#CFA This past weekend was kinda a lost weekend since I had my kids with me. I'm SOOOOOOO glad I started this month so I can figure out a routine that will work for me. The main difference between the circumstances I faced during L's 1 and 2 and now is that my job is way more demanding in terms of time, my kids are grown up now and want to be on top of me all the time, and I have a live in girlfriend who I need to devote some attention to. All these competing factors for my time make it essential that I come up with some approach to use the little free time I do have to get the study in. 

I decided to go back to SS3 and review it top to bottom. Here's the approach that seems to have worked for me:

- read thru CFAI chapters and do all blue box and EOC questions. Take some high level notes in the margins.

- Watch the Schweser lecture videos on the reading right after to help conceptualize the material in a different manner. I found I can help my note taking in the margins by doing this. 

- Quiz myself using QBank. 

I finished SS3 tonight. Tomorrow I plan on finishing the Qbank section on SS3. Weekend is to go back to SS1 and 2 which is all Ethics and follow same approach as above. Good thing for SS1 and 2 is that I have the notes from L's 1 and 2 which will cover most of it and can easily supplement the notes. 

I also plan on coming up with my study plan for the remainder of the readings. Goal is as in the past, finish initial cut by end of April and use May for review, quizzing and take mocks until I pass out. 

Right now I'm not focusing too much on the essay questions and answers. I know I need to change that real soon since the morning session is what kills most candidates. Not too concerned but definitely want to have my writing approach nailed down by test time. 

Once I finalize the notes from SS1-3 I'll upload. 

#CFA I finished Reading 3 over the weekend. Good way to "break the ice" and get back into a study rhythm. I was able to grasp the material and now that I've actually read thru a full CFAI reading using nothing but the curriculum, I think I see why the tests wind up easier for those who follow this route. I think there are certain things you synthesize more when you use the curriculum vs a study guide. One of the reasons the readings are so long is that they repeat a lot of concepts but in different contexts. I've also been forced to take my own notes instead of relying on what someone else thinks is important. 

I'm moving on to Ethics now. This should be a quick read, looks like a lot of it is the same old stuff with some extra material on the AMC at the end. I don't plan on spending too much time on Ethics for now since I can easily recall most of it from L's 1 and 2 and will definitely be reviewing in detail during the last month. 

Goal for this week is to finish Ethics by the weekend and use weekend to do a more thorough review of Reading 3, updating my notes and cheatsheet. Lots of little wrinkles and things to recall that are perfect for flashcards/cheat tables. I definitely want to incorporate a review session every few readings to keep material fresh in my mind. I didn't do this for L2 and I think it hurt me a bit. Starting early this year will afford me the time to do this and still have enough review time at end. 

I do need to sit down and plan out the rest of the studies to see where I'll wind up come early May. Should be done with all readings and ready for mocks, mocks, mocks and more mocks. 

I definitely recommend doing Ethics and Behavioral Finance to kickstart the studies. Helps to "ease" into the studies after a layoff since it's pure reading and conceptual. 

#CFA This post on AnalystForum may be helpful

http://www.analystforum.com/forums/cfa-forums/cfa-level-iii-forum/91308004

Some flash cards put together by the community. You can check them out here 

http://quizlet.com/subject/cfa-l3/

So far I like the concept and it should cut down on note taking time. I'll post later on how I plan to use these. 

There's a free app if you have an iphone/ipad called A+ Flashcards Pro which you can sync up to your account on Quizlet.com. Pretty sweet. 

#CFA Finished Reading 7 on Behavioral Finance tonight using only the CFAI material. Wow, very dry and boring, almost fell asleep reading it. Was reminded why the study guides help on topics like this since they distill the words down to what you really need to know. Still plan on using Schweser as supplemental material not my main study. Let's see how long I can last at that. 

Kinda flubbed the end of chapter item set.  Only got 2/6. 

My approach was to read the material and as I went along take notes in the whitespace on the left and right of the wording. This slowed me down a lot as for whatever reason it takes me forever to write these days. I guess when you're on the computer all day everyday you forget how to write. 

Goal is to finish Readings 7 and 8 this week. Still trying to figure out best way to take notes for later review. 

#CFA Decided to hop on the study train this week. Don't have an exact approach yet, just want to break the rust and get into the mode again. I figure it'll take me at least a week to figure out how to attack this. I actually started late last week but it was cursory reading at best. 

Going to start with Study Session 3 and knock that out this week.  Figure I can always get the Ethics part down since I've seen it two times already. I wanted to start with something new to kickstart my interest level. 

Behavioral Finance seems like a interesting topic, especially since I've always thought the traditional finance topics were a bit too simplistic with the assumptions. 

Approach will be to use CFAI Curriculum and supplement with Schweser material. Will definitely take major notes around all in chapter examples and end of chapter questions so I can review later on. Think I made a mistake in skipping the examples in the past. 

Let's go!!!!!!

Here's text of email I just received. Looks like there will be NO Stalla options for the 2012 exam cycle and you're stuck with Schweser next year. No big deal for me since I wasn't budgeting to spend $$ on Stalla this year anyway but could impact those that swear by them. I'm using the curriculum mostly and will supplement with other materials I find. 

*** Start of Email ***

Dear CFA Candidate:

Stalla Seminars began business in 1972 under the direction of Robert Stalla with the sole objective of helping candidates pass the CFA^® exams and become charterholders. The Stalla brand is known worldwide for quality, service, and support.

On December 2, 2011, DeVry, Inc. - Stalla's parent company - announced the sale of Stalla's assets to the Schweser Study Program - an operating unit of the Kaplan University School of Professional and Continuing Education.

Unfortunately, the timing of this transaction will not allow for the transfer of content from the DeVry technology platform to a new delivery mechanism in time for the June 2012 CFA exams. Therefore, Stalla courses and materials will not be available for the June 2012 exam cycle.

We pledge to be good stewards of the Stalla brand and mission, and intend to redeploy the Stalla content on a new platform for the 2013 exam cycle. In the interim, Schweser stands ready to meet all of your 2012 CFA study needs. If you are a previous Stalla student, we will be reaching out to you directly by phone, letter or email over the coming weeks to provide you with personalized service and assist you with this transition. Please click herefor more information about 2012 CFA review options.

As a Charterholder, I am grateful for the service that Stalla has provided to CFA candidates throughout the years, and am humbled by the weight of the commitment that we now carry to ensure that the Stalla legacy is fostered and protected. Schweser and Stalla share a common mission - to help CFA candidates succeed and to support investment professionals worldwide. I hope you share my enthusiasm for this change and wish you all the best for the 2012 CFA exams.

Best Regards,

Dr. Andrew Temte, CFA
President
Kaplan University School of Professional and Continuing Education

*** End of Email ***

This link will help in determining changes. Can help when using 2011 material that hasn't changed.

http://www.finquiz.com/cfa_level_3_curriculum_changes_2011_2012

Hey everyone. Long time since I updated the blog. Many of you found out your passing/failing status by now. For those who passed, congratulations, you worked hard for this so enjoy the accomplishment and it is an accomplishment no matter what level you are. For those who failed, keep your head up and eyes focused on the goal. Many people walking around with the CFA letters on their business card failed one or more of these exams one or more times. No one cares how many times it takes you, just stay with it. Think about what you could have done better and make sure you implement it for next time. 

As for me, I finally changed my career into Finance. I moved into a Financial Planning and Analysis role on the Corp Finance side of the house. I'm responsible for a $85M worldwide CapEx budget and I'm also in charge of preparing the monthly preview and closing decks for the CFO. It's been pretty much a whirlwind experience since I started end of June, longer hours and it's taken some time to get out of the IT mindset and re-calibrate myself for how things are done on the finance side. 

I've already learned a ton this past month and a half and working on the front end of the business has been really illuminating. I have also used a lot of my CFA training, specifically on the Corp Finance side. Evaluating projects using MIRR and NPV, etc. I'm also in charge of reporting the FX impact on EBITDA(how we measure performance) to get a gauge on how much our performance is driven by operational efficiency vs pure FX movements. We're about to start our budgeting season now so I'll be in the mix of that too.

I still want to move into the Capital Market stuff in Treasury but for now there isn't much going on there. For those who want to know how I pulled this off, I work for a company that was recently taken private and is going much internal change. I had been supporting the Treasury team from IT and got in good with the Treasurer and Treasury manager. I mentioned to the manager I wanted to slide into his team should something open up and when something opened up on the Planning team that also reports to the Treasurer they asked me to come over. Best part? No paycut at all. One of my fears was that I would have to take a cut to make a move and depending on how much I wouldn't be able to afford it. 

My IT background actually helped me out a bit since there's a push to rationalize our reporting systems(we use SAP, Hyperion and Oracle Financials) which is right up my alley and my connections on the IT side have helped move things along as well. For all of you who work in IT and think it's an uphill battle to switch careers, my response is simple: it is. But, if you have the right connections, the right luck, and the background you can make it too. In my case the CFA progress I made was the clincher. All of these guys are jealous that I'm one test away from obtaining the charter and were impressed that I pursued it without even having experience.

So keep the faith fellas. No I'm not working for a hedge fund or mutual fund. Truth be told, I actually like the fact that our Treasury guys have Wall St working for them not vice versa.  There are mutliple paths for CFA charterholders and not every one is on the Wall St track. While I still have the goal of working in capital markets beggars cannot be choosers and this is a nice way to break in. 

I'm definitely going for Level 3 next year to wrap this up finally. Still considering the CTP as well for later this year. 

Another one down. As I mentioned in a previous post, I passed the SAP Certified Application Professional - Financial Accounting exam yesterday. Scored a 75% which means I got 60 out of 80 questions right. 

Here's the breakdown of exam questions by area and my score in each section.

Asset Accounting/Investment Management - 6 - 66%

Accounts Payable - 6 - 66%

Business Process/Integration - 6 - 83%

SAP Business Warehouse - 5 - 60%

Accounts Receivable - 6 - 66%

New GL - 7 - 85%

GL - 4 - 100%

Basics of ABAP/Forms - 5 - 80%

Data Model /Tables/Interfaces - 5 - 60%

Basics of Authorization and Audit Requirements - 5 - 100%

Cash Management - 5 - 80%

Fundamental Business Knowledge - 6 - 66%

SAP Financials Portfolio - 5 - 60%

Financial Closing - 5 - 100%

Here's a breakdown of the exam as I remember it and some tips. I can't give specific questions or answers obviously:

- Most should know this, but this only covers the FI portion of SAP FI/CO. The CO(Controlling) module is tested separately. I work mostly on the Financial Accounting/Treasury side so this is fine for me. Will go for CO certification next year.

- Wrote exam in a PearsonVUE center in North Miami. Had room to myself after 1st hour, guy next to me was taking another non-IT certification. Definitely not the most ideal environment, but quiet enough to focus. You get a computer to work on and an eraseable board with eraseable marker so you can take notes etc. This is how I was able to remember the exam question breakdown. 

- 32 of the 80 questions were multi-choice. For questions with 5 possible choices, you had to choose 3 right answers, for those with 4 possible choices you had to choose 2 right answers. This was higher than I expected and I bet most I got wrong were multi choice where I got one choice wrong which means the whole question was marked wrong.

- I finished in an hour after my first pass. Spent next 2 reviewing answers and trying to memorize questions in case i failed and needed to take again. 

- Overall level of difficulty I would say was medium. None of the questions were hard if you've worked with the product before. Most of the time I could easily eliminate obviously wrong answers and work with a smaller subset of answers. 

- Was a bit more detailed in areas than I expected however. Some of the questions required detailed application knowledge i.e how you would use this in a real life situation, what if you got this error, what does it mean, what would you recommend to your client in this case type of questions. This exam is really designed for consultants and not end users. This is not an exam you can just memorize information on and pass. That's the associate level exam which is designed for people right out of training with little application knowledge. Of course, you can't answer the application questions if you don't have the foundational knowledge. 

- Definitely focus on the syllabus I linked to before. Here you go

- If you have a technical background in SAP like I do, the sections on ABAP/Forms/Authorization model will be easy for you. They make up a quarter of the exam giving you some breathing room in other sections. 

- If you also have any SD or MM knowledge it will help you a lot on the integration questions. I have worked in both and understand the touchpoints. Pure FI/CO folks who work in a silo may have issues. 

- In terms of study material, use TFIN50 and TFIN52, or if you can find the material listed in the syllabus, use those. The TFIN courses summarize the information from the other more detailed courses. I used a combination of both. 

- Find mock exams online if you can. Be careful when quizzing using these as some of the questions are poorly worded and the answer keys can have mistakes. I will link to some resources I used at the end.

- As I did with my CFA studies, try to broaden your studies to beyond just what's in the book. Look up YouTube videos on areas you may not be familar with. Find SAP FI/CO books and read the sections where you didn't exactly understand the coursework. I highly recommend this approach. I had to read Asset Accounting a few times to really get it and then once I read another book on it, it just clicked.

- Use the Internet to your advantage. Google specific terms or concepts you don't understand. There is a lot of knowledge out there around SAP and you may find an explanation that makes more sense than what you read in the book.  

- Use OSS if you have access. If you don't know what this is, you probably are not ready to take this exam. There will be questions that refer to issues documented in OSS notes. 

Some resources I used:

- Online mock exams from Daypo.net. Go here and search for FICO

- Some sample questions here. Only issue is no answer key.

- My notes and some other files that may be useful are located here. Contact me if this link is not valid anymore. 

Please do not contact me for specific questions or answers, I cannot disclose those without exposing myself to potential trouble. 

I hope this information helps others. My plan for rest of year is to take summer off before ramping up for CTP examination in fall then one more time on the CFA roller coaster to wrap up Level 3 next year. By end of 2012 I want to have the following on my resume:

- CFA Charterholder

- Certified Treasury Professional

- SAP Certified Application Professional - Financial Accounting

- SAP Certified Application Professional - Management Accounting

Figured I would post an update on the type of work I'm doing now. As I mentioned before I'm supporting a corporate Treasury department and recently we ran into a valuation issue with a IR Cap we put on to hedge some IR risk for our floating debt. Right now the value the system is calculating for the NPV is way off from what Bloomberg calculates and what the bank is valuing the cap at as end of March. It's off pretty significantly actually and we don't know why exactly. This is important as it opens us up for an audit deep dive into how the system is valuing these instruments. This is only an issue with this specific cap so it's most likely a data issue. 

There's no way I could have even begun to understand this issue without the CFA curriculum. If you recall IR caps from derivatives(I know, your favorite subject), you'll remember that a IR cap is essentially a call option on an interest rate. You pay a premium to a dealer(investment bank typically) and in turn you receive payments whenever the reference interest rate goes above the strike price. IR Caps are usually structured as a series of caplets, each with expiration dates corresponding to the payments to be made on the instrument you're hedging(in this case floating debt payments). They are used typically to place a ceiling on your floating debt payments and for companies with less than a sterling credit rating, are usually one of the few options available to you to hedge your floating debt exposure. Swaps typically require better credit history. 

IR Caps are valued using the Black-Scholes model typically. I won't go into the gory details here. 

This is as close as I've come to actually using the material in real life, excluding some of the basic accounting knowledge I've had to use from time to time. The great thing is, I can actually speak to these guys intelligently vs the deer in the headlights look that most IT people give them when trying to explain this.