The goal of Financial Management is to develop the knowledge and skills required of a finance manager, specifically in the areas of investment, financing, and dividend decisions. The ACCA exam has been developed with the intent to provide candidates with the skills required of a finance manager in charge of a company’s finance function. The ACCA Financial Management (FM) exam is an important component of the ACCA qualification. This exam covers a wide range of topics related to financial management, including working capital management, investment appraisal, business finance, and risk management. Let us look at some of the learning resources for the ACCA Financial Management (FM) Exam!
About ACCA Financial Management (FM) Exam
The ACCA Financial Management (FM) Exam is a professional certification exam offered by the Association of Chartered Certified Accountants (ACCA). It is designed to assess a candidate’s knowledge and understanding of financial management and accounting principles. The exam covers a range of topics, including financial planning and control, investment appraisal, working capital management, and financial statements analysis.
To be eligible to take the ACCA Financial Management (FM) Exam, candidates must meet the ACCA’s entry requirements, which include a minimum of two years of relevant work experience. The exam is computer-based and is typically held four times a year.
Further, taking this exam will also help you improve your technical and practical skills in the following areas:
- assessing and debating the economic environment’s impact on financial management
- Working capital management techniques are being discussed and implemented.
- Conducting an effective investment appraisal
- Identifying and evaluating alternative business finance sources
- discussing and applying business and asset valuation principles
- Explaining and implementing risk management techniques in the workplace.
Now that you are aware of the exam in detail, let us now move on to the step-by-step guide on How to Pass the ACCA Financial Management (FM) Exam!
Preparation Guide for the ACCA Financial Management (FM) Exam
Passing the ACCA FM exam is an important step towards achieving the ACCA qualification, which is recognized globally and highly respected by employers. The ACCA qualification is designed to provide candidates with the skills and knowledge required to succeed in the accounting and finance professions. Follow these steps to pass the exam with flying colors:
Step 1 – Refer to the exam syllabus
The following modules are covered in the ACCA Financial Management (FM) certification exam:
Module 1 – Financial Management Function
- The nature and purpose of financial management
- Financial objectives and relationship with corporate strategy
- Stakeholders and impact on corporate objectives
- Financial and other objectives in not-for-profit organizations
Module 2 – Financial Management Environment
- The economic environment for business
- The nature and role of financial markets and institutions
- The nature and role of money markets
Module 3 – Working Capital Management
- The nature, elements, and importance of working capital
- Management of inventories, accounts receivable, accounts payable, and cash
- , Determining working capital needs and funding strategies
Module 4 – Investment Appraisal
- Investment appraisal techniques
- Allowing for inflation and taxation in DCF
- Adjusting for risk and uncertainty in investment appraisal
- Specific investment decisions (lease or buy, asset replacement, capital rationing)
Module 5 – Business Finance
- Sources of, and raising, business finance
- Estimating the cost of capital
- Sources of finance and their relative costs
- Capital structure theories and practical considerations
- Finance for small and medium-sized entities (SMEs)
Module 6 – Business Valuations
- Nature and purpose of the valuation of business and financial assets
- Models for the valuation of shares
- The valuation of debt and other financial assets
- Efficient market hypothesis (EMH) and practical considerations in the valuation of shares
Module 7 – Risk Management
- Nature and types of risk and approaches to risk management
- Causes of exchange rate differences and interest rate fluctuations
- Hedging techniques for foreign currency risk
- Hedging techniques for interest rate risk
Module 8 – Employability And Technology Skills
- Use computer technology to efficiently access and manipulate relevant information
- Work on relevant response options, using available functions and technology, as would be necessary in the workplace Financial Management (FM)
- Navigate windows and computer screens to create and amend responses to exam requirements, using the appropriate tools
- Present data and information effectively, using the appropriate tools
Step 2 – Refer to Exam Format
The candidate will have two hours to finish the (ACCA) exam. The ACCA exam requires a passing score of 50%. The exam is offered in English, Japanese, and Latin American Spanish. Pearson VUE is where the candidate can register for the exam!
- 100 questions on the exam
- Exam time: 2 hours
- Passing score: 50 percent or higher
- Multiple-choice questions are the most common type of questions.
Step 3 – Get an Idea about the Difficulty Level
The difficulty is a relative term; a well-prepared student may find the most difficult paper set to be easy. And even the easiest papers would be difficult for someone with poor preparation. However, based on past pass rates and student feedback, taxation is the easiest to pass, followed by FM and then FR. The fact that the tax paper has the highest proportion of numerical, followed by FM and then FR, makes it easier to get marks. The theory is more difficult to grasp. Finally, how difficult the paper is will always be determined by your preparation.
Step 4 – Devise a Study Strategy
The following step is to plan a study strategy for your preparations. As you plan, keep the course topics and the time remaining for the real exam in mind. Remember to begin with your weakest points. Pay special attention to exam topics with a higher weightage. Following your plan will assist you in remaining consistent and avoiding distractions.
Step 5 – Refer to the best learning resources
It is true that hard work is required for success, whether you are a student studying for an exam or an employee aiming for a promotion. If you want to consider success to be your good fortune and wealth, your exam preparation must include effective time management and planning. Let us look at some resources –
Student Virtual Learning Centre
ACCA provides you with professional tutors who will be at your disposal to organize and conduct classes in both subjects to help you improve your English and Maths skills and prepare for your next ACCA exam.
ACCA Practice Platform
In the CBE environment, it has a blank workspace where you can answer constructed response questions. The ACCA Practice Platform includes a variety of content that allows you to attempt timed questions and then mark and debrief your responses. It also includes a blank workspace where you can answer constructed response questions from other CBE sources.
Join a Study Group
Participating in online forums allows you to discuss problems with other test-takers, compare your strategies with those of other test-takers, and gain insights into how other students are preparing for the exam. The online environment offers a wealth of resources that can assist you in improving your skills, staying motivated throughout the preparation process, and ultimately increasing your chances of passing the exam.
Try Practice Test
When it comes to testing preparation, there is no substitute for hard work. The more practice tests you take, the more familiar you’ll be with the types of questions you’ll see on exam day, and the more confident you’ll be when writing your own test. And, of course, as you practice, you’ll be less likely to make the same mistakes. At Testprep training, we also provide ACCA Financial Management (FM) free practice tests, which are extremely beneficial to those preparing. Always remember that practice makes perfect!
Exam Passing Tips:
Here are some tips for preparing for the ACCA Financial Management (FM) Exam:
- Familiarize yourself with the exam format: Understanding the format of the exam and the types of questions that will be asked can help you better prepare and increase your chances of success.
- Study the official ACCA study materials: Use the official ACCA study materials, such as textbooks and study guides, to ensure you have a comprehensive understanding of the syllabus.
- Practice using ACCA-approved study aids: ACCA-approved study aids, such as practice exams, can help you identify areas where you need to improve and get a feel for the types of questions that will be on the real exam.
- Create a study plan and stick to it: Create a study plan that works for you and stick to it. This can help you focus your efforts and make the most of your study time.
- Focus on key areas of the syllabus: The ACCA Financial Management (FM) exam covers a wide range of topics. Focus on the key areas that are tested more frequently to ensure you have a solid understanding of these topics.
- Attend ACCA-approved tuition: Attend ACCA-approved tuition to receive expert guidance and support in your studies. This can help you understand difficult concepts and improve your chances of success.
- Seek out additional resources: Look for additional resources, such as study guides and practice exams, that can help you prepare for the exam.
Final Words
Remember, the ACCA Financial Management (FM) exam is a challenging exam, and preparation and hard work are key to success. By following these tips and using the resources available, you can increase your chances of success on the exam and become an ACCA Financial Management (FM) certified professional. Overall, the value of the ACCA FM exam depends on your career goals and aspirations. If you are interested in pursuing a career in financial management or accounting, passing the ACCA FM exam can be a valuable asset.
