A ferromagnetic shape memory alloy is a very interesting system that has various structural transformation, microstructural phases and magnetic properties, and interplays among them. The system studied here is Co39Ni34Al27 that comprises a mixture of β (body‐centered cubic) and γ (face‐centered cubic) structural phases. Here the β phase is responsible for the FSMA behavior and the γ phase improves the mechanical properties necessary for practical applications. Herein, it is showed through resistivity and magnetization measurements that post‐annealing to a higher temperature significantly alters the ratio of β and γ phases in the system, resulting in increasing the austenite to martensite transition temperature and significantly modifying the magnetic properties. Additionally, it is also shown that the low‐temperature magnetic phase of this FSMA system is a disordered magnetic system.