FIN4801
EXAM PACK
+27 81 278 3372
,UNIVERSITY EXAMINATIONS
January/ February 2022
FIN4801
Advanced Financial Management
100 Marks
Duration: 4 Hours
Instructions:
• This paper consists of 13 pages, including appendix A (financial tables) on pages 9 to
13.
• This is an open-book examination.
• As the examination is an assessment, it should be your own work and you should
remember to tick the Declaration of Honesty.
• Plagiarism checks will be run on your submission on Turnitin and manual checks will
be done.
• Remember to save your file as a PDF before submitting it.
• Start submitting it as soon as the writing time for the paper has stopped (after the four
hours). Do not use your upload time to answer the paper.
• Ensure that your answers are uploaded on time, you have one hour to upload.
• We cannot help you in the last 15 minutes of the upload time and you must contact us
immediately if you are experiencing any issues with uploading or during the paper.
• Answer all the questions.
• Show all your calculations clearly and label your answers.
• Submit your paper on the myExams platform.
• See the instructions regarding the Invigilator Application on the next page.
, CONFIDENTIAL FIN4801
Page 2 of 13 JANUARY/ FEBRUARY 2022
Please take note that The Invigilator App will request you take a picture of every page of
your answer sheet at the end of the assessment.
Please take note that this does not replace your formal scan and upload to your Learning
Management System (MyExams).
YOUR EXAM QR CODE & QR ACCESS CODE:
INSTRUCTIONS ON THE DAY OF ASSESSMENT:
• Please log into The Invigilator App. You need to be connected to the internet in order to log in
and scan the QR code.
• Scan the QR code above once the examination formally commences. If you encounter difficulty
with scanning of the QR code you can also enter the QR access code at the bottom of the QR
code in order to start the assessment.
• Once the QR code is scanned, you can place your smartphone next to you. The Invigilator App
will notify you when an action is required. Ensure your media volume Is turned up.
• You may access your MyExams in the application if you only have one device by pressing the
‘access LMS’ button.
• Please remember to keep your smartphone on charge for the duration of the assessment.
• Keep The Invigilator app open on your cell phone during the assessment. You are not allowed to
leave or minimise the application.
• When an action is required, a notification beep will be heard. Action the request.
• Please ensure you are connected to the internet in order to commence the examination as well
as at the end of the examination. No internet connection is needed during the assessment.
• It is important to first upload your script to the MyExams. Uploading of app data is not time
sensitive and you can do it after you have uploaded your script to the MyExams.
• It is important to note that you have to adhere to the time limit in your MyExams assessment as
the invigilation time in the app could exceed the time allocated to complete your assessment.
• You can click the "Finish Assessment" button in the app if you finish early.
• Should you encounter any technical difficulty, please WhatsApp The Invigilator Helpdesk on 073
505 8273.
[TURN OVER]
, CONFIDENTIAL FIN4801
Page 3 of 13 JANUARY/ FEBRUARY 2022
QUESTION 1 [5 marks]
This question is comprised of three multiple-choice questions (MCQs). Write down only the
question number and the corresponding answer option you choose, for example:
Question 7.9: C.
Question 1.1 (1 mark)
Brundle Ltd is a reseller of dried foods, which is a burgeoning market. The company requires
funding to expand. With inflation expectations increasing rapidly, the owners wish to raise
equity rather than debt. If the company were to raise a significant amount of equity from purely
new sources, with all else staying the same as before, what would you expect would change
for the company?
Choose the most correct option below.
The company’s … .
a. EPS would increase, beta would increase and the current control would be diluted
b. EPS would decrease, beta would increase and the current control would be
consolidated
c. EPS would decrease, beta would decrease and the current control would be diluted
d. EPS would decrease, beta would decrease and the current control would be
consolidated
Question 1.2 (3 marks)
Rad Ltd supplies clothing products to retail outlets and has recently spun off its growing online
operations into a separate company. The management and board of the company resolved to
follow a strict residual approach to dividend pay-outs in the future, as limited growth is
expected from the retail sector. In the current year, of which we are at the end, the company
has generated a net profit (available to ordinary shareholders) of R30 000 000 and has
150 000 ordinary shares outstanding. The company expects capital requirements of
R10 000 000 in the coming year. If the company raises half of its funds from debt, what per-
share dividend would it pay this year?
a.) R100
b.) R125
c.) R166
d.) R200
[TURN OVER]
EXAM PACK
+27 81 278 3372
,UNIVERSITY EXAMINATIONS
January/ February 2022
FIN4801
Advanced Financial Management
100 Marks
Duration: 4 Hours
Instructions:
• This paper consists of 13 pages, including appendix A (financial tables) on pages 9 to
13.
• This is an open-book examination.
• As the examination is an assessment, it should be your own work and you should
remember to tick the Declaration of Honesty.
• Plagiarism checks will be run on your submission on Turnitin and manual checks will
be done.
• Remember to save your file as a PDF before submitting it.
• Start submitting it as soon as the writing time for the paper has stopped (after the four
hours). Do not use your upload time to answer the paper.
• Ensure that your answers are uploaded on time, you have one hour to upload.
• We cannot help you in the last 15 minutes of the upload time and you must contact us
immediately if you are experiencing any issues with uploading or during the paper.
• Answer all the questions.
• Show all your calculations clearly and label your answers.
• Submit your paper on the myExams platform.
• See the instructions regarding the Invigilator Application on the next page.
, CONFIDENTIAL FIN4801
Page 2 of 13 JANUARY/ FEBRUARY 2022
Please take note that The Invigilator App will request you take a picture of every page of
your answer sheet at the end of the assessment.
Please take note that this does not replace your formal scan and upload to your Learning
Management System (MyExams).
YOUR EXAM QR CODE & QR ACCESS CODE:
INSTRUCTIONS ON THE DAY OF ASSESSMENT:
• Please log into The Invigilator App. You need to be connected to the internet in order to log in
and scan the QR code.
• Scan the QR code above once the examination formally commences. If you encounter difficulty
with scanning of the QR code you can also enter the QR access code at the bottom of the QR
code in order to start the assessment.
• Once the QR code is scanned, you can place your smartphone next to you. The Invigilator App
will notify you when an action is required. Ensure your media volume Is turned up.
• You may access your MyExams in the application if you only have one device by pressing the
‘access LMS’ button.
• Please remember to keep your smartphone on charge for the duration of the assessment.
• Keep The Invigilator app open on your cell phone during the assessment. You are not allowed to
leave or minimise the application.
• When an action is required, a notification beep will be heard. Action the request.
• Please ensure you are connected to the internet in order to commence the examination as well
as at the end of the examination. No internet connection is needed during the assessment.
• It is important to first upload your script to the MyExams. Uploading of app data is not time
sensitive and you can do it after you have uploaded your script to the MyExams.
• It is important to note that you have to adhere to the time limit in your MyExams assessment as
the invigilation time in the app could exceed the time allocated to complete your assessment.
• You can click the "Finish Assessment" button in the app if you finish early.
• Should you encounter any technical difficulty, please WhatsApp The Invigilator Helpdesk on 073
505 8273.
[TURN OVER]
, CONFIDENTIAL FIN4801
Page 3 of 13 JANUARY/ FEBRUARY 2022
QUESTION 1 [5 marks]
This question is comprised of three multiple-choice questions (MCQs). Write down only the
question number and the corresponding answer option you choose, for example:
Question 7.9: C.
Question 1.1 (1 mark)
Brundle Ltd is a reseller of dried foods, which is a burgeoning market. The company requires
funding to expand. With inflation expectations increasing rapidly, the owners wish to raise
equity rather than debt. If the company were to raise a significant amount of equity from purely
new sources, with all else staying the same as before, what would you expect would change
for the company?
Choose the most correct option below.
The company’s … .
a. EPS would increase, beta would increase and the current control would be diluted
b. EPS would decrease, beta would increase and the current control would be
consolidated
c. EPS would decrease, beta would decrease and the current control would be diluted
d. EPS would decrease, beta would decrease and the current control would be
consolidated
Question 1.2 (3 marks)
Rad Ltd supplies clothing products to retail outlets and has recently spun off its growing online
operations into a separate company. The management and board of the company resolved to
follow a strict residual approach to dividend pay-outs in the future, as limited growth is
expected from the retail sector. In the current year, of which we are at the end, the company
has generated a net profit (available to ordinary shareholders) of R30 000 000 and has
150 000 ordinary shares outstanding. The company expects capital requirements of
R10 000 000 in the coming year. If the company raises half of its funds from debt, what per-
share dividend would it pay this year?
a.) R100
b.) R125
c.) R166
d.) R200
[TURN OVER]
