1. Module 1 — US Quarterly Financial Statements Are Called Audited
Curriculum location: Publicly vs. Privately Owned Corporate Issuers, Registration and Disclosure Requirements, p. 24.
"must file audited financial statements and other information on a quarterly basis"
The curriculum collapses two different assurance levels. US domestic issuers generally include audited annual financial statements in Form 10-K, while Form 10-Q for the first three fiscal quarters contains unaudited interim financial statements.
Correct reading: US domestic issuers generally file audited annual financial statements and unaudited financial statements for the first three fiscal quarters, together with other required SEC information.
This protects the distinction between annual audited reporting and quarterly unaudited reporting.
2. Module 1 — ESEF Is Described as a Semiannual Reporting Format
Curriculum location: Publicly vs. Privately Owned Corporate Issuers, Registration and Disclosure Requirements, p. 24.
"financial statements must be reported in the EU's standardized ESEF (European Single Electronic Format) in the registry of domicile, at least semiannually."
ESEF is the mandated format for annual financial reports of issuers whose securities trade on EU regulated markets. The separate requirement to publish half-yearly financial reports does not make ESEF a semiannual format.
Correct reading: In-scope EU issuers prepare annual financial reports in ESEF; half-yearly financial reports are a separate periodic disclosure obligation.
This prevents candidates from attaching an interim filing frequency to an annual-report format.
3. Module 3 — A Simple Voting Structure Uses One Vote per Shareholder, Not per Share
Curriculum location: Stakeholder Conflicts and Management, Controlling and Minority Shareholder Relationships, p. 72.
The simple voting structure is described as:
"In contrast to a simple structure of one vote per shareholder"
The unit is incorrect. Voting power in the simple structure is attached to shares, not distributed equally across shareholder accounts. The same sentence makes this clear when it describes both Class A and Class B by their votes per share. Treating the unit as the shareholder would give an owner of one share the same voting power as an owner of one hundred shares.
Correct reading: In a simple one-class voting structure, each share carries one vote. A dual-class structure differs because its share classes may carry different numbers of votes per share.
For exam questions, keep the voting unit explicit. If two shareholders hold different numbers of shares, one vote per shareholder would falsely give them equal voting power; one vote per share makes voting power track the shares held.
4. Module 4 — A CAD200,000 Gross Sale Is Treated as CAD200,000 Net
Curriculum location: Managing Working Capital and Liquidity, Liquidity and Short-Term Funding knowledge-check solution, p. 129.
"Sell CAD200,000 in value"
The example requires the issuer to raise CAD200,000 and states a brokerage cost of . Selling CAD200,000 gross would net only . To net the required amount, the gross sale must be , with a fee of approximately .
Correct reading: Sell approximately CAD201,005 of marketable securities, incur approximately CAD1,005 of brokerage cost, and receive CAD200,000 net. This remains the least-cost viable alternative in the example.
The error does not change the selected alternative, but correcting the gross-up is important whenever a target is stated as net proceeds after transaction costs.
5. Module 5 — Multiple Sign Changes Are Said to Guarantee Multiple IRRs
Curriculum location: Capital Allocation, Internal Rate of Return limitation, p. 152.
The discussion states:
"An important limitation with IRR is that multiple IRRs exist if cash flow signs change more than once."
The local example does have two IRRs, but the general statement is too strong. Multiple sign changes make multiple IRRs possible; they do not prove that multiple roots exist. For example, the cash flows have two sign changes. With , their IRR equation reduces to , whose discriminant is , so it has no real root.
Correct reading: Multiple IRRs may exist when cash-flow signs change more than once. The actual roots must be checked; use NPV when IRR is ambiguous.
This distinction matters whenever a question asks whether multiple IRRs are possible or certain. Count sign changes as a warning condition, not as proof of the number of IRRs.
6. Module 5 — The Two-Period NPV Formula Repeats in the Year-2 Term
Curriculum location: Real Options, decision-tree question-set solution, p. 168.
The generic formula is shown as:
The second numerator is mislabeled. It is discounted for two periods and must be the Year-2 cash flow. The numerical substitution immediately below uses distinct expected cash flows of in Year 1 and in Year 2, producing the stated NPV of approximately . Reusing in both terms instead gives approximately .
Correct reading: A two-period project must discount each year's own cash flow:
The corrected setup preserves the printed NPV of approximately ; the numerical result itself does not change.
The corrected subscript preserves the worked positive NPV and the investment conclusion. Literal use of the printed formula would reverse the sign of the result.
7. Module 6 — Higher Firm Risk Is Attributed to Operating Margin, Not Operating Leverage
Curriculum location: Factors Affecting Capital Structure, Question Set 2 solution, p. 190.
The solution concludes:
"Thus, firms with high operating margins are riskier and likely to have higher debt and equity costs."
The named measure is wrong. Operating leverage describes how fixed operating costs amplify the change in operating profit caused by a change in revenue. Operating margin instead measures operating profit relative to revenue. A high margin does not, by itself, show that profit is highly sensitive to revenue, so it cannot replace operating leverage in this risk conclusion.
Correct reading: Firms with high operating leverage are riskier, all else equal, because their fixed-cost structure makes operating profit more sensitive to changes in revenue; this can raise the returns required by debt and equity investors.
For exam questions, identify the causal chain: fixed-cost intensity → greater operating-profit sensitivity → higher business risk. Do not infer high operating leverage from the operating-margin level alone.
Complete Corporate Finance Errata Index
Scope: Modules 1–7, pp. 3–242 (printed page numbers).
Reviewed modules. Module 1, pp. 3–36; Module 2, pp. 37–65; Module 3, pp. 67–95; Module 4, pp. 97–134; Module 5, pp. 135–172; Module 6, pp. 173–211; and Module 7, pp. 213–242, including the printed Practice Problems and solutions in Modules 2–6 and the embedded Question Sets and solutions in Module 7.
What this review covers. Errors in the printed curriculum that would change a candidate's answer or understanding: wrong numbers, wrong formulas, reversed logic, and statements that contradict the volume's own data. It does not list spelling mistakes, equation-numbering slips, or wording that is loose but defensible.
The table lists every high-value, objectively confirmed curriculum error admitted for these modules, including eligible errors in printed questions and solutions. Repeated instances of the same defect are consolidated into one row. Extraction or import-fidelity problems, disputed readings, and low-value editorial issues are outside the public errata scope.
Scroll horizontally to see every column.
References
- SEC Investor.gov: Public Companies
- ESMA: Electronic Reporting
- ESMA Transparency Directive Article 5: Half-Yearly Financial Reports
- U.S. Securities and Exchange Commission: transaction costs are deducted from sale proceeds
- MIT Finance Theory Lecture 3: Capital Budgeting Under Certainty
- Aswath Damodaran: operating leverage and cost structure
This article is an independent candidate-focused analysis of confirmed errors in the CFA Level I 2027 Curriculum, Volume 3 Corporate Finance, Modules 1–7. It is not an official CFA Institute errata notice, and inclusion here must not be read as CFA Institute confirmation, endorsement, or approval.