Nov 2016 paper issues

It's quite insane in their model solution for Q1 to state that providing a free coffee machine worth $200 to low and medium users would not be environmentally friendly. Perhaps this exam question was set in some weird communist dictatorship state without me realising? You know, a place where there's no ebay, no charities, no one has friends to give the spare coffee machine to, no room to keep a spare coffee machine in their home and no recycling centre to dump one in... give me a break!

As actuaries we are trained to value assets by market value yet we're meant to consider a new, unused $200 coffee machine has zero market value and it's OK to make a weird assumption that low and medium users will cause an environmental problem with it?

 

You have to work with the question as set. Whether you feel it should be transferable saleable etc is not relevant. It's like any technical exam. Answer the question as set and don't try to make it fit what you wanted. They gave you the facts.

 

The question has zero relevance to any actuary anywhere. Don't use your brain kids, just go along with everything they say even when it makes no sense at all because they know better than you obviously. Keep spinning that slot reel kids at £450 a go.

 

It appears from the comments from both examiners that they wanted more on how the coffee offers satisfy the environmental policy from my Q1 submission.

It's funny how people are denied from qualifying as actuaries on such a basis when environmental considerations and expertise is not something we do. This exam was supposed to be an actuarial topic and our communication of it to non-actuaries. Who is to say that an excess of unused coffee machines or capsules would cause any kind of environmental problem anyway ?! Oh they said don't assume resale or give unused to others but nothing said about the recycling possibilities of these items etc. Then they contradict themselves in the examiners report saying proposal 3 would satisfy high end users in terms of environmental policy but not low or medium... erm sorry but that's not necessarily the case as they've just stated they would like a spare machine should the original break down...not that this has ANYTHING to do with ACTUARY!

Scandalous examination paper. Seriously, shouldn't an actuary say "I am not equipped to comment on the environmental impact of these options since I am an actuary and not a bloody environmentalist!"

 

There's a board at the profession that looks at resource and environment. The profession has commented on impacts of climate change, pension funds etc now actively look to avoid investing in companies with high carbon footprints etc and ethics. So environment is becoming an issue some actuaries get involved in. The question said one of the concerns was around goodness of fit with the one of the companies policies.

 

Sorry Ethics above should have read avoid investments in companies where there are ethical concerns.

 

What a red herring, wow very desperate. What you describe is in relation to assessing insurance liabilities, which is what actuaries do. This is totally different from what the question was asking.

Actuaries are also trained to value assets at market value yet this absurd question said we're not expected to do that. So we're to NOT use our actuarial training to approach this question. Stupid.

 

I'm not saying I'd have passed had I taken it. Just I can see the connection between solution and question and how it attempted to guide an answer hence a learning point on technique. Incidentally rough estimate of what it cost me over the years in studies resits etc £7.5k.

 

The question is unfit for purpose. Not an actuarial topic. Not allowing us to use our actuarial techniques to value the proposals by way of PV or market valuation -and you only get to find this out after reading to the very end of the question, thus wasting your time and thoughts as you read through the question. Expecting us to provide a somewhat qualitative evaluation according to an environmental policy, set in a wholly unreal business context- that's not what actuaries do. It's preposterous to determine who gets to qualify as an actuary from such an unsuitable question that fails to be in accordance with the exam's syllabus.

 

Regarding time waste on the day I recommend reading the question all the way through before trying to formulate an answer before you understand fully what it is. Then having read it in full, re read and then to decide what any data or scenario aspects you need to answer. It's the same approach in any exam. Read and re read the question so you answer as set and don't try to change it because if you do you will start losing marks. Whether or not you like the question on the day you have to stay calm and focussed to give yourself a chance. I'm not getting drawn into rights and wrongs of specific questions. I don't think this forum is about people and process bashing. It's not helping anyone reading for tips on how to pass next sitting.