CFA Lv2 财报

CFA 2级 财报 知识框架图 例题，通过清晰的逻辑结构和丰富的例题展示，帮助考生构建全面而深入的理解体系。

CFA Lv2 财报

• M1 Intercorporate Investments
  • 大概率考1个case
  • 金融资产三分类
    • 怎么分
      • 合同现金流测试
        • 通过
          • Debt
            • 业务模式测试
              • 以收合同现金流为目的
                • AMC
              • 不以收合同现金流为目的
                • FVOCI
            • 指定
              • FVPL
        • 不通过
          • Equity
            • 直接分类
              • FVPL
            • 指定
              • FVOCI
      • 重分类
        • Equity
          • 不允许
            • 股票重分类容易会计操纵
        • Debt
          • 可
            • 业务模式发生重大改变
              • 例题
                • Ferdinand continues the meeting with the following statement: “Before we consider impairment, let us calculate the amount Elbe will contribute to Dagmar's net earnings this year.” Turning to the Bergenfeld bonds, Christoph says: “If we're looking for contributions to net earnings, I see an opportunity with the Bergenfeld bonds. The decline in interest rates over the years since the original purchase has significantly increased their market value. IFRS allows us to reclassify these bonds to fair value as a way to increase reported income in the period. It works well because the standards don't require us to restate the prior periods when we reclassify.” Christoph’s comments about reclassifying the Bergenfeld bonds are best described as: A. both correct B. correct with respect to the effects on prior periods C. correct with respect to the rationale for reclassification
                  • B is correct A.Incorrect. Christoph is correct with respect to the restatement or prior periods, but not with respect to the rationale for reclassification. Reclassification of debt instruments is only permitted if the business model for the financial assets (objective for holding the financial assets) has changed in a way that significantly affects operations. B.Correct. Christoph is correct with respect to his comments on the restatement of prior periods. When financial assets are reclassified there is no restatement of prior periods at the reclassification date. C.Incorrect. Christoph is not correct with respect to the rationale for reclassification. Reclassification of debt instruments is only permitted if the business model for the financial assets (objective for holding the financial assets) has changed in a way that significantly affects operations.
                    • 只有业务形态重大改变才允许debt重分类，并且不允许追溯
            • 低频事件
    • 会计计量
      • • 例题
          • Young purchased a 10% ownership interest in Astrid for €90 million. During the current year, Astrid reported €80 million in pre-tax income and paid €40 million in dividends. The fair value of Astrid shares at 31 December of the current year was €970 million. Young accounts for Astrid by using the fair value through profit or loss (FVPL) method. For the current year, Young reported pre-tax income from Astrid in the amount of: A. €4 million. B. €8 million. C. €11 million.
            • 答案：C 解析：C is correct. Income earned from investments accounted for under the FVPL method includes both dividend income as well as any gains or losses (realized or unrealized) from holding the investment shares during the accounting measurement period. For the current year, Astrid received €4 million in dividend income (€40 million × 10%) plus €7 million in unrealized holding gains (€970 million year –end market value × 10% = €97 million valuation for Young's shares in Astrid at year-end. Then, €97 million – €90 million beginning of the year market value for Young's shares in Astrid = €7 million unrealized gain).
        • 例题
          • TNT is a manufacturing firm using IFRS, and its reporting currency is the Euro. On 1 January 2021, TNT paid €900,000 to purchase a newly issued bond of Bili which had a par value of €1,000,000. The bond, which mature on 31 December 2025, pays interest annually with a coupon rate of 5%. Under different classification, the interest income that TNT will report in 2021 from the Bili bond is closest to: FVOCI, Amortized cost A. €67,230. €67,230. B. €50,000. €67,230. C. €45,000. €50,000.
            • 答案：A 解析： 本题考点为金融资产的计量。 先计算出有效利率： N = 5, PMT = –50,000, FV = –1,000,000, PV = 900,000 → I/Y = 7.47% Interest income = BV beg × I/Y = 900,000×7.47% = 67,230 Beg. Balance + Interest income - Coupon = Ending Balance €900,000 + €67,230 - €50,000 = €917,230 根据国际财务报告准则，无论将债券归类为FVOCI还是Amortized cost，利息收入是使用有效利率法计算的。 因此，正确选项为A
        • 例题
          • Confabulated' s reported interest income would be lower if the cost was the same but the par value (in thousands) of: A. Bugle was €28,000. B. Cathay was €37,000. C. Dumas was €55,000.
            • B is correct. The difference between historical cost and par value must be amortized under theeffective interest method. lf the par value is less than the initial cost (stated interest rate isgreater than the effective rate), the interest income would be lower than the interest receivedbecause of amortization of the premium.
              • 基本题，考到就是送分，做错就是送命
        • 例题
          • On July 1 the company purchased €4,000 of 10-yearbonds ofAlme AG. The bonds have a 5% couponpayable annually and cost €3,705.60, reflecting theeffective market rate of 6%.Dagmar is expecting tocollect the interest and principal payments but ifliguidity needs arise will sell the bonds. Ferdinandand Christophe start by reviewing how the bond isclassified. The least appropriate classification for the investmentin the Alme bonds is: A. amortized cost. B. fair value through profit and loss C.fair value through other comprehensive income
            • A is correct. Investments in a bond can be cassified asamortized cost if it meets the two criteria: business model test andcash flow characteristic test. But ifthe asset may be sold pnor tocollecting all the contractual cash flows, as is Dagmar's intent. itshould be measured using one of the two fair value methods.
              • 破题点是if有liquidity needs，sell it，说明没有持有到期，least选a，b是可以随时卖掉，c是持有一段时间后卖掉，符合证有liquidity needs，sell it
        • 拓展题
          • AK Corp. purchased a bond (FV=$1,000, coupon rate=10%) issued at 8% for $1051.54 at the beginning of the year. The annual coupon payments are made at the end of the year and the fair value decreases to $1040. Determinethe impact of the bond on B/S, I/S, assuming when it is classified as Amortized cost, FVPL, and FVOCI respectively.Suppose the issuer called back the bond on the first day of the next year at $1,100, Calculate the gain or loss recognition for each classification.
            • Interest revenue=1051.54 x 8%=$84.12 Coupon payment= 1000 x10%=$100 Amortized premium=100-84.12 = $15.88 At year-end, the carrying value of the bond= 1051.54- 15.88 = $1035.66 Unrealized gain =1,040-(1051.54-15.88)= $4.34 Amortized cost: B/S: Amortized cost: $1035.66; I/S: Interest income: $84.12 Realized gain= 1,100-1,035.66 = $64.34 (I/S) FVPL: B/S: Fair value: $1040; I/S: Interest income: $84.12; Unrealized G/L: $4.34 net gain=1,100 -1,040=$60 (/S). FVOCI: B/S: Fair value: $1040; OCI: $4.34 I/S: Interest income: $84.12 realized gain: Realized gain from call back= 1,100-1,040 =$60; Unrealized gain ($4.34) is moved out of from OCI to I/S.
              • 【PS1】Unrealized G/L是指公允价值与账面价值之差，而非期初公允价值与期末公允价值之差
              • 【PS2】对于债券投资，IS表中确认的是interest而不是coupon，收到的现金流是coupon
              • 【PS3】FVPL的unrealized G/L在I/S，FVOCI的unrealized G/L在B/S，AC没有unrealized G/L
              • 【PS4】卖掉Bond要将OCI中的unrealized G/L提取出来，一并放进I/S中
              • 【PS4 Pro】收了可观的小费后，酒馆老板小声道：金融资产三分类是1级知识点。2级财报的模块一和模块二是重点，其中模块一的大头是权益法和并购法，大概率会考到case。不排除模块一考一个case的时候顺便考一个小问来问金融资产。如果1级已经讲过内容，2级是默认大家掌握。这题理论上是送分题，因为都是1级知识点，考2级的，肯定都会1级。但是考试要警惕送分题，因为别人都稳对的送分题，如果你做错了，就变成了送命题。所以建议多练习本题，通过一道题目彻底掌握一个知识点。真的考试，大概率考定性，真考定量，最多问一个数的计算。
    • 减值
      • Expected loss model
        • 预计股价下跌就可以减值
      • Incurred loss model
      • 只有AMC和FVOCI有减值
    • 1级学过，2级考到概率不高
  • Associaties
    • 一般用equity method
      • ~(20%,50%)，实质大于形式
        • 例题
          • Jara Hofstede, an analyst in Maple Securities, recently is evaluating a company called Saturn Investment Group. Jara learned that Saturn holds a stake of 35% in Pluto Shipping and exerts significant influence on Pluto. All the companies are based in America. One day, Jara was discussing with his colleague Raj that Saturn’s purchase of Pluto is required to use the equity method. However, Raj didn’t agree with Jara and thought that the equity method is only permitted to use under IFRS for joint ventures or when Pluto has technological dependency on Saturn. In the discussion between Jara and Raj about equity method, which statement is most accurate? A Jara B Raj C Both Jara and Raj
            • 答案：A 解析： 此题主要考点为公司间投资的分类。 因为如果投资方对被投资方持股比率是在20%到50%之间或者产生重大的影响的情况下，是需要用equity method进行处理。因此正确选项为A。 对于选项B，尽管equity method也适用于与joint venture，但是同时也是适用于长期股权投资（investment in associate）的。 同时，技术依赖（technological dependency）并不是唯一被认定为有重大影响的依据。 还包括： 投资方在被投资方董事会占有席位 参与被投资方的投资决策 投资方与被投资方之间有重大的交易 向被投资方驻派管理人员 因此，该选项错误。 对于选项C，不符合题意。因此该选项错误。
              • 实质重于形式，不要被题目BBB忽悠了，有时候，考试题目其实很简单。
        • 例题
          • Albert Strong, a junior metals analyst at Goodson Funds, was reviewing the history of AdOre Ventures, a Peruvian gold mining company. Cupernico, Inc., Strawberry Mines Corp., and Glace, S.A., were global gold mining companies. Cupernico and Strawberry were both headquartered in the United States and complied with US GAAP. Glace was a French company that followed International Financial Reporting Standards (IFRS). All companies’ fiscal years ended on 31 December. On 1 January of the prior year, the three companies combined their Peruvian operations into a separate company, AdOre Ventures. The fair value of assets contributed by each company was in proportion to its ownership interest as shown in Exhibit 1. Cupernico was considered to have control over AdOre because of its ownership interest and representation on AdOre’s board of directors. Both Strawberry Mines and Glace were considered to have significant influence. At the time the operations were combined, the fair value of each company’s assets was equal to their respective reported (book) values. Exhibit 1:AdOre ownership Structure Cupernico: 50% Strawberry Mines Corp.: 32% Glace:18% For the prior year, the most appropriate method for Glace to use to account for its investment in AdOre was: A.fair value through profit and loss. B. fair value through other comprehensive income. C. the equity method.
            • C is correct A. Incorrect because in the prior year Glace was considered to have significant influence (even though less than 20% ownership) and had to use the equity method. B. Incorrect because in the prior year Glace was considered to have significant influence (even though less than 20% ownership) and had to use the equity method. C.Correct. In the prior year, although Glace had less than 20% ownership interest in AdOre, it was considered to have significant influence, which required the equity method under both US GAAP and IFRS.
              • 要注意，实质大于形式。已经说了influence，所以应该是equity method
      • 报表计量
        • One line consolidation
        • B/S
          • 期初
            • Cash
              • Asset
            • Investment in associate
              • Asset
              • GW = 期初投资金额 - % * FVNIA
                • 例题
                  • If the company Saturn paid $50 million to acquire Pluto's 12% equity interest with voting power, the value of goodwill is closest to: A. 22 B, 12,8 C. 33
                    • 答案:B 该此题主要考点为权益法(equity method)下商誉(goodwil)的计算。 Goodwill=Purchase Price - Fair value of identifiable net assets=50-310x12%=12.8. 因此正确选项为 B。
                      • 基本题，考到就是送分，做错就是送命
          • 后期
            • 被投公司利润
              • 按比例计入I/S
                • Equity income
                  • NI
                    • R/E
              • 按比例计入投资公司Investment in associate
                • Asset
            • 被投公司股利
              • 按比例计入投资公司Cash
                • Asset
              • 按比例抵减投资公司Investment in associate
                • Asset
          • 例题
            • On 1 January 2018, Topmaker acquired a 15% equity interest with voting power in Rainer Co. for $300 million. Exhibit 2 presents selected financial information for Rainer on the acquisition date. Thronen notes that the plant and equipment are depreciated on a straight-line basis and have 10 years of remaining life. Topmaker has representation on Rainer's board of directors and participates in the associate's policy-making process.
            • Based on Exhibit 2, Topmaker’s investment in Rainer resulted in goodwill of: A. $21 million. B. $60 million. C. $99 million.
              • 答案：B 解析：B is correct. The goodwill in Topmaker's $300 million purchase of Rainer's common shares using the equity method is $60 million, calculated as (300-0.15*1340)-0.15*(3160-2900)=60
                • Equity的GW的值和partial GW一样，因为考试不考计算过程，只考答案，所以也可以用partial的计算方法算：300-1600*0.15=60
            • Using the information from Exhibit 2, the carrying value of Topmaker's investment in Rainer at the end of 2018 is closest to: A. $282 million. B. $317 million. C. $321 million.
              • 答案：B 解析： B is correct. The carrying value of Topmaker's investment in Rainer using the equity method is $317 million and is calculated as 300+360*0.15-220*0.15-(3160-2900)*0.15/10=317.1
                • 要注意 对(FV/BV)/N的调整
          • 例题
            • At the start of 2021, TNT purchased 40% of the outstanding shares of Bili, for $1,300 thousand and exerts a significant influence. At the time of the purchase, the book value of Bili's identifiable net asset was $2,350 thousand. The fair values of Bili's assets and liabilities were equal to their book values except for an equipment. The equipment had a book value of $800 thousand, and a fair value of $950 thousand. At the time of the purchase, which of the followings is most likely to be correct about the goodwill? A. The goodwill is $300 thousand and is reported separately on the balance sheet. B. The goodwill is $360 thousand and is included in the carrying amount of the investment. C. The goodwill is $300 thousand and is included in the carrying amount of the investment.
              • 答案：C 解析： 本题考点为equity method中商誉的计量。 由于TNT持有Bili 40%的股份，通常认为具有重大影响力，应该用equity method计量。在TNT的B/S中，投 资者对被投资方的股权投资，按持股比例，以单项项目披露，商誉包括在投资的账面价值中。因此，A选 项错误。 Bili可辨认净资产的公允价值=可辨认净资产的账面价值+公允价值增值= 2350 + (950 - 800) = $2500 thousand Goodwill = 1300 - 2500×40% = $300 thousand。因此，B选项错误，正确选项为C。
                • 基本题，考到就是送分，做错就是送命
          • 例题
            • Saturn spent 90 million to acquire 25% of equity of Pluto at 31 December 2019. Pluto declared for fiscal year 2020 that total revenue of $ 300 million and net income of $60 million, and paid dividends of 20 million. It is noted that the PP&E is depreciated on a straight-line basis and its remaining life is 5 years. Based on the data provided, the carrying amount of Saturn’s investment in Pluto at the end of 2020 is A. 99. B. 105. C. 95.
              • 答案：A 解析： 此题主要考点为在权益法下（equity method）, 股权投资的后续计量。 股权投资期末金额=股权投资的期初金额 + 投资收益 -股息 - 公允价值和账面价值差异的摊销在权益法下，投资方报表上的股权投资包含的是被投资方的净资产的公允价值，所以这些资产的折旧和摊销应该以投资时的公允价值为基础来计算。 所以投资方在披露股权投资收益（即按比例享有的被投资方利润时）,需要在被投资披露利润的基础上，针对资产的公允价值和账面价值的(通常被投资方资产在投资时的公允价值高于其账面价值)差异进行摊销的调整。 90+60*0.25-20*0.25-(0.25*(200-180)/5)=99
                • 基本题，考到就是送分，做错就是送命
          • 拓展题
            • On 1 January, BM acquired a 25% interest in XM for €1,000,000 and used the equity method to account for its investment. The book value of XM's net assets on that date was €3,800,000, and all fair values of assets and liabilities were equal to book values except for a building: the building was undervalued by €40,000 and has a 20-year remaining life. XM used straight-line depreciation for the building. During the year, XM sold inventory to BM. At the end of the year; there was €8,000 profit from the upstream sale in XM's profits. Only 10% inventory sold to BM by XM had been sold to an outside party. During the year, XM reported net income of €20,000, and paid €3,200 in dividends. Calculate: 1. Excess purchase price; 2. Goodwill (residual); 3. Equity income for this year; 4. BM's Investment in XM, end of the year
              • 1. Excess purchase price = 1000000-3800000*0.25=50000 2. Goodwill (residual) = 50000-40000*0.25=40000 3. Equity income for this year = (20000-8000*0.9)*0.25-10000/20=2700 4. BM's Investment in XM, end of the year = 1000000+2700-3200*0.25=1001900
                • 【PS】合并报表的时候，关联公司的内部交易必须要被拿走，除非相应商品已经被卖出。
                • 【PS2】权益法下，超过账面价值的分为2部分，统称excess purchase price，可以细分FV appreciation和GW
          • 拓展题
            • BM owns 25% of NDLW and appropriately applies the equity method of accounting. Amortization of excess purchase price, related to undervalued assets at the time of the investment, is €8,000 per year. During 2017, BM sold €96,000 of inventory to NDLW for €160,000. NDLW resold €120,000 of this inventory during 2017, and the remainder was sold in 2018. NDLW reports income from its operations of €800,000 in 2017, and €820,000 in 2018. 1. Calculate the equity income to be reported as a line item on BM's 2017 income statement; 2. Calculate the equity income to be reported as a line item on BM's 2018 income statement.
              • 2017: Unrealized profit = (160000-96000)*(1-120000/160000)*25%=4000 Equity income = 800000*0.25-8000-4000=188000 2018: 820000*0.25-8000+4000=201000
                • 【PS】计算2018要考虑realized profit，即为2017的unrealized profit
                • 【PS2】excess purchase price的amortization不要额外乘百分比，是已经折算后的。
        • I/S
          • 被投公司
            • BV -> FV
            • Dep Adjustment -> (FV/BV)/N
            • 扣除未实现的内部利润
              • 统一以upstream处理
              • 例题
                • TNT is a US-based retailer which acquired a 15% stake in Bili. Bili sells all products to TNT, and TNT is the final consumer of these products. In 2021, net profit of Bili was $50 million, and the products sold to TNT had not been used. The proportion of Bili's net profit reflected in TNT's income statement is most likely to be: A. 100%. B. 15%. C. 0%.
                  • 答案：C 解析： 本题考点为equity method中I/S的计量。 尽管TNT只拥有Bili 15%的股份，但是Bili把所有的商品卖给TNT，可以判断TNT对Bili有重大影响，应该用 equity method计量。在TNT的I/S中，Bili的利润应该按照其持股比例计入equity income，但是，公司间交 易产生的unrealized profit除外。由于在2021年，Bili将其所有的商品销售给TNT，且TNT没有使用，因此Bili的利润全部是unrealized profit，将不包括在TNT的I/S中。因此，正确选项为C。
                    • 基本题，考到就是送分，做错就是送命
              • 例题
                • At the start of 2021, TNT purchased 40% of the outstanding shares of Bili, for $1,300 thousand and exerts a significant influence. At the time of the purchase, the book value of Bili's identifiable net asset was $2,350 thousand. The fair values of Bili's assets and liabilities were equal to their book values. During 2011, Bili reported net income of $1,000 thousand, of which 80% was earned by selling inventory to TNT. Also, Bili paid dividends of $600 thousand in this year. At the end of 2021, only half of the inventory remained at TNT’s warehouse. At the end of 2021, TNT's investment in associate account (in thousands) is closest to: A. $1,460. B. $1,300. C. $1,100.
                  • 答案：B 解析： 本题考点为equity method中B/S的计量。 由于TNT持有Bili 40%的股份，通常认为具有重大影响力，应该用equity method计量。在TNT 的B/S中，投资者对被投资方的股权投资，按持股比例，以单项项目披露。 公司间交易产生的unrealized profit = 1000 × 80% × 50% = $400 thousand Equity investment B + Investee’s net income% - Dividends received% = Equity investment E 1,300 + (1,000 - 400) ×40% - 600×40% = $1,300 thousand 因此，正确选项为B。
                    • 要特别注意，虽然NI要扣，但是Dividend全吃，不能按比例扣
            • 将调整后的利润按投资比例计入投资公司
              • 例题
                • A 25% ownership interest in Balto was purchased for €500 million. The fair values of all Balto's assets and liabilities were equal to their book values except for equipment which was undervalued by €40 million. The undervalued equipment has a remaining useful life of 5 years and will be fully depreciated by using the straight-line method. Young has significant influence over Balto but it does not have control. During the current year, Balto reported €140 million in income and paid €40 million in dividends. At the end of the current year, Young's investment in Balto has a recorded balance of: A. €523 million. B. €525 million. C. €533 million.
                  • 答案：A 解析：A is correct. Under the equity method of accounting the investment balance in an associate at the end of an accounting period is determined by adding to the beginning balance, the proportionate amount of reported investee income earned (which is then adjusted for any amortization of excess purchase price that is attributable to tangible and identifiable intangible assets), less the proportionate amount of dividends received from the associate. Accordingly, for the investment in Balto, the proportionate amount of income earned is €33 million (€140 million × 25% = €35 million less the proportionate amount of additional depreciation expense from the undervalued equipment, or [€40 million ÷ 5 years] × 25% = €2 million). The dividends received for the investment in Balto were €10 million (€40 million × 25%). Therefore, the investment balance in Balto at the end of the current year is €523 million (€500 million + €33 million – €10 million).
      • 减值
        • IFRS
          • recoverable amount = Max(NRV, value in use)
          • Loss event触发
            • 例题
              • 答案：A 解析： 此题主要考点为在权益法（Equity method）下的减值（impairment） 在权益法下，商誉是包含在股权投资当中的，不单独列示，商誉不进行单独的减值测试。因此正确选项为A。 对于选项B，US GAAP 和IFRS都禁止对股权投资的减值损失进行调整，两套准则均禁止后期对商誉进行转回（reversal）。因此，该选项错误。 对于选项C。在IFRS下，导致减值的客观事件进行减值的必要条件。因此，该选项错误。
                • 注意US GAAP由Permanent触发
        • USGAAP
          • fair value
          • Permanent decline触发
        • 都不能转回
        • 例题
          • Thronen is concerned about possible goodwill impairment for Topmaker at the end of 2017. He calculates the impairment loss based on selected data from the projected consolidated balance sheet data presented in Exhibit 3, assuming that the cash-generating unit and reporting unit of Topmaker are the same.
          • Based on Exhibit 3, Topmaker's impairment loss under IFRS is: A. $120 million. B. $300 million. C. $400 million.
            • 答案：B 解析：B is correct. The goodwill impairment loss under IFRS is $300 million, calculated as the difference between the recoverable amount of a cash-generating unit and the carrying value of the cash-generating unit. Topmaker's recoverable amount of the cash-generating unit is $14,900 million, which is less than the carrying value of the cash-generating unit of $15,200 million. This results in an impairment loss of $300 million ($14,900 – $15,200).
              • 如果是USGAAP，则是15200-14800=400
              • 如果是Business Combination，而不是Equity method
                • IFRS
                  • 15200-14900=300
                • USGAAP
                  • 520-(14800-14400)=120
      • Fair value option
        • IFRS
          • 只有投资机构可以选
        • USGAAP
          • 所有企业都可以选
        • 只能期初选，不能改
      • 缺点：低估负债，高估盈利能力（净利率）
  • Business Combination
    • >50%，实质大于形式
    • USGAAP
      • Merger: A+B=A
      • Acquisition: A+B=(A+B)
      • Consolidation: A+B=C
    • 报表计量
      • B/S
        • BV -> FV
        • Asset, Liability 100%合并
          • 例题
            • On 1 January of the prior year, the three companies combined their Peruvian operations into a separate company, AdOre Ventures. The fair value of assets contributed by each company was in proportion to its ownership interest as shown in Exhibit 1. Cupernico was considered to have control over AdOre because of its ownership interest and representation on AdOre's board of directors. Both Strawberry Mines and Glace were considered to have significant influence. At the time the operations were combined, the fair value of each company's assets was equal to their respective reported (book) values. Exhibit 1:AdOre ownership Structure Cupernico: 50% Strawberry Mines Corp.: 32% Glace:18% On 1 January of the current year, Glace acquired Strawberry Mines. Given AdOre's relatively brief operating history, Glace determined that the fair value of assets remained equal to the value at which they were carried on AdOre's books. Because the merger left Glace and Cupernico with equal economic interests in AdOre, the two companies negotiated a joint control agreement. Selected financial data related to AdOre are presented in Exhibit 2. Because gold prices are set globally in US dollars, AdOre's functional currency is the US dollar. Which of the following amounts (in thousands) from AdOre would most likely be included on the prior year financial statements of Cupernico? A. $31,773 of revenue B. $23,689 of equity C. $40,000 of long-term debt
              • C is correct A. Incorrect. This amount is 50% of AdOre's revenue: 50% × $63,546= $31,773; Cupernico should include 100% of the revenue under consolidation. B. Incorrect. The amount represents 50% of AdOre's ending equity: 50% × $47,378 = $23,689. Under consolidation, none of the subsidiary's equity is included in the consolidated financial statements of the parent. C. Correct. In the prior year, Cupernico had a controlling interest in AdOre and would have used the consolidation method. Under consolidation, companies combine all of the assets, liabilities, revenues, and expenses of subsidiaries with those of the parent. Therefore, Cupernico would have included $40,000 (100%) of AdOre's long-term debt.
                • B选项本身说法就是错误的，我们合并的是Asset和Liability，没有合并equity的说法
                • Revenue也应该100%合并
        • GW
          • IFRS
            • Full GW = 100%收购价格 - 100%FVNIA
              • 例题
                • For Cordeau, Young exchanged €1,800 million in shares to acquire a 75% controlling interest in Cordeau. The book value of Cordeau on 1 January was €2,000 million. On that date, Cordeau's inventory was undervalued by €60 million. All other recorded assets and liabilities were equal to their fair values. Cordeau applies the FIFO inventory valuation method and Young uses the partial goodwill method when it consolidates Cordeau. Cordeau's primary competitor is a US company that reports under US GAAP. For the current year, Cordeau reported net income of €240 million and paid €40 million in dividends. If Young had presented its consolidated statements for Cordeau in the same manner as its primary competitor, it would have a higher: A. return on assets for the current year. B. financial leverage ratio for the current year. C. total asset turnover ratio for the current year.
                  • 答案：B 解析：B is correct. Under US GAAP the full goodwill method must be applied whereas under IFRS, either the partial or the full goodwill may be elected. Accordingly, if Young had used the full goodwill method, goodwill (and therefore total assets) would have been higher. The financial leverage ratio (Average total assets ÷ Average shareholders' equity) would then be higher since average total assets would be higher. Average shareholders' equity for Young would be the same under both goodwill methods.
                    • financial leverage = A / E = 1 + D / E
                      • 如果E不包含MI, 杠杆不变
                      • 如果E包含MI, E变大，杠杆变低
                      • 70%题目MI不算equity, 30%题目MI算equity
                      • 涉及equity用排除法，先排除觉得确定的，剩下的灵活选择
                        • 防止协会突然抽风，把MI塞到E里
            • Partial GW = 实际%收购价格 - 实际% * FVNIA
              • 例题
                • Clapton, Inc. acquired 90% of the outstanding shares of Harrison, Inc. by paying $1,800. Two companies complied the following information shown in Exhibit 1:
                • Based on Exhibit 1, partial goodwill and minority interest reported on the consolidated balance sheet should be: Partial goodwill Minority interest A. $360 $160 B. $360 $180 C. $400 $200
                  • 答案：A 解析： Partial Goodwill = Purchase Price – FV of Identifiable Net Asset % = $1,800 - $1,600 * 90% = $360 MI = FV of subsidiary's identifiable net assets ×% Not owned = $1600*(1-90%) = $160
                    • 基本题，考到就是送分，做错就是送命
                • Based on Exhibit 1, full goodwill and minority interest reported on the consolidated balance sheet should be: Full goodwill Minority interest A. $360 $160 B. $400 $180 C. $400 $200
                  • 答案：C 解析： Full Goodwill = Assumed 100% Purchase price – 100% FV of Identifiable Net Asset = $2,000 - $1,600 = $400 MI = Assumed 100% Purchase price × % Not owned = $2000*(1-90%) = $200
                    • 基本题，考到就是送分，做错就是送命
          • USGAAP
            • FW only
              • 例题
                • Zachary Alison is analyzing the earnings and financial reporting quality of Apex, a consumer electronics manufacturer. The company reports its financial statements according to US GAAP. Apex recently announced that it will purchase an 80% interest in Beast Electronics (Beast) for $24 million and will gain control over Beast. Beast's identifiable net assets have a fair value of $25 million and the fair value of the entire company is $30 million. As a result of its purchase of Beast, Apex should recognize goodwill of: A. $4 million B. $5 million C. $6 million
                  • 正确答案：B B.Correct because Apex reports under US GAAP, and should report $5 million under the full goodwill method. Full goodwill = Fair value of entity – Fair value of identifiable net assets = $30 million – $25 million = $5 million.
                    • Full: 30-25=5
                    • Partial: 24-25*0.8=4
                    • US GAAP只能用Full
        • MI
          • Full GW
            • MI = 少数股东% * 100%收购价格
          • Partial GW
            • MI = 少数股东% * FVNIA
              • 例题
                • Topmaker plans to increase its ownership interest in Rainer to 80% and will account for the investment in Rainer using the partial goodwill method. Thronen estimates that the fair market value of the Rainer’s shares on the expected date of exchange is $2 billion with the identifiable assets valued at $1.5 billion. Based on Thronen’s value estimates on the acquisition date of 1 January 2018, the estimated value of the minority interest related to Rainer will be: A. $300 million. B. $400 million. C. $500 million.
                  • 答案：A 解析： A is correct. According to IFRS, under the partial goodwill method, the value of the minority interest isequal to the non-controlling interest's proportionate share of the subsidiary's identifiable net assets. Rainer's proportionate share is 20% and the value of its identifiable assets on the acquisition date is $1.5 billion. The value of the minority interest is $300 million (20% x $1.5 billion).
      • I/S
        • 忽略母子交易
        • 子公司BV -> FV
          • 调整影响
            • COGS
            • Dep/Amort
        • Line-by-line, 收入和费用100%合并
          • 例题
            • Saturn acquire Pluto's 80% equity. The consolidated net income attributed to Saturn is closest to: A. $86 million B. $73 million C. $92 million
              • 答案：A 解析： 此题主要考点为收购法（acquisition method）的合并利润表的计量。 在合并利润表中，要求披露的最终结果是归属于母公司的净利润,因此，在合并收入和费用后，还需要扣除归属于非控股东的损益（non-controlling interest）。 归属于母公司的净利润=合并后的净利润-归属于非控股的损益=（70+20）-20x(1-80%)=86.因此，正确选项为A。
                • 基本题，考到就是送分，做错就是送命
        • 抵减MI%的利润
    • 减值
      • GW
        • IFRS
          • cash generating unit
            • vs Recoverable amount
        • USGAAP
          • reporting unit
            • 和fair value对比
            • 减到implied GW
              • Implied GW = FV - FVNIA
            • 例题
              • TNT, a US-based retailer, has a subsidiary Bili, which operates in P2P business. Because of the restriction of government, TNT has to treat the investment as being impaired. At the impairment test date, the CEO of TNT, Mars, gathers the following information about Bili. Information about Bili at the impairment test date (in thousands) Carrying value of the reporting unit: $900 Goodwill reported on the consolidated balance sheet: $250 Fair value of the reporting unit: $800 Fair value of the identifiable net assets: $700 Recoverable amount of the cash-generating unit: $790 The impairment loss (in thousands) is closest to: A. $150. B. $110. C. $100.
                • 答案：A 解析： 本题考点为美国准则下的商誉减值。 由于Carrying value of the reporting unit 900 > Fair value of the reporting unit 800，发生了减值。 Implied GW = Fair value of the reporting unit - Fair value of the identifiable net assets = 800 - 700 = $100 thousand Impairment loss = CV of GW – Implied GW = 250 - 100 = $150 thousand 因此，正确选项为A。
                  • 基本题，考到就是送分，做错就是送命
        • 都不可转回
          • 例题
            • Which of the following statements under acquisition method is most accurate? A. There is no need for goodwill to be tested under acquisition method B. After writing down, reversal of the goodwill is not allowed under both IFRS and US GAAP. C. Under IFRS, if the carrying amount of the investees exceeds the value in use, an impairment loss is recognized.
              • 答案：B 解析： 此题主要考点为在购买法（acquisition method）下商誉的减值(impairment)。 在购买法下，goodwill的减值损失不管是在国际准则还是美国准则都是不能转回的,因此正确选项为B。 对于选项A，在购买法下，goodwill每年都需要减值测试。因此，该选项错误。 对于选项C，在购买法下，在判断是否需要减值的标准时，需要将carrying value和recoverable amount作对比，而不是value in use。因此，该选项错误。
                • 基本题，考到就是送分，做错就是送命
    • 和equity method对比
      • NI
      • A,L,E
      • profitability ratio
      • 例题
        • Analysts gathered the following financial data, which are sourced from the balance sheet immediately after acquisition:
        • Saturn is acquiring 80% stakes of Pluto at 31 December 2020, which of following methods would lead to the highest current ratio in 2020？ A. Acquisition method with full goodwill B. Acquisition method with partial goodwill C. Equity method
          • 答案：C 解析： 此题主要考点为购买法(acquisition method)对财务比率的影响。 Current Ratio=Current Asset/Current Liability。在购买法下，子公司的资产和发债全部并入母公司的合并报表，相当于把母公司和子公司视为一个整体。Current ratio= (280+170)/ (120+100) =2.05。所以无论是部分商誉（partial goodwill）还是整体商誉(full goodwill)，它们的current ratio是相同的，都是等于2.05。 在equity method（权益法)下，current ratio=280/120=2.33。因此正确选项为C 对于选项A和B，不符合题意。因此，该选项错误。
            • 大部分情况，Full GW和Partial GW结果差不多。如果实在不确定选什么，就选Equity吧
      • 例题
        • Hulk, Inc. is a diversified manufacturing company headquartered in the United Kingdom. It complies with IFRS. In 2017, Hulk held a 19 percent passive equity ownership interest in Cambridge Processing, In December 2017；Hulk announced that it would be increasing its ownership interest to 50 percent effective 1 January 2018 through a cash purchase. Hulk and Cambridge have no intercompany transactions. Peter Lubbock, an analyst following both Hulk and Cambridge, is curious how the increased stake will affect Hulk' s consolidated financial statements. He asks Hulk' s CFO how the company will account for the investment, and is told that the decision has not yet been made. Lubbock decides to use his existing forecasts for both companies' financial statements to compare the outcomes of alternative accounting treatments. At 31 December 201& Hulk' s total shareholders' equity on its balance sheet would most likely be: A. highest if Hulk is deemed to have control of Cambridge. B. independent of the accounting method used for the investment in Cambridge. C. highest if Hulk is deemed to have significant influence over Cambridge.
          • B is correct. if Hulk is deemed to have control over Cambridge, it would use the acquisitionmethod to account for Cambridge and prepare consolidated financial statements. Proportionateconsolldation is used for joint ventures; the equity method is used for some joint ventures and when there is significant influence but not control.
            • 基本题，考到就是送分，做错就是送命
        • At 31 December 201& assuming control and recognition of goodwill. Hulk's reported debt to equity ratio will most likely be highest if it accounts for its investment in Cambridge using the: A, equity method. B, full goodwill method. C. partial goodwill method.
          • C is correct. The full and partial goodwill method will have the same amount of debt; howevershareholders' equity will be higher under full goodwill (and the debt to equity ratio will be lower)Therefore, the debt to equity will be higher under partial goodwil. ifcontrol is assumed, Hulkcannot use the equity method.
            • 注意这题的潜台词，是不能用equity method
      • 例题
        • Albert Strong, a junior metals analyst at Goodson Funds, was reviewing the history of AdOre Ventures, a Peruvian gold mining company. Cupernico, Inc., Strawberry Mines Corp., and Glace, S.A., were global gold mining companies. Cupernico and Strawberry were both headquartered in the United States and complied with US GAAP. Glace was a French company that followed International Financial Reporting Standards (IFRS). All companies' fiscal years ended on 31 December. On 1 January of the prior year, the three companies combined their Peruvian operations into a separate company, AdOre Ventures. The fair value of assets contributed by each company was in proportion to its ownership interest as shown in Exhibit 1. Cupernico was considered to have control over AdOre because of its ownership interest and representation on AdOre's board of directors. Both Strawberry Mines and Glace were considered to have significant influence. At the time the operations were combined, the fair value of each company's assets was equal to their respective reported (book) values. On 1 January of the current year, Glace acquired Strawberry Mines. Given AdOre's relatively brief operating history, Glace determined that the fair value of assets remained equal to the value at which they were carried on AdOre's books. Because the merger left Glace and Cupernico with equal economic interests in AdOre, the two companies negotiated a joint control agreement. Exhibit 1:AdOre ownership Structure Cupernico: 50% Strawberry Mines Corp.: 32% Glace:18% The best conclusion Strong can make about the effect of AdOre's current year ownership change is that Cupernico would have reported a: A. higher return on equity (ROE). B. lower return on assets (ROA). C. lower net profit margin.
          • A is correct. In the current year, Cupernico and Glace shared joint control. Cupernico must use the equity method under US GAAP; if the ownership structure had not changed, Cupernico would have continued to use the consolidation method.
            • 这题关键是要读懂题目。题目说新的法则是joint venture，在US GAAP下，JV只允许用equitymethd，所以题目变相在问，用equity method和consolidation method对比，会有什么变化。
            • 2者的NI是一样的
            • Consolidation method完全合并A和L，所以equity和asset更高，所以ROE(NI/Equity)和ROA(NI/Asset)更低。
            • Consolidation也完全合并Revenue，所以Net Profit Margin (NI/Revenue)也更低。
  • 其他
    • 发股收购
      • common stock上升，cash不变
        • 例题
          • For Cordeau, Young exchanged €1,800 million in shares to acquire a 75% controlling interest in Cordeau. The book value of Cordeau on 1 January was €2,000 million. On that date, Cordeau's inventory was undervalued by €60 million. All other recorded assets and liabilities were equal to their fair values. Cordeau applies the FIFO inventory valuation method and Young uses the partial goodwill method when it consolidates Cordeau. Cordeau's primary competitor is a US company that reports under US GAAP. For the current year, Cordeau reported net income of €240 million and paid €40 million in dividends. Upon acquiring a controlling ownership interest in Cordeau on 1 January, Young's pre-consolidation debtto-assets ratio: A. decreased. B. remained unchanged. C. increased.
            • 答案：A 解析：A is correct. Because total assets increased by €1,800 million for the pre-consolidation investment account balance in Cordeau (that is, the fair value of the net assets that Young paid for). Shareholders' equity also increased by €1,800 million because of the issuance of common shares to pay for the 75% ownership interest in Cordeau. The debt-to-assets ratio (Total debt ÷ Total assets) therefore decreased since total assets increased and total debt was unaffected.
              • 如果不是增发股票，而是用cash，则equity不变，选B
              • 题目只用股票换，没说来源是增发，默认是增发
    • bargain purchase
      • PV入账
      • 差额算G/L
        • Gain: NI上升，R/E上升
    • SPE&VIE
      • 必须100%合并
      • VIE要求吸收大部分损失
    • Pooling of interest
      • 同一控制人
      • 2级大概率不考
    • proportional consolidation
      • 几乎不用，但是考试可能考到
      • 没有MI
        • 80%的钱买80%的E和L
• M2 Employee Compensation: Post-Employment and Share-Based
  • 大概率考1个case
  • 分类
    • RS
      • Voting rights
      • Divident participation
      • Tradeable
      • 例题
        • Which of the following statements is not correct regarding share-based compensation? A. Share-based compensation expense is reported at fair value under both IFRS and US GAAR B, Share-based compensation helps align employees' interests with those of the shareholders. C. Requiring no current-period cash outlays is a disadvantage of share-based compensation.
          • 10.答案:C 本题考查 Share-based compensation 的特点。 选项C，不要求当期支付现金是优点而非缺点，故选项c表述错误，符合题意。选项A及B都是正确的表述，不符合题意。因此，正确选项为C。
            • 感觉这题有点难，尽量当结论记吧
    • RSUs
      • voting rights
      • Divident participation
      • Tradeable
    • Stock Option
      • Tradeable
      • FV on grant date
        • 例题
          • For a stock grant, compensation expenses are calculated based on the: A issuance price of the stock. B fair value of the stock on the grant date. C amortized cost of the stock throughout the employees’ service period.
            • 答案：B 解析： 本题考点是stock grant（股票授予）的含义与基本计量方式。Stock grant对员工而言是福利，而企业而言是费用。 Stock grant的费用是基于赠予发生当日股票的公允价值计算的，故B项符合题意；注意股票价值的计算既非基于发行价计算（故A项不符合题意），也非基于摊余成本计算（故C项也不符合题意）。
              • 基本题，考到就是送分，做错就是送命
  • Accounting
    • 新增内容，需要重点关注
    • RSUs & Stock option
      • Grant date
        • 看FV，没影响
      • Vesting period
        • 每年摊销FV/N
          • 例题
            • Another company, Luminary Innovations Ltd. implements a controlled stock compensation scheme applicable to all its employees. Commencing at the start of the latest year, Luminary Innovations Ltd. bestowed 9.4 million limited shares with a fair value amounting to GBP 12.49 per share. In order for employees to obtain ownership rights to these shares, they are required to maintain their positions with the company for a duration of three years. As the conclusion of the most recent year approached, the market value of Luminary Innovations Ltd.'s shares had gracefully ascended to GBP 21.98. The approximate monetary value (in millions of GBP) attributed to the compensation expense for Luminary Innovations Ltd.'s restricted stock grant in the most recent year was: A. 39 B. 69 C. 119
              • A is correct 12.49×9.4/3 = 39.135 million
        • I/S
          • NI
        • B/S
          • Equity
            • Retained earning
            • share-based compensation reserve
        • CF/S
      • settlement date
        • I/S
        • RSUs
          • B/S
            • Equity
              • Reserve
              • Capital
                • 考试简单归到paid-in capital即可
          • CF/S
        • Stock option
          • B/S
            • Asset
              • Cash (A)
            • Equity
              • Reserve (B)
              • Capital
                • cash上升和reserve下降的部分都扔进去，来配平 (C=A+B)
          • CF/S
            • CFF
          • 例题
            • Gordon Inc. granted 15 million stock options to employees in the R&D department on 1 January 2023 at an exercise price of $20 per share. These stock options would vest on 31 December 2024. The fair value per option at the grant date was $10. If all options were exercised on 31 December 2025 when the stock price was $35. Which of the following statements about the effect of option awards on the financial statements is most likely correct? A. An R&D expense of $150 million would be recognized in the income statement in 2023. B. Cash flow from financing activities would increase by $300 million when the stock options vest. C. Paid-in capital would increase by $450 million if all options were exercised.
              • 答案：C 解析： 股票期权在授予日的公允价值，在两年行权限制期内进行摊销，每年计入研发费用（R&D expense）$75 million。同时，股份补偿准备金（share-based compensation reserve）每年增加$75 million。当员工对股票期权行权时(exercised)，公司现金增加$300 million, 股份补偿准备金减少$150 million，同时实收资本（paid-in capital）增加$450 million。因此，正确选项为C。
                • 注意B选项的vest不是exercise
    • Tax treatment
      • windfall
        • 实际成本>估计成本
          • share price on settlement date > on grant date
        • Effective tax rate
          • income tax expense
        • FCFF
          • equity
        • 例题
          • Golden Inc. reports under US GAAP and initiated a Compensation Incentive Plan. Under the plan, Golden Inc. grants 30 million stock options to its executives. The options were granted at the money on May 1, 2022, when the fair value per option was $5. The options will vest on May 1, 2025, and expire eight years after the grant date. Assume that all options would be exercised on October 1, 2025, when the intrinsic value of options was $8 and a statutory tax rate of 20%, the impact on Golden's income tax expense for 2025 related to share-based compensation is closest to: A. a $18 million increase in income tax expense. B. a $ 18 million decrease in income tax expense. C. a $ 30 million decrease in income tax expense
            • 答案：B 解析：期权授予日的公允价值小于行权日的内在价值，因此会产生超额税收优惠（excess tax benefit），即在美国准则下，超额税收优惠会计入当期利润表减少所得税费用（income tax expense），因此，正确选项为B。 对于选项A，当期权授予日的公允价值小于行权日的内在价值，会产生超额税收优惠，减少所得税费用，因此，该选项错误。 对于选项C，计算中忽略了期权行权日的内在价值，因此，该选项错误。
              • 股票涨了，记支出，少交税
        • 例题
          • Golden Inc. reports under US GAAP. In 2022, its share price increased by 50%, resulting in an excess tax benefit related to share-based compensation. The reconciliation between Golden's statutory tax rate and the effective tax rate is as follows: The year ended 31 December: 2022 Statutory tax rate: 25% Excess tax benefits related to share-based compensation: (4.5%) Effective tax rate: 20.5% Assume that the excess tax benefit from share-based compensation is the only contributor to the difference between the statutory tax rate and the effective tax rate. Which of the following statements is most likely correct if Golden had reported under IFRS? A. Golden's effective tax rate would become more volatile if its stock price were to fluctuate significantly. B. Golden's effective tax rate would be higher in 2022. C. Golden's income tax expense would be lower in 2022
            • 答案：B 解析：在US GAAP下，超额税收优惠（excess tax benefits）会先计入当期利润表减少所得税费用，从而降低当期有效税率（effective tax rate）。而在IFRS下，超额税收优惠直接计入资产负债表增加所有者权益，对当期所得税费用和有效税率没有影响。所以在IFRS下，有效税率会更高。因此，正确选项为B。 对于选项A，在IFRS下，股价的变动产生的超额税收优惠或者税收缺口（tax shortfalls）直接计入资产负债表，不会影响有效税率，因此，和US GAAP相比，有效税率的波动性更小。因此该选项错误。 对于选项C，在US GAAP下，超额税收优惠会减少当期所得税费用。而在IFRS下，超额税收优惠直接计入资产负债表，对当期所得税费用没有影响。所以，在IFRS下，所得税费用会更高。因此该选项错误。
              • 理解不同会计准则的区别
              • US GAAP喜欢PV和I/S
      • shortfall
  • Diluted shares OS
    • Diluted ESP <= Basic EPS
    • 计算
      • Basic
      • shares from conversion/exercise
        • 例题
          • Your colleague is building financial statement and discounted cash flow models for a company and has asked you review their modeling decisions with respect to the subject company's post-employment and stock-based compensation plans. As an alternative to expensing stock-based compensation in free cash flow in the discounted cash flow valuation model, your colleague could account for the expected dilution by: A. increasing shares outstanding. B. reducing operating expenses because the company could compensate its employees in cash rather than shares C. increasing net cash because share-based compensation expense is a non-cash expense.
            • A is correct. Dilution from share-based compensation can be accounted for by expensingshare-based compensation in free cash fiow or by increasing the share count for expecteddilution, B and C are incorrect as they would be accretive, not dilutive, to valuation.
      • assumed proceeds
        • proceeds = cash from exercise + avg unrecognized share-based compensation expense
          • 拿未实现的假设去回购
          • 没现金也要假设拿去回购，准则
          • RSU的cash proceeds为0
      • 例题
        • Golden Inc. reported basic shares outstanding of 290,000,000 and positive net income in 2022. Golden had 9,000,000 unvested and unsettled employee stock options on 31 December 2022. The exercise price of options is $20. Unrecognized share-based compensation expense as of 31 December 2021 and 2022 was $81 million and $54 million, respectively. Employee stock options are the only potentially dilutive securities outstanding. Assuming an average share price of $40 for 2022, Golden's diluted shares outstanding on 31 December 2022 is closest to: A. 292,812,500. B. 294,500,000. C. 299,000,000.
          • A is correct 290+9-((81+54)/2+9*20)/40=292.8125M
            • 因为不知道什么时候行权，只能用期初加期末除以二
    • 特殊情况
      • 反稀释越要被考虑
        • NI是负数
          • EPS = -0.1, DEPS =-0.2
        • 公司股价大跌
          • 行权日股票价格大幅下跌
            • Accounting expense > deductable expense
              • tax exp
                • NI
          • 理解不了能记住就行
        • 例题
          • Golden Inc. had RSUs and stock option plans for its executives. Other than these two share-based compensation plans, there are no other potentially dilutive securities outstanding. In 2022, Golden Inc.'s diluted shares outstanding are the same as the basic shares outstanding, which of the following is the least likely explanation for this situation? A. Golden reported a net loss in 2022. B. Golden’s average stock price in 2022 is less than the exercise price of stock options. C. Golden’s average stock price in 2022 is slightly below the stock price at the RSU grant date.
            • 答案：B 解析：限制性单位股票通常都具有稀释性。只有在平均股价大幅低于授予日的股价，即“假设股票回购的股数”（假设行使权利获得的收入/平均股价）大于“假设行权增加的股数”时，才会产生反稀释。题中2022年的平均股价只是略微低于授予日的股价，不会产生反稀释，因此稀释的流通在外的股数(diluted sharesoutstanding)大于基本的流通在外的股数(basic shares outstanding)。选项C描述错误，符合题意，为正确选项。 对于选项A，当出现净亏损（net loss）时，基本每股收益（Basic EPS）和稀释每股收益（Diluted EPS）都是负数。当有潜在的稀释性证券纳入稀释的流通在外的股数计算时，会使得稀释每股收益大于基本每股收益（负数的绝对值越小，数值越大），即具有反稀释性。因此在这种情况下稀释的流通在外股数与基本的流通在外股数相等。因此，该选项描述正确，不符合题意，为错误选项。 对于选项B，当平均股价小于股票期权的行权价格时，股票期权具有反稀释性，导致稀释的流通在外股数与基本的流通在外股数相等。因此，该选项描述正确，不符合题意，为错误选项。
              • 关键C选项，为啥是对的呢，因为RSU和option不同，option是真金白银掏钱，没人9块钱买8块钱的东西，所以只要行权，肯定反稀释，没稀释肯定是没行权。但是RSU因为是算平均，所以会收到之前的影响，如果只是低一点点行权，也可能稀释。
                • 举个栗子只为了帮助理解： T0给RSU，9元，100股，3年， 第二年年底8元，算Diluted OS Shares， 3年，每年折9*100/3=300，所以第二年年初有600，第二年年底有300。 假设8块钱行权，那么节省了(300+600)/2=450，回购450/8=56.25。最后股数增加100-56=44，还是稀释。 Option就不同，行权要掏9*100=900，然后8块钱买回去，回购900/8=112.5，最后股数增加100-112.5=-12.5，反稀释。
        • 例题
          • Thomas prepared a DCF model for Golden Inc. Besides RSUs and employee stock options, The company had no other potentially dilutive securities outstanding. In calculating the value per share, he used diluted shares outstanding to account for the effect of unvested share-based awards. Jackson, a senior colleague of Thomas, recommends that Thomas add the number of anti-dilutive securities to the diluted shares outstanding when modelling the total number of shares outstanding. Which of the following is most likely not a reason for Jackson to make this suggestion? A. The company reported a net loss but had positive free cash flow. B. The company’s share price has fallen significantly. C. The company’s share price has risen significantly.
            • 答案：C 解析： 股价的大幅上涨会使得“假设股票回购的股数”变少，从而使得unvested share-based awards产生稀释性。这种情况下，diluted shares outstanding已经包括了所有的unvested share-based awards，没有unvested share-based awards作为anti-dilutive securities被排除在diluted shares outstanding之外，所以Jackson不会在这种情况下建议将anti-dilutive securities加入diluted shares outstanding的计算中。选项C描述错误，符合题意，为正确选项。
  • Forecasting share-based compensation
    • 建模
    • 不是很重要，知道就行
  • Valuation consideration
    • DCF，把非现金的费用从现金流中扣除
      • 每股价值=intrinsic value / 股数
        • Dilution考虑对股数的影响
        • CF考虑对intrinsic value的影响
      • Dilution from OS but unvested share-based awards
      • Dilution from future share-based awards
        • share count for expected dilution
        • free cash flow
    • 可考性高，但是大部分是定性题
  • DB Plan
    • B/S
      • 净额列表
        • Net PA or Net PBO
          • 如果是Net PA，还要和present value of available future refunds and reductions in future contributions比较，取较小值
            • 例题
              • Assume Golden Tea Co.'s present value of defined benefit obligation is €5,500 and the fair value of the pension plan assets is €6,000. In addition, the present value of available future refunds and reductions in future contributions is €326. What is the amount would report as a pension asset or liability on Golden Tea’s balance sheet: A. Assets of €500. B. Assets of €326. C. Liability of €500.
                • 答案：B 解析： Golden Tea's pension plan is overfunded by €500 (€6,000 − €5,500). However, when a company has a surplus in a defined benefit plan, the amount of asset that can be reported is the lower of the surplus and the asset ceiling (the present value of future economic benefits, such as refunds from the plan or reductions of future contributions). In this case, the asset ceiling is given as €326, so the amount of Golden Tea’s reported net pension asset would be limited to €326
      • PA (ABC)
        • Actual return
          • PA(beg) * Actual rate of return
        • Benefit paid
        • Contribution from employer
          • 例题
            • One year later, Sharma reviews Pinkwell's recently released full-year financial statements and notes that the company's contribution to the plan was higher than the periodic pension cost. She considers what adjustments she should make to Pinkwell's statement of cash flows to reflect the economic reality of this difference. Sharma's adjustment to Pinkwell's statement of cash flows should include a reduction in cash flow from: A. operating activities B. investing activities C. financing activities
              • C is correct Because the company’s contribution to the pension plan is higher than the total periodic pension cost. From an economic standpoint, the excess contribution is similar to a repayment of borrowing (financing use of funds) rather than an operating cash flow. As a result, Sharma should decrease the company’s cash flow from financing activities and increase cash flow from operating activities.
                • 这里要灵活理解contribution的含义。excess contribution可以视为提前还款
      • PBO (IASB)
        • Interest cost
          • PBO(beg) * DR
        • Actuarial gain
        • Service cost
          • CSC+PSC
        • Benefit paid
    • TPPC
      • 公式1
        • Interest cost
        • Actuarial gain
        • Service cost
        • Actual return
      • 公式2
        • Contribution - Delta(net PA)
        • Contribution + Delta(net PBO)
        • 例题
          • ABC SA, a hypothetical company, offers its employees a defined benefit pension plan. Information on ABC’s retirement plans is presented in Exhibit 1. It also grants stock options to executives. Exhibit 2 contains information on the volatility assumptions used to value stock options.
          • The total periodic pension cost is closest to: A. 320. B. 1,020. C. 1,320.
            • 答案：B 解析：B is correct. The total periodic pension cost is the change in the net pension liability adjusted for the employer's contribution into the plan. The net pension liability increased from 3,000 to 3,020, and the employer's contribution was 1,000. The total periodic pension cost is 1,020. This will be allocated between P&L and OCI.
              • TPPC有3个公式，只能看题目给什么条件，灵活决定用什么
      • 公式3
        • PPC in I/S
        • PPC in OCI
    • PPC
      • IFRS
        • I/S
          • Service cost
            • =CSC+PSC
          • Interest cost
            • =PBO(beg) * DR
          • Interest income
            • =PA(beg) * DR
          • 例题
            • Burning Corporation operates multi-national business and complies with IFRS. Selected financialdata as of 31 December 2020 (in £ millions) are as follows: Benefit obligations at beginning of year: 295,688 Fair value of plan assets at beginning of year: 291,100 Funded status at beginning of year: -4,588 Discount rate: 7% For the year 2020, the interest cost and net interest expense (income) are respectively: Interest cost, Net interest expense (income) A. £20,698 million £321 million B. £20,377 million £321 million C. £20,698 million £ (321) million
              • 答案：A 解析： 本题考查Interest cost 以及Net interest expense的计算。 Interest cost = Beginning benefit obligations × discount rate = £295,688 × 7% = £20,698。 根据IFRS的要求，Net interest expense = beginning net pension liability × discount rate，期初的net pension liability = £4,588，故本年的net interest expense = £4,588 × 7% = £321。 因此，正确选项为A。
                • 基本题，考到就是送分，做错就是送命
          • 例题
            • XYZ is a European corporation that reports under IFRS. Senior accountants of XYZ's pension department plan to make some changes to its pension plan's key parameters and are evaluating possible effects. Assuming XYZ decides to lower only the discount rate that is used to compute current pension obligation, the decrease in discount rate will: A. result in a decrease in interest expense if XYZ's pension plan is a relatively long-term one. B. lower the interest income reported on income statement. C. improve the plan's funded status by increasing the fair value of plan assets.
              • 答案：B 解析： 本题考点是贴现率的变化对养老金价值变化的判断。 B项表述正确，符合题意：IFRS下的公司，计算利息费用和预期利息收入均使用单一的discount rate，故该discount rate下降就会导致expected interest income下降； 对于A项：A项表述不正确，不符合题意：对于较长期（long-term）的养老金负债，其久期（duration）一般比较大：久期是判断负债对贴现率变化敏感程度的指标。Interest expense等于PBO*Discount rate，对于久期较大的养老金负债，一个单位discount rate的下降（注意本题题干设定的是discount rate更低的情形） 会导致多于一个单位PBO的上升，所以PBO和discount rate相乘的结果是interest expense也会更高，因此A项discount rate下降的结果应该是an increase in interest expense； 对于C项：C项表述不正确，不符合题意：discount rate下降与资产的fair value是无关的，因为资产的fairvalue通常是随行就市确定的，由市场买卖力量的博弈综合确定，而不受discount rate参数的变更影响。
                • A选项Interest expense=PBO*Discount rate，乘号的两项一个变大一个变小，借助久期可以巧妙判断最后结果的变化
          • 例题
            • Tony plc, a fictional company based in the United Kingdom, sponsors a DB pension plan for qualifying employees. Tony prepares its financial statements under IFRS. The discount rate that the company used in estimating the present value of its pension obligation was 5.48%. Disclosures on Tony' s pension plan in the company' s notes to financial statements for the year ended 31 December 20X1 included the following. Components of periodic benefit cost Service cost: £228 Net interest (income) expense: 273 Remeasurements: -18 Periodic pension cost: £483 Change in benefit obligation Benefit obligations at beginning of year: £28,416 Service cost: 228 Interest cost: 1,557 Benefits paid: -1,322 Actuarial gain or loss: 0 Benefit obligations at end of year: £28,879 Change in plan assets Fair value of plan assets at beginning of year: £23,432 Actual return on plan assets: 1,302 Employer contributions: 693 Benefits paid: -1,322 Fair value of plan assets at end of year: £24,105 Funded status at beginning of year -£4,984 Funded status at end of year -£4,774 The GBP 1,284 million difference in interest expense reported on the income statement and the interest cost on the benefit obligation in 20X1 is a result of: A. interest income on plan assets. B. the actual return on plan assets. C. different assumed discount rates.
              • A is correct. The interest expense reported on the income statement is a "net" interestexpense/income amount computed as the product of the funded status and discount rate at thebeginning of the year. Equivalently, it is the (discount rate x benefit obligation) - (discount rate xfair value of plan assets).
                • 基本题，考到就是送分，做错就是送命
            • The amount recognized by Tony as an operating expense on the income statement for the year ended 31 December 20X1 is closest to: A. 210. B. 228. C.483.
              • B is correct. Service cost is an operating expense, representing the increase in the benefitobligation from current and past service, Net interest expense/income is financing expense/income recognized below the operating, income line. Remeasurements are recognized in OCl, not in earnings.
                • 注意问的是本年I/S里的
            • The amount recognized on the balance sheet decreased from 31 December 20X0 to 31 December 20X1 because: A. The sum of service cost and interest cost exceeded benefits paid. B. the discount rate used in estimating the pension obligation exceeded the actual rate of return of plan assets for the year. C. the sum of the actual return on plan assets and employer contributions exceeded the sum of service and interest cost on the benefit obligation.
              • C is correct The net pension liability recognized on Tony's balance sheet decreased becausethe fair value of plan assets increased by more than the benefit obligation. A is incorrect. while itis true that the sum of service and interest costs exceeded benefits paid, benefits paid isdeducted from both the benefit obligation and plan assets, so the relevant spread is between thesum of service and interest costs and the sum of return on plan assets and employercontributions, B is incorrect, The discount rate used in estimating the pension obligation was5.489 and the actualrate of return on plan assets was 1,302/23,432= 5.56%, 8 basis pointshigher, not lower.
        • OCI
          • Remeasurement
            • actuarial gain
            • (actual return - interest income)
            • 例题
              • Assume IFRS applies. Red Spring co. reports following information about pension plan. Interest rate: 6% Beginning plan asset: $8,000,000 Actuarial gain: $70,000 Actual return: $500,000 To account for remeasurement of pension plan, Red Spring co. should: A. reduce OCI by $90,000. B. increase OCI by $90,000. C. recognize a gain of $90,000 in income statement.
                • 答案：B 解析： 该题主要考点为养老金费用调整项（Remeasurement）的计量。 在国际会计准则（IFRS）下，公司应将保险统计损益（Actuarial gains and losses）及养老金资产（Plan asset）的净收益（Net return）纳入到养老金费用的调整项并披露在其他综合收益（OCI）中。计算如下： Remeasurement = Actuarial gains + Actual return − Plan asset × Interest rate = 70,000 + 500,000 − 8,000,000 × 6% = $90,000 因此正确选项为B。
                  • 基本题，考到就是送分，做错就是送命
        • 例题
          • ABC SA, a hypothetical company, offers its employees a defined benefit pension plan. Information on ABC’s retirement plans is presented in Exhibit 1. It also grants stock options to executives. Exhibit 2 contains information on the volatility assumptions used to value stock options.
          • The amount of periodic pension cost that would be reported in P&L under IFRS is closest to: A. 20. B. 530. C. 1,020.
            • 答案：B 解析：B is correct. Under IFRS, the components of periodic pension cost that would be reported in P&L are the service cost (composed of current service and past service costs) and the net interest expense or income, calculated by multiplying the net pension liability or net pension asset by the discount rate used to measure the pension liability. Here, the service costs are 320 (= 200 + 120) and the net interest expense is 210 [= (42,000 + 120 − 39,000) × 7%]. Thus, the total periodic pension cost is equal to 530.
              • 注意IFRS都是用DR，US GAAP对PA会用expected rate of return
              • 注意应该用年初的PA和PBO
          • Under IFRS, the amount of periodic pension cost that would be reported in OCI is closest to: A. 20. B. 490. C. 1,020
            • 答案：B 解析：B is correct. The component of periodic pension cost that would be reported in OCI is the remeasurements component. It consists of actuarial gains and losses on the pension obligation and net return on plan assets. Here, the actuarial loss was 460. In addition, the actual return on plan assets was 2,700, which was 30 lower than the return of 2,730 (= 39,000 × 0.07) incorporated in the net interest income/expense. Therefore, the total remeasurements are 490.
              • 因为你I/S用的是PA(Beg) * DR=39000*0.07=2730，但是actual return才2700，所以多算的30 interest income要对冲到OCI，也就是OCI有个30的loss。 加上本身精算假设的460的loss，总的OCI的cost是30+460=490
      • USGAAP
        • I/S
          • Current service cost
          • Interest cost
            • =PBO(beg) * DR
          • Expected return
            • =PA(beg) * DR
          • Amortized Past service cost
            • = PSC / N
              • N是平均工作时间
          • Amortized Actuarial gain
            • 如果精算假设盈亏绝对值大于Corridor = Max(PA(beg), PBO(beg)) * 10%
              • 例题
                • Assume U.S. GAAP (generally accepted accounting principles) applies. Blue Spring Co. reports following information about the pension plan. Beginning balance Projected benefit obligation: $6,000,000 Plan asset: $5,555,555 Unrecognized actuarial gain: $700,000 Expected average remaining working lives: 10 To amortize the actuarial gain, Blue Spring Co. should: A. reduce pension expense by $10,000. B. increase pension expense by $10,000. C. increase pension expense by $55,555.
                  • 答案：A 解析： 该题主要考点为精算损益（Actuarial gains and losses）的摊销。 根据美国会计准则（US GAAP）Corridor Approach的要求，当精算损益（Actuarial gains and losses）大于期初PBO或Plan Asset的较大者（在本题中PBO较大）的10%时，则需对超出部分按雇员剩余工作年限摊销，且如果精算损益为正值时，摊销部分调减利润表的养老金费用（pension expense）。计算如下： (700000-6000000*0.1)/10=10000
            • Amortized actuarial gain = 超过corridor部分/N
          • Reclassification of Periodic Pension Costs in l/S
            • 计算要求不在24年考纲范围内
        • OCI
          • Unamortized Past service cost
          • Actuarial gain
            • actuarial gain
            • (actual return - interest income)
    • 精算假设变更
      • DR
        • PBO
          • TPPC
          • Interest cost
            • PPC in I/S
        • PA
      • Compensation growth rate
        • final salary
          • Pension payment
            • PBO
              • TPPC
              • Interest cost
                • PPC in I/S
            • PA
      • Expected rate of return
        • PBO
        • PA
        • TPPC
        • PPC in I/S
        • PPC in OCI
      • 例题
        • Exhibit 2: ABC SA Volatility Assumptions Used to Value Stock Option Grants Grant Year | Weighted Average Expected Volatility 2009 valuation assumptions 2005-2009: 21.50% 2008 valuation assumptions 2004-2008: 23.00% Compared to 2009 net income as reported, if ABC had used the same volatility assumption for its 2009 option grants that it had used in 2008, its 2009 net income would have been: A. lower. B. higher. C. the same.
          • 答案：A 解析：A is correct. In 2009, ABC used a lower volatility assumption than it did in 2008. Lower volatility reduces the fair value of an option and thus the reported expense. Using the 2008 volatility estimate would have resulted in higher expense and thus lower net income.
            • 首先，波动变大，期权变贵，这个是基调。
            • 然后，期权相当于负债成本，所以负债变相增加。
            • 最后就很容易得出负债多了所以NI变低的结论。
            • 最后的最后，题目问2009和2008比，2009怎么样？所以2009的NI是会变高。
    • 估值考量
      • Fund status
        • overfunded
          • 忽略
        • underfunded
          • 视为债务
      • DCF
        • future service cost 从DCF中扣除
          • 例题
            • Tom, a junior analyst, works for Golden Investment Corp. He built a DCF model for a company. To take into account the impact of the company's DB plans on the valuation, he subtracted both estimated future service cost and net interest expense from free cash flow. To determine the equity value of the company, he deducted the company's net pension liability from the enterprise value to arrive at the value of equity. Jack, Tom's manager, reviewed Tom's work and would most likely recommend that Tom A. did not deduct the net pension liability from the enterprise value when calculating the value of the equity. B. did not subtract net interest expense when calculating free cash flow. C. did not subtract estimated future service cost when calculating free cash flow.
              • 答案：B 解析： 在对公司进行DCF模型估值时，不应从自由现金流中扣减净利息费用（net interest expense），因为净利息费用反映的是养老金支付义务随时间推移产生的货币时间价值。DCF模型估值是基于公司现在的价值，而养老金支付义务的现值已经通过把养老金净负债从公司价值中扣减予以考虑，无需重复考虑。因此，正确选项为B。 对于选项A，在对公司进行估值时，养老金净负债会作为债务纳入公司价值（enterprise value）的计算中，所以在计算股权价值时，要从公司价值中予以扣除。因此该选项错误。 对于选项C，未来的服务成本是员工在未来服务期间通过服务而产生的福利成本，尽管没有实际现金流出，也应从自由现金流中予以扣减。因此该选项错误。
                • 推导Market Value(equity)的完整链路：MV(equity) = Enterprise Value - MV(debt) - MV(Preferred Stock) + Cash&Equivalent。 其中EV可以通过DCF模型算出。service cost除了current service cost还有future service cost，这些在算公司价值的时候都要考虑/扣减。但是interest expense本质是PBO向后一年折现产生的时间价值/费用，并不是真实的现金流。PBO本身是debt，所以会在MV(debt)里被扣减现值/present value，这部分扣减掉不会再有任何未来未发生的interest expense，所以interest expense不需要在DCF中被扣减。
                • service cost虽然不是cash flow，但是需要在FCF里被考虑，当expense处理。
                • 如果funded status是underfunded，则在计算EV的时候当debt处理，否则ignore overfunde
• M3 Multinational Operations
  • Foreign currency transaction
    • Reason
      • 权责发生制 vs 首付实现制
      • 时间差
        • 例题
          • Haiwang is an analyst with an international bank. She analyzes Ambleu S.A. ( "Ambleu" ), a multinational corporation, for a client presentation. Ambleu complies with IFRS, and its presentation currency is the Norvoltian krone (NVK). Ambleu1 s two subsidiaries, Ngcorp and Cendaro, have different functional currencies: Ngcorp uses the Bindiar franc (FB) and Cendaro uses the Crenland guinea (CRG). Yu first analyzes the following three transactions to assess foreign currency transaction exposure: Transaction 1: Cendaro sells goods to a non-domestic customer that pays in dollars on the purchase date. Transaction 2: Ngcorp obtains a loan in Bindiar francs on 1 June 2016 from a European bank with the Norvoltian krone as its presentation currency. Transaction 3: Ambleu imports inventory from Bindiar under 45-day credit terms, and the payment is to be denominated in Bindiar francs. Which transaction would generate foreign currency transaction exposure for Ambleu? A. Transaction 1 B. Transaction 2 C. Transaction 3
            • C is correct. In Transaction 3, the payment for the inventory is due in Bindiar francs, a different currency from the Norvoltian krone, which is Ambleu's presentation currency. Because the import purchase (account payable) is under 45-day credit terms, Ambleu has foreign currency transaction exposure. The payment is subject to fluctuations in the FB/NVK exchange rate duringthe 45-day period between the sale and payment dates, Thus, Ambleu is exposed to potential foreign currency gains if the Bindiar franc weakens against the Norvoltian krone or foreigncurrency losses if the Bindiar franc strengthens against the Norvoltian krone.
              • 关键是45天的credit terms
          • Haiwang's determination regarding Transaction 2 should be based on the currency of the: A. loan. B. bank. C. borrower
            • C is correct The currency of Ngcorp as the borrowing foreign subsidiary, relative to that of Ambleu, determines Ambleu's choice of translation method for Transaction 2. Because Ngcorp'sfunctional currency is the Bindiar franc and Ambleu's presentation currency is the Norvoltiankrone, the current rate method rather than the temporal method should be used. Regardless ofthe currency in which the loan is denominated, the loan is first recorded in Ngcorp's financial statements. Then, Ngcorp's financial statements, which include the bank loan, aretranslated intoAmbleu's consolidated financial statements.
              • 谁借的和谁有关
    • 时间点
      • 交易发生日
      • 资产负债表日
      • 收付款日
    • 案例
      • 一家中国公司涉及美元业务， 当年11月9日产生应收100USD，对应汇率7RMB/USD; 12月31日对应汇率6.8RMB/USD; 次年2月9日收到货款100USD，对应汇率7.2RMB/USD.
        • 11.9
          • A/R: 700
        • 12.31
          • A/R: 680
          • G/L: -20
        • 2.9
          • Cash: 720
          • G/L: 40
  • Foreign currency translation
    • Functional currency
      • 判断依据
        • 判定母子functional currency一致
          • 母公司业务延申
          • 母子交易占比大
          • 子公司CF直接影响母公司CF
          • 母公司给子公司还债
        • 判定单纯子公司functional currency
          • 产品、服务定价货币
          • 竞争压力来源货币
          • 主要成本货币
          • 资金来源货币
          • 留存现金货币
      • 例题
        • Which of the followings is least likely correct? A. The currency has a significant influence on the sales prices for goods and services, which is one of the criteria to decide the functional currency. B. The currency has a significant influence on the costs of labor and material is one of the criteria to decide the functional currency. C. The currency is received from the non-operating activities, which is one of the criteria to decide the functional currency.
          • 答案：C 解析： 该题主要考点为经营性货币（functional currency）的判断标准从日常经营活动中（operating activities）获得的货币，而不是从非日常经营活动（non-operating activities）中获得的货币，该选项描述错误。因此正确选项为C。 对于选项A，判断是否为经营性货币的重要标准之一为是否影响产品和服务价格的货币。因此，该选项描述正确，不符合题意，为错误选项。 对于选项B，判断是否为经营性货币的重要标准之一为是否影响产品和服务所投入的人工，材料等成本的货币。因此，该选项描述正确，不符合题意，为错误选项。
            • 本来这个知识点都不准备放的，后来想想，都有题了，还是放一下吧。扫一眼就差不多了，扫两眼都是浪费。
      • 例题
        • Flash Inc. (Flash), Schnell's wholly owned subsidiary operating in the UK, was established on 1 January in the year just ended. Flash supplies automotive components to some of Schnell's subsidiaries in the US, with all transactions settling in USD. Norman Lee, finance manager of Schnell, translates Flash's financial statements for consolidation using the temporal method. Flash's functional currency is the: A. EUR B. GBP C. USD
          • A is correct. A.Correct because when the temporal method is being used, the parent company’s currency (EUR) is the foreign subsidiary's functional currency. The foreign currency financial statements of a foreign operation that has the parent’s presentation currency as its functional currency are translated using the temporal method. B.Incorrect because if the current rate method were used, the local currency (GBP) of the foreign subsidiary is the functional currency. When the temporal method is being used, the parent company’s currency (EUR) is the foreign subsidiary's functional currency. C.Incorrect because while the USD is used to settle Flash's sales to its fellow subsidiaries, USD is not its functional currency based on the translation method used by Schnell When the temporal method is being used, the parent company’s currency (EUR) is the foreign subsidiary's functional currency.
            • 这题坑的点在于，你需要基于temporal method这个已知条件去判断functional currency，而不是基于"……all transactions settling in USD"来判断
    • 折算方法
      • Current rate method
        • functional <> reporting currency
        • 子公司独立
          • 关键字：independent, autonomous
        • 例题
          • On 1 January of the most recent year, Hera established a wholly owned subsidiary, Giselle Co. (Giselle), in the US. Giselle has fixed assets of USD 10 million when established. Giselle's presentation currency is the US dollar. It reports under US GAAP, and is accounted on Hera's consolidated financial statements using the temporal method.
            • Which of the following is most consistent with the translation method used for Giselle? A. Giselle operates with a significant amount of autonomy B. Giselle's functional currency is the same as its presentation currency C. Giselle's translation gains or losses are included in Hera's consolidated net income
              • C is correct A is incorrect because one of the additional factors to consider in determining whether the foreign entity’s functional currency is the same as the parent’s functional currency is whether the activities of the foreign operation are an extension of the parent’s or are carried out with a significant amount of autonomy. Hera uses the temporal method, so Giselle is most likely an extension of Hera's operations in the US, such as a sales outlet for Hera's products. B is incorrect because Hera uses the temporal method, essentially implying that Giselle is using Hera's presentation currency, instead of its own presentation currency as its functional currency. In this case, it is the euro for Hera, instead of the US dollar. C is correct because under both international and US accounting standards, when the temporal method is used, the translation adjustment needed to keep the translated balance sheet in balance is reported as a gain or loss in net income.
                • Temporal method只管local->function；current rate method只管function -> reporting
                • temporal method，一般母子关联紧密，local<>function=reporting，很多东西要用历史汇率，差额进I/S
                • current rate method，母子比较独立，local=function<>reporting，大部分用current rate，差额进OCI
        • 例题
          • Saturn，a US -based company, ordered a machine from Venus on 15 November 2020 and the order price was 10,000 euros. Venues got the payment on 15 January 2021. The functional and presentation currency is US dollar. Saturn’s fiscal year is ending at 31 December. Exchange rates between the USD and euro are showing as below. Dates | Exchange rates (USD/EUR) 15 November 2020: 1.1732 31 December 2020: 1.1849 15 January 2021: 1.1789 What influences will exert on the Saturn’s financial statements during year 2020 and 2021? A. Report an unrealized loss of $117 in other comprehensive income statement in 2020 and a realized gain of $60 in income statement in 2021. B. Report an unrealized loss of $117 on income statement in 2020 and a realized gain of $60 in income statement in 2021. C. Report a realized gain of $57 in other comprehensive income statement in 2021.
            • 答案：B 解析： 该题主要考点为外汇汇率的波动而导致的外汇交易利得和损失(foreign currency transactions gains and losses)如果交易发生和交易结算（支付）是分别处于两个会计期间，既资产负债表日(12月31日)处于交易发生（2020年11月15日）和交易结算（2021年1月15日）之间。那么从交易日到资产负债表日的汇率变化而产 生的损益是未实现的汇兑损益（unrealized gains or losses），该损益是属于未实现的汇兑损益，需要计入当年的利润表中。值得注意的是这里的unrealized gains/losses 是少数的unrealized gain/loss需要计入到利润表中的情形。 当这笔交易完成支付时，实际支付的金额是按照支付日的汇率算的。从前一个资产负债表日到支付日的汇率变化是属于已实现的汇兑损益（realized gains or losses）,该损益是计入利润表的。因此正确选项为B。 对于选A和选项C，不符合题意。因此该选项错误。
              • 注意Current Method的所有差异，都进I/S的relized G/L里
      • Temporal method
        • local <> functional currency
        • 母子强关联
          • 关键字：well integrated
        • USGAAP使用remeasurement来描述
      • 2个可以同时出现
        • Local <> functional <> reporting currency
    • 折算流程
      • Current rate method
        • 先I/S，后B/S
          • 折算损益在B/S的(OCI-CTA)
        • I/S
          • 全部用avg rate
        • B/S
          • Asset和Liability用current rate
            • 所以Equity总金额是current rate
          • Capital用his rate
          • Dividend用his
            • 宣告日期
          • BASE法则算留存收益
            • RE(beg) + NI - Div = RE(end)
        • 倒挤得到OCI-CTA
          • CTA = Equity - Capital - REend
            • 例题
              • XD Co. is a US-based company and has a subsidiary whose functional currency is the euro. If the euro appreciates against the US dollar for the foreseeable future, XD Co. would most likely report: A. an addition to the cumulative translation adjustment B. a negative translation adjustment to stockholders' equity C. a translation gain or loss on the income statement
                • 答案:A 本题主要考点为 current rate method 的折算。XD Co.应该用 current rate method 折算报表，因为它的功能货币(functional currency)是欧元，报告货币(reportingcurrency)是美元(USD)。在 current rate method 下，资产负债表敞口大多数情况下是净资产(net assets)，即总资产减去总负债。当外币欧元升值，净资产也增值，所以会产生gain。在 currentratemethod 下，translation gain 计入 cumulative translation adjustment。 因此正确选顶为 A。
                  • Current method调整都在B/S里，所以先把I/S算出来，最好调到B/S的CTA
            • 例题
              • Romantic Corp. is a US-based company that prepares its financial statements in accordance with US GAAP. Romantic Corp. has an European subsidiary established on Dec. 31, 20X1: Julius. Anthony Jack, CFA, is an analyst trying to forecast Romantic's 20X2 results. Jack has prepared forecast for Julius, as well as for Romantic's other operations (prior to consolidating the results.) He is now considering the impact of currency translation on the results of the subsidiary and the parent company's consolidated financials. His research has provided the following insights: ■ The results for Julius will be translated into US dollars using the current rate method. ■ Julius uses the FIFO method to account for inventory. ■ Jack believes Julius will report €2,300 in sales and €2,200 in total expenses without paying any dividends in 20X2. Jack also forecasts the 20X2 year-end balance sheet for Julius (Exhibit 1). Data and forecasts related to euro/dollar exchange rates are presented in Exhibit 2. When Jack translates his forecasted balance sheet for Julius into US dollars, the cumulative translation adjustment (CTA) as of 31 December 20X2 (dollars in millions) will be closest to: A. $217. B. $154. C. $(87).
                • 答案：A 解析： Total equity translated into US dollar is (2300-700)×1.61 = $2576. Common stock translated into US dollar is 1500×1.47 = $2205 Retained earnings ending balance in US dollar will be $0 + $NI - $dividends declared. NI in US dollar is (2300-2200)×1.54 = $154 The retained earnings ending balance in US dollar should be $154 Thus, the cumulative translation adjustment should be $217(= $2576 - 2205 - 154).
                  • 注意CTA只在Equity里面倒挤
      • Temporal method
        • 先B/S，后I/S
          • 折算损益在I/S
            • US GAAP
              • reasurement G/L
            • IFRS
              • foreign exchange G/L
            • 因为母公司能操控子公司，所以损益入账
            • 例题
              • Desai analyzes the impact of the INR/CZK exchange rate movement on Wardha's translated financial statements using the temporal method. In the prior year, Wardha had a net monetary liability exposure. Based on the INR/CZK movement, the translation of Wardha's prior year financial statements would be reported by Betwa as a: A. gain in net income. B. loss in net income. C. loss in other comprehensive income.
                • 答案：B 解析：B is correct. The translation of Wardha's financial statements using the temporal method results in translation loss due to the liability exposure and strengthening of the CZK which results in lower net income. The translation loss is reported as a line item before net income is calculated.
                  • 注意temporal method的G/L是进NI，不是OCI
        • B/S
          • Monetory Asset/Liability用current
            • 现金，应收，应付
          • Non-monetory asset/liability/capital用His rate
            • 存货，长期资产，预付款，预收款
          • 倒挤R/E
            • R/E = Asset - Liability - Capital
          • 例题
            • Triofind, Inc. (Triofind), based in the country of Norvolt, provides wireless services to various countries, including Norvoltf Borliand, Abueli and Certait. The company1 s presentation currency is the Norvolt euro (NER), and Triofind complies with IFRS. Triofind has two wholly owned subsidiaries, located in Borliand and Abuelio. The Borliand subsidiary (Triofind-B) was established on 30 June 2016, by Triofind both investing NER1,000,000, which was converted into Borliand dollars (BRD)f and borrowing an additional BRD500,000. Marie Janssen, a financial analyst in Tricfind's Norvolt headquarters office, translates Triofind-B's financial statements using the temporal method. Non-monetary assets are measured at cost under the lower of cost or market rule. Spot BRD/NER exchange rates are presented in Exhibit 1, and the balance sheet for Triofind-B is presented in Exhibit 2. Exhibit 1: Spot BRD/NER Exchange Rates Date | BRD per NER 30 June 2016: 1.15 Weighted-average rate when inventory was acquired (2016): 1.19 31 December 2016: 1.20 Weighted-average rate when inventory was acquired (2017): 1.18 30 June 2017: 1.17
            • Based on Exhibits 1 and 2 and Janssen's translation method, retained earnings for Triofind-B translated into Tnofindf s presentation currency as of 30 June 2017 are closest to: A. NER150,225. B. NER170,940. C. NER172,414.
              • A is correct. Triofind uses the temporal method to translate the financial statements ofTriofind-B. The temporal method uses the current exchange rate for translating monetary assetsand liabilities and the historical exchange rate (based on the date when the assets were acquiredfor non-monetary assets and liabilities. Monetary assets and liabilities are translated using thecurrent exchange rate (as of 30 June 2017) Of NER1 = BRD1.17 (Or NERO.8547/BRD), andnon-monetary assets and liabilities are trarslated using the historical exchange rate (as of 30 June2016)of NER1= BRD1.15 (or NER0.8696/BRD). inventory is translated at the 2017 weightedaverage rate of NER1 = BRD1.18 (or NER0.8475/ BRD). The difference required to maintainequality between (a) total assets and (b) total liabilities and shareholder's equity is then recordedas ret ained earnings. The retained earnings for Triofind-8 translated into Norvolt euros (Triofind'spresentation currency) as of 30 June 2017 is calculated as follows: Cash: 1350000/1.17=1153846.153846 Inventory: 500000/1.18=423728.813559 Total Asset: 1153846+423729=1577575 Notes Payable: 500000/1.17=427350.42735 Common Stock: 1150000/1.15=1000000 Retained earnings: 1577575-427350-1000000=150225
                • 基本题，必须掌握
        • I/S
          • 与Non-monetory asset有关的费用，继续用his rate
            • CoGS, Depreciation
            • 例题
              • Flash Inc. (Flash), Schnell's wholly owned subsidiary operating in the UK, was established on 1 January in the year just ended. Flash supplies automotive components to some of Schnell's subsidiaries in the US, with all transactions settling in USD. Norman Lee, finance manager of Schnell, translates Flash's financial statements for consolidation using the temporal method. As part of the consolidation process, Lee summarizes Flash's financial statement information in Exhibit 1 and historical EUR/GBP exchange rate data (amount of EUR per 1 GBP) in Exhibit 2. Flash's operating profit margin translated into Schnell's presentation currency for the year just ended is closest to: A. 14.8% B. 15.3% C. 15.8%
                • C is correct Because this is the operating profit margin calculated under the temporal method, which is approximately 15.8%. Revenues and expenses, other than those expenses related to non-monetary assets are translated at the exchange rate that existed when the transactions took place (for practical reasons, average rates may be used). Expenses related to non-monetary assets, such as cost of goods sold (inventory), depreciation (fixed assets), and amortization (intangible assets), are translated at the exchange rates used to translate the related assets. The calculations are illustrated below: Revenue: 1080*1.17=1263.6 CoGS: 698*1.16=809.68 Selling expenses: 72*1.17=84.24 Dep: 150*1.13=169.5 Profit Margin: (1263.6-809.68-84.24-169.5)/1263.6=0.15842
                  • 要注意CoGS是跟inventory的汇率。Selling expense是expense，跟Avg。Dep是Inv，跟Inv。
          • Dividend用his
            • 宣告日
          • BASE法则倒挤NI
            • RE(beg) + NI - Div = RE(end)
            • 例题
              • Sunjet Airlines Ltd. (Sunjet), a US-based “no frills” carrier, has the following existing non-domestic operations. Nanuk Air Inc. (Nanuk) is a Canadian carrier that Sunjet purchased several years ago. It provides service to remote mining operations in the Canadian north. The company has been very profitable, and it recently financed a renewal of its fleet of seaplanes with CAD-denominated long-term debt. Sunjet Mexico SA (SunMex) was established on 1 April 2016 to facilitate expansion of the Sunjet network to six Mexican destinations. The company purchased hangar assets in Mexico that were 100% financed with MXN-denominated loans guaranteed by Sunjet, and operations began shortly thereafter. Although most of SunMex’s revenues are generated in the US vacation travel market, the company also serves domestic Mexican passengers. These MXN-denominated sales amounted to approximately 10% of SunMex’s fiscal 2016–17 revenues, and they are expected to remain below 15% in the future. Today is 30 April 2017, one month after Sunjet’s fiscal year end, and the CEO, Mark Napier, is meeting with the CFO, Lisa Cameron, to discuss the international operations. Napier mentions that he will be meeting next week with the president of SunMex to discuss the first year of operations. Cameron pulls out the draft year-end results (Exhibit 1) and some exchange rate data (Exhibit 2). She notes that the SunMex president’s bonus is tied to fixed asset turnover and net income targets. She reminds Napier that the bonus thresholds are evaluated based on the translated USD-denominated financial statements rather than the MXN-denominated ones, and she promises to send the translated version once the results are finalized. On translation, SunMex’s USD-denominated net income most likely includes: A. a re-measurement gain of $2.526 million B. a re-measurement loss of $1.792 million C. no re-measurement gains or losses
                • 正确答案：A A.Correct. SunMex will be translated using the temporal method because the competitive environment that mainly determines SunMex’s sales prices is that of the United States. Under this approach, monetary assets and liabilities are translated at the year-end rate, and non-monetary items are translated at historical rates. Because it is SunMex’s first year of operations, the retained earnings will include only the translated net income for the year. The translated net income will include the re-measurement gain or loss in accordance with the temporal method. As shown in the following table, the retained earnings balance required to balance the balance sheet is USD2.352 million.
                  • Remeasurement G/L的计算必须掌握
                  • 注意折旧是跟固定资产，所以用历史汇率法
        • 倒挤折算后收入费用汇总和NI的差额，放入利润表
          • US GAAP
            • reasurement G/L
          • IFRS
            • foreign exchange G/L
          • 例题
            • Norman Lee, finance manager of Schnell, translates Flash's financial statements for consolidation using the temporal method. Translation gains and losses related to Flash should be reported on Schnell's financial statements as: A. part of net income B. other comprehensive income C. a separate component of equity
              • A is correct A.Correct because under both international and US accounting standards, when the temporal method is used, the translation adjustment needed to keep the translated balance sheet in balance is reported as a gain or loss in net income. B.Incorrect because under both international and US accounting standards, when the temporal method is used, the translation adjustment needed to keep the translated balance sheet in balance is reported as a gain or loss in net income. Under the current rate method, the translation gains and losses are reported as other comprehensive income, and the cumulative effect is reported as a separate component of stockholders' equity, such as accumulated other comprehensive income. C.Incorrect because under both international and US accounting standards, when the temporal method is used, the translation adjustment needed to keep the translated balance sheet in balance is reported as a gain or loss in net income. When the current rate method is used, the cumulative translation adjustment needed to keep the translated balance sheet in balance is reported as a separate component of stockholders’ equity.
                • 注意temporal method是进NI，currency rate method是进OCI
    • Net exposure
      • current rate method
        • Net Exposure = Asset - Liability
          • 大概率净资产
            • （哪家好人资不抵债？）
            • 还真有，星巴克
        • 例题
          • Jacky Products, Inc. is a US-based multinational with subsidiaries around the world. One such subsidiary, Acceletron, operates in Singapore, which has seen mild but not excessive rates of inflation. Villiers gathers Acceletron's the US dollar/Singapore dollar exchange rates in Exhibit 2. Exhibit 2:Exchange Rates Applicable to Acceletron Exchange Rate in Effect at Specific Times | USD perSGD Rate when first SGD1 billion of fixed assets were acquired: 0.568 Rate when remaining SGD640 million of fixed assets were acquired: 0.606 Rate when long-term debt was issued: 0.588 31 December 2006: 0.649 Weighted-average rate when inventory was acquired: 0.654 Average rate in 2007: 0.662 31 December 2007: 0.671 Jacky' s consolidated gross profit margin for 2007 would be highest if Acceletron accounted for inventory using: A. FIFO, and its functional currency were the US dollar. B. LIFO, and its functional currency were the US dollar. C. FIFO, and its functional currency were the Singapore dollar.
            • A is correct. Because the Us dollar has been consistently weakening against the singaporedollar, cost of sales will be lower and gross profit higher when an earlier exchange rate is used totranslate inventory, compared with using, current exchange rates, lf the Singapore dollar is thefunctional currency, current rates would be used. Therefore, the combination of the Us dollar(temporal method) and FiFo will resuit in the highest gross profit margin.
              • 先判断汇率变化趋势
              • 后判断LIFO还是FIFO
              • 最后确定折算方式
        • 例题
          • Saturn, located in a Spain, opened a new subsidiary in China. The CFO of Saturn decided to use Chinese Yuan as the functional currency. Recently, the Chinese Yuan weakens against Euro. What of the following is most likely to report? A. increase of the cumulative translation adjustment. B. decrease of cumulative translation adjustment. C. remeasurement gain to net income
            • 答案：B 解析： 本题目考点为现行汇率下(Current Rate Method)的累计折算调整（cumulative translation adjustment）。 在Current Rate Method的情况下，所有由于折算而导致的收益和损失都是需要计入到cumulative translation adjustment。外币贬值，在C－Method的情况下，会导致负的累计折算调整，即所有者权益下降。因此，正确选项为B。 对于选项A，不符合题意。因此，该选项错误。 对于选项C，remeasurement gain／losses的发生是在T-method下发生的，不符合题意。因此，该选项错误。
              • 注意默认currency method是正的净资产
        • 例题
          • Sunjet Airlines Ltd. (Sunjet), a US-based “no frills” carrier, has the following existing non-domestic operations. Nanuk Air Inc. (Nanuk) is a Canadian carrier that Sunjet purchased several years ago. It provides service to remote mining operations in the Canadian north. The company has been very profitable, and it recently financed a renewal of its fleet of seaplanes with CAD-denominated long-term debt. The best answer to Napier’s question about the effect of Nanuk on Sunjet’s other comprehensive income is that Nanuk’s: A. net asset exposure will generate a re-measurement gain B. net liability exposure will generate a re-measurement gain C. net asset exposure will generate a re-measurement loss
            • 正确答案：C C.Correct. Nanuk is translated under the current rate method, so its translational exposure is its net asset position. The weakening CAD (see Exhibit 2) will generate a re-measurement loss in Sunjet’s other comprehensive income.
              • 先判断是current method，可以得到敞口是net asset
              • 下一步判断汇率，要注意是CAD/USD，并且在上升，所以USD升值，CAD贬值，所以敞口减少，是loss
      • Temporal method
        • Net Exposure = Monetory asset - monetory liability
          • 大概率净负债
            • （哪家傻缺账上全现金？）
            • 还真有，诈骗公司的资产大部分都是现金
        • 例题
          • Consolidated Motors is a US-based corporation that sells mechanical engines and components used by electric utilities. Its Canadian subsidiary, Consol-Can, operates solely in Canada. It was created on 31 December 20X1 f and Consolidated Motors determined at that time that it should use the US dollar as its functional currency. Nian explains that Consol-Can uses the FIFO inventory accounting method and that purchases of C$300 million and the sell-through of that inventory occurred evenly throughout 20X2. The board responds with one question: Would there be any translation effects for Consolidated Motors if the functional currency for Consol-Can were changed to the Canadian dollar? In response to the board' s question, Nian should reply that if the change is made, the consolidated financial statements for Consolidated Motors would begin to recognize: A. realized gains and losses on monetary assets and liabilities. B. realized gains and losses on non-monetary assets and liabilities. C. unrealized gains and losses on non-monetary assets and liabilities.
            • C is correct lf the functional currency were changed from the parent currency (us dollar) tothe local currency (Canadian dollar), the current rate method would replace the temporalmethod, The temporal method ignores unrealized gains and losses on non-monetary assets and liabilities, but the current rate method does not.
              • T method的敞口只有净资产。
        • 例题
          • Jacky Products, Inc. is a US-based multinational with subsidiaries around the world. One such subsidiary, Acceletron, operates in Singapore, which has seen mild but not excessive rates of inflation. Villiers gathers Acceletron' s financial statements denominated in Singapore dollars (SGD) in Exhibit 1. If the US dollar were chosen as the functional currency for Acceletron in 2007, Jacky could reduce its balance sheet exposure to exchange rates by: A, selling SGD30 million of fixed assets for cash, B. issuing SGD30 million of long-term debt to buy fixed assets. C. issuing SGD30 million in short-term debt to purchase marketable securities.
            • 21. A is correct. if the Us dollar is the functional currency, the temporal method must be used,and the balance sheet exposure will be the net monetary assets of 125+230-185-200 =-30 or a net monetary liability of SGD30 million, This net monetary liability would be eliminated iffixed assets (non-monetary) were sold to increase cash. lssuing debt, either short-term orlong-term, would increase the net monetary liability.
              • 1. 确认折算方法和敞口范围: T: Net Monetory
              • 2. 确认敞口: net monetory liability
              • 3. 确认处理方法: 提高moentory asset
    • Hyperinflationary
      • 判断方法
        • 3年100%或者1年26%
          • 例题
            • A hyperinflationary economy is typically defined as one that has: A) cumulative inflation that exceeds 100% over a twelve-year period. B) cumulative inflation that exceeds 100% over a three-year period. C) an inflation rate that exceeds 10% per year for three consecutive years.
              • B is correct The typical definition is that cumulative inflation exceeds 100% over a three-year period.
      • 折算方法
        • US GAAP
          • Temporal method
            • 例题
              • Which of the following statements regarding the treatment of subsidiaries in a hyperinflationary environment under U.S. GAAP is most likely correct? A) The subsidiary should be translated using the temporal method regardless of the level of autonomy, and then no further restatement is required. B) The subsidiary should be translated using the temporal method regardless of the level of autonomy, and non-monetary items restated for the effect of local inflation. C) The subsidiary should be translated using the current rate method regardless of the level of autonomy, and non-monetary items restated for the effect of local inflation.
                • A is correct U.S. GAAP requires the use of the temporal method.
            • 例题
              • In a hyperinflationary economy, translation under the current rate method will most likely result in relatively: A) high balance sheet values for long term assets. B) high translation gains. C) low balance sheet values for long term liabilities.
                • C is correct In a hyperinflationary economy, translation under the current rate method will most likely result in relatively low balance sheet values for assets and liabilities. Translation losses will also occur.
            • 例题
              • Under U.S. GAAP, the temporal method is preferred to the current rate method in hyperinflationary economies because the temporal method: A) is easier to perform under hyperinflation. B) provides better conversions of subsidiary revenues. C) results in non-monetary asset values that are a better proxy for the economic values of those assets.
                • C is correct The temporal method results in non-monetary asset values that are a better proxy for the economic values of those assets than those obtained under the current rate method. Both methods convert revenues and SG&A at the average rate so there could be no clear preference when considering these measures
        • IFRS
          • Restate for inflation
            • B/S
              • Non-monetory
                • GPI(end)/GPI(beg)重述
                  • 注意和I/S不同
                • GPI题目会给，找不到就去找他兄弟，有啥用啥
                • 例题
                  • On 1 January of the prior year, Santa Maria S.R.L., Hera's wholly owned subsidiary in Argentina, acquired distribution rights in Argentina with an indefinite useful life for 67 million Argentine Pesos (ARS). Argentina is a hyperinflationary economy, and such hyperinflationary economic conditions are expected to persist. Li reviews the accounting treatment and assesses the impact on Hera's consolidated financial statements. The relevant exchange rates in EUR/ARS (number of EUR per 1 ARS), as well as Argentina's annual inflation rates for the past two years are presented in Exhibit 2.
                    • The value of Santa Maria's distribution rights (in EUR millions) on Hera's consolidated balance sheet as at 31 December of the most recent year is closest to: A. 1.005. B. 1.077. C. 1.183.
                      • C is correct C is correct because Argentina is considered a hyperinflationary economy as stated in the case. Therefore, Santa Maria must be restated to include local inflation, before being translated using the current exchange rate into EUR for consolidation. This approach reflects both the likely change in the local currency value of the distribution rights, as well as the actual change in exchange rates. Given the original purchase price is ARS 67 million, the value of the distribution rights as at 31 December of the most recent year is EUR 1.183 million, calculated as follows: 67*1.361*1.509*0.0086=1.18337
                        • 恶性通胀条件：3年100%，或者每年26%
                        • 无形资产才可以考虑恶性通胀
                        • 恶性通胀下，无形资产可以随时通胀增值
                • 例题
                  • On 31 May 2017, Triofind-A also received NER50,000 from Triofind and used the funds to purchase a new warehouse in Abueli. Janssen translates the financial statements of Triofind-A as of 31 July 2017 and must determine the appropriate value for the warehouse in Triofind's presentation currency. She observes that the cumulative Abuelio inflation rate exceeded 100% from 2015 to 2017. Spot exchange rates and inflation:
                  • Based on Exhibit 3f the value of the new warehouse in Abuelio on Triofind's balance sheet as of 31 July 2017 is closest to: A. NER31,452. B. NER47,964. C. NER50Q00.
                    • B is correct. Triofind complies with lFRs, and Abuelio can be considered a highly inflationaryeconomy because its cumulative inflation rate exceeded 100% from 2015 to 2017. Thus,Triofind-A's financials must be restated to include local inflation rates and then translated usingthe current exchange rate into Norvolt euros, which is Triofind's presentation currency. Thisapproach reflects both the likely change in the local currency value of the warehouse as well asthe actual change in the exchange rate. The original purchase price is ABP1,008,065 (NER50,000/ABP0.0496). The value of the new warehouse in Abuelio as of 31 july 2017 is NER47,964,calculated as follows: 50000/0.0496*1.25*1.22*0.0312=47963.709677
                      • 注意通胀是monthly
                • 例题
                  • In reality, what best describes the real value of non-monetary assets and liabilities in a hyperinflationary environment? A) Typically not affected because their local currency-denominated values decrease to offset the impact of inflation. B) Typically not affected because their local currency-denominated values increase to offset the impact of inflation. C) All non-monetary accounts are re-measured at the current rate
                    • B is correct Typically not affected because their local currency-denominated values increase to offset the impact of inflation (i.e., real estate values typically rise with inflation).
              • Monetory
                • 不变
                • 例题
                  • Which of the following asset or liability values is likely to be the most understated in a hyperinflationary economy if translation occurs under the current rate method? A) A plant purchased several years ago. B) Dividends payable. C) Accounts receivable.
                    • A is correct The accounts receivable and dividends payable will each have book values that are closer to their market values than a plant purchased many years ago.
            • I/S
              • GPI(end)/GPI(avg)重述
                • 注意和B/S不同
          • Translate using current rate
      • 折算流程
        • 战略性放弃，有兴趣自己翻书和讲义
    • 分析师bbb
      • 子公司财务比率变化
        • Pure ratio (分子分母同一张表)
          • Current rate
            • 不变
          • Temporal
            • 变
        • Mixed ratio
          • Current rate
            • 变
          • Temporal
            • 变
        • 怎么变
          • 具体问题具体分析
          • 例题
            • At the beginning of the previous year, specifically on 1 January, SunriseTech established a wholly-owned subsidiary in Mexico. The financial statements of the subsidiary are reported in Mexican pesos (MXN), and SunriseTech utilizes the temporal method to convert the subsidiary's financials into CAD for the most recent year. It is important to note that there have been no impairments recorded for inventory or fixed assets. Which of the subsequent translated ratios for the Mexican subsidiary will remain unaltered due to the expansion and the accompanying modification in the accounting approach? A. Current ratio B. Total asset turnover C. Days of sales outstanding
              • C is correct
                • 抓住Current Asset, Current Liability会变化
                • Sales不变
                • Avg xxx不变
          • 例题
            • XD Co. is a US-based company and has a subsidiary whose functional currency is the euro. If the functional currency were changed to the US dollar, which of the following ratios would most likely remain unchanged? A Quick ratio B. Gross profit margin C. Debt-to-asset ratio
              • 答案:A 该题主要考点为不同折算方法对rato 的影响。对于选项A,由于 quick ratio 只涉及到货币性资产(monetaryassets)和货币性负债(monetaryliabilities〉，在两种折算方法下，都是用期末汇率进行折算的，故数值不受折算方法影响。因此，该选项正确。 对于选项 8，毛利率等于毛利润除以收入，而毛利润等于收入减去销货成本(cOGS)。在current rate method 下，销贷成本用平均汇率折算，在 temporal method下，销货成本用历史汇率折算，所以，毛利率在两种折算方法下一般不同，除非平均汇率恰好等于历史汇率。因此，该选项错误。 对于选项C，Debt-to-assetratio等于有息负债除以资产。在currentrate method下，所有的资产和负债都是用期末汇率折算的。在temporalmethod下，monetary的资产和负债是用期末汇率折算，non-monetary的资产和负债是用历史汇率折算。所以，Debt-to-assetratio 会受折算方法影响。因此，该选项错误。
                • 抓住Monetary Assets和Monetary Liability不变
            • Saturn is a US-based company and has worldwide subsidiaries. Saturn has been using the temporal method as translation method before. However, the CFO of Saturn, decided to change from the temporal method to the current rate method, as the subsidiaries want to be more independent. Which of the following ratios will be most likely affected? A. quick ratio B. fixed asset turnover C. accounts receivables turnover
              • 答案：B 解析： 该题主要考点为折算方式的改变对比率的影响。 对于选项B，Fixed asset turnover=Revenue/( Fixed asset)。无论是Current rate method 还是Temporal method, 分子revenue的都是乘以Average rate来进行调整。 在Temporal method的情况下，fixed asset需要用historical rate来进行调整；在Current rate method的情况下，fixed asset需要用current rate来进行调整。即折算方式发生改变会影响到fixed asset turnover。因此正确选项为B。 对于选项A，quick ratio的分子分母包含的科目都是属于monetary items，所以分子分母同时乘以current rate，所以无论是Current rate method还是Temporal method，它们的quick ratio是不变的。因此该选项错误。 对于选项C，Current rate method和Temporal method，accounts receivables的公式分子是乘以average rate进行调整，分母都是乘以current rate进行。所以无论是Current rate method还是Temporal method，accounts receivables turnover
                • 抓住Fixed Asset会变化
      • 收入增长因素
        • Price
        • Volume
        • Change in Ex rate
          • 均值回归，不可控
• M4 Analysis of Financial Institutions
  • 分析银行
    • CAMELS
      • 评分标准
        • 单项
          • 1最好
          • 5最差
            • 例题
              • According to the CAMELS approach, which of the following statements is least likely to be correct? A. It is an approach widely used to analyze a bank. B. Judgement is needed when composite rating. C. Higher rating score indicates better practices in risk management and performance.
                • 答案：C 解析： 该题主要考点为骆驼评级法（CAMELS approach）的应用。 对于选项A，骆驼评级法就是广泛被应用于对商业银行的风险评级。因此，该选项描述正确，不符合题意。 对于选项B，在使用骆驼评级法时，最终加总分数时应当对不同评分标准划分权重，需要一定的主观判断。因此，该选项描述正确，不符合题意。 对于选项C，rating 1的评级要比rating 5的评级在风险管理表现方面更为优秀。因此，该选项描述错误，符合题意。 因此正确选项为C。
                  • 分越低越好
        • 整体
          • 加权平均
          • 算术平均
      • Capital Adequacy
        • 要求
          • Tier 1 Core: 4.5%
            • 除了优先股的equity
          • Tier 1 Total: 6%
            • 优先股
          • Tier 1 & 2 Total: 8%
            • 长期次级债
              • 例题
                • According to the classification of capital under CAMELS approach, which of the following capital is least likely to be included in Tier 1？ A. Issuance surplus related to common stock. B. Perpetual preferred shares with discretionary dividends. C. Subordinate debt
                  • 答案：C 解析： 该题主要考点为骆驼评级法（CAMELS approach）下对于第一级资本（Tier 1）的分类。 对于选项A，在发行普通股时形成的资本公积属于股权类第一级资本。因此，该选项描述正确，不符合题意。 对于选项B，无到期期限且股利发放自由的优先股属于其他类第一级资本。因此，该选项描述正确，不符合题意。 对于选项C，次级债券在吸收潜在损失方面的能力较差，属于第二级资本。因此，该选项描述错误，符合题意。 因此正确选项为C。
                    • 次级债是Tier 2
            • 可转债
          • 例题
            • According to the Basel III minimum capital requirements, the total capital must be at least: A. 4.5% of RWAs. B. 6.0% of RWAs. C. 8.0% of RWAs.
              • C is correct. According to the Basel III minimum capital requirements, the total capital must be at least 8.0% of risk-weighted assets. Common Equity Tier 1 Capital must be at least 4.5% of risk- weighted assets and Total Tier 1 Capital must be at least 6.0% of risk- weighted assets.
                • 记住3个核心指标：8%，6%，4.5%
          • 例题
            • Based on the most important metric in Exhibit 1, the best conclusion about First West's capital adequacy over the past five years is that it has: A. declined. B. improved. C. been unstable.
              • 答案：B 解析：B is correct. The most important metric in assessing capital adequacy is the common equity tier 1 ratio. First West improved its position in that ratio by 150 bps in the five-year period (8.0% to 9.5%).
                • 有一堆指标的时候，简单粗暴只看Tier 1 Core
      • Asset qualirty
        • 记住名字，其他战略性放弃
        • 例题
          • Judith Yoo is a financial sector analyst wntingan industry report In the report, Yoo discusses the relative global systemic risk across industries, referencing Industry A (international property and casualty insurance), Industry B (credit unions), and Industry C (global commercial banks). Part of Yoo' s analysis focuses on Company XYZ, a global commercial bank, and its CAMELS rating, risk management practices, and performance. To assess Company XYZ's risk management practices, Yoo reviews the consumer loan credit quality profile in Exhibit 3. Based on Exhibit 3f the trend in impairment allowances is reflective of the changes in: A. impaired assets. B. strong credit quality assets. C. past due but not impaired assets.
            • C is correct. lmpairment allowances have increased proportionately to the increases in theamount of past due but not impaired assets, which may be in anticipation of these past dueassets becoming, impaired. impaired assets have decreased each year while strong credit qualityassets have increased each year, which suggests lowering impalrment allowances as a result ofimproving credit quality of these financial instruments. YoY change in impaired assets: -5.8% (2017) YoY change in strong credit quality assets: 3.5% (2017) YoY change in past due but not impaired assets: 22.0% (2017) YoY change in impairment allowances: 22.2% (2017)
              • 直接看上升下降趋势也可以做出简单的判断
              • 如果趋势一样，需要看变化的百分比，而不是绝对数值
      • Management capabilities
        • 记住名字，其他战略性放弃
      • Earnings sufficiency
        • 盈利要求
          • 简单总结：往死里吹
        • 盈利来源
          • Net interest income
          • Service income
          • Trading income
            • trading不是银行的主营业务，所以这个优先级最低
            • 例题
              • Hollis Herbison is an analyst specializing in the banking and insurance industries. He uses the CAMELS (capital adequacy, asset quality, management capabilities, earnings sufficiency, liquidity position, and sensitivity to market risk) approach when assessing banks. Herbison first evaluates the financial statements of Denison Bank, a large bank providing services throughout the Americas. He gathers selected information (in $ millions) from Denison's income statements shown in Exhibit 1. Over the last three years, Denison's income sustainability has been: A. trending downwards. B. trendless. C. trending upwards.
                • A is correct A. Correct because Denison's income sustainability over the three-year period has declined. From the data provided, trading income as a percentage of total income for the most recent year was 40.0% ($220/$550), for the previous year it was 35.0% ($184/$525), and for the period two years ago it was 34.0% ($187/$550). Therefore, sustainability over the three-year period has declined from 66.0% two years ago, to 65.0% in the previous year, and finally to 60.0% for the most recent year. Note: Regarding sustainability of a bank's earnings, it is important to examine the composition of earnings. Banks' earnings typically comprise (a) net interest income (the difference between interest earned on loans minus interest paid on the deposits supporting those loans), (b) service income, and (c) trading income. Of these three general sources, trading income is typically the most volatile. Thus, a greater proportion of net interest income and service income is typically more sustainable than trading income. Another indicator of sustainability is the degree to which trading income is part of a bank's revenue stream. Trading income tends to be volatile and not necessarily sustainable. Higher-quality income would be net interest income and fee-based income. These provide sustainable, returning streams of income. B. Incorrect because income sustainability over the three-year period has been declining. Trading income as a percentage of total income has been increasing. C. Incorrect because income sustainability over the three-year period has been declining. Trading income as a percentage of total income has been increasing.
                  • 这题的考点比较刁钻，给你一堆数字，让你看trading income%的变化，来判断整体收入的可持续性
        • 例题
          • Ivan Paulinic, an analyst at a large wealth management firm, meets with his supervisor to discuss adding financial institution equity securities to client portfolios. Paulfnic focuses on Vermillion Insurance (Vermillion% a property and casualty company, and Cobalt Life Insurance (Cobalt). All of the national banks under consideration primarily make long-term loans and source a significant portion of their funding from retail deposits. Paulinic and the rest of the research team note that the central bank is unwinding a long period of monetary easing as evidenced by two recent increases in the overnight funding rate. Paulinic informs his supervisor that: Statement 1 Given the recently reported stronger-than-anticipated macro-economic data, there is an imminent risk that the yield curve will invert. Based on Statement 1, the net interest margin for the three banks' most likely will: A. decrease. B. remain unchanged. C. increase.
            • A is correct. A bank's net interest revenue represents the difference between interest earned on loans and other interest-bearing assets and the level ofinterest paid on deposits and otherinterest-bearing, liabilities. Banks typically borrow money for shorter terms (retail deposits) andlend to customers for longer periods (mortgages and car loans). ifthe yield curve unexpectedly inverts, the short-term funding, costs will increase and the net interest margin will most likelydecrease (not remain unchanged or increase),
      • Liquidity position
        • Liquidity coverage ratio (LCR)
          • = highly liquid assets / expected cash outflows
            • 最好>=100%
          • Expected cash outflows是压力情景下1个月内流动性要求
          • 例题
            • In preparation for her first meeting with her new team, Reddy makes the following notes about how she thinks banks differ from the industrial companies on which she usually works. • Banks will have fewer tangible assets. • Bank assets are predominantly measured at fair market value. • Because banks do not carry inventory, liquidity risks will be negligible. Which of Reddy’s notes concerning banks versus industrials is least accurate? The note concerning: A. fair value. B. liquidity risks. C. tangible assets.
              • 答案：B 解析：B is correct. Liquidity risk is a major concern for a bank, despite not carrying inventory. A bank's assets are primarily financial assets (loans), which are often measured at fair value. It isimportant that a bank have adequate liquidity in its assets such that it could withstand the demand for a redemption of deposits (liabilities) if it arose.
                • 注意银行也有流动性风险
        • Net stable funding ratio
          • =Available stable funding / required stable funding
            • 最好>=100%
          • 例题
            • Reddy continues her preparation by reviewing the Basel III requirements for banks. She expects that the team will be assessing factors relating to the bank's deposits: the ratio of long-term to short-term deposits and the proportion of consumer to interbank deposits. The two deposit factors that Reddy expects the Sutton team will be assessing most likely focus on which of the key Basel III requirements? A. Stable funding B. Minimum liquidity C. Minimum capital requirements
              • 答案：A 解析：A is correct. Stable funding is one of the three key requirements of Basel III. A bank is required to have a minimum amount of stable funding relative to the bank's liquidity needs over a one-year horizon. Stable funding is assessed on the basis of (1) the tenor of deposits, long-term being considered more stable than short-term, and (2) the type of depositor—those from consumers are considered more stable than those from interbank markets.
                • 长期储蓄，客户存款相对更稳定
          • 例题
            • Green includes the following Basel III highlights in his research report: Highlight 1 : Basel III specifies the minimum percentage of its risk-weighted assets that a bank must fund with equity capital. Highlight 2 : Basel III specifies that a bank must hold enough high-quality liquid assets to cover its liquidity needs in a 30-day liquidity stress scenario. Highlight 3 : Basel III requires a bank to have a minimum amount of stable funding relative to the bank's liquidity needs in a 90-day liquidity stress scenario. Which of the following highlights included in Green's research report is incorrect? A. Highlight 1 B. Highlight 2 C. Highlight 3
              • 正确答案：C A.Incorrect because Basel III specifies the minimum percentage of its risk-weighted assets that a bank must fund with equity capital. Therefore, Highlight 1 is an accurate statement. B.Incorrect because Basel III specifies that a bank must hold enough high-quality liquid assets to covers its liquidity needs in a 30-day liquidity stress scenario. Therefore, Highlight 2 is an accurate statement. C.Correct because Basel III requires a bank to have a minimum amount of stable funding relative to the bank's liquidity needs over a one-year horizon and not a 90-day liquidity stress scenario. Therefore, Highlight 3 is an inaccurate statement.
                • 注意流动性要求里，质量要求30天，稳定性要求1年，并且都要求>=100%
      • Sensitivity to market risk
        • 记住名字，其他战略性放弃
          • 例题
            • Green notices that the allowance for loan losses decreased year over year as a result of a recovery of a prior fiscal year charge-off. Green calculates several comparative ratios to assess the quality of the allowance for loan losses. The comparative ratio that Green is least likely to calculate is the ratio of the allowance for loan losses to: A. net income. B. net loan charge-offs. C. non-performing loans
              • 正确答案：A A.Correct because this ratio would not provide any insight to the quality of the allowance for loan losses as it would only represent a comparison against the overall net income of the financial institution. B.Incorrect because it is one of three ratios are helpful in assessing the quality of the allowance for loan losses: - the ratio of the allowance for loan losses to non-performing loans - the ratio of the allowance for loan losses to net loan charge-offs - the ratio of the provision for loan losses to net loan charge-offs C.Incorrect because it is one of three ratios are helpful in assessing the quality of the allowance for loan losses: - the ratio of the allowance for loan losses to non-performing loans - the ratio of the allowance for loan losses to net loan charge-offs - the ratio of the provision for loan losses to net loan charge-offs
                • 虽然战略性放弃，但是还是混个眼熟吧
        • VaR
          • 看组合
          • 例题
            • Ivan Paulinic, an analyst at a large wealth management fimm, meets with hissupervisor to discuss adding financial institution equity securities to clientportfolios.Paulinic focuses on vmillion Insurance (Vemmillion). aproperty and casualty company, and Cobalt Life msurance (Cobalt) Focusing on N-bank and T-bank, Paulinic prepares the following data Based only on Exhibit 3, Paulinic should concude that. A. tading activities are riskier at 'T bank than N-bank. B. trading revenue per unit ofrisk has improved more at N-bank than T-bank. C. compared with duration, the metric used is a better measure of interestrate risk.
              • B is correct. Trading revenue per uit ofrisk can be represented bythe ratio of annual trading revenue to average daily trading value at riskVaR) and represents a measure of reward-to-risk. The trading revenue perunit ofrisk improved at N-bank (from 134x to 160 x) between 2016 and2017, and there was no change at T-bank (80 x). VaR can be used forgauging trends in intra-company risk taking.
                • VaR是一个绝对指标，不能直接相比而得出结论
      • 例题
        • Johansson also asks Smith to review key performance ratios for ABC Bank, a bank in which Aries is invested. The ratios are presented in Exhibit 2. Based on Exhibit 2, Smith and Johansson should conclude that over the past three years, ABC Bank' s: A. liquidity position has declined, B. capital adequacy has improved. C. sensitivity to market risk has improved.
          • C is correct. Over the past three years, there has been a downward trend in the two VaRmeasures-total trading, VaR (all market risk factors) and total trading and credit portfolio VaR.This trend indicates an improvement in ABc Bank's sensitivity, or a reduction in its exposure, tomarket risk. The two liguidity measures-the liquidity coverage ratio and the net stable fundingratio-have increased over the pastthree years, indicating an improvement in ABc Bank'sliquidity position, Trends in the three capital adequacy measures-common equity Tier 1 capitalratio, Tier 1 capital ratio, and total capital ratio-indicate a decline in ABc Bank's capital adequacy.While the total capital ratio has remained fairly constant over the past three years, the commonequity Tier 1 capital ratio and the Tier 1 capitalratio have declined. This trend suggests that ABCBank has moved toward using more Tier 2 capital and less Tier 1 capital, indicating an overalldecline in capital adequacy.
  • 分析保险公司
    • 分类
      • P&C
        • 低风险，低收益，高流动
        • 因为你不知道啥时候就要掏钱
      • L&H
        • 和P&C反过来
        • 因为可以通过精算控制
      • 例题
        • Sarah Williams also works as an analyst at XYZ Investments. She meets with her supervisor, Lina Zhang, to discuss the insurance companies under consideration for investment by the firm. Zhang asks Williams about the differences between P&C and L&H insurers. Williams states the following differences: Difference 1: P&C claims are more variable as they arise from accidents or unpredictable events, whereas L&H insurers’ claims are more predictable because they correlate with actuarial determined mortality rates. Difference 2: P&C companies invest in stable-return, low risk investments, whereas L&H seek the higher returns o?ered by riskier investments. Difference 3: Due to their low-risk investments, P&C companies have lower risk-based capital requirements as compared to L&H insurers, which need a high equity cushion and can have higher capital requirements. Which of the differences between P&C insurers and L&H insurers stated by Williams is incorrect? A. Difference 3. B. Difference 2. C. Difference 1.
          • A is correct. L&H claims are considered more predictable than those of P&C insurers, therefore L&H insurers do not need as high an equity cushion and can have lower capital requirements.
            • S3主要错在lower capital requirements。P&C随时要掏出钱来配，所以需要流动性高，资本充足率高。
      • 例题
        • Which of the following statements regarding insurance companies is most likely correct? A. Compared to P&C insurance companies, L&H insurance companies protect against loss or damage to property. B. The duration of the P&C insurers’ policy is generally shorter than that of the L&H insurers' policy. C. Compared to L&H insurers, P&C insurers usually seek higher returns using more risky investments.
          • 答案：B 解析： 本题考查insurance companies的辨析。 P&C保险公司业务包括财产损失保险，并非是L&H保险公司，因此，选项A是错误的表述；与L&H保险公司相比，P&C保险公司提供的财产保险期限通常更短，因此，选项B是正确的表述；与P&C保险公司相比，L&H保险公司通常会寻求高风险高收益的投资，因此，选项C是错误的表述。 因此，正确选项为B。
            • 熟练辨析2种保险公司直接的特点
    • 核心分析指标
      • Loss and loss adjustment expense ratio
        • =(loss + loss adjustment expense) / net premiums earned
          • Loss expense: 理赔产生的损失
          • Loss adjustment expense: 前期估计损失所进行的调整
          • Net premium earned: 保费收入
        • 流出/流入
        • 从质量衡量盈利能力
      • Underwriting expense ratio
        • =underwriting expense / net premiums written
          • Underwriting expense: 销售人员佣金
          • Net premium written: 收取保费 - 支出的再保修费用
        • 杂项/净收
        • 从效率衡量盈利能力
          • 例题
            • Viktoria Smith is a recently hired junior analyst at Aries Investments. Smith and her supervisor, Ingrid Johansson, meet to discuss some of the firm' s investments in banks and insurance companies. To evaluate P&C insurance companies, Johansson tells Smith that she places emphasis on the efficiency of spending on obtaining new premiums. 25. The best indicator of the operations of a P&C insurance company emphasized by Johansson when evaluating P&C insurance companies is the: A. combined ratio. B. underwriting loss ratio. C. underwriting expense ratio.
              • C is correct. The underwriting expense ratio is an indicator of the efficiency of money spenton obtaining new premiums. The underwriting loss ratio is an indicator ofthe quality of acompany's underwriting activities-the degree of success an underwriter has achieved inestimating the risks insured, The combined ratio, a measure of the overall underwritingprofitability and efficiency of an underwriting operation, is the sum of these two ratios.
                • 注意题目是明确问efficiency
          • 例题
            • Johansson asks Smith to review key performance ratios for three P&C insurers in which Aries is invested. The ratios are presented in Exhibit 1. Based on Exhibit 1, Smith should conclude that the insurer with the most efficient: A. Insurer A. B. Insurer B. C. Insurer C.
              • C is correct. The combined ratio, which is the sum of the underwriting expense ratio and theloss and loss adjustment expense ratio, is a measure of the efficiency of an underwriting operation. A combined ratio of less than 1009 is considered efficient; a combined ratio greaterthan 100% indicates an underwriting loss. insurer C is the only insurer that has a combined ratioless than 100%.
                • 注意题目是明确问efficiency
      • Combined ratio
        • 上面2个加起来
        • 越小越好
        • 例题
          • Doris ZHOU, an analyst, is required to analyze two insurance companies, Golden and Silver. The related information is as below: - | Golden | Silver Loss and loss adjustment expense ratio | 59.7% | 61.9% Underwriting expense ratio | 34.8% | 33.4% Combined ratio | 94.5% | 95.3% Compared with the data of Silver above, Golden most likely: A. is less capable in estimating risks insured. B. is more efficient in obtaining new premiums. C. shows better overall efficiency.
            • 答案：C 解析： 本题考查对P&C insurance companies的分析指标。 Combined ratio越低，通常表明overall efficiency越高，Golden公司Combined ratio为94.5%低于Silver公司的95.3%，故Golden公司overall efficiency更好，选项C正确。 Loss and loss adjustment expense ratio越低，通常表明公司estimating risks insured能力越强，Golden公司Loss and loss adjustment expense ratio为59.7%低于Silver公司的61.9%，故Golden公司能力更强，选项A错误。 Underwriting expense ratio越低，通常表明obtaining new premiums的效率越高，Golden公司Underwritingexpense ratio为34.8%高于Silver公司的33.4%，故Golden公司效率更低，选项B错误。 因此，正确选项为C。
              • 必须熟练掌握3个ratio的含义
• M5 Evaluating Quality of Financial Reports
  • 财报质量
    • High financial reporting quality
    • High earning quality
      • Adequate
      • Sustainable
        • 公式1：Earning(t+1) = a + b * Earning(t) + error
          • beta越大越好
        • 公式2：Earning(t+1) = a + b1 * Cash Flow(t) + b2 * Accruals(t) + error
          • b1比b2越大越好
            • 例题
              • Ioana Matei is a senior portfolio manager for an international wealth management firm. She directs research analyst Teresa Pereira to investigate the earnings quality of Miland Communications. She estimates the following regression model to assess Miland's earnings persistence: Earnings(t+1) = a + b1 * Cash Flow(t) + b2 * Accruals(t) + error Based on the regression model used by Pereira, earnings persistence for Miland would be highest if: A. β1 is less than 0. B. β1 is greater than β2. C. β2 is greater than β1.
                • 答案：B 解析： When earnings are decomposed into a cash component and an accruals component, research has shown that the cash component is more persistent. A beta coefficient (β1) on the cash flow variable that is larger than the beta coefficient (β2) on the accruals variable indicates that the cash flow component of earnings is more persistent than the accruals component. This result provides evidence of earnings persistence.
                  • 送分题
        • 盈利最后会均值回归
      • 例题
        • Which of following situations is least likely to be an indicator of high cash flows quality? A. Positive cash flows. B. Cash flows cover capital expenditures, dividends, and debt repayments. C. High volatility.
          • 答案：C 解析： 该题主要考点为高现金流质量的特点。 对于选项A，现金流质量高的首要因素是必须现金流是正向流入公司的。因此，该选项描述正确，不符合题意。 对于选项B，如果公司获得的现金流能够满足公司所需的资本花销、分红支付及债券偿还，那么认为该现金流是比较充足且质量高的。因此，该选项描述正确，不符合题意。 对于选项C，如果公司的现金流波动大，那么该现金流一般认为是不稳定且质量不高。因此，该选项描述错误，符合题意。 因此正确选项为C。
            • 送分题
  • 潜在影响因素
    • 金额
      • 虚报
    • 时间
      • 提前、延迟确认
    • 科目
      • CF/S计量差异
      • I/S和OCI差异
      • 合并报表和单列合并差异
      • Warning signs
        • 看原版书p295
        • 凭直觉选
        • 考前拜神
    • M&A
      • 机会和动机
    • 不同会计准则
  • Steps of evaluation
    • 1-4
      • 战略性放弃
    • 5. check for warning signs
      • declining receivable turnover
        • 收入假的吧？
      • declining inventory turnover
        • 库存都垃圾？
      • NI > CFO
        • 会计准则太激进
      • 例题
        • Mike MAO is required to analyze Golden Inc. Golden currently exhibited strong earnings growth compared with earnings in the last year whereas the sustainability of the earnings is doubtful. After reviewing the company's financial statements, Mike found that Golden reported an unusually sharp decline in accounts receivable and an increase in long-term trade receivables in the current year. What would most likely be the impact on Golden's performance in the current year if Mikef s finding is correct? Compared with the previous year, Golden's: A. days of inventory on hand (DOH) will increase. B. days of sales outstanding (DSO) will decrease. C. accounts receivable turnover will decrease.
          • 正确答案:B 本题考查财务比率的分析。 DSO =Accounts recetvable/(Revenues/365)，根据 Mike 的发现，本年应收账款大幅下降，DSO会减少，故选项B正确。DSO下降，则应收账款周转率增加，故选项c错误。选项A，DOH的变化无法推断，故选项A错误。因此，正确选项为 B。
    • 6
      • 战略性放弃
    • 7 用量化工具评估
      • Beneish model
        • M-Score > -1.78
          • 操纵利润
        • 缺点
          • 没经济意义
        • 例题
          • Then Zhang asks Williams about the use of quantitative tools to assess the likelihood of misreporting. Williams tells Zhang she uses the Beneish model, and she presents the estimated M-scores for three financial institutions in the following table.
          • Based on the Beneish model results for 2017 in the table above, which company has the highest probability of being an earnings manipulator? A. DEF Bank B. POT Insurance C. UFO Investments
            • A is correct. Higher M-scores indicate an increased probability of earnings manipulation. The company with the highest M-score in 2017 is DEF Bank, with an M-score of –1.54. POT Insurance has the lowest M-score at –2.60, and UFO Investments also has a lower M-score at –1.86. The M-score for DEF Bank is above the relevant cutoff of –1.78.
              • M-score越低越好
              • 临界值-1.78
        • 例题
          • Which of following models is most likely to be a method to assess the probability that a firm will file for bankruptcy? A. Beneish model. B. Altman's model. C. Business model.
            • 答案:B 该题主要考点为公司破产可能性的评估。 对于选项 A，分析师通常使用 Beneish model 去评估公司操纵收益可能性，当计算出的M-score>-1.78时，表示收益操纵的可能性高于可接受的水平。因此，该选项描述错误，不符合题意。 对于选项 B，分析师通常使用 Altman's model 去评估公司破产的可能性，也就是我们熟知的Zscore。因此，该选项描述正确，符合题意。对于选项c，商业模式(business model)指的是企业与企业之间、企业的部门之间、乃至与顾客之间、与渠道之间都存在各种各样的交易关系和连结方式。因此，该选项描述错误不符合题意。 因此正确选项为 B。
      • Altman's model
        • Z > 3
          • 破产概率低
        • Z < 1.81
          • 破产概率高
        • 缺点
          • 没经济意义
          • 单期静态模型
      • M78星云发现有人操纵利润，派奥特曼来看看啥情况，奥特曼一个Z光波看了眼，公司破产了
• M6 Integration of Financial Statement Analysis Techniques
  • Financial statement analysis framework
    • 1-2
      • 战略性放弃
    • 3. Process input data
      • 调整
        • 删掉不用科目
      • Common-size statement
        • 方便做对比
      • Ratios and graphs
        • DuPont Analysis
          • 剔除Equity method的影响
          • financial leverage归因
          • 两分解
            • ROE = NI/Asset * Asset/Equity
          • 三分解
            • ROE = NI/Sales * Sales/Asset * Asset/Equity
              • NI/Sales: 净利率
              • Sales/Asset: 总资产周转率
              • Asset/Equity: 杠杆率
          • 五分解
            • ROE = NI/EBT * EBT/EBIT * EBIT/Sales * Sales/Asset * Asset/Equity
              • NI/EBT: tax burden
              • EBT/EBIT: interest burden
              • EBIT/Sales: EBIT margin
          • 例题
            • Quentin Abay, CFA, is an analyst for a private equity firm interested in purchasing Bickchip Enterprises, a conglomerate. His first task is to determine the trends in ROE and the main drivers of the trends using DuPont analysis. Id do so he gathers the data in Exhibit 1. After conducting the DuPont analysis, Abay believes that his firm could increase the ROE without operational changes. Based on the DuPont analysis, Abay' s belief regarding ROE is most likely based on: A. leverage. B. profit margins. C. asset turnover.
              • A is correct. The DuPont analysis shows that profit margins and asset turnover have both increased over the last three years, but leverage has declined. The reduction in leverage offsets a portion of the improvement in profitability and turnover. Thus, ROE would have been higher if leverage had not decreased.
                • 注意题目问的是could increase，所以要找最有潜力的那一项。也就是之前在变差的项，我们来着手提升。
        • Ratio of capital expenditure proportion to the total asset proportion
          • Capex% / Asset%
            • Capex%反应投资该部门资金占全公司比例
            • Asset%反应该部门资产占全公司比例
            • 大于1说明投资加重
              • growing
            • 分析大于1的部门的利润率，看看相关侧重是否利好
          • 例题
            • After conducting the DuPont analysis, Abay thinks that ROE could improve if the company divested segments that were generating the lowest returns on capital employed (total assets less non-interest-bearing liabilities). Segment EBIT margins in 2020 were 11 percent for Automation Equipment, 5 percent for Power and Industrial, and 8 percent for Medical Equipment. Other relevant segment information is presented in Exhibit 2. Based on Abay's criteria, the business segment best suited for divestiture is: A. medical equipment B. power and Industrial. C. automation equipment.
              • B is correct The Power and industrial segment has the lowest EBlT margins but uses about31 percent of the capital employed. Further, Power and industrial's proportion of the capitalexpenditures has increased from 32 percent to 36 percent over the three years. lts capitalintensity only looked to get worse, as the segment's percentage oftotal capital expenditures washigher than its percentage of total capital in each of the three years. lf Abay is considering divesting segments that do not earn sufficient returns on capital employed, this segment is mostsuitable.
                • 注意分析投资的占比和回报的比例
        • Accruals ratio
          • B/S approach
            • NOA = (Total asset - cash - marketable securities) - (Total liabilities - Total Debt)
            • Aggregate accruals(B/S) = NOA(End) - NOA(Beg)
            • Accruals ratio(B/S) = (NOA(End) - NOA(Beg)) / ((NOA(End) +NOA(Beg) / 2)
            • 例题
              • Jacket, the CFO of Blue Holiday Co., wants to evaluate the persistence and sustainability of the firm1 s earnings by using balance sheet approach. Base on the following data collected by Jacket. What is the Accruals ratio in 2020 under balance sheet approach? A. 55% B. 13% C. 27%
                • Answer: B 该题主要考点为资产负债表法(Balamce approach)下Accruals ratio 的计算。 计算过程如下(in$ millions) NOA END= END(Total assets- Cash- Marketable securities)- END(Totalliabilities - Total debt) =(1.300-150-250)-(550-450)-800 NOA BEG= BEG(Totalassets-Cash- Marketable securities)- BEG(Totalliabilities - Total debt) =(1.200-100-200)-(500-300)=700 Accruals ratio BS = ((NOAEND - NOABEG)) / 0.5*(NOAEND + NOABEG) = (800-700) / (0.5 * (800+700)) =13%因此正确选项为 B。
                  • 基础知识点，必须掌握，
                  • 同时需要一并掌握I/S的算法
          • CF/S approach
            • Accurals(CF/S) = NI - CFO - CFI
            • Accruals ratio(CF/S) = (NI - CFO - CFI) / ((NOA(End) +NOA(Beg) / 2)
            • 例题
              • Jacket, the CFO of Blue Holiday Co., wants to evaluate the persistence and sustainability of the firm's earnings by using cash flow statement approach. Base on the following data collected by Jacket: End of the year(in $ millions) | 2019 | 2020 Total Assets | 1,200 | 1,300 Cash | 100 | 150 Marketable securities | 200 | 250 Total liabilities | 500 | 550 Total debt | 300 | 450 CFO | 150 | 200 CFI | -50 | -100 Net income | 250 | 300 What is the accruals ratio of year 2020 under cash flow statement approach? A. 55% B. 13% C. 27%
                • 答案：C 解析： 该题主要考点为现金流量表法（Cash flow statement approach）下Accruals ratio的计算。 计算过程如下(in $ millions) NOA End = End(Total assets − Cash − Marketable securities) − END(Total liabilities − Total debt) = (1,300 − 150 − 250) − (550 − 450) = 800 NOA Beg = Beg(Total assets − Cash − Marketable securities) − BEG(Total liabilities − Total debt) = (1,200 − 100 − 200) − (500 − 300) = 700 Accruals ratio = (NI − CFO − CFI) / (0.5 * (NOA END + NOA BEG)) =(300 − 200 + 100) / (0.5 * (800 + 700)) = 26.67% 因此正确选项为C。
                  • 基础知识点，必须掌握，
                  • 同时需要一并掌握B/S的算法
            • 例题
              • In Exhibit 1, Alison compiles selected financial statement data for Apex for the year just ended. Alison then assesses the company's earnings quality by calculating the cash-flow-based accruals ratio. Apex's cash-flow-based accruals ratio for the year just ended is closest to: A. 9% B. 10% C. 11%
                • 正确答案：C C.Correct because the cash flow accruals ratio for the year just ended is 11% as follows: = [NI1 − (CFO1 + CFI1)] / [(NOA1 + NOA0) / 2] = [83 − [113 + (–58)]] / [(280 + 229) / 2] = [83 − (55)] / [(509) / 2] = 28 / 254.5 = 11.00…% ≈ 11% Cash flow accruals ratio for time t = [NIt − (CFOt + CFIt)]/[(NOAt + NOAt−1)/2], where NI is net income, CFO is cash flow from operations, and CFI is cash flow from investing.
                  • 基础知识点，必须掌握，
                  • 同时需要一并掌握B/S的算法
          • 绝对值越低越好
    • 4. Analyze/interpret the data
      • Analytical result
        • Impilied value of parent
          • =母公司市场价值 - 母公司联营投资按持有比例计算的市场价值
          • 先折算成本币再计算
    • 5-6
      • 战略性放弃
• M7 Financial Statement Modeling
  • Financial modeling
    • 先I/S，后B/S
    • I/S modeling
      • Revenue
        • Top-down
          • GDP growth
          • Market growth
          • 例题
            • Metric | Net sales Candidate A | Net sales will growat the averageannual growth ratein net sales overthe 2017-19 timeperiod. Candidate B| Industry sales willgrow at the same rateas nominal GDP, but Chrome will have a 2 percentage pointdecline in market Candidate C | Net sales will grow 50bps slower than nomi-nal GDP share. Based on Exhibit above, the modeling approach used by Candidate A, B and C to project future net sales is most accurately classified as a: Candidate A | Candidate B | Candidate C A. bottom-up approach | hybrid approach | top-down approach B. bottom-up approach | top-down approach | top-down approach C. hybrid approach | bottom-up approach | top-down approach
              • 答案：B 解析： A bottom-up approach for developing inputs to equity valuation models begins at the level of the individual company or a unit within the company. By modeling net sales using the average annual growth rate, Candidate A is using a bottom-up approach. A top-down approach usually begins at the level of the overall economy. Both Candidate B and Candidate C are using a top-down approach, which begins at the level of the overall economy.
                • 注意就算是和GDP比，有偏差，也是top-down，不是hybrid
        • Bottom-up
          • Time series
            • 历史增长率
          • return-based
            • 用资产来预估收入
          • capacity-based
            • 基于不同时间产能差异预估收入
        • Hybrid
          • 例题
            • Jamie Kohler, an equity analyst, is doing research on smartphone industry and is analyzing Dami company. Kohler forecasts the selling price of Dami' s latest version smartphone, Dami V100 plus, will grow at expected inflation rate and selling volume will grow at the average growth rate of Dami' s smartphone segment for the past five years. The expected inflation rate is 3.5% and the average growth rate of smartphone segment is 1,2%,Which of following approaches does Kohler use when modeling Dami' s revenue? A. Top-down approach B. Bottom-up approach C. Hybrid approach
              • 答案:C 本题考查在收入建模时的方法。 杰米科勒在预测大米最新款智能手机的销售价格增速时，使用了预期通货膨胀率，这属于自上而下(top-down approach)的建模方法。但是杰米科勒在预测销量时，使用了公司业务部门的平均增速，这属于自下而上(bottom-upapproach)的建模方法。因此收入的整体预测采用了混合型(hybrid)建模方法，答案C正确，符合题意。选项 A和 B均不符合题。
      • Operating cost
        • CoGS
          • 可以用revenue同比例预测
          • 可以参考竞争对手
        • SG&A
          • 小知识点太多，战略性放弃
        • 这两个都可以判断是否处在economic of scale
          • 记得用百分比
          • 例题
            • SmallDragon and LargeDragon are two of the largest Hot Pot restaurants in catering industry in China. Both companies have thousands chain stores all over the world. Although they are dominant companies in the same industry, their operating margins are not quite similar since SmallDragon has 1200 stores with 15 million square footages in total while LargeDragon has 3100 stores with 57 million square footages. Selected financial data are presented in the following table. Do economies of scale exist in the catering industry? A. No B. Yesf but only in COGS C. Yes, in both COGS and SG&A expenses
              • 答案:B 本题考查在利润表建模中判断规模经济是否存在。通过题目的描述可以知道，无论是从门店数量还是所有门店总占地面积来看，“大龙”火锅店的规模比“小龙"火锅店的规模大得多。因此这道题目的关键是通过两家企业的经营利润率的高低对比来判断，规模大的企业是否能够有效降低平均成本。以 2020 的数据为例,“大龙"公司的 COGs 占销售收入的占比为 25.16%,而“小龙"公司的 COGS占销售收入的占比为 49.65%,很显然,在 COGs 上“大龙"公司体现了规模经济。再来看 SG&A成本，“大龙”公司的 sG&A占销售收入的占比为 46.50%，而“小龙”"公司的 SG&A占销售收入的占比为 18.44%，很显然，SG&A成本并没有体现出规模经济。所以选项B正确。选项A错误，因为 COGS体现了规模经济效应。选项C错误，因为 SG&A并没有规模经济效应。
                • 注意一定是看比例的变化
    • B/S modeling
      • 原因
        • 收到I/S预测影响
      • 科目
        • A/R, Inventory, PP&E, Capital Structure
          • 小知识点太多，战略性放弃
          • 靠常识可以做个七八成，莫慌（毒奶+1）
        • 例题
          • Fiona Chen, CFA, the Chief Investment Officer in ABC high-technology company, manages the capital structure of the company. ABC is the leading company in semiconductor industry and profitable in the past decade and expected to remain profitable. However, Chen forecasts earnings to decline 3% annually in the next several years since industry competition rises. Chen intends to increase debt-to-capital ratio from 30% to 35% next year. Assuming company ABC will retain all earnings and not repurchase shares or pay any dividend, how will ABC's total debt most likely change during next year? A. Total debt will increase B. Total debt will decrease C. It is undetermined
            • 答案:A 本题考查资产负债表的建模。 根据题目描述，Fiona认为 ABC公司的能够维持盈利的状态，但是净利润数额会以3%的速率下降，因此净利润一定为正。如果净利润为正，同时公司将收益全部留存且不会回购股份那么权益(equity)的数额一定会增加。在预期权益增加且企图提高债务资本比(debt-to-capital)的情况下，总负债(debt)一定会增加。所以选项A正确。选项B错误，总负债会增加，而非减少。选项c错误，总负债会增加，并非不能确定其变化方向。
              • 注意这里earning虽然是下降，但是还是为正。所以总资产还是在上升的。
    • CF/S modeling
      • 你知道里面有哪3类，每一类里面有哪些项，对吧？
        • 靠常识可以做个七八成，莫慌（毒奶+1）
        • 例题
          • David notes that for the year just ended (2019), Gong's COGS was 30% of sales. To forecast Gong's income statement for 2020, David assumes that all companies in the industry will experience an inflation rate of 8% on the COGS. Exhibit 2 shows David's forecasts relating to Gong's price and volume changes. Exhibit 2: Gong's 2020 Forecasted Price and Volume Changes Average price increase per unit: 5.00% Volume growth: -3.00% Based on Exhibit 2 Gong's forecasted gross profit margin for 2020 is closest to: A. 62.7%. B. 67.0%. C. 69.1%.
            • 答案：C 解析：C is correct. The calculation of Archway's gross profit margin for 2020, which reflects the industry-wide 8% inflation on COGS, is calculated as follows: Revenue growth: 1.85% COGS increase: 4.76% Forecasted revenue (Base revenue = 100): 101.85 Forecasted COGS (Base COGS = 30): 31.43 Forecasted gross proft: 70.42 Forecasted gross proft margin: 69.14%
              • 送分题
              • 注意Revenue的变化也影响成本
  • Behavior Finance
    • Overconfidence bias, Conservatism bias, representativeness bias
      • 一级内容还没忘，对吧？
      • 靠常识可以做个七八成，莫慌（毒奶+1）
    • Illusion of control bias
      • 人生三大错觉
      • 和overconfidence bias相关
      • 解决
        • 正视不确定性
        • 唾手可得的信息少用
        • 关注重要变量
        • 多和核心人物谈谈
    • Confirmation bias
      • 自我催眠
      • 和overconfidence以及representativeness bias密切相关
      • 解决
        • 和悲观者谈谈
        • 和不投资的人谈谈
    • Base-rate neglect
      • Representariveness bias
      • 误将公司特征当成行业特征
      • 解决：纳入行业可比公司数据
      • 例题
        • Vergil is conducting research on Beta Co, a leading biopharmaceutical company. Beta's detailed firm-specific information has been collected, including but not limited to its R&D expenditures, number of sales representatives, and gross profit margins for its major products. Data of comparable companies within the same industry has also been collected for comparison purposes. By doing so, Vergil will most likely mitigate which of the following bias? A. conservatism Bias B. base-rate neglect C. confirmation Bias
          • 答案：B 解析： 该题主要考点为财务预测中的行为偏差。 解析：Base-rate neglect是代表性偏差（Representativeness Bias）中的一种常见形式，指分析师在分析时忽略了公司的某个特定特征在整个行业特征中的发生的概率，而误将公司的特定特征认定为行业特征。分析师在预测公司的盈利水平时，除了分析公司的自身数据外，也将行业可比公司数据纳入分析中，以此降低base-rate neglect。因此，正确选项为B。 对于A选项，Conservatism Bias是指在做分析时，会采用各种方法以维持他们先前的预测或所持的观点，而不吸收新信息，特别是与原有预测相矛盾的新信息。题目中并未提及从此类情况，因此，该选项错误。对于C选项，Confirmation Bias是指在建模预测过程中，分析师倾向于寻找和注意能证实其信念的东西，只追求积极的信息和标准，或者缩小研究范围。例如，如果分析师对某家公司从持有积极观点，他只会与持有相同观点的分析师或者该公司的管理层进行交谈。题目中并未提到此类情况，因此，该选项错误。
  • Competitive factors
    • 波特五力
      • 一级内容还没忘，对吧？
      • 靠常识可以做个七八成，莫慌（毒奶+1）
      • 例题
        • Based on the current competitive landscape presented in Exhibit 1, David should conclude that Gong's ability to: A. pass along price increases is high. B. demand lower input prices from suppliers is low. C. generate above-average returns on invested capital is low
          • 答案：A 解析：A is correct. Porter's five forces framework in Exhibit 1 describes an industry with high barriers to entry, high customer switching costs (suggesting a low threat of substitutes), and a specialized product (suggesting low bargaining power of buyers). Furthermore, the primary production inputs from the large group of suppliers are considered basic commodities (suggesting low bargaining power of suppliers). These favorable industry characteristics will likely enable Archway to pass along price increases and generate above-average returns on invested capital.
            • 送分题
        • Based on the current competitive landscape presented in Exhibit 1, Gong's operating profit margins over the forecast horizon are least likely to: A. decrease. B. remain constant. C. increase.
          • 答案：A 解析：A is correct. The current favorable characteristics of the industry (high barriers to entry, low bargaining power of suppliers and buyers, low threat of substitutes), coupled with Archway's dominant market share position, will likely lead to Archway's profit margins being at least equal to or greater than current levels over the forecast horizon.
            • 送分题
  • Long-term forecasting
    • forecast horizon
      • = expected holding period
    • normalized earnings
    • 这块还是战略性放弃吧，有时间可以学点其他的
    • 靠常识可以做个七八成，莫慌（毒奶+1）
  • 对比
    • 例题
      • David, an analyst at Golden Investment Management, is analyzing Gong Technologies, a manufacturer of luxury electronic auto equipment, at the request of his supervisor, Lukas Wright. David is asked to evaluate Gong's profitability over the past five years relative to its two main competitors, which are located in different countries with significantly different tax structures. Which profitability metric should David use to assess Gong's five-year historic performance relative to its competitors? A. Current ratio B. Operating margin C. Return on invested capital
        • 答案：B 解析：B is correct. Operating (EBIT) margin is a pre-tax profitability measure that can be useful in the peer comparison of companies in countries with different tax structures. Archway's two main competitors are located in different countries with significantly different tax structures; therefore, a pre-tax measure is better than an after-tax measure, such as ROIC. The current ratio is a liquidity measure, not a profitability measure.
          • 注意如果税有影响的话，就应该避开
• 特别提醒
  • 所有内容纯自用，仅小范围分享，请勿进一步传播！
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  • 的是重要知识点，颜色越深越重要
  • 是习题，颜色越深越重要
  • 拓展题只用来做知识拓展，非必看。但是有能力建议看
  • 该思维导图只用来努力覆盖70%基础知识点和常规考法，不覆盖任何拓展知识点和难题、进阶题。
  • 不提供源文件，谢谢