Forecast of Question-F9

[How]

Hi, I would like to request, based on your experience make a forecast of question that would be ask in this Dec'07 examination. Thank You!:)

[Robert]

Hi,

Since F9 is a relatively new paper, where all the questions are compulsory, it would be advisable to revise thoroughly all the topics in the syllabus. However, keeping the past exam papers of paper 2.4 (i.e. the old syllabus) as well as the pilot paper in mind, you can revise the following areas as a last minute study plan. These topics are arranged in order of how frequently they have appeared in past exams.

1. Investment Appraisal

Make sure you thoroughly understand each investment appraisal method with special emphasis on discounted cash flow techniques, including the pros and cons of each method and also the techniques of adjusting for risk and uncertainty in investment appraisal. Another topic you cannot miss is the NPV calculation with tax and inflation. If you’re using Get Through Guides’s Study Text I’m referring to Study Guides D3 and D4. Questions on analysing whether to lease or buy an asset, asset replacement and capital rationing are also frequently tested topics in the exam.

2. Business Finance

Analysing the impact of raising finance from various long-term and short-term sources is an important topic in this section. Remember that, for this, you will need to know your gearing and interest coverage ratios like the back of your hand.

3. Working Capital Management

Make sure you revise all the ratios included in working capital management. A typical exam question on this topic would ask you to calculate certain ratios specific to a given company, analyse the working capital condition of the company and suggest ways to improve it. Also make sure you cover topics like cash operating cycle, net working capital ratio and cash management.

4. Business Valuations

Although the F9 pilot paper did not cover this topic, questions from this section have frequently appeared in past exams and this is a major area of the F9 paper. Hence make sure you focus on the models for the valuation of shares while studying.

5. Financial Management Function

Remember to revise ratios like ROCE, EPS and Dividend Per Share which help an investor assess an entity’s performance. Another important concept that you should cover is ‘value for money‘ which is mentioned under not-for-profit organisations.

6. Risk Management Function

Topics like hedging, forwards, currency futures and options and interest rate and purchasing power parity theory are topics from this section that are likely to come up.

7. Cost of Capital

This topic is not tested frequently in the F9 exam. But when revising, make sure you cover the Weighted Average Cost of Capital and strategies to reduce it. Refer to the Pilot paper for F9.
Please note that although you can use the above tips as important areas to cover when revising, remember that apart from the examiner, no one knows what is likely to be asked in the exam. So, your safest bet would be to cover the entire syllabus in your revision.
Regards,
F9 team at Get Through Guides

[khanjee4u]

thanxxxxxxxxx:D