2010 年 12 月 ACCA 考试 P5 真题
Section A–BOTH questions are compulsory and MUST be attempted
1
Film Productions Co(FP)is a small international company producing films for
cinema release and also for sale on DVD or to television companies.FP deals with
all areas of the production from casting,directing and managing the artists to
negotiating distribution deals with cinema chains and TV channels.The industry is
driven by the tastes of its films' audience,which when accurately predicted can lead
to high levels of profitability on a successful film.
The company's stated mission is to 'produce fantastic films that have mass
appeal'.The company makes around $200 million of sales each year equally split
between a share of cinema takings,DVD sales and TV rights.FP has released 32 films
in the past five years.Each film costs an average of $18 million and takes 12 months
to produce from initial commissioning through to the final version.Production
control is important in order to hit certain key holiday periods for releasing films
at the cinema or on DVD.
The company's films have been moderately successful in winning industry awards
although FP has never won any major award.Its aims have been primarily commercial
with artistic considerations secondary.
The company uses a top-down approach to strategy development with objectives
leading to critical success factors(CSFs)which must then be measured using
performance indicators.Currently,the company has identified a number of critical
success factors.The two most important of these are viewed as:
(i)improve audience satisfaction
(ii)strengthen profitability in operations
These CSFs will need to be measured and there must be systems in place to perform
that role.The existing information system of the company is based on a fairly basic
accounting package.However,the CEO has been considering greater investment in these
systems and making more use of the company's website in both driving forward the
business'links to its audience and in collecting data on them.
The CEO is planning a report to the board of Film Productions and has asked you
to help by drafting certain sections of this report.
Required:
You are required to draft the sections of the CEO's report answering the
following questions:
(a)Explain the difference between the following two types of CSF:monitoring and
building,using examples appropriate to FP.(4 marks)
(b)Identify information that FP could use to set its CSFs and explain how it
could be used giving two examples that would be appropriate to FP.(6 marks)
(c)For each of the two critical success factors given in the question,identify
two performance indicators(PIs)that could support measurement of their achievement
and explain why each PI is relevant to the CSF.(10 marks)
(d)Discuss the implications of your chosen PIs for the design and use of the
company's website,its management information system and its executive information
system.(9 marks)
Professional marks will be awarded in Question 1 for appropriateness of style
and structure of the answer.(2 marks)
(31 marks)
2
Robust Laptops Co(RL)make laptop computers for use in dangerous
environments.The company's main customers are organisations like oil companies and
the military that require a laptop that can survive rough handling in transport to
a site and can be made to their unique requirements.
The company started as a basic laptop manufacturer but its competitors grew much
larger and RL had to find a niche market where its small size would not hinder its
ability to compete.It is now considered one of the best quality producers in this
sector.
RL had the same finance director for many years who preferred to develop its
systems organically.However,due to fall in profitability,a new chief executive
officer(CEO)has been appointed who wishes to review RL's financial control systems
in order to get better information with which to tackle the profit issue.
The CEO wants to begin by thinking about the pricing of the laptops to ensure
that selling expensive products at the wrong price is not compromising profit
margins.The laptops are individually specified by customers for each order and
pricing has been on a production cost plus basis with a mark-up of 45%.The company
uses an absorption costing system based on labour hours in order to calculate the
production cost per unit.
The main control system used within the company is the annual budget.It is set
before the start of the financial year and variances are monitored and acted upon
by line managers.The CEO has been reading about major companies that have stopped
using budgets and wants to know how such a radical move works and why a company might
take such a step.He has been worried by moves by competitors into RL's market with
impressive new products.This has created unrest among the staff at RL with two
experienced managers leaving the company.
Financial and other information for Robust Laptops
Robust Laptops
Data for the year ended 30 September 2010
Required:
Write a report to the CEO to include:
(a)An evaluation of the current method of costing against an Activity Based
Costing(ABC)system.You should provide illustrative calculations using the
information provided on costs for 2010 and Order 11784.Briefly state what action
management might take in the light of your results with respect to this order.(15
marks)
(b)An explanation of the operation of a beyond budgeting approach and an
evaluation of the potential of such a change at RL.(10 marks)
Professional marks will be awarded in Question 2 for appropriateness of
format,style and structure of the report.(4 marks)
(29 marks)
Section B–TWO questions ONLY to be attempted
3 LOL Co is a chain of shops selling cards and gifts throughout its country.It
has been listed on the stock exchange for 10 years and enjoys a fairly high profile
in the retail sector of the national economy.You have been asked by the chief
executive officer(CEO)to advise the company on value-based management(VBM),as a
different approach to performance management.The CEO has read about this method as
a way of focusing on shareholder interests and in the current tough economic
climate,she thinks that it may be a useful development for LOL.
The company has traditionally used earnings per share(EPS)growth and share price
in order to assess performance.The changes being proposed are considered significant
and the CEO wants to be briefed on the implications of the new analysis and also
how to convince both the board and the major investors of the benefits.
Financial data for LOL
Required:
(a)Explain to the CEO what value-based management involves and how it can be
used to focus the company on shareholder interests.(4 marks)
(b)Perform an assessment of the financial performance of LOL using Economic
Value Added()and evaluate your results compared with those of earnings per
share(EPS)growth and share price performance.You should state any assumptions
made.(12 marks)
(c)Evaluate VBM measures against traditional profit based measures of
performance.(4 marks)
(20 marks)
Section B–TWO questions ONLY to be attempted
4
FGH Telecom(FGH)is one of the largest providers of mobile and fixed line
telecommunications in Ostland.The company has recently been reviewing its corporate
objectives in the light of its changed business environment.The major new addition
to the strategic objectives is under the heading:'Building a more environmentally
friendly business for the future'.It has been recognised that the company needs to
make a contribution to ensuring sustainable development in Ostland and reducing its
environmental footprint.Consequently,it adopted a goal that,by 2017,it would have
reduced its environmental impact by 60%(compared to year 2001).
The reasons for the board's concern are that the telecommunications sector is
competitive and the economic environment is increasingly harsh with the markets for
debt and equities being particularly poor.On environmental issues,the government
and public are calling for change from the business community.It appears that
increased regulation and legislation will appear to encourage business towards
better performance.The board have recognised that there are threats and
opportunities from these trends.It wants to ensure that it is monitoring these
factors and so it has asked for an analysis of the business environment with
suggestions for performance measurement.
Additionally,the company has a large number of employees working across its
network.Therefore,there are large demands for business travel.FGH runs a large fleet
of commercial vehicles in order to service its network along with a company car scheme
for its managers.The manager in charge of the company's travel budget is reviewing
data on carbon dioxide emissions to assess FGH's recent performance.
Recent initiatives within the company to reduce emissions have included
(a)the introduction in 2010 of a homeworking scheme for employees in order to
reduce the amount of commuting to and from their offices and
(b)a drive to increase the use of teleconferencing facilities by employees.
Section B–TWO questions ONLY to be attempted
Data on FGH Telecom:
Carbon Dioxide emissions
Required:
(a)Perform an analysis of FGH's business environment to identify factors which
will affect its environmental strategy.For each of these factors,suggest
performance indicators which will allow FGH to monitor its progress.(8 marks)
(b)Evaluate the data given on carbon dioxide emissions using suitable
indicators.Identify trends from within the data and comment on whether the company's
behaviour is consistent with meeting its targets.(9 marks)
(c)Suggest further data that the company could collect in order to improve its
analysis and explain how this data could be used to measure the effectiveness of
the reduction initiatives mentioned.(3 marks)
(20 marks)
Section B–TWO questions ONLY to be attempted
5
RM Batteries Co(RMB)is a manufacturer of battery packs.It has expanded
rapidly in the last few years under the leadership of its autocratic chairman and
chief executive officer,John Smith.Smith is relentlessly optimistic.He likes to get
his own way and demands absolute loyalty from all his colleagues.
The company has developed a major new product over the last three years which
has necessitated a large investment in new equipment.Smith has stated that this more
efficient battery is critical to the future of the business as the company operates
in a sector where customers expect constant innovation from their suppliers.
However,the recent share price performance has caused concern at board level
and there has been comment in the financial press about the increased gearing and
the strain that this expansion is putting on the company.The average share price
has been $1.56(2008),$1.67(2009)and $1.34(2010).There are 450 million shares in
issue.
A relevant Z-score model for the industry sector is:
Z = 1·2X1 + 1·4X2 + 3·3X3 + 0·6X4 + X5
Where
X1 is working capital/total assets(WC/TA);
X2 is retained earnings reserve/total assets(RE/TA);
X3 is Profit before interest and tax/total assets(PBIT/TA);
X4 is market value of equity/total long-term debt(Mve/total long-term debt);and
X5 is Revenue/total assets(Revenue/TA).
A score of more than 3 is considered safe and at below 1.8,the company is at
risk of failure in the next two years.
Section B–TWO questions ONLY to be attempted
The company's recent financial performance is summarised below:
Summary Income Statements