You probably thinking that I am about to write about a film or a play. Not quite.

What I want emphasise in this blog is that for those studying or planning to study ACCA AFM, keep in mind the topics & skills that repeat over & over again. These are the leading actors in ACCA AFM.

So who are these leading actors.

The first one has to be NPV. I am not just talking about the concept, but also the function.

NPV is the primary (but not the only) method used in investment appraisal. But the spreadsheet NPV function is used in different parts of ACCA AFM.

It appears in bond valuation when the YTM is used as the discount rate. It also appears in business valuations when the future free cash flows have a finite period.

Talking about free cash flows, here we have another leading player. Free cash flows appear in investment appraisal. Also in business valuations. And don’t forget dividend capacity.

The key is to know the difference between free cash flow to the company and to equity. But, I won’t take away the glory of my tuition course lecture videos on this here.

Last but not least is IRR. Like NPV, this is part of investment appraisal. But, it’s not confined to there.

The IRR function is also used as one method to find the YTM for a bond.

So to conclude, as a student preparing for ACCA AFM, remember these leading actors. They may not win an Oscar, but they will get you the award of a pass in ACCA AFM.