What is SIDC Module 7?
Module 7, Financial Statement Analysis and Asset Valuation, is one of the Securities Commission's licensing examinations, run by the Securities Industry Development Corporation (SIDC). It tests whether you can read company accounts, calculate ratios and value shares and bonds. It is usually taken with Module 6 by people applying to deal in securities.
The exam format
| Questions | 60 multiple choice |
|---|---|
| Time | 90 minutes |
| Pass mark | 60% (36 correct answers) |
| Fee | RM 400 per sitting, the same for re-sits |
| Materials | Closed book |
| Mode | Centre-based or remote proctored; the physical option carries a non-refundable RM 100 administrative fee |
| Results | Released three working days after the exam and valid for two years |
With 90 minutes for 60 questions you have about 90 seconds each, so fast, accurate calculation matters. Check SIDC's current rules on which calculators are allowed before the exam.
What the exam covers
- Financial statements: the statement of financial position, profit or loss and changes in equity, inventory, depreciation, revenue, leases and EPS under MFRS.
- Ratio analysis: liquidity, gearing, interest cover, profitability, efficiency, DuPont and market ratios such as P/E, dividend yield and payout.
- Cash flow analysis: operating, investing and financing activities, the indirect method and free cash flow.
- Time value of money: future and present values, annuities, perpetuities, effective rates, NPV and IRR.
- Equity valuation: the dividend discount model, CAPM, P/E and enterprise value, bonus and rights issues.
- Bond valuation: pricing, current yield, yield to maturity, zero-coupon bonds and interest rate and credit risk.
- Economic analysis: monetary and fiscal policy, the OPR, inflation, the business cycle and exchange rates.
- Portfolio and risk: expected return, beta, correlation, the Sharpe ratio and diversification.
Free official resources, and what we add
SIDC publishes the exam terms online and sells official study guides, with a 20% discount for first-sitting candidates. The MFRS standards are issued by the Malaysian Accounting Standards Board. There is no free official question bank. Our questions are original, and every calculation is shown step by step in the explanation, including why the tempting wrong answers are wrong (for example, using last year's dividend instead of next year's).
How to prepare
- Work through the SIDC Module 7 study guide with a calculator beside you.
- Learn the core formulae by heart, since the exam is closed book: current and quick ratios, ROE and DuPont, P0 = D1 / (r - g), CAPM, bond price and annuity formulae.
- Practise each calculation type until you can do it in under 90 seconds.
- Practise one topic at a time, then sit full 60-question timed mocks in 90 minutes.
- Review every mistake and note which formula or step went wrong.
Practice questions with answers
Tap a question to see the correct answer and explanation.
A company has total assets of RM800 million and total liabilities of RM300 million. What is its total equity?
- RM300 million
- RM500 million
- RM1,100 million
- RM2.67 million
Answer: B, RM500 million. Assets = liabilities + equity, so equity = 800 - 300 = RM500 million. Source: MFRS 101 Presentation of Financial Statements; SIDC Module 7 (Financial Statement Analysis and Asset Valuation) syllabus, statement of financial position.
Current assets are RM600,000, of which inventory is RM200,000. Current liabilities are RM400,000. What is the quick (acid-test) ratio?
- 1.0 times
- 1.5 times
- 2.0 times
- 0.5 times
Answer: A, 1.0 times. Quick ratio = (current assets - inventory) / current liabilities = (600,000 - 200,000) / 400,000 = 1.0 times. Source: SIDC Module 7 (Financial Statement Analysis and Asset Valuation) syllabus, liquidity ratios.
Net profit is RM100,000; depreciation RM20,000; receivables rose by RM15,000; payables rose by RM10,000; inventory rose by RM5,000. Using the indirect method, what is cash flow from operating activities?
- RM110,000
- RM90,000
- RM150,000
- RM120,000
Answer: A, RM110,000. Start with net profit 100,000. Add depreciation (non-cash) +20,000. Increase in receivables -15,000. Increase in payables +10,000. Increase in inventory -5,000. Total = RM110,000. Source: MFRS 107 Statement of Cash Flows (indirect method).