Investment Appraisal
3 articles INF Inflation and Investment Appraisal Discusses the nominal and real terms approaches to NPV investment appraisal, including the impact of taxation — an area where unprepared candidates often make mistakes. ↗ ADV Advanced Investment Appraisal Covers advanced investment appraisal techniques — one of the core and most frequently examined topics within the Financial Management paper. ↗ EAC Equivalent Annual Costs and Benefits Explains how to calculate equivalent annual costs — a tool used by companies to assist in asset replacement decisions and capital expenditure planning. ↗
Working Capital Management
3 articles WCM Working Capital Management Covers the foundations of working capital management — analysis of current assets and liabilities. Can form the whole of a 20-mark FM question. ↗ AR Accounts Receivable Management Covers the management of accounts receivable — credit policies, early settlement discounts, and the cost-benefit analysis of credit decisions. ↗ REC Receivables Collection Considers two methods a company could adopt to speed up the collection of cash from customers — factoring and invoice discounting. ↗
CAPM & Cost of Capital
5 articles P1 The Capital Asset Pricing Model — Part 1 Introduces the CAPM, its components, how it estimates the cost of equity, and the asset beta formula — essential FM exam knowledge. ↗ P2 The Capital Asset Pricing Model — Part 2 Describes how to apply the CAPM when calculating a project-specific discount rate to use in investment appraisal — a common exam requirement. ↗ P3 CAPM: Theory, Advantages and Disadvantages The final part of the CAPM series — critically evaluating the theory, examining its practical advantages and widely discussed limitations. ↗ CG1 Cost of Capital, Gearing and CAPM — Part 1 The first of two articles on how to calculate a suitable discount rate — covering weighted average cost of capital and the effect of gearing. ↗ CG2 Cost of Capital, Gearing and CAPM — Part 2 Continues from Part 1 — applying the Modigliani-Miller propositions and the CAPM to derive the cost of capital in geared entities. ↗
Business Finance & Sources of Finance
4 articles BF Business Finance Covers Section E of the FM syllabus — types of finance, sources of finance, and the mix of financing available to businesses. ↗ SME Business Finance for SMEs Considers finance sources for SMEs — with a particular focus on modern sources including crowdfunding and supply chain financing. ↗ ALT Analysing the Suitability of Financing Alternatives Suggests a structured approach for analysing financing alternatives in FM exam questions — demonstrated through a worked example. ↗ ISL Introduction to Islamic Finance Covers Islamic finance — recently introduced to the FM syllabus. Explains the key principles, instruments, and differences from conventional finance. ↗
Risk Management
3 articles FX Foreign Currency Risk and Its Management Focuses on the three types of currency risk — economic risk, translation risk, and transaction risk — and how each is managed in practice. ↗ IR Hedging Techniques for Interest Rate Risk Covers Section G of the FM syllabus — the management of interest rate risk using forward rate agreements, futures, options, and swaps. ↗ FAR Management of Foreign Accounts Receivable Focuses on foreign accounts receivable — the additional challenges of dealing with overseas customers compared to domestic-based ones. ↗
Business Valuations
2 articles VAL Business Valuations Discusses the three broad approaches to business valuations — assets-based, income-based, and cash flow-based methods and when to apply each. ↗ BEH Behavioural Finance Introduces behavioural finance and its key concepts — important for understanding market efficiency and valuation debates within the FM syllabus. ↗
Capital Structure & Dividend Policy
2 articles OCS Optimum Capital Structure Examines whether it is possible to increase shareholder wealth by changing the capital structure — covering traditional view, MM propositions, and practical considerations. ↗ DIV Dividend Theory Looks at the two ways wealth can be provided to shareholders — dividends and share price growth — and examines dividend theories, policies, and practical considerations. ↗
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