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Pre-CFA Exam Words Of Wisdom

By Morgan International Staff Writers 

Becoming a CFA charterholder is likely to be the longest and most difficult process most candidates have experienced in their educational lives so far. On average, a candidate will study for 300 hours for each level of the exam. This typically takes 6 months bearing in mind that most candidates also have a full time job.

Nailing the exam first time around for each level is far more likely if some straightforward study tips are followed:

Plan

Produce a timetable that covers the detail of what you will study and when. You need to fit in approximately 300 hours of study, which will include reading, retention activities, and mock exams. It is useful to build in some additional slack of approximately 5-10% to allow for unexpected events such as being extra busy at work or being unwell.

Consider a professional programme

You may want to undertake review days, or seek more detailed support. Consider what will work for you, do your research, select a provider, and schedule that into your overarching plan.

Find what works for you

We all learn and retain information in different ways. Some candidates may be able to read material once and commit it to memory. Others may need to use flash cards to retain information. Find out what works for you early on and utilise that technique throughout your studies.

Do practice papers in exam conditions

The CFA exam is arduous – prepare for that by undertaking practice papers in exam conditions. I cannot recommend highly enough taking a day out to do the full six hour exam in the two sections, with the set middle break.

Avoid panic cramming

If you have followed the tips above, there will be no need to panic cram. It will not only stress you out, but it may cloud the systematic learning you have undertaken.

In Summary

If becoming a CFA charterholder was easy, many more people would be pursuing it. To be successful, a methodical approach to study and exam preparation is fundamentally important. For more advice and tips, take a look at our website.

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What Do CFA Charterholders Really Earn?

By Morgan International Staff Writers 

According to the Robert Half 2018 salary survey, salaries within the finance and accounting industry have reached a ‘steady plateau’ which is great news for those looking to gain their CFA charter.

Specific areas of expertise

When Robert Half spoke to businesses about what they are seeking in candidates, they produced the following list:

  • Internationally recognised qualifications
  • Financial planning and analysis
  • ERP skills (SAP and Oracle)
  • Cash management
  • Macro-level Excel expertise
  • Effective communication

The unsurprising but great news is that right up the top is the desire for an internationally required professional qualification.

Roles in demand

Interestingly, the roles in demand are not straight-up Financial and Management Accountants. To earn big, you need to specialise – for example into tax, treasury or financial planning. As ever, CFOs remain in demand as there are a limited supply of individuals who not only are qualified accountants, but also have the leadership skills required to be successful.

Salaries by role

The data looks at the minimum and maximum salaries by role type within an SME and a large company. We have picked out some of the key roles within the data for large companies – but you can find the full report here. What you will undoubtedly note from the figures is that the range varies hugely in the more senior roles such as CFO. There are narrower gaps in the more junior roles.

  • CFO: $240,300 - $605,300
  • Finance Director: $196,200 - $402,800
  • Financial Controller: $140,500 - $204,300
  • Treasurer: $147,100 - $222,300
  • Finance Manager: $119,500 - $194,500
  • Tax Manager: $92,000 - $141,000
  • Senior Tax Associate: $71,200 - $91,200
  • Financial Analyst: $65,400 - $98,000
  • Senior Internal Auditor: $88,200 - $147,300
  • Internal Auditor: $65,500 - $81,800

In Summary

It is a lucrative and stable time to become a CFA charterholder. The salary levels are stable and fairly consistent for the entry level roles, but there is a wider gap for the more senior candidates. What the data does indicate is that the more in demand roles typically require specialising after the CFA programme has concluded.

The Digital Transformation of Financial Services

 

By Morgan International Staff Writers

The road to digitalisation hasn’t been an easy one for the financial services industry, but the sector is now in the process of embracing digital transformation.

 

The road to digital transformation hasn’t been an easy one for the financial services industry. Traditional financial institutions work within an inflexible regulatory framework and, by habit, have generally prioritised tight security over flexibility. However, the market landscape is now far more competitive than it was in the past – meaning that innovation is essential for institutions to survive.

 

Indeed, traditional finance faces an existential threat from new competitors disrupting their markets, whether from challenger banks (N26 or Atom bank, for example) that offer increased flexibility and lower fees, or from specialist services (like TransferWise or Kreditech) that unbundle banking services and offer them at rock bottom prices. Furthermore, while consumers operated from a position of information scarcity in the pre-internet age, it’s now easy to compare interest rates and account fees, and hence to find the best and cheapest offers available online.

 

Along with this, consumers now expect a high standard of service – having online and mobile access to accounts isn’t a perk, but a necessity. Banks need to retain consumer confidence, but they also need to be seen to pay attention to customer service and to provide the access and functionality that account holders demand. However, self service actually saves banks a great deal of time and money – as being able to check accounts details and make payments online significantly reduces the need for staff and for branches.

 

The financial service sector is also particularly well positioned to take advantage of big data, drawing on a wide variety of datapoints to assess the level of risk associated with individual borrowers and account holders, or to recognise otherwise invisible patterns that may be indicative of fraud. In the future, financial service organisations will be able to target consumers as effectively as Amazon, anticipating a need for specific services and the best time and venue to deliver them to meet the customer’s requirements. While big data will provide a huge amount of information about broader trends and market opportunities, we may even see services targeting interest rates and premiums to specific individual customers based on intelligence collected by the provider.

 

Looking ahead, the priority for institutions is not necessarily that they can make significant savings by embracing digitisation but the fact that doing so will ensure that they remain competitive and agile on an organisational level.

 

 

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Most Banks Provide An App, But Do People Actually Use Them?

 

By Morgan International Staff Writers

Most major banks now offer mobile apps as standard with accounts – but one might well ask whether people actually use them.

Is Mobile Banking A Buzzword Or The Business Of The Future?

 

Most major banks now offer mobile apps as standard with accounts – as of course do online-only challenger banks. These apps typically allow users to check their balance and recent transactions, to pay bills online and to transfer funds. However, with the small screen size, the difficulty of inputting information and the concerns that some users will have about security, one might well ask whether people actually use banking apps. The answer is that yes, they do.

 

In a survey compiled by the Mobile Ecosystem Forum, the organisation found that, globally, 26% of individuals preferred using a mobile app to access banking services over all other channels (while another 9% preferred mobile web and 19% said they used a mixture of channels). In terms of specific functionality, some 44% of all respondents had used their mobile phone to check their balance in the previous six months (rising to 54% in growth markets). Meanwhile, in China, in the last six months, 40% had used their mobile phone to transfer funds between accounts and 36% had used mobile to pay a bill.

 

Usage is also quickly increasing – compared to numbers two years before, there was a 57% increase in users who had checked their bank balance via mobile and a 56% increase in users who had moved funds between accounts on mobile.

 

This is perhaps unsurprising given the flexibility and convenience that mobile banking offers, saving customers from visiting branches or being restricted to logging in via desktop. Mobile apps quite literally put control over the account directly in the consumer’s hands.

 

There is no doubt that there is a higher level of uptake among millennials, but the statistics also illustrate the importance of apps in China and growth markets where mobile is often not a secondary digital platform but is the primary point of online access for users. Given this, it will be important in future not just to make mobile banking fast and easy to use but to ensure that it requires as little internet bandwidth as possible.

 

To learn more about trends in financial services take a look at our professional training programmes here. https://www.morganintl.com/cfa/#

 

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10 Steps to Acing Your CFA Exams

 

By Morgan International Staff Writers

Taking CFA exams can be a daunting prospect. Here are 10 steps that will put you on course to getting the best results possible.

 

Taking CFA exams can be a daunting prospect – and there’s no doubt that a pass requires a huge amount of work. Here are 10 steps that will put you on course to getting the best results possible.

 

  1. Plan for the long run

 

Taking CFA exams is no small thing. Candidates are advised to begin preparing six months before the exam and to pursue several hundred hours of study over this period. This will allow you to spend significant amounts of time on every topic and to revisit specific areas of study, ensuring that the subject matter is cemented in your memory.

 

  1. Make the best use of your time

 

It’s all too easy to put off studying, particularly when you have other commitments. To ensure that you are able to commit time, block off hours in your calendar. If you stick to this, it will soon become a habit.

 

  1. Approach studying in a way that’s right for you

 

People learn in different ways. Find an environment that’s comfortable and where you can stay focused, whether that’s in the library or at home. Then think about how you absorb information: do you get the best results just from reading, from writing up notes or from talking through your studies? Try to mix things up, but use the techniques that work most effectively for you.

 

  1. Drill yourself on the exam

 

Practice makes perfect, so there’s a lot of value in running through test questions and past papers. The key thing is to ensure that you have a rounded understanding of the full curriculum.

 

  1. Don’t silo your studying

 

You might be tempted to follow the curriculum one area at a time – but you may actually see much better results by concurrently studying multiple topics, and seeing how the big picture fits together.

 

  1. Ensure you cover everything

 

It is important, however, to make sure that there aren’t any areas that you’ve forgotten about or ignored. Even if you think that they won’t come up in the exam, neglecting topics could trip you up in a big way.

 

  1. Take advantage of material supplied by the CFA

 

The CFA offers a great deal of material online that can be extremely useful when preparing for exams – so make sure to take full advantage of it.

 

  1. Take care of your health

 

You might feel like you have no opportunities to take a break, but it’s important to stay healthy, to get good sleep and to exercise while studying. Though this might take a little time, it’ll put you in a better position, both mentally and physically, and better prepare you for learning and retaining information.

 

  1. Make sure you have everything ready for the exam

 

When it comes to the exam, make sure you allow plenty of time to get there and that you have all the materials you need – and only what you’re allowed – with you.

 

  1. Take a sensible approach to the exam

 

It might seem obvious, but it’s important to have a strategy to how you approach the exam – manage your time, and work through the simple questions first; answer every question, even if you have to guess; and remain calm!

 

To gain more insights into becoming a chartered financial analyst, take a look at our professional training programmes here. https://www.morganintl.com/cfa/#

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4 Big Mistakes to Avoid Making with Life Insurance

 

By Morgan International Staff Writers

Once you have life insurance you might imagine that you can rest easy. However, it’s essential to pay attention to the details when buying. Here are four common mistakes that can be easily avoided.

 

Once you’ve bought life insurance you might imagine that you can rest easy knowing that your loved ones will be provided for should the worst come to the worst. However, it’s essential to pay attention to the details when buying to ensure that your policy serves your best interests. Here are four common mistakes that can be easily avoided.

 

  1. Finding that you’ve outlived your policy

 

If you buy a permanent life insurance policy, you’ll generally find that it has a date, based on your age, when it will come to maturity – and with many policies this is when you turn 85. At this point the policy comes to an end and the insurer will make a payout (though this is often modest). Meanwhile, you will be left, at the age of 85, with no life insurance and little to show for it – while buying a new policy may well be extremely expensive. Because of this, it’s important to keep an eye on the maturation date when buying and to carefully consider what is right for you and your family.

 

  1. Invalid insurance

 

If you miss important personal details off your insurance then it may well be invalid. Equally, you may still be able to buy a policy after developing a major condition, but it’s likely to be much more expensive and, depending on the terms, it may only become fully valid a number of years later.

 

  1. Not assigning a beneficiary

 

If you die, your policy will become due and be passed to the individuals named in your will – so you might imagine that there’s no big problem with not having a named beneficiary. However, as part of your estate, the benefits can be pursued by creditors for outstanding debts, before the funds reach your heirs; and the sum may also push you closer to thresholds for inheritance tax. Having designated beneficiaries avoids all this. Equally, should any or all of the beneficiaries die, then make sure to review the paperwork.

 

  1. Not clearly identifying your beneficiaries

 

If your beneficiaries don’t know about the policy or if you provide limited or incorrect contact details, then it may be difficult for the insurer to reach them. Ensure that all your beneficiaries are explicitly named, that contact details are updated and that they all have copies of the policy. Equally, should circumstances change, you may well want to update the list of beneficiaries, removing ex-spouses or adding individuals in the event that others have passed away.

 

To gain more insights into personal finances, take a look at our professional training programmes here. https://www.morganintl.com/cfa/#

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Understanding Your Income Statement

 

By Morgan International Staff Writers

The income statement, also referred to as the profit and loss is a financial statement showing the company’s revenues and expenses during a period of time. Its purpose is to demonstrate whether the company made or lost money during the reported period. The income statement is an extremely valuable reporting tool for managers and decision makers. So, what are the key things you need to know about an income statement?

 

  • Income statements cover a defined time period

It shows how much money the business made or lost during a specific period of time. Usually businesses will look at their performance on a monthly, quarterly, and yearly basis. Many businesses also produce a year to date view.

 

  • Naming conventions cause undue confusion

I have already pointed out that this financial statement is referred to both as an income statement and a profit and loss. In the same way, naming conventions can differ for the same categories of expenditure or revenue. For example sales and income, expenses and costs, and profit and net income are all used interchangeably. The key thing is to agree as a business what terms will be used, and stick to them.

 

  • Expenses are broken down

Expenses are usually not shown as one line. Normally they are broken down into various types of expense such as cost of goods sold (COGs), and overheads such as rent and utilities.

 

  • Income statements have a simple formula

Some income statements look complex and daunting – however they all follow the same formula – which is revenue minus expenses equals’ profit.

 

In Summary

An income statement is very important as it is used by decision makers within the company, but also investors and creditors outside of the company to evaluate profitability and assess risk. Whilst the income statement may seem complex, it is in fact very straightforward when it is kept in mind that in essence it is simply looking at profitability over a set time frame. That said, many businesses do decide to employ a qualified accountant to prepare these statements on their behalf.

 

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Top 10 Tips to Get Rich

 

By Morgan International Staff Writers

The concept of being ‘rich’ of course differs from person to person. For some it would be to reach a million dollars in the bank, and for others they are seeking the heady heights of billionaire status. The thing about a lot of entrepreneurs is that they love what they do, and getting rich is a by-product of their success. That said, if you are looking to get rich, we have 10 quick tips to achieve your goal.

 

1.              Save

Most ventures will require an injection of cash. Be prudent with your cash.

 

  1. Don’t over aim

Do not forget that small profits can add up to big success. Cumulative growth from a small start is a good strategy to consider.

 

  1. Treat people with respect

It sounds simple, but so many people get this wrong. Treat people as you would want to be treated, regardless of the level of success you are having.

 

  1. Believe in yourself

Very often you will be selling yourself as well as your product/service. If you do not really believe in yourself, why should others?

 

  1. Don’t commit to a location

Business is becoming increasingly global. It may not be sensible to commit yourself to one location, get a mortgage, a few dogs, and a cat. You may need to be highly transient, particularly in the first few years.

 

  1. Follow your passion

I said at the beginning that for many, money comes as a result of them following their passion. If there is something you love, pursue it.

 

  1. Outsource

The best leaders and entrepreneurs know when to delegate/outsource leaving them to focus on their core area of expertise.

 

In Summary

There is no magic formula to getting rich. If there was then everybody would be doing it. However there are some common traits of entrepreneurs who have got rich which we have shared above, and are surely worth consideration.

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Protect Your Business from Credit Card Fraud

 

By Morgan International Staff Writers

Many businesses accept credit cards from customers, whether that be over the phone or on the internet. Typically products are shipped before the business becomes aware that the credit card was used fraudulently. In this case the business is out of pocket as the real card owner will not be liable – so what can be done to avoid this from happening?

 

  1. Capture all the credit card information

Make sure you request the cardholders name in full, the long card number, the expiration date, and the three/four digit verification number on the back of the card. Also request the full address that the card is registered to. If the customer refuses to provide any of the information, don’t ship. With all of this information you will be able to use the address verification service. Don’t forget that in most cases someone who has stolen a credit card will not know the address it is registered to.

 

  1. Be cautious

Question orders that are very large and next day delivery. Clearly someone using a fraudulent credit card will be keen to get the order as soon as possible before you have an opportunity to realise the card is fraudulent. Furthermore be cautious when the bill to and ship to addresses are different. There are websites out there such as www.anywho.com which can be used to validate billing addresses.

 

  1. Validate the order

Another validation step is to call the mobile number provided to confirm the order. Furthermore, you could request scanned ID such as a passport if the order is very large and you are concerned about the identity of the customer placing the order.

 

  1. Report to the police

If you have reason to believe there has been a fraudulent transaction, report it to the police as soon as possible. There is a possibility that the stolen goods can be recovered.

 

In Summary

Use all of the tips above to try and reduce the possibility of credit card fraud. However remember to trust your instincts – if you think an order is suspicious, ensure you follow up.

 

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5 Startup tips – get your finances right

 

By Morgan International Staff Writers

There are so many things to think about when kicking off with your first startup, finances being one of them.  Here we take a look at a few tips that will enable you to get your finances right from day one.

  1. Cash flow is key

Don’t ever take your eye off the ball when it comes to cash flow; you should always know what your money situation is at any given time.  If it comes as a shock to see that money is tight when you check your accounts, you are not doing it properly.  Track every single dollar and treat each one spent or coming in as vitally important.  Keep to a budget and don’t let yourself get into a sticky mess financially.

  1. Track spending

Particularly at the beginning, you are going to have a lot of expenses.  Work out how much you need to set aside for this and stick to it.  Rather than hire an accountant to do the books, use one of the fabulous accounting packages that are online (some free) or set up your own spreadsheet in Excel.  If you do this on a regular basis, at the end of the tax year you will have your figures all ready to go.  Only go to the expense of a professional accountant when your business starts to become too much for you to handle.

  1. Limit your fixed expenses

Don’t go overboard when it comes to things like office space or facilities/equipment.  A single room should do to begin with; some people convert garage space or use a spare room.  Later on, as you grow, you may want to look at hiring a small commercial space or even a spot in serviced offices. It is essential that early on your capital is fed into growth and not overheads. Keep revenue as your top priority and don’t lose focus.

  1. Maintain a safety net

Don’t expect to make a lot of money from day one; keep a safety net/slush fund of savings so that if you do have dry periods financially, you can keep going. If you are giving up a full time job to go it alone, maybe maintain your key source of income for a while until your business is ready to replace it.  Some people decide to create their own start up after being made redundant – this can also work, particularly if you have a large redundancy sum of money to keep you going while the business grows.

  1. Love your customers

Each and every customer is paramount to the success of your business as, without them, you have nothing.  Set time aside to acquire them and don’t neglect your marketing. Try and make use of the channels that cost little or nothing, such as social media.  Once you have a customer, look after them well and maintain your relationship.  This all bodes well for building a great client base.

Bringing your first startup to life is incredibly exciting but do take note of our tips and ensure that you begin slowly, building steadily and always paying attention to that one vital things; finances.

For those of you looking to begin a new business, make use of our professional training courses which will provide you with much more information on how to make your startup successful.

Contact us now to find out which of our training programs are most suitable for you.