CA Inter Paper 6: FM & SM study guide
CA Inter Paper 6: FM & SM · Work through your exam, one topic at a time.
CA Intermediate Paper 6, Financial Management and Strategic Management (commonly called CA Inter FM & SM), is one of the papers in the Intermediate level of the Chartered Accountancy course offered by the Institute of Chartered Accountants of India (ICAI). Our page is an independent study resource and is not affiliated with, endorsed by, or operated by ICAI. The paper is split evenly: Financial Management carries 50% weight and Strategic Management carries 50%. Financial Management is computational and decision-oriented, covering areas such as capital budgeting, cost of capital, leverage, working capital, dividend policy and financing choices. Topics on this exam: Financial Management and Strategic Management. The CA Inter Paper 6: FM & SM study guide has 2 sections and about 793 words.
01Financial Management: Decisions, Costs and Leverage
Financial Management in Paper 6 checks whether you can compute and then interpret a firm's four core decisions - investment, financing, dividend and working capital. Expect 5–10 mark computational items plus short theory on objectives and policy, where the marks sit as much in the reasoning as in the final figure. Objective: maximise shareholder wealth (market price per share), not accounting profit - profit ignores timing, risk and cash flow. Cost of capital: use after-tax component costs and market-value weights.
414 words, about 2 min02Strategic Management: Analysis, Choice and Control
Strategic Management is theory-heavy: questions ask you to define concepts precisely, apply them to a short company scenario, and justify a recommendation. Marks come from correct terminology plus explicit links to the facts given in the case. Hierarchy: vision (what we want to become) → mission (why we exist, our scope) → SMART objectives → strategy → tactics. External analysis: PESTLE (political, economic, social, technological, legal, environmental) and Porter's five forces - rivalry, new entrants, substitutes, buyer power, supplier power.
379 words, about 2 min