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Financial management

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This module aims to equip you with the vital knowledge and skills needed for the successful management of financial operations within an organisation. Managing the financial function of an organisation requires mastering various aspects. After being introduced to the broad economic and financial environment within which organisations operate, you’ll learn how to justify and make efficient decisions related to financing, investments, valuation, and risk. Upon completion, you’ll be ready to apply the techniques and tools you've acquired in a professional environment.

What you will study

The module consists of the following six units, each of which lasts between two and three weeks:

Unit 1: Financial management in context
You'll begin with an introduction to the module and the fundamentals of financial management. This includes explaining the nature, objectives, and impact of financial management and also discusses the economic and financial environment for organisations. You’ll focus on the financial objectives of the organisations and the most common measurements of performance, as well as the role of the various stakeholders. The unit also examines the key aspects of macroeconomic policies, as well as the various functions of financial markets and institutions.
Unit 2: Sources of finance and the cost of capital
In this unit you'll look at the key financial resources available to organisations and how their cost can be estimated. You'll also consider the related specific opportunities and constraints in an accessible and contextualised manner. The key features of the ‘financing mix’ available to the various types of organisations will be elucidated, along with the relationships that can be built with capital markets. This unit also introduces the issues specific to small and medium-sized enterprises, and additional considerations regarding the assumptions underpinning the estimation of the cost of capital, the key theories of capital structure, and dividend policy.
Unit 3: Working capital management
This unit presents the planning process through which organisations can efficiently use short-term or current assets and liabilities thus ensuring operational success. You’ll learn about the role and key elements of working capital management, as well as issues related to liquidity, solvency, efficiency and inventory control. The unit covers the key techniques for managing cash inflows and outflows. The appropriate balance between not holding too much cash that could be more profitably invested, and having ready cash to pay bills and respond to contingencies and opportunities, is a crucial aspect of ensuring that all short-term financial objectives are achieved.
Unit 4Investment appraisal
The focus of this unit is the key techniques to analyse and make decisions about the profitability of an investment. Unlike working capital management, which deals with short-term assets and liabilities, investment appraisal is about the analysis required for more long-term or capital investment decisions. You’ll learn about the four most commonly used investment appraisal techniques, namely Payback, Accounting Rate of Return (ARR), Net Present Value (NPV) and Internal Rate of Return (IRR). The advantages and limitations of each of these will be discussed, as well as their relevance to analyse the economic viability of long-term projects.
Unit 5: Business valuation
This unit presents the main models for valuing shares, debt, and other financial assets. You’ll start by understanding the core elements and purposes of estimating the value of a business, and then move into the explanation and applications of the key methods for valuing equity and debt. You'll learn how the real value of a business depends on methods and viewpoints. The unit also introduces complicating factors in practical valuation, also related to key debates about market efficiency and behavioural finance.
Unit 6: Introduction to risk management
The last unit introduces issues related to the management of risk in organisations. Effective risk management is an important tool for businesses and individuals to prevent uncertainties and mitigate potential risks that could affect their performance. You'll be introduced to the issue of risk in financial management, focusing on the causes of exchange and interest rate fluctuations. You’ll be also introduced to the key techniques to hedge these types of risks such as practical approaches, forward currency contracts, forward rate agreements, and futures contracts.  

Professional recognition

This module forms part of the BSc (Hons) Accounting and Finance (R52) which has been granted exemptions by the Chartered Institute of Management Accountants (CIMA) towards its CGMA qualification.

Entry requirements

You must have successfully completed Fundamentals of accounting (B124) and Business data analytics and decision making (B126) before you can register for B252.

Preparatory work

If you would like to prepare for this module, you may find ​that Organisations and the financial system, a free course on OpenLearn, is a helpful introductory resource.

What's included

You’ll have access to a module website, which includes:

  • a week-by-week study planner
  • module materials, including datasets to practice your analytical skills
  • audio and video content such as animations and screencasts
  • assignment details and submission section
  • online tutorial access.

Computing requirements

You’ll need broadband internet access and a desktop or laptop computer with an up-to-date version of Windows (10 or 11) or macOS Ventura or higher.

Any additional software, including any required to complete the online invigilated exam, will be provided or is generally freely available.

To join in spoken conversations in tutorials, we recommend a wired headset (headphones/earphones with a built-in microphone). You’ll need a webcam and microphone for the online invigilated exam.

Our module websites comply with web standards, and any modern browser is suitable for most activities.

Our OU Study mobile app will operate on all current, supported versions of Android and iOS. It’s not available on Kindle.

It’s also possible to access some module materials on a mobile phone, tablet device or Chromebook. However, as you may be asked to install additional software or use certain applications, you’ll also require a desktop or laptop, as described above.

Teaching and assessment

Support from your tutor

Throughout your module studies, you’ll get help and support from your assigned module tutor. They’ll help you by:

  • marking your assignments (TMAs) and providing detailed feedback for you to improve
  • guiding you to additional learning resources
  • providing individual guidance, whether that’s for general study skills or specific module content
  • facilitating online discussions between your fellow students, in the dedicated module and tutor group forums.

Module tutors also run online tutorials throughout the module. Where possible, recordings of online tutorials will be made available to students. While these tutorials won’t be compulsory for you to complete the module, you’re strongly encouraged to take part.


The assessment details for this module can be found in the facts box.

This module includes a remote exam you will take at home or another suitable location. The exam will be invigilated online by another person – find out more about online invigilation.

If you have a disability

The OU strives to make all aspects of study accessible to everyone and this Accessibility Statement outlines what studying B252 involves. You should use this information to inform your study preparations and any discussions with us about how we can meet your needs.

Future availability

Financial management starts once a year – in April. This page describes the module that will start in April 2025. We expect it to start for the last time in April 2032.

Course work includes:

2 Tutor-marked assignments (TMAs)