond of testing the cash operating cycle and also receivables management. It is wise to be prepared for a question focussing on payables management or inventory management. A discussion about funding strategies is a key discursive element.
Valuations:
This has been examined in virtually every F9 exam to date. The PE ratio and dividend valuation methods still appear to be the more examinable areas. Cash flow based values have yet to be examined. There are often high scoring discursive elements in this area of the syllabus for being able to discuss the implications of something on the value of the business or perhaps the various valuation methods. A discussion of the Efficient Market Hypothesis carried a fair few marks in the most recent sitting.
Business Finance: This topic has been heavily examined recently and in particular the impact of financing on ratios is an area the examiner likes. Candidates should make sure they are able to discuss the impact that different policies may have on a company by being able to both calculate and interpret financial ratios. Ability to be able to discuss the characteristics of various sources of finance is paramount and most importantly to able to relate suggestions/ comments to the scenario at hand.
Cost of Capital:
This topic features in virtually every exam to a greater or lesser extent. Good coverage of all of the syllabus areas is therefore essential to ensure students can handle any eventuality on the day. Candidates should feel confident when using the CAPM formula and calculating the overall cost of capital (WACC) and going on to discuss the impact of the cost of capital on investments. It has been a while since the examiner has focussed on a discussion relating to gearing theories.
Risk Management:
Within this section of the syllabus, foreign exchange risk has been examined more often than interest rate risk. However, both are fairly under-examined areas of the syllabus as a whole and so this is a topic worth being on top of. Questions in this area can often be wholly discussional or may involve some basic calculations. The Financial Management Function and The Financial Management Environment:
We can probably expect an element of these syllabus areas to feature as a tag on discursive element within one question on the exam. This part of the question can provide some easier knowledgebased marks and therefore is worth some focus.
The examiner repeatedly comments that this area of the syllabus is not dealt with by students as well as it should be. Perhaps this is due to focus being given to other more technically challenging parts of the syllabus but this area can provide some relatively easy knowledge marks so should not be over-looked.
Investment appraisal:
This is a key topic which is highly likely to be examined every time. The most common technique assessed is NPV with inflation and taxation. It is worth bearing in mind that IRR has not been tested for over three years so may pop up in some form. It is wise to be prepared for applications of NPV such as replacement analysis as well as the more general discussion aspects relating to risk and uncertainty. In the most recent sitting capital rationing carried a substantial number of marks.
Working Capital Management:
Another key topic which is likely to examined every time. In recent sittings, the examiner has seemed fond of testing the cash operating cycle and also receivables management. It is wise to be prepared for a question focussing on payables management or inventory management. A discussion about funding strategies is a key discursive element.
Valuations:
This has been examined in virtually every F9 exam to date. The PE ratio and dividend valuation methods still appear to be the more examinable areas. Cash flow based values have yet to be examined. There are often high scoring discursive elements in this area of the syllabus for being able to discuss the implications of something on the value of the business or perhaps the various valuation methods. A discussion of the Efficient Market Hypothesis carried a fair few marks in the most recent sitting.
Business Finance: This topic has been heavily examined recently and in particular the impact of financing on ratios is an area the examiner likes. Candidates should make sure they are able to discuss the impact that different policies may have on a company by being able to both calculate and interpret financial ratios. Ability to be able to discuss the characteristics of various sources of finance is paramount and most importantly to able to relate suggestions/ comments to the scenario at hand.
Cost of Capital:
This topic features in virtually every exam to a greater or lesser extent. Good coverage of all of the syllabus areas is therefore essential to ensure students can handle any eventuality on the day. Candidates should feel confident when using the CAPM formula and calculating the overall cost of capital (WACC) and going on to discuss the impact of the cost of capital on investments. It has been a while since the examiner has focussed on a discussion relating to gearing theories.
Risk Management:
Within this section of the syllabus, foreign exchange risk has been examined more often than interest rate risk. However, both are fairly under-examined areas of the syllabus as a whole and so this is a topic worth being on top of. Questions in this area can often be wholly discussional or may involve some basic calculations. The Financial Management Function and The Financial Management Environment:
We can probably expect an element of these syllabus areas to feature as a tag on discursive element within one question on the exam. This part of the question can provide some easier knowledgebased marks and therefore is worth some focus.
The examiner repeatedly comments that this area of the syllabus is not dealt with by students as well as it should be. Perhaps this is due to focus being given to other more technically challenging parts of the syllabus but this area can provide some relatively easy knowledge marks so should not be over-looked.
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