Top accounting skills for management accountants
If you’re thinking about pursuing a career as a Certified Management Accountant, or CMA, you may be wondering what it takes to be successful on this career path. While there’s not one clear answer, the field of management accounting calls for candidates to possess certain personal and professional skills because of the nature of tasks required in CMA-related roles. For example, as management accounting jobs often deal with budgeting and financial processes, it’s critical that management accountants have highly developed accounting skills, including data analysis and critical thinking.
So, how do your current talents match up with the skills required for an accountant in a CMA position?
What is management accounting and what skills does it require?
What do accountants do, especially those at the CMA level? Most CMAs work with upper-level management staff at a firm or company, and CMA job descriptions often require taking on a major role in making choices for the company’s finances. Here are some of the roles that CMAs can venture into:
- Financial analyst
- Cost accountant
- Managerial accountant
- Chief Financial Officer
- Corporate accountant
This article explains the five best skills for an accountant in management to have in their back pockets, from hard skills to soft skills. Once you understand and develop these accounting skills, you can rest assured that you’re on the path to becoming a successful CMA.
1. Financial analysis
Every organization needs accountants who can perform useful analysis and provide unbiased data in order to make informed business decisions. Especially in the role of cost accountants, financial managers and other related roles, CMAs need to have strong acumen in analyzing financial documents.
What do financial managers do? Financial analysis refers to forecasting revenue, expenses, and other outcomes for a business, and comprises a large portion of a CMA’s work. CMAs also perform analysis to determine the rate of return for a particular business decision, and evaluate business risks. Additionally, financial tools are used to determine a company’s capital budgeting needs, the financial impact of starting a new product line or the cost of purchasing a business. Becoming adept at these financial tools, and being able to interpret financial reports is one of the most important skills needed for accounting at the CMA level, and provides a great deal of value to any company.
2. Evaluating cost accounting issues
Firms need CMAs with strong cost accounting skills to create accurate budgets, and to provide realistic business forecasts.
Cost accounting includes determining cost standards for material, labor, and overhead costs, in order to create budgets reflective of business activities. CMAs need to use cost accounting skills to accurately analyze production costs and further recommend changes to reduce costs and increase overall efficiency.
The most valuable Certified Management Accountants have the ability to perform cost accounting analysis in a timely manner and clearly explain the results to all business members, from stakeholders to CFOs.
3. Written and verbal communication
A CMA must be able to communicate accounting data to financial managers, and to non-accountants to easily relay important financial information. While CMAs perform a number of behind-the-scenes tasks to make financial decisions, presenting the information in a digestible way is an equally important part of the role. Much of this communication takes place in the form of written reports, but may also occur in presentation settings.
All CMAs should be able to summarize financial findings in an understandable written form, and further, present findings to other company personnel. Additionally, CMAs should be able to convert their results into engaging visual presentations that best tell the business story behind the numbers. Experienced CMAs often take on the role of advisors and business consultants to senior management, and therefore must be able to communicate changes at a high level.
For example, many CMAs take on the role of risk managers. Risk management is a key role in every business, as companies face a number of regulatory and financial risks. Risk managers must be able to effectively communicate risk issues and solutions to the entire company. If a company is implementing a new set of internal controls, the CMA acting as the risk manager must explain to employees at every level why the controls are important, how each control works, and how it will affect daily work. The CMA would also document each control in a clearly written procedures manual that includes the steps required to complete each routine task the company is performing.
CMAs who communicate well are likely to build trust with others in the business, as well as clients, as they clearly demonstrate the value of certain control processes to the business.
4. Management and mentoring skills
As CMAs gain experience and take on more senior roles, they may need to manage a staff. Establishing leadership skills helps to effectively lead a team of other accountants and CMAs.
Effective managers set clear expectations for the staff, and review work to give feedback in a timely manner. Managers must also invest time to train employees, and work as a mentor to help staff members advance in their careers.
For example, a CMA in a manager role may have a direct report who is interested in moving from a staff accounting position into a role as a financial analyst. To help grow their career outcomes, the managing CMA would help the more junior employee take on more analysis work, provide regular feedback on this work, guidance for improvement and eventually provide a referral so that the employee can move into the analysis role full time.
5. Attention to detail + adaptability
CMAs must have the focus required to perform detailed work, and the drive needed to meet regulatory deadlines. A CMA’s job is meticulous, and having the ability to identify anomalies in data and pick up on small details is immensely helpful to the profession’s daily work.
When delivering accounting information, CMAs must be prepared to answer technical questions regarding management reporting and the financial statements.
CMAs must adapt to evolving customer preferences, new competitors, and especially regulatory changes that affect the industry on a daily basis.
Technology also changes constantly, and CMAs must be willing to learn about new applications to implement them in the business. Successful CMAs embrace technology in order to increase productivity and reduce the risk of error. CMAs need to use many forms of technology to complete daily responsibilities, and must understand how software applications are integrated across the company. Leveraging technology is also a great way for CMAs to remain competitive in the job market.
There are a number of hard and soft skills needed for accountants at the CMA level, that when developed properly, can help set the foundation for a successful career. You can lay the groundwork for a fruitful CMA career with not only the right resources, but more importantly, the drive to better your skillset.
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