ACCA P4 2015 Jun - options

Sep 17, 2026

ACCA P4 2015 June exam question paper covering an options-focused, two-section attempt structure with one compulsory and one optional section. The scenario centers on Yilandwe’s economic conditions and stabilization policies, plus a foreign investor considering setting up an assembly plant to produce and export high-tech diagnostic components. The case provides macroeconomic assumptions, investment timing, pricing and volume forecasts, tax and depreciation rules, royalty arrangements, transfer pricing negotiation, and detailed cash-flow inputs for evaluation under given exam instructions.

LanguageEnglish

CategoryExam

FormatPDF

Pages25

Reading Time1 h 3 min

AccessFree to download

Attempt requirements

Two-section structure and compulsory questions

Business scenario background

Yilandwe macroeconomic controls and inflation path

Project structure and investment timing

Four-year duration and working capital release

Commercial assumptions

Selling price growth and expected units sold

Transfer pricing and component supply costs

Tax, depreciation, and royalties

Corporation tax rate, treaty treatment, and asset depreciation

Cost structure and inflation impacts

Variable and fixed costs escalation

􀀑ro􀀝􀀜ssion􀀘l 􀀍􀀜v􀀜l – 􀀐ptions 􀀎o􀀛ul􀀜 􀀈􀀛v􀀘n􀀚􀀜􀀛 􀀋in􀀘n􀀚i􀀘l 􀀎􀀘n􀀘􀀞􀀜m􀀜nt 􀀔u􀀜s􀀛􀀘y 􀀃 􀀌un􀀜 􀀃􀀁􀀂􀀆 | Time allowed
􀀒􀀜􀀘􀀛in􀀞 􀀘n􀀛 pl􀀘nnin􀀞􀀇􀀖ritin􀀞􀀇 | 􀀂􀀆 minut􀀜s 􀀄 ours | | --- | --- | | 􀀔 is p􀀘p􀀜r is 􀀛ivi􀀛􀀜􀀛 into two s􀀜􀀚tions􀀇
􀀓􀀜􀀚tion 􀀈 – 􀀔 is 􀀐􀀏􀀊 qu􀀜stion is 􀀚ompulsory 􀀘n􀀛 􀀎􀀕􀀓􀀔 􀀙􀀜 􀀘tt􀀜mpt􀀜􀀛􀀓􀀜􀀚tion 􀀉 – 􀀔􀀖􀀐 qu􀀜stions 􀀐􀀏􀀍􀀗 to 􀀙􀀜 􀀘tt􀀜mpt􀀜􀀛
􀀖ormulae and tables are on pages 􀀎–􀀉􀀋􀀇
􀀔o 􀀚􀀛T open this paper until instructed by the supervisor􀀇
􀀔uring reading and planning time only the question paper maybe annotated􀀇 You must 􀀚􀀛T write in your answer booklet until instructed by the supervisor􀀇
This question paper must not be removed from the examination hall􀀇 | | The 􀀑ssociation of 􀀓hartered 􀀓ertified 􀀑ccountants 􀀑 􀀘 p 􀀜 r 􀀑􀀅 􀀇􀀎􀀌􀀙􀀐􀀔􀀓 􀀂 􀀜 􀀈􀀏􀀐􀀘 􀀆􀀅􀀃 􀀖􀀚􀀎􀀘􀀙􀀐􀀔􀀓 􀀐􀀘 􀀌􀀔􀀒􀀕􀀚􀀑􀀘􀀔􀀗􀀛 􀀊􀀓􀀍 􀀄􀀉􀀇􀀈 􀀋􀀎 􀀊􀀙􀀙􀀎􀀒􀀕􀀙􀀎􀀍 􀀁 􀀉􀀑􀀓􀀊􀀕􀀍􀀛􀀎 Yilandwe􀀆 whose currency is the Yilandwe 􀀜and 􀀄Y􀀜􀀅􀀆 has faced extremely difficult economic challenges in the past 􀀋􀀎 years because of some questionable economic policies and political decisions made by its previous governments􀀈 􀀕lthough Yilandwe􀀃s population is generally poor􀀆 its people are nevertheless well􀀇educated and ambitious􀀈 􀀚ust over three years ago􀀆 a new government took office and since then it has imposed a number of strict monetary and fiscal controls􀀆 including an annual corporation tax rate of 􀀍􀀉􀀂􀀆 in an attempt to bring Yilandwe out of its difficulties􀀈 􀀕s a result􀀆 the annual rate of inflation has fallen rapidly from a high of 􀀏􀀎􀀂 to its current level of 􀀌􀀌􀀂􀀈 􀀞hese strict monetary and fiscal controls have made Yilandwe􀀃s government popular in the larger cities and towns􀀆 but less popular in the rural areas which seem to have suffered disproportionately from the strict monetary and fiscal controls􀀈 􀀙t is expected that Yilandwe􀀃s annual inflation rate will continue to fall in the coming few years as follows􀀓 􀀉􀀎􀀊􀀘 􀀈􀀕􀀏􀀓􀀊􀀚􀀑􀀖􀀕 􀀘􀀊􀀚􀀎 􀀊 􀀋􀀋·􀀉􀀂 􀀋 􀀊􀀍·􀀐􀀂 􀀌 onwards 􀀒·􀀑􀀂 Yilandwe􀀃s government has decided to continue the progress made so far􀀆 by encouraging foreign direct investment into the country􀀈 􀀜ecently􀀆 government representatives held trade shows internationally and offered businesses a number of concessions􀀆 including􀀓 􀀄i􀀅 zero corporation tax payable in the first two years of operation􀀔 and 􀀄ii􀀅 an opportunity to carry forward tax losses and write them off against future profits made after the first two years􀀈 􀀞he government representatives also promised international companies investing in Yilandwe prime locations in towns and cities with good transport links􀀈 􀀈􀀔􀀖􀀕􀀑 􀀇􀀖 􀀙moni 􀀖o􀀆 a large listed company based in the 􀀝􀀕 with the 􀀝 dollar 􀀄􀀁􀀅 as its currency􀀆 manufactures high tech diagnostic components for machinery􀀆 which it exports worldwide􀀈 􀀕fter attending one of the trade shows􀀆 􀀙moni 􀀖ois considering setting up an assembly plant in Yilandwe where parts would be sent and assembled into a specific typeof component􀀆 which is currently being assembled in the 􀀝􀀕􀀈 􀀛nce assembled􀀆 the component will be exported directly to companies based in the 􀀗uropean nion 􀀄􀀗 􀀅􀀈 􀀞hese exports will be invoiced in 􀀗uro 􀀄€􀀅􀀈 􀀆􀀙􀀙􀀎􀀔􀀋􀀓􀀜 􀀗􀀓􀀊􀀕􀀚 􀀑􀀕 􀀉􀀑􀀓􀀊􀀕􀀍􀀛􀀎􀀅 􀀏􀀑􀀕􀀊􀀕􀀌􀀑􀀊􀀓 􀀊􀀕􀀍 􀀖􀀚􀀐􀀎􀀘 􀀍􀀊􀀚􀀊 􀀗􀀘􀀖􀀒􀀎􀀌􀀚􀀑􀀖􀀕􀀙 􀀙t is initially assumed that the project will last for four years􀀈 􀀞he four􀀇year project will require investments of Y􀀜􀀋􀀊􀀆􀀉􀀉􀀉 million for land and buildings􀀆 Y􀀜􀀊􀀑􀀆􀀉􀀉􀀉 million for machinery and Y􀀜􀀒􀀆􀀏􀀉􀀉 million for working capital to be made immediately􀀈 􀀞he working capital will need to be increased annually at the start of each of the next three years by Yilandwe􀀃s inflation rate and it is assumed that this will be released at the end of the project􀀃s life􀀈 􀀙t can be assumed that the assembly plant can be built very quickly and production started almost immediately􀀈 􀀞his is because the basic facilities and infrastructure are already in place as the plant will be built on the premises and grounds of a school􀀈 􀀞he school is ideally located􀀆 near the main highway and railway lines􀀈 􀀕s a result􀀆 the school will close and the

FAQs

How is the paper structured for the June 2015 P4 attempt?

The paper is divided into two sections. Section A has one compulsory question and Section B includes options with a specified number of questions to attempt.

What is the core scenario involving Yilandwe and the investor?

A listed company from Monaco is considering establishing an assembly plant in Yilandwe and exporting the assembled diagnostic component to European customers.

Which financial assumptions and adjustments are provided for evaluating the project?

The case includes four-year project timing, up-front investments, working capital changes, selling price and unit sales forecasts, transfer pricing negotiations, variable and fixed costs with inflation, and corporation tax and depreciation plus royalty terms.

Sep 17, 2026

Uploaded by Berry Peter