The role of management accountant goes beyond numbers crunching and requires a different set of skills than those employed by traditional financial accountants. Management accountants use organizations’ financial data gathered from accounting information systems and reports to provide input for critical business decisions. Instead of simply keeping balance sheets and financial statements, management accountants must utilize creativity, leadership and big picture knowledge to identify business risks and opportunities and suggest solutions. Here are some of the abilities and characteristics that differentiate management accountants from other business professionals in the workplace.
Although numbers crunching is not the sole focus of management accountants’ jobs, these accountants still do a great deal of mathematical calculations to support internal reports. For example, management accountants gather quantitative data from balance sheets, income statements and statements of cash flow to measure performance for various business activities. By analyzing revenues and expenses across business activities, management accountants can determine ways to budget and spend funds to maximize profits or reduce costs. These accountants can also use financial data to help forecast fiscal requirements for approved operational initiatives.
Aptitude for Technical Processes
Management accountants work in both public and private organizations that represent a variety of industries. Although these accountants are not expected to be subject matter experts on technical or operational subjects, they usually have a thorough working knowledge of the systems built by their organizations as well as the unique production processes employed by their companies. This knowledge allows management accountants to create more accurate cost estimates during forecasting activities. Knowledge of production processes also enables accountants to draft spend plans that make use of available funding in the most efficient manner. Input from management accountants with technical and operational proficiency can assist other managers in their quest for optimal capacity utilization and asset allocation.
Knowledge of Business Fundamentals
Management accountants would have a hard time doing their jobs if they did not have thorough knowledge of a broad range of business functions like finance and economics. Management accountants often work with senior business leaders in an advisory role when they evaluate the company’s portfolio. These accountants use finance and economics principles to analyze the value of prospective investments; they can identify and recommend acquisitions that will likely move their organizations closer to achieving long term goals. Management accountants can also identify risky investments to avoid and recommend divestiture of underperforming business activities based on quantitative analysis and market trends.
Interpersonal and Communication Skills
One of the greatest tools that management accountants have at their disposal is the ability to establish trust with the various stakeholders that they support. As a result, these accountants must demonstrate a high degree of business ethics so that company decision makers know that their recommendations are free from personal biases or agendas for personal profit. Management accountants must also demonstrate excellent written and verbal communication abilities. A great deal of their work involves distilling large amounts of quantitative data into accurate and concise snapshots of relevant information for use by a range of internal stakeholders and decision makers.
Management accounting jobs require that accountants exercise a greater level of responsibility to internal business stakeholders. The knowledge of broad business topics such as economics and logistics as well as technical skills helps a management accountant to suggest customized, creative solutions for organizations that align with enterprise level goals.