Professional Documents
Culture Documents
Assess their current financial standing. You should use the Excel
program to prepare the relevant joint financial statements and financial ratios per
Attachment 1.
(20 marks)
b)
The couple has stated two (2) specific goals which they would like to achieve.
i)
ii)
Determine the lumpsum or annual savings that they would need to achieve the
goals; and
Evaluate if these goals are achievable and if so, suggest ways in which they can
achieve them.
Do note that these goals are very important to them and if you are not able to help
them to fulfill the goals, you must be able to explain your reasons clearly.
Investment Planning
Based on the risk profile analysis done by Don and Connie, they were both classified as
having low risk tolerance.
Based on the original portfolio (per Attachment 1), describe the steps that you would take
over the next 5 years in order to achieve a better performing and/or a better balanced
portfolio. Substantiate your recommendations with sound investment principles.
(15 marks)
Insurance Planning
a)
b)
Recommend to the couple three (3) most appropriate insurance policies that are
currently available in the market. Explain the rationale for your recommendations.
(10 marks)
Executive Summary
Based on your analysis of the earlier segments and the inter-relatedness of these
segments, summarise your recommendations. Among other things, you need to consider
the feasibility of their goals, the means of achieving them and any other important risk
factors which you would like to highlight to the couple.
(5 marks)
Presentation of report
The presentations will be held during the tutorial sessions in Term 2 Week 4 (i.e. week
beginning 21 July 2014). Each CA group will have a maximum of 15 minutes to present
the key findings / recommendations for the case. You should not read the report in its
entirety but should only highlight the salient points.
There will be a question and answer session at the end of each presentation. Every
member must be assigned a section of the report and is responsible for taking any
questions relating to that part.
(20 marks)
Assumptions
Inflation
Investment rate of return
- Expected after-tax yield (for insurance estimation)
- Equities
- Fixed income
4% pa
5% pa
8% pa
4% pa
Death expenses
$20,000 per person
Except for CPF savings, all other assets are jointly owned by the couple
With reference to Attachment 1, all assets/liabilities were valued as at
31/3/14 and all income/expenses were reflected for the year ended 31/3/14
Don plans to retire in 15 years time.
Expected lifespan assume 85 years for both.
You may make any other reasonable assumptions to support your recommendations
but these assumptions must be clearly stated and explained.
3
Structure of Report
The report should meet the following guidelines:
a)
b)
c)
The length of the report should not be more than 15 pages, and appendices should
not exceed 15 pages.
d)
The report must be typed with double spacing, with font size of 12,
and a 3-cm margin on all sides of the page. Attention must also be paid to proper
paragraphing and sub-headings, and pages must be properly numbered.
e)
All members are expected to contribute towards this assignment and any
complaints of free riders will be severely dealt with, including the possibility of
being given zero for the assignment.
Administration
a)
Names of group members and their admission numbers are to be shown on the
cover page.
b)
c)
Attachment 1
Item
Cash
Savings Deposit
Shares
Remarks
5,000 They do not have the habit of making
10,000 regular savings on a monthly basis. Their
interest income was negligible.
182,800 The shares held as at 31/3/14 were:
10 lots of SGX
10 lots of SingTel
10 lots of OSIM
20 lots of Noble Group
20 lots of Genting SP
Dividend income was about $3,000 for the
year.
Real estate
450,000
Car
10,000
CPF Savings
Don
CPF Ordinary A/c
CPF Special A/c
Medisave A/c
130,000
88,000
42,000
Connie
CPF Ordinary A/c
CPF Special A/c
Medisave A/c
12,000
9,000
9,000
Salary
Don
Net salary
CPF - Employee
CPF - Employer
Insurance Policies
71,050
12,950
9,800
Sum Assured ($)
Premiums ($)
Don
NTUC VivoLife
Safra Essential Term
Dependants Protection Scheme
300,000
150,000
46,000
9,200 pa
600 pa
200 pa
183,000
0
0
5
Premiums ($)
Connie
NTUC VivoLife
Dependants Protection Scheme
150,000
46,000
3,400 pa
200 pa
76,000
0
*The couple has not bought any medical insurance as Dons employer has provided sufficient
medical benefits for both Connie and himself.
Car loan installments
Household
Food
Transportation
Tax
Personal expenses Don
Personal expenses Connie
Vacation expenses
Miscellaneous
14,000
5,000
12,000
12,000
2,500
5,000
3,000
10,000
3,000