REGULATIONS AND EXAMINATION SYLLABUS FOR PROFESSIONAL STUDENTS • EFFECTIVE NOVEMBER 2025

Prior Knowledge
Strategic Financial Management assumes and develops on the core knowledge and
technical skills covered in Financial Management and Performance Management.
Background knowledge in Management Accounting, Financial Accounting, Financial
Reporting, Business Environment, Corporate and Business Law will be required by
candidates.

Ethics
Applicable ethical codes will be those issued by International Ethics Standards Board for
Accountants (IESBA) and 'CAN. These ethical considerations will be at both the
organisational level and for individuals, particularly with respect to the accountant in
business.

Method of assessment
The Strategic Financial Management paper is for three (3) hours with fifteen (15) minutes
reading time. The paper is in three (3) sections, consisting of seven (7) questions in all.
Section A comprises one (1) compulsory question, while sections B and C comprise three (3)
questions each and candidates are required to attempt any two (2) questions from each
section. The compulsory question could be an integrated question combining two (2) or
more areas of the syllabus.

Ethics and professional skepticism

Candidates should note that underlying ethical thinking is required in arriving at
appropriate investment decisions, managing capital reconstructions, corporate
reorganisation and financial risk. The implications of financial strategy for all stakeholders
must be considered and evaluated, and any ethical dilemmas must be resolved. Candidates
will also be expected to apply professional skepticism and critical thinking when making all
judgements.

Specification grid
The grid below shows the relative weightings of the main sections within this syllabus and
should guide the study time spent on each. Over time, the marks available in the
assessment will be within the ranges of weightings below, while slight variations may occur
in individual assessments to enable suitably rigorous questions to be set.
Syllabus overview
Weight
Grid
%

to strategy and linotteial management 10

strotegic monogement 10

C Risk management

O Governance 5

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E Advoneed investment opproigol 30

F Acquisitions, corporate reconstruction and

Advanced

TOTAL too

Detailed contents

A. INTRODUCTION TO BUSINESS STRATEGY AND FINANCIAL MANAGEMENT

• 10%
1. The role and responsibility of senior finance executive/adviser
(a) Formulate strategies for achievement of the organisational goals in line
with the organisation's agreed policy framework.
(b) Develop and recommend appropriate strategies for management of
the financial resources of the organisation to ensure effectiveness,
efficiency and transparency.
(c) Advise management and the board of directors of the organisation in
developing financial goals and organisational financial policies, taking
into considerations the following:
Investment and capital resource allocation decisions;
(ii) Optimising the cost of capital;
(iii) Distribution and retention policy; and (iv) Risk
management.
(d) Discuss the emerging role of the Chief Financial Officer (CFO) as a
strategic partner to the CEO, contributing to the overall business
success by providing financial leadership, driving performance,
managing risks, optimising costs, embracing technology, fostering
stakeholder relationships and ensuring compliance with laws and
regulations.
Discuss the changing role of a company's head of finance from a CFO to
Chief Value Officer (CVO).
2. Financial strategy formulation
(a) Assess and evaluate organisational performance using ratios, trends
analysis, etc.
(b) Recommend an optimum capital mix and structure appropriate to
specified business organisation's capital asset structure.
(c) Advise an appropriate distribution and retention policy.
(d) Evaluate organisation's exposure to risks - business and financial risks
(strategic, operational, reputational, political, economic, regulatory and
fiscal risks).
Advise an appropriate risk management framework, including risk
identification, risk mitigation, hedging and diversification strategies.

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3. Corporate environmental, social, governance (ESC) and ethical issues

(a) Assess the impact on the physical environment and the sustainability
of natural resources arising from alternative organisational business,
financial and investment decisions.
(b) Examine how the organisation manages its stakeholder groups as part
of its social responsibility.
(c) Assess and advise on the impact of investment and financing strategies
and decisions on the organisation's stakeholders.
(d) Explore the areas within the ethical and governance framework of the
organisation which may be undermined by agency issues and/or
stakeholder conflicts and establish strategies for dealing with them.
Recommend appropriate strategies for the resolution of stakeholder
conflict in specific situations and advise on alternative approaches that
may be adopted.
(f) Assess the impact of ethical and governance issues on the
management of an organisation's financial resources.
(g) Recommend ethical and governance framework for the development
of an organisation's financial management policies, which is based on
the highest standards of probity and is fully aligned with the ethical
principles of 'CAN.
4. Management of international trade and finance
(a) Discuss the theory and practice of free trade and the management of
barriers to trade.
(b) Evaluate and advise on the impacts of the actions of the World Trade
Organisation (WTO), the International Monetary Fund (IMF), The World
Bank (WB) and Central Banks on multinational organisations.
5. Dividend policy in multinationals and transfer pricing
(a) Determine a company's dividend capacity and its policy given:
The company's short- and long term reinvestment strategy;
(ii) The companies income tax regime within the host jurisdiction;
and
(iii) The organisational policy on the transfer pricing of goods and
services across international borders.
6. Financial management and ethical issues and emerging technologies
(a) Identify and assess the impact of emerging technologies on strategic
financial management. These include the changing landscape of
financial markets regulations, digitisation, Artificial Intelligence (Al),
blockchain; new asset classes, such as crypto currencies; newer
financing methods such responsible investment, sustainable
finance/green bond; emerging risks beyond currency and interest rate
risks.
(b) Evaluate the ethical implications of an organisation's financial strategy
(including those for the organisation, individuals and other

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stakeholders) and recommend appropriate courses of action to resolve

any ethical dilemmas that may arise.

B. STRATEGIC MANAGEMENT -10%

1. Strategic analysis
(a) Analyse and evaluate an organisation's purpose, in terms of its stated
mission, objectives and critical success factors, highlighting omissions,
inconsistencies and weaknesses, and considering the different
objectives of stakeholders.
(b) Analyse the external environmental factors which may impact upon an
organisation's performance and position, evaluating significant issues
in areas, such as natural capital and climate change; macroeconomic
forces; international trade, financial systems and global economic
factors; government policies; its industry and markets, including
competition; cultural environment; stakeholders, markets for finance,
labour and other resources; supply chain factors; technology
developments, and ecosystem and participant impact.
(c) Explain and evaluate the significance and impact of the internal
environmental factors which affect or may influence an organisation's
ability to achieve its chosen strategy, including its: current resources;
product/service portfolio; value chain and networks; organisational,
operational and technological capabilities (including core
competences, existing business processes, human capital and
workforce flexibility).
(d) Analyse and evaluate an organisation's current position and
performance using both financial and non-financial data, presented in
different formats, applying appropriate statistical and data analytical
tools.
Discuss how business strategy and financial strategy can interrelate in a
given scenario.
Explain and evaluate the ethical and business trust issues to be considered
in determining the scope and nature of an organisation's objectives
and its strategic analysis, considering the legitimate interests of all
stakeholder groups and the public interest.
(g) Evaluate the corporate strategy, business unit strategy and operational
level strategies.
(h) Analyse and evaluate current technology developments, including
those relating to big data, internet of things, digital assets, automation,
intelligent systems, the platform economy, distributed ledger
technology, such as blockchain, cryptocurrencies, etc. and explain how
an organisation can align its strategies with these technologies, using
StrategicAlignment Model.
Explain, demonstrate and evaluate how data from multiple sources can be
selected, captured and analysed to provide management information,

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recognising the causes and effects of different types of data bias, data
omissions, data limitations and data trends and applying an
appropriate degree of professional skepticism.
(j) Discuss techniques for conducting strategic analysis, such as
brainstorming, interview, questionnaire, elicitation method, mind
mapping, process design, business case development and scope
definition.
(k) Demonstrate how strategic analysis tools can be used in a given
scenario. Note: Models for analyses include PESTEL, SWOT, SOAR,
Porter's diamond, Porter's Five Forces, Life Cycle, Benchmarking,
Customer Relationship Management and BCG Matrix.
2. Strategic choice
(a) Assess, advise on and propose appropriate business strategies to meet
stated objectives, including sustainability targets.

(b) Explain and demonstrate how strategic business models can be used in
a given scenario, to identify factors that a business may consider in
choosing between competing strategies. This should include
competitive advantage, the strategic clock, cost leadership
differentiation, lock-in strategies, valuable, rare, inimitable and non-
substitutable/value, rarity, imitability and organisation (VRIN/VRIO)
framework for analysing sustainable competitive advantage (SCA) and
collaboration.
(c) Identify and evaluate business unit strategies to achieve sustainable
competitive advantage.
(d) Explain and demonstrate how financial and non-financial data can be
analysed in order to select an optimal business strategy, including the
impact of big data on business models.
Explain international strategies; appraise international value chains and
markets; including the concepts of globalisation and the borderless
business; and show the impact on individual and group financial
statements of changes in foreign exchange rates.
Evaluate digital strategies, including the use of cloud accounting, software
selection, digital assets, automation, artificial intelligence, machine
learning and robotic process automation.
(g) Explain and demonstrate how management information can be used to
select from proposed strategies, taking account of limitations of data,
including data bias.
Evaluate the appropriateness of a chosen strategy that supports business
objectives, considering constraints, conflicts and other issues based on
a given scenario. The following models and tools may be employed in
carrying out the evaluation: Porter's generic competitive strategies;
Johnson, Scholes and Whittington (JSW) model of strategic planning;
Boston Consulting Group (BCG) model in strategic management;

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Forecasting tools; Trend analysis; System modelling; and Delphi

technique.
Draw conclusions based on market and product analyses that support a
business strategy concerning pricing, positioning, placing and other
product decisions in a strategic marketing plan.
O Determine the appropriate corporate growth strategy in a given scenario:
Internal development; diversification; forward and backward
integration; mergers and acquisitions; product portfolio management;
Griener's growth model; and other growth models; and select a
strategic growth direction of a company using Ansoff's matrix.
3. Strategic implementation
(a) Evaluate and explain the relationship between business strategy and
organisational structure.
(b) Evaluate, in a given scenario, the functional strategies necessary to
achieve a business's overall strategy.
(c) Develop business plans and proposals and advise on technical issues
relating to business and organisational plans, assessing the impact on
historic and projected corporate reporting information.
(d) Communicate chosen strategies and performance targets to
operational and tactical managers through annual budgets, monthly
and weekly targets, linking critical success factors (CSFs) to key
performance indicators (KPls) and strategy.
Demonstrate and explain the impact of acquisitions and strategic alliances
in implementing corporate strategy and evaluate the nature and role of
assurance procedures in selecting and monitoring such strategies.
Explain and evaluate the nature and methods of change management and
advise on the implementation of change in complex scenarios using
Strategic Change Models, including climate change transition.
(g) Demonstrate and explain the techniques that may be used in
implementing a strategy to reduce costs, for example, supply chain
management, business process re-engineering and outsourcing.
(h) Demonstrate and explain the interplay between business strategy,
technology strategy, innovation strategy, technological innovation, and
non-technological innovation for organisational performance.
Identify and explain barriers to implementation of digital strategy, including
digital transformation, and make recommendations as to how they
may be overcome.
(j) Demonstrate an understanding of, and provide advice on, data security
issues, including cyber security issues, arising from c communications,
shared systems and data sharing throughout the supply chain and with
strategic partners.

c. RISK MANAGEMENT
1 . Analyse and evaluate key internal and external business risks and evaluate
their impacts on:

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(a) Attainment of strategic objectives;

(b) Operational efficiency and effectiveness;
(c) Reliable reporting; and
(d) Legal, regulatory and ethical compliance.
2 Assess risks involved in business plans, discuss them and advice on risk
management to mitigate them to cover strategic, operational and financial
risks, including those arising from climate change,
3 Discuss the role of those in governance in risk management, and assess the
impact of risk on key stakeholders, considering both inherent and residual
risks after mitigation.
4 Discuss alternative risk management approaches: risk diversification; risk
transfer; risk sharing; and risk hedging.
5 Evaluate the limitations of risk management processes and approaches
and discuss risk monitoring and auditing.
6 Explain and evaluate appropriate mechanisms to monitor risk and risk
management processes, including information and communication systems
such as enterprise risk management and ISO 31000 framework on risk
management.

D. GOVERNANCE
1 . Identify the issues and bases of decision making, employing theories and
philosophies of corporate governance in a given scenario. These include: (a)
Agency theory;
(b) Transaction cost theory;
(c) Stewardship theory;
(d) Resources dependency theory;
Managerial and class hegemony theory;
Psychological and organisational perspective theory; (g)
Stakeholders' theory; and (h) Systems theory.
2. Explain the nature, significance and scope of enterprise governance and
threats to effective governance, including: (a) Concept of good governance;
(b) Roles of internal and external
auditors; (c) Board structure; and (d)
Audit committee.
3. Discuss the roles and responsibilities of an effective board, including
'noncompliance with laws and regulations' (NOCLAR) and IT governance.
4. Discuss the oversight functions and impact of a board and institutional
shareholders for determining strategic direction, monitoring corporate
performance and risk, and responsibilities to stakeholders for environmental,
social and governance (ESC) and sustainability policies. Advise on the
corporate disclosures relating to them.

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5. Evaluate the suitability of corporate governance and organisational

structures, including assurance processes for implementing strategy and
meeting stakeholders' expectations.
6. Discuss the importance of probity as a principle of governance and assess
transparency of an entity through the quality of its disclosures.
Assess the extent to which a board in the public sector focuses on the value of
sustainable long-term success, delivery of effective and appropriate public
services and acting in the public interest.
8. Discuss the impact of the legal and regulatory frameworks within which
businesses, assurance and governance systems operate, including company
law, laws against corruption (bribery, money laundering, embezzlement, theft,
fraud, extortion, and blackmail), Whistle Blower Act, Independent Corrupt
Practices and Other Related Offences Commission (ICPC) Act; and Economic
and Financial Crimes Commission (EFCC) Act, employment law, contract law,
tort and environmental laws on governance mechanisms and processes.
9. Discuss global developments in enterprise and corporate governance and
review the rules-based and principles-based approaches to corporate
governance. Also, evaluate relevant national and international codes of
corporate governance.
10. Discuss how an organisation can manage its stakeholder groups as part of its
social responsibilities.

E. ADVANCED INVESTMENT APPRAISAL -30%

1. Discounted cash flow techniques
(a) Evaluate complex capital investment, using net present value (NPV)
and internal rate of return (IRR) methods, including:
Specific and general inflation;
Taxation (including tax allowable depreciation);
(iii) Capital rationing (multi-period rationing, limited to discussion
only);
Probability analysis;
Sensitivity analysis;
(vi) Certainty equivalent;
(vii) Risk adjusted discount rate;
(viii) Decision tree;
(ix) Value of perfect information and value of imperfect
information; (x) Project duration as a measure of risk; and
(xi) Simulation.
(b) Establish the potential economic return-modified internal rate of
return. Discuss the relative merits of NPV and IRR.
(c) Evaluate an organisation's commitment to ESG criteria when
undertaking business, financial and investment decisions, and explain

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and proffer solutions on how conflicts between the criteria may be

resolved.
(d) Evaluate and discuss the impact on the physical environment and the
sustainability of natural resources arising from alternative
organisational business, financial and investment decisions.
Evaluate capital investment decisions, using advanced capital budgeting
techniques that incorporate strategic factors.
2. Application of option pricing theory in investment decisions
(a) Utilise the Black-Scholes Option Pricing (BSOP) model to financial product
valuation and to asset valuation:
Enumerate and discuss, using published data, the five principal
drivers of option value (value of the underlying, exercise price,
time to expiry, volatility and the risk-free rate); and
Evaluate the underlying assumptions, applications and limitations of
the BSOP model. (b) Calculate and advise on the value of options to delay,
expand, redeploy and withdraw, using the BSOP model.
3. Impact of financing on investment decisions and adjusted present values
(a) Identify and assess the appropriateness of the range of sources of
finance available to an organisation including equity, debt, hybrids,
venture capital, business angel finance, private equity, asset
securitisation and sale, Islamic finance and security token offerings.
(b) Evaluate and advise on the impact of investment and financing
strategies and decisions on the organisation's stakeholders.
Discuss finance options, including green finance available for
organisations that have adopted environmental, social and
governance (ESG) into their business model.
(d) Determine the cost of capital of an organisation, including the cost of
equity and cost of debt, based on the range of equity and debt sources
of finance. Discuss the appropriateness of using the cost of capital to
establish project and organisational value, and discuss its relationship
to such value.
Compute and evaluate project specific cost of equity and cost of capital,
including their impact on the overall cost of capital of an organisation.
Demonstrate detailed knowledge of business and financial risk, the
capital asset pricing model and the relationship between equity and
asset betas.
Evaluate an organisation's debt exposure to interest rate changes using the
simple Macaulay duration and modified duration methods.
(g) Discuss the benefits and limitations of duration, including the impact of
convexity.
(h) Evaluate the impact of financing and capital structure upon the
organisation with respect to:
(i) Modigliani and Miller propositions, before and after tax;
(ii) Static trade-off theory;

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(iii) Pecking order propositions; and (iv) Agency

effects.
(h) Utilise the adjusted present value technique to the appraisal of investment
decisions that entail significant alterations in the financial structure of
the organisation, including their fiscal and transactions cost
implications.
4. Valuation and the use of free cash flows
(a) Utilise asset based, income based and cash flow based models to value
equity. Utilise appropriate models, including term structure of interest
rates, the yield curve and credit spreads, to value corporate debt.
(b) Estimate an organisation's free cash flow and its free cash flow to
equity (pre and post capital reinvestment).
(c) Assess and advise on the value of an organisation using its free cash
flow and free cash flow to equity under alternative horizon and growth
assumptions.
(d) Discuss the role of option pricing models, such as the BSOP model, in
the assessment ofthe value of equity, the value of debt and of default
risk.
5. International investment and financing decisions

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(a) Estimate project or organisation free cash flows in any specified

currency and determine the project's net present value or organisation
value.
(b) Assess the significance of exchange controls for a given investment
decision and strategies for dealing with restricted remittance.

F. ACQUISITIONS, MERGERS, CORPORATE RECONSTRUCTION AND

REORGANISATION -25%
1. Acquisitions and mergers versus other growth strategies
(a) Discuss the arguments for and against the use of acquisitions and
mergers as a method of corporate expansion.
(b) Assess and advise upon the criteria for choosing an appropriate target
for acquisition.
Discuss the reasons for the frequent failure of acquisitions to enhance
shareholder value as expected, including the problem of over
valuation.
(d) Assess from a given context, the potential for synergy separately classified
as:
Revenue synergy; (ii)
Cost synergy; and
(iii) Financial synergy;
2. Valuation for acquisitions and mergers
(a) Evaluate the potential near-term and continuing growth levels of a
corporation's earnings using both internal and external measures.
(b) Evaluate and advise on the value created from an acquisition or
merger of both quoted and unquoted entities using models such as:
Book value-plus' models;
(ii) Market based models;
(iii) Cash flow models, including free cash flows; and
(iv) Residual income model — including economic value added
(EVA) and market value added (MVA).
(c) Utilise appropriate methods, such as: risk-adjusted cost of capital,
adjusted net present values and changing price earnings multipliers,
resulting from the acquisition or merger to the valuation process
where appropriate.
3. Regulatory framework and processes
(a) Discuss the key factors influencing the development of the regulatory
framework for mergers and acquisitions globally and, in particular, be
able to compare and contrast the shareholder versus the stakeholder
models of regulation.

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(b) Enumerate and explain the main regulatory issues which are likely to
arise in the context of a given offer, and:
Determine whether the offer is likely to be in the shareholders' best
interests; and
(ii) Assess and advise the directors of a target entity on the most
appropriate defence if a specific offer is to be treated as hostile.
4. Financing acquisitions and mergers
(a) Evaluate the various sources of financing available for a proposed cash
based acquisition.
(b) Assess the advantages and disadvantages of a financial offer for a
given acquisition proposal using pure or mixed mode financing
and recommend the most appropriate offer to be made.
(c) Evaluate the impact of a given financial offer on the reported financial
position and performance of the acquirer.
5. Financial reconstruction
(a) Appraise an organisational situation and determine whether a financial
reconstruction is an appropriate strategy for a given business situation.
(b) Evaluate and communicate the likely response of the capital market
and/or individual suppliers of capital to any reconstruction scheme and
the impact their response is likely to have upon the value of the
organisation.
6. Business re-organisation
(a) Appraise and recommend, with reasons, strategies for unbundling
parts of a quoted company.
(b) Evaluate the likely financial and other benefits of unbundling a
company.
(c) Discuss and advise on the financial issues relating to a management
buy-out and buy-in.

G. ADVANCED RISK MANAGEMENT TECHNIQUES -15%

1. The role of the treasury function in large organisations
(a) Discuss the role of the treasury management function within:
The short-term management of an organisation's financial
resources;
(ii) The longer-term maximisation of corporate value; and (iii)
The management of risk exposure.
(b) Discuss the operations of the derivatives market, including:
The relative advantages and disadvantages of exchange traded
versus OTC agreements; and

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(ii) Risks such as delta, gamma and theta, and how these
can be managed.
2. The use of financial derivatives to hedge against foreign exchange risk
(a) Analyse and evaluate the impact on an organisation to exposure in
translation, transaction and economic risks and how these can be
managed.
(b) Evaluate and apply, for a given hedging requirement, which of the
following is the most appropriate strategy, given the nature of the
underlying position and the risk exposure:
The use of the forward exchange market and the creation of a money
market hedge;
Exchange-traded currency futures contracts;
(iii) Currency swaps; and (iv) Currency options.
(c) Advise on the use of bilateral and multilateral netting and matching as
tools for minimising FOREX transactions costs.
3. The use of financial derivatives to hedge against interest rate risk
(a) Assess and advise, for a given hedging requirement, which of the
following is the most appropriate given the nature of the underlying
position and the risk exposure:
Forward rate agreements (FRAs);
I nterest rate futures;
(iii) Interest rate swaps; and
(iv) Interest rate options (including dollars)

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