How to use the IRR Function | ACCA FM Help

Help, exam technique and tips to pass the ACCA FM / F9 exam. Here's how to use the IRR function in ACCA paper FM: it will save you time in Section C, for example in a Weighted Average Cost of Capital (WACC) question. This step-by-step approach shows the IRR working from ACCA FM question Fence. Using the IRR function will help you pass your upcoming ACCA FM CBE exam. Good luck!
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Steve Willis ACCA
How to Pass ACCA FM
If you'd like more information on this ACCA FM IRR, check out Open Tuition: • ACCA F9 Discounted Cas...

[@S09IA]

Hi Steve. Thanks to your videos I finally passed PM in the March sitting! Unfortunately I was 2 marks off FM and will be resitting on Sep 9th. Big ask but if there's any chance of covering more FM content i.e the latest papers on the practice platform or topics such as the dividend growth model and CAPM, that would be a huge help.

[@SteveWillisACCA]

I'll see what I can do over the weekend and early next week. Good luck this time, fingers crossed for you.

[@S09IA]

@@SteveWillisACCA Hi Steve. I've just had my September result through and I got 49%. I'm feeling absolutely gutted and deflated but not willing to give up. I would really appreciate some more FM content to get me through. Sadly a lot of these techniques and models were not tested either time that I've attempted FM including WACC which is so frustrating.

[@SteveWillisACCA]

Over the next two weeks I'll be adding more FM videos.

[@zakkhan6095]

Hi Steve, could you go through Section A and/or B for the FM papers please?

[@SteveWillisACCA]

Will do that soon

[@KhabibandEnola]

@@SteveWillisACCA looking forward!

[@pavanvladdamusicproduction7291]

Hi Steve, thanks alot for your efforts

[@SteveWillisACCA]

My pleasure :) hope you find them helpful!

[@jayshreekrishna8086]

Nice quick learning...

[@SteveWillisACCA]

Thanks for watching

[@KhabibandEnola]

thanks so much for your videos

[@SteveWillisACCA]

Glad it helped :)

[@Salman_Zahur]

Steve, hi! Many thanks, and a request. Could you please proceed a little more slowly, overall? I suppose the kind of candidates you seem to be targeting are already so good that they probably don’t need much help. My suggestion would be that your learner base should increase a good deal if you decided to include somewhat less quick learners too.

[@SteveWillisACCA]

Thanks for the tip--l'll slow down

[@maria041192]

Hi Steve, thank you for the helpful videos! quick question re. the above please, I have seen an IRR example in the ACCA FM mock debrief and it does IRR(grabs the range) but also includes a "comma" 0.20 as a guess of the discount factor % in the formula in excel - what s the difference here please? should we just grab the range or do we also need to include the DF? thanks in advance!

[@SteveWillisACCA]

Hi, the guess is optional. I've never used it in ACCA exams--if you are doing standard IRR stuff, like cost of debt, or IRR after NPV, you don't need it. Microsoft says about the guess part "Microsoft Excel uses an iterative technique for calculating IRR. Starting with guess, IRR cycles through the calculation until the result is accurate within 0.00001 percent. If IRR can't find a result that works after 20 tries, the #NUM! error value is returned" I am assuming the Practice Platform is based on the same principle. If you got that error, you could try with the guess of 0.2. But I've never seen a question where it was needed...was the mock exam question something out of the ordinary?

[@maria041192]

@@SteveWillisACCA thank you for clarifying! 🙏 it was the FM Mock March 2024 the most recent one on the practice platfrom, the debrief videos are on youtube as well at the moment and have noticed it when they worked the IRR. will keep using it as per your videos 🙂

[@DinaAfroza777]

Hi Steve! Why are not you uploading any APM videos? I am so much worried about the changes made from this September 2022 session. What is your view on splitting the marks 80:20 between Theoretical marks:professional marks? Don't you think the scope of getting marks just got reduced? Would appreciate more APM videos from you. Thanks.

[@SteveWillisACCA]

Coming soon!

[@unbelievablycensored]

can we use this in investment appraisal f9? or will we miss out on marks because we didn't discount them to present value?

[@SteveWillisACCA]

You can use the IRR function and get full marks.

[@speedlive6106]

Don't we need Present Value of interest payments to calculate IRR?

[@SteveWillisACCA]

Hi there, if you are using IRR for an investment appraisal decision, and are comparing the IRR result to the company's after-tax WACC, you want to ignore the interest payments because the are accounted for in the cost of debt in the WACC.

[@jayshreekrishna8086]

Sir please make a tutorial for ques. HGR CO. working capital management please

[@SteveWillisACCA]

Ok! Will add that to the list :)

[@jayshreekrishna8086]

Thank you so much sir...

[@SteveWillisACCA]

You're welcome :)

[@jayshreekrishna8086]

Sir one doubt was about rounding off in sec A and B ques... I have seen in some BPP ques that if ans was 169,133.42 so to nearest whole will it be 169,133 or 169,134 ??? (Ans in BPP is 169,134)

[@SteveWillisACCA]

That is ambiguous I would round down like you did, unless is breakeven point in units, then I would round up to the nearest unit as you can't sell a partial unit.

[@jayshreekrishna8086]

@@SteveWillisACCA These questions are of money market hedge and in this also we cannot pay a $ less rather would pay $ more ... is it correct!!

[@deeprajmishra631]

Dear sir whether to attempt Which section we should attempt first either A,B and C in FM exam so that we can score better?

[@SteveWillisACCA]

I say do A --> C ---> B

[@deeprajmishra631]

@@SteveWillisACCA Is there any extra advantage of doing this,sir?

[@jayshreekrishna8086]

sir can you suggest from where to get past papers sec A and B sums ... that are not available on practice platform

[@SteveWillisACCA]

Best place to get is in the approved learning provider books

[@jayshreekrishna8086]

@@SteveWillisACCA that’s correct but I am done with doing BPP and kaplan kit .. So needed more practice..though thanks

[@SteveWillisACCA]

@Jay shree Krishna If you did all those questions you are good to go. Those books are re-printing the past exam questions from A and B as well as writing new ones

[@jayshreekrishna8086]

@@SteveWillisACCA cool sir .. thanks a lot for help from videos . I am just bit more concerned in FM this time as in june session I failed PM by 4 marks

[@ayeshaeiman2845]

how can I join this channel

[@jayshreekrishna8086]

From laptop you will see the option to join after the subscribe button