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CIMA F3 Exam With Confidence Using Practice Dumps

Exam Code:
F3
Exam Name:
Financial Strategy
Certification:
Vendor:
Questions:
393
Last Updated:
Oct 22, 2026
Exam Status:
Stable
CIMA F3

F3: CIMA Strategic Exam 2025 Study Guide Pdf and Test Engine

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Financial Strategy Questions and Answers

Question 1

Company AAB is located in Country A with the A$ as its functional currency It plans to grow by acquisition and has identified Company BBA as a potential takeover candidate Company BBA is located in Country B with the BS as its functional currency.

The directors of Company AAB are concerned about foreign currency risk if the acquisition goes ahead

Which of the following will be most effective in reducing Company AAB's exposure to translation risk if the acquisition is successful1?

Options:

A.

Financing the acquisition with equity in A$’s.

B.

Setting up a mufti-currency bank account to net-off receipts and payments

C.

Financing the acquisition with borrowings in BS's

D.

Using forward contracts to fix the exchange rate between the AS and the B$

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Question 2

A company has borrowings of S5 million on which it pays interest at 8%. It has an operating profit margin of 20%.

The company plans to increase borrowings by S2 million Interest on additional borrowings would be 10% and the operating profit margin would remain unchanged

A debt covenant attached to the new borrowings requires interest cover to be at least 4 times throughout the period of the borrowing

Interest cover is defined in the loan documentation as being based on operating profit

What is the minimum sales value required each year to avoid a breach of the interest cover covenant'

Options:

A.

S12.00 million

B.

S3.00 million

C.

TS2.40 million

D.

S2.88 million

Question 3

The Board of Directors of a listed company wish to estimate a reasonable valuation of the entire share capital of the company in the event of a takeover bid.

The company's current profit before taxation is $10 0 million.

The rate of corporate tax is 20%.

The average P/E multiple of listed companies in the same industry is 10 times current earnings.

The P/E multiple of recent takeovers in the same industry have ranged from 11 times to 12 times current earnings.

The average P/E multiple of the top 100 companies on the stock market is 16 times current earnings.

Advise the Board of Directors which of the following is a reasonable estimate of a range of values of the entire share capital in the event of a bid being made for the whole company?

Options:

A.

Minimum = $110 million, and maximum = $120 million.

B.

Minimum = $88 million, and maximum = $96 million.

C.

Minimum = S100 million, and maximum = $120 million.

D.

Minimum = S80 million, and maximum = $128 million.