How seriously are you all taking these formulas? These are the cash flow measures that are used by the rating agencies that differ from the ones we’ve learned–they include things like the Funds from Operations, Discretionary cash flow, and other as well as four new coverage ratios and a new leverage ratio. They’re only used in this one LOS and are confusing because many of them are “kind of” like the ones we learned but are just missing one component (see pg. 18 schweser book 5 to see what i mean). Does anyone think these formulas are worth the time to really get a good grip on? If so, what’s an easy way to remember them?
Yes, i think they will be tested. I just memorized how the three diff types of cash flow are calculated. i think the most imp one is discretionary cash flow i.e. FCF - dividends.
On this topic, I wantet to verify that there is an error on problem 27 in the CFAI books for reading 52 (p. 213 of fixed income). They take total liabilities for the debt service coverage, when I think it should be total debt. Can anyone help me out?
shoot i didnt even know this stuff will be tested. Is this equity?
its the beginning of SS 14, fixed income
DraymondGreen Wrote: ------------------------------------------------------- > On this topic, I wantet to verify that there is an > error on problem 27 in the CFAI books for reading > 52 (p. 213 of fixed income). They take total > liabilities for the debt service coverage, when I > think it should be total debt. Can anyone help me > out? looks like an error - but cannot be sure. can you report an erratum to cfai and see what they say?