Abstract
This paper evaluates the impact of managers financial literacy on firm financial policies and performance. A randomized control trial with 74 medium-size and large companies in Mozambique identifies a positive treatment effect on firm return on assets of an 18-hours executive education programme in finance for top managers. Using survey data as well as accounting data, we find that managers adjust financial policies in response of the treatment. We find a significant and large treatment effect on working capital management (net working capital, changes in net working capital, and the average collection period). Our results suggest that relatively small interventions such as financial education improve financial practices and decision-making and may ultimately affect economic development.