Day: February 16, 2021

INTRODUCTION You may be expected to write briefly on a number of topics, as part of one of the questions.   This is an opportunity to gain some very valuable marks for a small amount of effort.  There is a limited Read More …

INTRODUCTION Foreign currencies have a habit of changing relative to the domestic currency and therefore add risk to dealing with foreign countries as sales markets or sources of supplies. Foreign companies also can be a source of capital to facilitate Read More …

INTRODUCTION There are many reasons why companies prepare Business Plans.  One of the most common reasons is where the promoters of the company are intending to raise finance and a detailed Business Plan is required for  presentation to potential investors. Read More …

INTRODUCTION The Capital Asset Pricing Model (CAPM) is an extension of Portfolio Theory, which is concerned with the risk and return of portfolios and the process by which risk can be reduced by efficient diversification.  The CAPM assumes that all Read More …

INTRODUCTION A portfolio is a collection of different investments which comprise an investor’s total investments.  For example, a property investor’s portfolio may consist of many investment properties in different locations and which are used for varied purposes.  Other examples of Read More …

 It is important that a company is aware of its cost of capital.  In certain cases it is not initially apparent what this cost is (e.g. new share issue, retained earnings etc.) and a number of models have been developed Read More …

INTRODUCTION   It may be necessary to carry out a valuation for: Quoted Companies – where a bid is made and the offer price is an estimated “fair value” in excess of the current market price of the shares. Unquoted Read More …

INTRODUCTION  When an organisation decides on expansion the choice is between organic growth or acquisition.  Organic growth is internal growth by expansion of the existing business (e.g. opening more outlets, major marketing/sales campaign, reduce prices to achieve additional sales etc.)  Read More …

INTRODUCTION To judge the performance of a company or group of companies the analysis of financial statements is normally based largely on ratio analysis. You may be expected to carry out a performance analysis on a set of company accounts.  Read More …

RISK MANAGEMENT -MAIN TECHNIQUES/INSTRUMENTS Interest Rate Guarantee (IRG)/Option These provide a degree of flexibility which is not provided by certain other instruments. They protect one from adverse interest rate movements but also allow one to profit from favourable Interest Rate Read More …