EVA Simplified | Exam Help and Tips for ACCA APM students | Question Stillwater
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- čas přidán 25. 07. 2024
- Help, tips and exam technique guidance to help you pass ACCA paper APM. Here's how to quickly solve an Economic Value Added (EVA) question (Stillwater June 2012) in the computer-based exams with tips on using spreadsheet formulas and functions. This video helps you pass the ACCA APM CBE exam, demystifying EVA (Economic Value Added).
Here's the link to the ACCA APM question "Stillwater," December 2012: drive.google.com/file/d/1PiYv...
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Table of Contents:
00:00 - Introduction
00:41 - Concepts behind Economic Value Added
00:51 - Present Value of Perpetuity
01:43 - Value of a company
04:27 - What EVA measures
04:51 - EVA Calculation
05:00 - NOPAT
05:24 - WACC * Capital Employed
05:40 - EVA
06:56 - Question Stillwater
06:57 - EVA Template Setup
07:40 - WACC Working
10:00 - NOPAT working
11:37 - R&D working
14:27 - Opening Capital Employed working
18:57 - Final EVA Calculation
21:17 - "Evaluation" requirement
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Steve Willis ACCA
How to pass ACCA exams
For more help with APM EVA, please check out open Tuition: • Divisional Performance... and • Divisional Performance...
Great video as ever, thanks Steve. This has helped me out a lot for March's APM exam! Your content is always super helpful.
Happy to help!
Very helpful ! Highly recommended to watch at least once. Simple and sweet
Thanks :)
Another really helpful video! Understand this topic a lot more now! Thanks!
Glad it was helpful!
Thanks for sharing valuable knowledge 💯💯💯💯
My pleasure
Thank you for this video. You have helped me by explaining the reason for obtaining the closing 2011 balance
Glad it was helpful!
Thanks you for your content and expertise, Steve! Very much appreciated.
My pleasure!
Thanks so much Steve! Something very similar came up today and I am grateful to have solved this with you this morning. Fingers crossed for July!
Fantastic! Glad it helped.
@@SteveWillisACCAI passed with 78% From PM, FM and now APM, you have been a huge source of help to me! Now an ACCA affiliate! Thank you so much Steve! Blessings to you!
Thank you so much.God bless
Glad it helped.
Thank you sir for this great video. it is extremely helpful:)
Most welcome!
Thanks a lot!
You're welcome!
Helpful
Glad you think so!
Hi Steve, how many marks would you have got roughly just for the calculation part? So if there are 13 marks how many are we looking to get from the write up?
Thanks for this video, it was so helpful.
Hi there, I'm glad the video helped :) the numbers are 10 marks, and the discussion is for 3 marks. Make sure you know this topic for next Wednesday.
Hi Tutor, amortisation for research and development was not charged for the year 2018, why is that? Thanks
Hi, there's no mention in the scenario the RD project needs amortisation, they simply say there was an expense for the long term benefit of the company. Please see question Arkaig SD19 for an example of when you need to amortise, it; they tell you precisely to do that.
For EVA, if WACC is using post tax cost of debt, is tax shield a deduction in NOPAT? While WACC using pre tax cost of debt as stated, is tax shield an addition in NOPAT?
Yes, treat NOPAT as if it was funded 100% equity, so there is no tax benefit at that line. The tax benefit happens at cost of debt in WACC.
Hi Steve thanks for this, i sat for APM in June and got 49 Tommorow i will be sitting for my second attempt, any tips to earn extra marks on how answer you can give for final revision just to edge to 50+ this time
1. Consider it as a business simulation, not an academic exam 2. Make sure everything you write is helpful to the reader 3. Find the embedded requirements, do exactly that 4. Structure your answer on the verbs you find in the embedded requirement 5. Professional marks--develop your points for professional marks. Use linking words to help you do this. Say, 'however,' 'also,' etc... GOOD LUCK!
@@SteveWillisACCA Thank you very much well noted i am minutes away to my exam and this is very helpful
Hi Steve, great video. Just wanted to confirm that dont we add Increase in provisions and deduct decrease in provisions from Operating Profit rather than the capital employed as this is what ACCA's technical article says; please elaborate. Moreover, shouldn't the tax be 9.5 rather than 9?
Hi there, tax charge is 9.5--tax paid is 9.0. Any non-cash expense gets reducted from operating profit. With capital employed, the examiner wants you to use OPENING capital employed, so the charges in the current year don't affect the opening capital employed.
Hi Steve, thank you for the great video.
Just one question, why do we not adjust for tax on the other items we deduct from NOPAT, while we do this for interest? Some of other adjustable items may be material and may be tax allowable. Thanks in advance :)
Hi there, we show 'tax paid' in the NOPAT working, so this includes all the tax savings of the operating costs.
hi Steve, do you provide tuition services please ? thank you
Yes, I work for several training companies, but at the moment I don't have an open course. But I will change that this year. If you need help with PM, please check out my site www.accaexamhelp.com. I'll also be posting new APM videos next week.
@@SteveWillisACCA Where are the APM videos?
@@rosiemangerona5408 i have seen PM only on his website, i guess next year probably for APM
7:23 hi Steve , i cant find link for the practice question
Please check the description of the video, it's there.
After tax cost of Debt should be 0.05*(1-0.25) instead of 0.05*(1-0.3)
Oops! Thanks for catching that--0.3 is so common as the tax rate I must have been in auto-pilot. I'll update that.
I thought the provision amount for the NOPAT calculation would be the increase $1.5M (2-0.5) instead of the $2M.
Am I missing something?
There are two places to deal with this--in the NOPAT, and the Adjusted Cap employed. For the NOPAT, they are giving you the annual charge in the question, so that is the non cash expense to add back.
hi Steve, urs APM videos are very useful.
do u have APM videos in ur own platform or website as I tried looking for it but I cant find.
it would be soo useful if I can ask questions and also watch such videos for other chapters of APM too
Thanks for your interest, but I'm sorry I don't have that yet.