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FAE 2011 Where to begin

FAE_UCH

Hello all,

This thread may be a little premature but after that disaster of a paper on Saturday, I figure i better start doing a bit now while i'm still slightly in study mode. I did a masters so i feel at a huge disadvantage as i did not have to come through CAP 2. Is there any point in me now going back and trying to look at CAP2 material or would that be much too technical for this.

Does anyone know what the best plan of attack to study this? I'd love to hear past Faer's advice, or people who have a plan to share it with us.

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burgerking1

Yes very important to remember that it is your interpretation of the actual scenario presented and your response that will deem your competence

suggested solutions are suggestions and does not mean to say that your answer is right or even wrong. Remeber that not 1 of these papers will be answered in exactly the same manner so there is leeway for how and what you actually answer.

The idea I gathered from it was the actual IPO would entail a flotation of the companies and an appropriate structure was needed, also facilitating the any future disposal of both ENVI or NRG.

Tomorrow is anyones guess, think there will be one topical/technical individual, dealing with and individual in an instance possibly.

My tip is to think of the indicators that appeared today, how well you think you answered each one with particular reference to BL and PM.

Dedicate slightly more time to the indicators where you think you need to lift your game tomorrow during planning to reach the required level. Only half time, never over at this stage

Vaioer

burgerking1 wrote: »

My tip is to think of the indicators that appeared today, how well you think you answered each one with particular reference to BL and PM.

Dedicate slightly more time to the indicators where you think you need to lift your game tomorrow during planning to reach the required level. Only half time, never over at this stage

This is absolute gold advice, someone from last year told me the same.

LightningBolt

netpia11 wrote: »

Whats SBP? also will fail on audit if it doesnt come up tomorrow got barely nothing on it down today..

IFRS 2...;)

Choc Chip

Bugger. Forgot to right anything on that STUPID due diligence indicator as I was trying to scribble down something just for a few marks at the end... Grrr.

Completely ignored the patent income too. The patent relief finished at the end of the 2010 so there'd be no point addressing it from a tax perspective... surely...

burgerking1

Vaioer wrote: »

This is absolute gold advice, someone from last year told me the same.

this is my first sit but i can easily tell you that planning and analysis of where you are at in this exam is important. in my opinion CAP 2 in the prior year was alot more difficult than anything seen today but then again that is my opinion.

KEY KPI for a recycling company - waste recycled % PER TONNE. Tonnage is the key for this sort of company, encountered it in practice.

Chill the heads, relax for tomorrow, bit of reading tonight and then back at it in the morning

burgerking1

Choc Chip wrote: »

Bugger. Forgot to right anything on that STUPID due diligence indicator as I was trying to scribble down something just for a few marks at the end... Grrr.

Completely ignored the patent income too. The patent relief finished at the end of the 2010 so there'd be no point addressing it from a tax perspective... surely...

yes unfortunately choco, due diligence was clear as day to me. it was the ranking that was difficult and so subjective. obviously an investor will want to assess past performance for me, that is the basic starting point on any investment. this had links to getting current year audit completed.

Thus then i said future performance, strategy, the EU mandate and its applicability in the EU for growth prospects and similar transactions invloing similar companies etc. Thought this was open to alot of interpretation as it would depend on the investment objectives of the investor but definitely as a start point you assess previous performance

Hackysack

Nuts, I thought I actually did decent enough with the Financial Reporting indicator but completely forgot to mention IFRS8 and the related party. I had it written down in my plan but completely forgot to put it down at the end. Ballsack.

Reckon i'll have to try and blast PM out of the water tomorrow as well as making up on Audit cause I left it til last (but still got a few points down in anycase).

I reckon i'll have a power nap now...

Hanley

To anyone stressing out, watch this and smile

https://www.youtube.com/watch?v=ZZ5LpwO-An4

Choc Chip

burgerking1 wrote: »

yes unfortunately choco, due diligence was clear as day to me. it was the ranking that was difficult and so subjective. obviously an investor will want to assess past performance for me, that is the basic starting point on any investment. this had links to getting current year audit completed.

Thus then i said future performance, strategy, the EU mandate and its applicability in the EU for growth prospects and similar transactions invloing similar companies etc. Thought this was open to alot of interpretation as it would depend on the investment objectives of the investor but definitely as a start point you assess previous performance

Clear as day to me too - that's why I wrote it in my plan at the start... Pity I didn't follow that up with a mention in the actual answer booklet...

Colts

burgerking1 wrote: »

this is my first sit but i can easily tell you that planning and analysis of where you are at in this exam is important. in my opinion CAP 2 in the prior year was alot more difficult than anything seen today but then again that is my opinion.

KEY KPI for a recycling company - waste recycled % PER TONNE. Tonnage is the key for this sort of company, encountered it in practice.

Chill the heads, relax for tomorrow, bit of reading tonight and then back at it in the morning

CAP II was definitely more difficult in terms of content, but in terms of trying to identify everything, then relate it to the case, FAE is much tougher. Plus you have the added factor of needing a higher calibre of answer to reach competency.

Much easier when you're just asked the question IMO!

p13

For due diligence I found a bit in ann Marie ward finance text book about this. Tried to relate it back to Q by referring to liability re: solicitors letter. Don't seem to have done it as well as some ppl here

ManwitaPlan

Rickyroma wrote: »

I'm not convinced about there being a tax indicator. I think that what people mentioned is valid in respect of Holding Co but the focus seemed to be on a structure to allow floation of One company and also with a focus on the Fin Rep consequences of floatation.

They seemed far more worried about disposal - which is where Section 626B would come in.

If there was a tax indicator it would have been extremely theoretical which is something I think these exams tend to try to avoid.

I brought up Hold Co, group relief for SD and CGT, 626B and hived off the assumed patent income into another co, but in the context of group structure. Even while writing I felt I was forcing an indicator rather than answering one - so I shied away from general chat about Reorg relief as it was just too open - anything would have been valid.

The main point is that if enough people felt there was an indicator there - then they will have to allow one to be there. But I think it can be argued either way.

So don't think that if you missed it you are in trouble. In my opionion it is reaching and there will almost certainly be two tax indicators tomorrow. The marking of the exam is a fluid process - if a significant minority come up with a reasonable interpretation (i.e. a tax indicator) this will be allowed. There is very little set in stone (other than directive indictors) is my understanding.

Dont have paper in front of me but I thought it clearly said that they want to list as a single co with a view to disposing one of the businesses.

This suggested to me that ENVI and NRG should be kept as individual companies with Energie Holding as a holding company rather than having energie as the company doing both activities (as harder to dispose of then).

Thats what I took from it. Problem is everything is so subjective and can be interpreted in different ways. Would hope the take account of it but dont know....looking back at it it was a very grey issue.

p13

If single IPO would consolidated accounts be required?

LightningBolt

burgerking1 wrote: »

KEY KPI for a recycling company - waste recycled % PER TONNE. Tonnage is the key for this sort of company, encountered it in practice.

This isn't a dig at you but that's not going to cost people marks. That'd be pretty industry specific knowledge to be fair.

okdune

Rickyroma wrote: »

I'm not convinced about there being a tax indicator. I think that what people mentioned is valid in respect of Holding Co but the focus seemed to be on a structure to allow floation of One company and also with a focus on the Fin Rep consequences of floatation.

They seemed far more worried about disposal - which is where Section 626B would come in.

If there was a tax indicator it would have been extremely theoretical which is something I think these exams tend to try to avoid.

I brought up Hold Co, group relief for SD and CGT, 626B and hived off the assumed patent income into another co, but in the context of group structure. Even while writing I felt I was forcing an indicator rather than answering one - so I shied away from general chat about Reorg relief as it was just too open - anything would have been valid.

The main point is that if enough people felt there was an indicator there - then they will have to allow one to be there. But I think it can be argued either way.

So don't think that if you missed it you are in trouble. In my opionion it is reaching and there will almost certainly be two tax indicators tomorrow. The marking of the exam is a fluid process - if a significant minority come up with a reasonable interpretation (i.e. a tax indicator) this will be allowed. There is very little set in stone (other than directive indictors) is my understanding.

Ah Ricky your the insider - damn totally screwed it up them - I took the theoretical route. I totally didn't yhink I would feel like this now, with all my preparation. I assumed due to the lack of CG and also the ineffective group structure for a listing a holding company would be best (particularly given the option to dispose in a few years) and therefore assumed a holding co would be best.

So for the purpose of PM i totally ruled out IPO as an option - but did point out at one stage that if the internal controls and CG was up to scratch within the 24 month period, it could be possible.

If I mentioned a lot of control and audit type issues in the overall script are they counted for as I didnt get to write up my audit section properly. Left it till last cause I thought it was most straight forward (stupid) and ran out of time......

Man this is horrible I have worked so hard and I know the stuff.

Hanley

So what are we thinking indicator wise tomorrow?!

3-4 per simulation?

p13

I still think this whole thing of not sure if you've answered all the questions or what the questions even are is the worst part! Spend so much time on it also. In some sample papers I've noticed I'll think they mean one thing, yet in the solution they take a totally different approach.

As you say you know the stuff. It's not really too fair

ManwitaPlan

Hanley wrote: »

So what are we thinking indicator wise tomorrow?!

3-4 per simulation?

Would expect tax and finance. Maybe a buyout/acquisition with valuation and tax implications.

Few snakey ethics ones and maybe a bit of management accounting.

Potentially four pm indicators in todays paper (IFRS 2, FR implications of IPO, legal claim and KPI/Budget stuff) so would not expect too much heavy stuff tomorrow, especially as the IFRS 2 indicator was quite technical. Could be anything though...was feeling pretty good after the exam but feeling awful after reading through this thread.:(

ahtfulal

p13 wrote: »

For due diligence I found a bit in ann Marie ward finance text book about this. Tried to relate it back to Q by referring to liability re: solicitors letter. Don't seem to have done it as well as some ppl here

I ran out of time left this til last and just jotted down some points, think I stole it from dat devaney car sim from mocks.

It's only finance anyway, hopefully we can nail that 2moro, surely some sort of financial analysis will come up!

ahtfulal

This thread is great for pre exam but its becoming a bit of a killjoy post exam mortem!

Best of luck 2moro everyone. Nearly there!

apple13

Choc Chip wrote: »

Bugger. Forgot to right anything on that STUPID due diligence indicator as I was trying to scribble down something just for a few marks at the end... Grrr.

Completely ignored the patent income too. The patent relief finished at the end of the 2010 so there'd be no point addressing it from a tax perspective... surely...

I ran out of time and wrote absolutely nothing for that stupid due diligence indicator too...freaked as it was such an obvious indicator and fairly do-able. Just HAVE to spot the finance tomorrow and get to competent pass right?....soooooo annoyed!!!!!!

Stabshauptmann

Hanley wrote: »

This.

And were there no tax indicators, or did I f*ck up on that area AGAIN?

I thought it was very clear that you were to recommend reorganisation under a single holding company, so mentioning paper for paper share issue and CGT and SD relief was essential, and that the company wished to be able to avail of participation relief. Brief outline of the reliefs would have been enough.

I messed up my time however and though I had perfect notes on all of the above, I didnt get it down on paper :-(

RonaldRayGun

I would not be surprised to see Marketing rear its pointless head tomorrow. Didn't come up at all last year. No sign today (unless everyone on here missed it) and 'flagged' (sort of) in the Mocks (Brilliant Bee - Characteristics of a Logo).

So I for one am going to prepare answers on the commercial benefits of, to use Brilliant Bee's example, the abstract concept of 'Summer Loving' and the entrepreneurial acumen of doling out 'fridge magnets'.

Stabshauptmann

While I may not have written enough on each indicator, I think I found them.
Remember folks, most depth is required in PM and BL so start with them in your answers.

I knew "mngt want to retain as many shares as possible", didnt realise there was 25% req to IPO. Is that finance indicator?
Think my due dilligence was fairly wishy washy, is that finance too?

If so I really need to focus on finance for tomorrow. I like calculation questions myself, so from my POV I would have prefered more computation.

Fly on, McDuff!

Colts

Just realised I cocked up my IMS recommendation! Everything else was ok, and meant to go back and change it but ran out of time! So annoyed with myself!

Rickyroma

okdune wrote: »

I took the theoretical route......and therefore assumed a holding co would be best. .

I think most people recommended a Holding Co.

okdune wrote: »

So for the purpose of PM i totally ruled out IPO as an option - but did point out at one stage that if the internal controls and CG was up to scratch within the 24 month period, it could be possible..

This seems reasonable - in the short term I recommended against seeking a listing as too much to sort out first.

Really important to remember what Burgerking said a few posts back -

"It is your interpretation of the actual scenario presented and your response that will deem your competence. Suggested solutions are suggestions and does not mean to say that your answer is right or even wrong. Remeber that not 1 of these papers will be answered in exactly the same manner so there is leeway for how and what you actually answer."

okdune wrote: »

If I mentioned a lot of control and audit type issues in the overall script are they counted for as I didnt get to write up my audit section properly..

The Institute have confirmed that this is fine - if you refer to the revlevant points (i.e. stitch them into the answer) it doesn't matter if the are not in their own separate section. In some cases may even be better if they are not - so that you are linking the issues rather than presenting everything separately.

Your answer seems ok to me - but I have to stress I'm just a student - no inside knowledge whatsoever - all of this is simply my opinion and recollection.

p13

Colts wrote: »

Just realised I cocked up my IMS recommendation! Everything else was ok, and meant to go back and change it but ran out of time! So annoyed with myself!

What was the IMS recommendation? I said off the shelf as it said about straightforward requirements of management

Student456

p13 wrote: »

What was the IMS recommendation? I said off the shelf as it said about straightforward requirements of management

I said the same, I outlined the advantages and disadvantages of each and linked it back to the company. Concluded that due to the straightforward requirements of management i suggested they go for an off the shelf package..... Thats my opinion anyway!

okdune

Rickyroma wrote: »

I think most people recommended a Holding Co.

This seems reasonable - in the short term I recommended against seeking a listing as too much to sort out first.

Really important to remember what Burgerking said a few posts back -

"It is your interpretation of the actual scenario presented and your response that will deem your competence. Suggested solutions are suggestions and does not mean to say that your answer is right or even wrong. Remeber that not 1 of these papers will be answered in exactly the same manner so there is leeway for how and what you actually answer."

The Institute have confirmed that this is fine - if you refer to the revlevant points (i.e. stitch them into the answer) it doesn't matter if the are not in their own separate section. In some cases may even be better if they are not - so that you are linking the issues rather than presenting everything separately.

Your answer seems ok to me - but I have to stress I'm just a student - no inside knowledge whatsoever - all of this is simply my opinion and recollection.

Thanks RickyRoma - you have made me feel momentarily better! Its all timing that's what hurts - trying to see where the case is going and then aligning all your points across the indicators is so difficult in such a tight timeframe.

Hanley

Student456 wrote: »

I said the same, I outlined the advantages and disadvantages of each and linked it back to the company. Concluded that due to the straightforward requirements of management i suggested they go for an off the shelf package..... Thats my opinion anyway!

Sames. I only gave an explanation of each, an advantage, why it wouldn't be appropriate and reiterated my recommendation for a tailored off the shelf system. Hopefully that's enough.