All AFM questions will include this professional skill as it is fundamental to financial management. It is common for AFM questions to include significant amounts of calculation consisting of the use of models or methods to evaluate financial strategy decisions. It is key to remember that in AFM any analysis or evaluation is contextual and must consider the situation in which the organisation in the question operates.
Analysis can be demonstrated by appropriate use of the data/information to determine suitable calculations to support your evaluation. The ability to draw appropriate conclusions from the data/information analysed should be demonstrated, so that appropriate responses can be designed, and advice given. Identifying where data appears to be omitted or where further analysis is needed to make a recommendation is also important, as that means a full evaluation cannot be performed due to the lack of that data. It is key that financial management decision-makers are made aware of this.
An evaluation is a balanced appraisal to determine the impact of a course of action, for example, changing an organisation’s reward system. Part of that is to demonstrate reasoned judgement to consider relevant factors, decide what to prioritise and then come to a suitable and justified conclusion.