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Activity papers · Last updated October 2026

HKSI LE Paper 11: Corporate Finance: free practice test

The paper for Type 6 (advising on corporate finance) representatives and Responsible Officers, taken together with Papers 1 and 7. It covers the corporate finance industry, accounting and financial statement analysis, corporate finance principles, equity and debt financing, business valuation, and mergers and acquisitions.

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About the Paper 11 exam

The paper for Type 6 (advising on corporate finance) representatives and Responsible Officers, taken together with Papers 1 and 7. It covers the corporate finance industry, accounting and financial statement analysis, corporate finance principles, equity and debt financing, business valuation, and mergers and acquisitions.

What's on the exam

Paper 11
Corporate Finance Industry Overview
6 key facts
Accounting and Financial Statement Analysis
6 key facts
Principles of Corporate Finance
7 key facts
Equity Financing
7 key facts
Debt Financing
6 key facts
Business Valuation
5 key facts
Mergers and Acquisitions
7 key facts

Each branch is a topic in the official outline. Members see every key fact on the full mind map. Read the free study guide →

How to pass the Paper 11 exam

  • 40 questions in 90 minutes is about 2 minutes each, so you have time to work the calculations.
  • You need 70%: 28 out of 40, so you can miss up to 12.
  • Know the Takeovers Code numbers cold: the 30% trigger, the 2% creeper and the six-month highest price rule.
  • Ratio and NPV questions are quick marks if you know the formulas. Practise current ratio, interest cover and simple discounting until they are fast.

Save your results and get your Readiness Score

Create a free account after the test: your score by topic, a mistakes bank, the complete study notes for the first topic, flashcards and the HKSI Key Numbers Sheet.

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What's in the premium Paper 11 prep

Premium Paper 11 prep is studied one topic at a time. Each step starts with that topic's key notes and flashcard deck, then its own question sets of 25, so you master one topic before you move to the next. When every topic is strong, the 6 full mock exams show you're ready.

3,000practice questions, every answer explained
6full-length mock exams, 50 questions each, timed
800flashcards with spaced repetition, sorted by topic
60comprehensive key notes across 7 topics

Your step-by-step study path

  1. 1
    Corporate Finance Industry Overview9 key notes, 115 flashcards, then 450 practice questions in 18 sets of 25
    Notes free with an account
  2. 2
    Accounting and Financial Statement Analysis9 key notes, 115 flashcards, then 425 practice questions in 17 sets of 25
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  3. 3
    Principles of Corporate Finance9 key notes, 115 flashcards, then 425 practice questions in 17 sets of 25
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  4. 4
    Equity Financing9 key notes, 115 flashcards, then 425 practice questions in 17 sets of 25
    Premium
  5. 5
    Debt Financing8 key notes, 115 flashcards, then 425 practice questions in 17 sets of 25
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  6. 6
    Business Valuation8 key notes, 115 flashcards, then 425 practice questions in 17 sets of 25
    Premium
  7. 7
    Mergers and Acquisitions8 key notes, 110 flashcards, then 425 practice questions in 17 sets of 25
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  8. Final step: 6 full mock exams50 questions each, timed like test day. Pass them, then book your exam.
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Free with an account

Read the complete Paper 11 study notes for “Corporate Finance Industry Overview”

Our first full set of comprehensive notes, about 10 minutes of reading: What corporate finance is · Characteristics of financial markets · Instruments: equity, debt, hybrids and derivatives · Types of organisation · Problems, ethics and governance, a worked exam example, the traps examiners use and a one-minute recap. Create a free account to read it and see how premium notes work before you decide.

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Study tools included

3,000 practice questions

3,000 exam-style questions per exam, organized topic by topic in sets of 25. Every answer explained, with the rule it comes from.

6 full mock exams

6 full-length timed mock exams per exam, with real question counts and time limits, so test day feels like practice day.

Exam Readiness Score

One 0 to 100 number that tells you when you're ready to book. Reach 80 and you're covered by our Pass Guarantee.

800 flashcards + spaced repetition

800 flashcards per exam, in a deck for each topic, that come back right before you'd forget them. Five minutes a day keeps every number fresh.

60 comprehensive key notes

60 key notes per exam, split across its topics and each explained in full: the concepts, worked exam examples, the traps examiners use and a quick recap. Your first set is free with an account.

Mind maps

See the whole exam on one screen: every topic and the facts under it.

Sample questions with answers

These are the questions in the free test above, with answers. Try the test first. You'll learn more by getting some wrong.

1. A Hong Kong manufacturer issues bonds that are bought directly by a pension fund. This is an example of:
Answer: Direct financing. In direct financing, savers invest in securities such as bonds issued by the user of funds. Indirect financing goes through an intermediary such as a bank, which takes the credit risk itself.
2. Which of the following forms of business organisation gives its owners limited liability?
Answer: Company limited by shares. A company is a separate legal person under the Companies Ordinance (Cap. 622), so shareholders can lose only what they invested. Sole proprietors, general partners and joint venturers face unlimited personal liability for business debts.
3. Under accrual accounting, revenue is recognised when:
Answer: It is earned, regardless of when cash is received. The accrual basis recognises revenue when it is earned and expenses when they are incurred, not when cash moves. This is a fundamental assumption underlying Hong Kong Financial Reporting Standards.
4. A company has current assets of HK$60 million and current liabilities of HK$30 million. Its current ratio is:
Answer: 2.0. Current ratio = current assets divided by current liabilities = 60 / 30 = 2.0. It measures short-term liquidity, the ability to pay debts falling due within a year.
5. The internal rate of return (IRR) of a project is the discount rate at which:
Answer: The net present value of the project equals zero. IRR is the discount rate that makes NPV exactly zero. A project is acceptable when the IRR exceeds the company's cost of capital.
6. A project costs HK$1,000,000 today and returns HK$1,100,000 in one year. If the discount rate is 8%, the NPV is approximately:
Answer: +HK$18,500. Present value = 1,100,000 / 1.08, which is about HK$1,018,500. NPV = 1,018,500 - 1,000,000 = about +HK$18,500, so the project should be accepted.
7. In a rights issue, new shares are offered:
Answer: Pro rata to existing shareholders. A rights issue offers new shares to existing shareholders in proportion to their holdings, so each can take up their entitlement and avoid dilution.
8. A company issues cumulative preference shares but skips the dividend this year. Next year, the holders:
Answer: Receive both years' dividends before ordinary shareholders receive anything. Cumulative preference shares carry unpaid dividends forward as arrears, which must be paid before any ordinary dividend. Non-cumulative preference shares lose skipped dividends permanently.
9. In a management buy-out (MBO):
Answer: The existing management team buys the company from its owners. An MBO is the purchase of a company by its existing management, usually funded with debt and private equity. A management buy-in (MBI) brings in an outside management team instead.
10. A bond that repays its entire principal in a single payment at maturity has:
Answer: Bullet repayment. Bullet repayment means the principal is repaid in one lump sum at maturity. Credit foncier (instalment) loans repay principal and interest in instalments over the life of the loan.
11. Compared with a straight bond of the same issuer and maturity, a convertible bond normally offers:
Answer: A lower coupon. Investors pay for the conversion option, so issuers can sell convertibles with a lower coupon than straight debt. The trade-off for the issuer is dilution if the bonds are converted.
12. A discounted cash flow (DCF) valuation values a business by:
Answer: Discounting its projected future cash flows back to present value. DCF sums the present values of projected cash flows, discounted at a rate reflecting the business's risk. Comparable companies and asset-based methods are alternative approaches.
13. In a liquidation, the value of a business is best described as:
Answer: The floor value, based on the realisable value of its assets. Liquidation value is what the assets would fetch in a break-up, whether orderly or forced. It is often treated as the floor value of a company.
14. Under Rule 26.1 of the Takeovers Code, a shareholder (together with its concert parties) must make a mandatory general offer when its holding first reaches:
Answer: 30% of the voting rights. Rule 26.1 requires a mandatory general offer when a person, with its concert parties, acquires 30% or more of the voting rights of a company covered by the Code.
15. A shareholder already holds 35% of a listed company. Under the Takeovers Code, a mandatory offer is triggered if it acquires more than:
Answer: 2% of the voting rights in any 12-month period. The creeper provision in Rule 26.1 requires a mandatory offer when a holder of between 30% and 50% acquires more than 2% of the voting rights in any 12-month period.

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Certification guide

Which HKSI papers do you need?: To become an SFC licensed representative (or a relevant individual at a bank), you usually pass three HKSI Licensing Examination papers: Paper 1 on regulation, Paper 7 on financial markets, and one paper for your regulated activity. Here's which one.

Paper 11 exam FAQ

How many questions are on the Paper 11 exam?

40 multiple-choice questions, with a time limit of 90 minutes. Format: closed book, computer-based.

What is the passing score for Paper 11?

70%.

How much does the Paper 11 exam cost?

HK$1,620 in Hong Kong (HK$2,070 at overseas Prometric centres). Fees change, so confirm with the HKSI Institute before you enrol.

Which languages is the Paper 11 exam offered in?

English or Traditional Chinese.

Where do I take the Paper 11 exam?

HKSI Institute computer-based test centre in Hong Kong, or Prometric centres outside Hong Kong.

Is this Paper 11 practice test free?

Yes. The 15-question practice test on this page is free, with an explanation for every answer and no signup. A free account also unlocks the complete study notes for the first topic. The full Paper 11 prep is Premium at HK$1,147 a month for this exam.

What's in the premium Paper 11 prep?

3,000 practice questions organized topic by topic (Corporate Finance Industry Overview: 450; Accounting and Financial Statement Analysis: 425; Principles of Corporate Finance: 425; Equity Financing: 425; Debt Financing: 425; Business Valuation: 425; Mergers and Acquisitions: 425), 6 full-length timed mock exams of 50 questions, 800 flashcards and 60 comprehensive key notes split across all 7 topics, plus a mistakes bank and the Readiness Score.

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Exam details are summarized from the official candidate information available in October 2026. HKSI Institute changes formats and fees, so confirm with Hong Kong Securities and Investment Institute (HKSI Institute) before you book. HKSIMock is not affiliated with the HKSI Institute or the SFC.

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