What does the FREE03 People Professionals and Finance course cover?

FREE03 covers essential finance concepts that every HR professional needs to understand. The course spans three learning outcomes: understanding financial fundamentals (financial statements, profit vs cash, people costs), applying financial planning to workforce decisions (budgeting, forecasting, evaluating people initiatives), and managing financial risk and communication (financial risks, organisational controls, and presenting financial data to stakeholders).

Is the FREE03 course really free?

Yes. FREE03 is one of our free introductory courses designed to give learners a solid foundation in finance for HR. You can access the study guides and HR model videos with a free account. Full video access is available when you upgrade.

How do people costs appear in financial reporting?

People costs appear across multiple areas of financial reporting, including direct employment costs such as salaries, national insurance, and pension contributions, as well as indirect costs like recruitment, training, absence, and turnover. Understanding how these costs are categorised and reported helps HR professionals contribute meaningfully to financial discussions and workforce planning.

Why do HR professionals need to understand finance?

HR professionals increasingly need financial literacy to build credible business cases for people initiatives, manage workforce budgets, evaluate the ROI of HR programmes, and communicate effectively with finance colleagues. Understanding financial fundamentals helps people professionals demonstrate the value of their work in terms the business understands.

What financial risks are linked to people practice?

Key financial risks include payroll errors and fraud, non-compliance penalties, poor contractor management (including IR35), high employee turnover, uncontrolled overtime, absence and wellbeing costs, litigation and settlement costs, and pension obligations. Understanding these risks helps HR professionals protect their organisations from avoidable financial losses.

New FREE03 Video Course: People Professionals and Finance

We've just released FREE03: People Professionals and Finance — a brand-new free course with 26 videos covering everything HR professionals need to know about finance in the workplace.

Whether you're preparing for a CIPD qualification or simply want to strengthen your financial literacy as a people professional, this course gives you a solid grounding in the finance concepts that matter most to HR.

What's covered?

The course is structured across three learning outcomes, with eight assessment criteria and 26 videos in total.

Understand key financial concepts and people costs

The first learning outcome builds your understanding of financial fundamentals from an HR perspective.

Explain key financial terms and statements used in organisations

Three videos on financial foundations:

1. Introduction to the three core financial statements

Understand the income statement, balance sheet, and cash flow statement — and why they matter for HR professionals.

2. Types of costs, expenditure, and working capital

Learn the difference between fixed and variable costs, capital and revenue expenditure, and how working capital affects day-to-day operations.

3. Understanding revenue, costs, profit, and margin

Explore how revenue flows through to profit, what margins tell you about business health, and where people costs fit into the picture.

Explain the difference between profit and cash and why it matters

Three videos on profit versus cash:

1. Introduction to profit and cash — definitions and key differences

Understand why a profitable business can still run out of cash, and what this means for workforce decisions.

2. Payroll, credit terms, and cash flow timing

Learn how payroll cycles, supplier terms, and revenue timing create cash flow challenges that affect HR planning.

3. Seasonality, growth, and practical implications

Explore how seasonal fluctuations and rapid growth can strain cash flow, and what HR professionals should watch for.

Discuss how people costs appear in financial reporting

Three videos on people costs:

1. Introduction to people costs and measuring the workforce

Learn what counts as a people cost and how organisations measure workforce size and spending.

2. Direct employment costs and benefits

Understand salaries, national insurance, pension contributions, and other direct costs that make up the true cost of employment.

3. Hidden costs, accounting treatments, and budgeting

Discover the less obvious people costs — recruitment, training, absence — and how they appear in financial reports.

Apply financial planning to workforce decisions

The second learning outcome focuses on budgeting, forecasting, and evaluating the value of people initiatives.

Explain how budgeting and forecasting apply to workforce planning

Three videos on workforce budgeting:

1. Annual budgets and workforce budget components

Learn how annual budgets are constructed and where workforce costs sit within them.

2. Vacancy factors, scenario planning, and build vs buy decisions

Explore how organisations plan for vacancies, model different scenarios, and decide whether to develop or recruit talent.

3. Reforecasting, cost centres, and headcount planning

Understand how budgets are revised throughout the year and how cost centre structures affect workforce planning.

Discuss how to evaluate the cost and value of people initiatives

Videos on measuring HR value:

1. Introduction to evaluating people initiatives and ROI fundamentals

Learn the basics of building a business case and calculating return on investment for HR programmes.

2. Turnover costs, absence reduction, training impact, and compliance value

Explore how to quantify the financial impact of common people initiatives, from reducing turnover to improving compliance.

Manage financial risk and communicate effectively

The third learning outcome covers financial risks, organisational controls, and communicating financial information.

Explain key financial risks linked to people practice

Videos on financial risk:

1. Introduction to financial risks, payroll errors, and fraud

Understand the major financial risks that stem from people practice, including payroll errors, fraud, and the cost of high turnover.

2. Non-compliance penalties and contractor management

Learn about the financial consequences of non-compliance, poor contractor management, and IR35 considerations.

Discuss the importance of controls, authorisation and data quality

Understanding organisational controls and why they matter

Learn how approvals, delegated authority, audit trails, and segregation of duties protect organisations — and why accurate employee data and secure payroll handling are essential.

Explain how people professionals can communicate financial information effectively

Metrics, visuals, and working with finance colleagues

Discover how to present financial data using clear metrics and visuals, collaborate with finance colleagues, and translate complex numbers into language that supports business decisions.

Start learning today

All 26 videos are available now — completely free. Create an account and start building your financial confidence as a people professional.

Browse the full FREE03 course in our content library or create your free account to get started.