ACCA P4 Exam Tips December 2015


ACCA P4 Exam Tips December 2015 session given below are just intelligent guesses from exam point of view provided by famous tuition providers. These exam tips must not be relied on totally. To increase chances of success in Exams you must prepare full breadth of syllabus and topics

ACCA P4 Exam Tips December 2015:

ACCA P4 Exam Tips December 2015 Session are given below by famous tuition providers


P4 is a technical paper with some complex calculations sometimes but DO NOT think of the exam as numbers-only. There are plenty of discursive parts which are usually easier than the calculations and easy marks can be picked up by applying commercial awareness and common sense.

Analyse the individual requirements of the question. If you can do the wordy bits first then do so as you will not get bogged down in them like you will with the calculation elements.

Do not expect to finish a question. You must stick to time, especially on the calculations which are very easy to over-run on. The exam is extremely time pressured and the secret to passing is to have a go at every part of every question, not to try and get 100% on every question – to do that you would need about 7 hours!

If you are not sure what to do with a particular figure in a question, ignore it and move on – state assumptions, you haven’t got time to worry about it!

If you get a Black-Scholes question, always list out the input variables as your first stage and assign the relevant values to them – there will be about 2-3 marks usually for doing this.

Practice as many questions as possible but do as many as possible to time. You must get used to doing the questions in the time available and not spending too long on them.

Practice as many questions as possible across the syllabus, and don’t only concentrate on what you consider to be the core areas.

Choose carefully on section B of the paper – it is very limited choice but nonetheless it will be critical.

Do not put down unnecessary workings; because as it will cost you heavily in lost time.

If there is a calculation that you are unable to complete – for e.g. a WACC which prevents you from going on to do the NPV, then just make a reasonable assumption and estimate a WACC which you have been unable to calculate, this will then allow you to progress the calculation and get on to the often more generously rewarded discursive parts of the question.

Look out for examinable articles – two in particular for June 2011:

  • 24 August – The new examiner Shishir Malde gives his approach for the P4 paper
  • 23 September – Another article by the new examiner Shishir Malde on Risk Management January/February article

Two key topics are always NPV appraisal and capital structure, particularly CAPM and Betas. You will not pass if that is all you know but you will struggle to pass if you do not know them!


– Q1: Expect core subjects such as project appraisal (domestic or overseas), business valuations (cost of capital calculations), and risk management (hedging).
– Q2-4: Risk management (currency or interest rate), business re-organisation, real options.


– Investment appraisal using adjusted present values/net present values or capital rationing.
– Valuation of business using free cash flows and Price-earnings ratio methods, defensive tactics or cash offer or share exchange.
– Cost of capital using the principles of Modigliani & Miller prepositions or geared and ungeared betas.
– Hedging exchange rate risk using forward contract, futures contract and options contract. Explanation of the Greeks.
– Capital reconstruction schemes – designing a capital reconstruction scheme or assessing the success of a given scheme.
– Real options – option to abandon, expand or delay using the Black-Schole option pricing model.

Beckers Professional

Coming Soon

First Intuition

– International investment appraisal techniques focusing on risk management tools such as value at risk.
– Impact on WACC following hedging of interest rate risk.
– Company valuation based scenario, possible MBO finance to structure.
– Adjusted present value with link to real options and Black Scholes option pricing model.

Open Tuition

  • When you are allowed to, start doing the Question 1 on the exam paper itself. Remember, for all questions to put your answers in the proper format where required – Question 1 almost always requires a report. Make sure that you have the appendix separate from the report.
  • Do make sure that you state the assumptions that you make in Question 1 – very often the question specifically asks you to state your assumptions and there are therefore marks for them. In addition there are often different assumptions you could make (which result in different answers to calculations) – provided you have stated your assumptions and they are reasonable, then you will still get the calculation marks.
  • Make sure you write something for every part of every question. You are unlikely to be able to finish every part of every question – either because you run out of time or you get stuck – but you can always write something for each part. In the calculations each part of the workings is marked separately, whether or not you have finished. In the written parts, each comment is marked separately.
  • Even if you can only think of one brief comment and get just one mark, that could turn a 49% fail into a 50% pass.
  • For calculation parts of questions, show your workings neatly. It is the workings that get the marks (whether the final answer is right or wrong) but the marker can only give you the marks if they can follow what you are doing.
  • For the written parts of questions, make sure that your writing is legible. (Before the exam day, ask someone if they can read your writing easily – if they can’t then consider printing the words – though that is slow!)
  • For the written parts of questions, write each separate point on a new line (with a line space between points). If you write one long paragraph containing several points, then there is a danger that the marker will miss some of the points.
  • Allocate your time. You should allow 45 minutes for each 25-mark question, and 90 minutes for the 50 mark question.  Within question allocate the proper time to each part (1.8 minutes per mark).
  • Start each part of each question on a new page in the answer booklet (if you run out of pages they will provide an extra booklet!).That way you can always go back to questions and be able to add more to your answer neatly, if you have time left at the end of the exam.
  • You do not have to attempt the questions in order or even every part within a question in order, but do make sure you make it clear at the top of the page which part of which question you are answering.

Sunil Bhindari:

– Q1: Business valuations and cost of capital – computation of the company WACC. Valuation of equity capital using FCF method. Post-acquisition computation using the ‘Bootstrapping technique’. Purchase consideration evaluation – cash, shares and bonds.
– report covering: Calculations stated above, assumptions & reservations surrounding the valuations, regulations of takeovers, ethical dilemma relating to the acquisition.
– Q2: Advanced investment appraisal – APV method. Real options using the BSOP model.
– Q3: Risk management FX hedging methods (FC, MMH, Futures and Options). Margins maybe tested again. Discussion on the Euro crisis and the effect upon international trade.
– Q4: Corporate reconstruction – liquidation vs reconstruction. Valuation of equity. New finance, including ‘S & T’ and Islamic choices.