Finance managers are business specialists who manage essential financial functions of an organisation. The finance manager’s job is a huge responsibility as they produce financial reports, manage investment activities, and create strategies and plans for the long-term financial goals of an organisation.
Qualifications For Finance Manager
To work successfully as a Finance Manager, you need a bachelor’s degree in finance, management, accounting, or business administration.
Some employers prefer to choose candidates with Certified Public Accountant (CPA) licence. Also, having a Master of Business Administration (MBA) is an advantage for the Financial Manager position.
International Accounting Standards Board (IASB) accreditation is essential for a Finance Manager. Understanding Generally Accepted Accounting Principles (GAAP) makes your opportunities wider.
Thorough knowledge of Microsoft Office, high-level proficiency in working with various financial applications, and reporting tools required in the field of work are essential qualifications for a Finance Manager.
Skills Required For A Finance Manager
As a financial manager, you need to have a good head of figures and a sound grasp of economic systems and procedures for dealing with complex modelling and analysis. Apart from educational qualifications, there are some much-needed skills that a finance manager needs to have.
Some essential skills required for a finance manager are :
1. Basic Financial Statements Preparation
Financial Statements are the most basic and crucial skill for a finance manager. These statements are prepared with relevant information for external users. Preparing Financial Statements accurately requires well-honed hard skills.
2. Budget Preparation
Preparing departmental budgets is the job of a Finance manager. By designing an accurate budget, you can satisfy the demands of leaders, investors and top management.
3. Variance Analysis
One of the essential skills that are needed for a financial manager. Against any forecast or budget, variances are analysed by the finance managers. They are responsible for examining all the favourable and unfavourable conflicts in the business.
4. Financial Analysis Of Capital Invested
Financial managers present and defend the capital investment and design strategies to improve an organisation’s financial and operational performance. Financial evaluation is mandatory for any project to be approved. Financial managers give entry passes for every project.
5. Financial Reporting
Financial Reporting is one of the essential skills a Financial Manager needs. The skill is getting high in demand. But finding someone with great financial reporting skills is a tough task. So to be a Financial Manager, you need to have this technical skill.
6. Analytical Skills
Analytical skills are the soft skills that make you identify problems and find logical solutions to solve them. Analytical skills are needed when you make a budget or bridge the gap between the firm’s expectations and challenges.
7. Technical Skills
Technical skills are a much-needed skill in finance management. A finance manager must have technical skills, including computing abilities, financial marketing forecasting techniques, quantitative analysis and an array of tasks to hone.
8. Communication Skills
Finance managers must convey and explain complex financial ideas to their fellow workers and clients. This soft skill of communication makes complex situations easier.
Here are some responsibilities of the Finance Manager :
- Continuous improvement of end-to-end accounting practices.
- Plan, organise, and execute financial tasks and projects of an organisation.
- Develop and implement budgets and forecasting.
- Complete financial reports, lead the month-end closing process and conduct monthly economic forecasts to specific deadlines.
- Provide financial insight and analysis to drive the business performance of the organisation.
- Achieve a proper mix of equity and debt to minimise the cost and maximise operational profit.
- Understand and calculate the risks involved in the financial activities of the organisation.
- Supervising teams are responsible for payroll, VAT and HMRC processes.
- Analysing competitors and market trends.
- Developing external relationships with appropriate contacts like auditors, solicitors, bankers etc.
Certifications For Finance Manager
Certifications represent your skills and knowledge in a particular area of the financial space.
Let’s see some of the certifications for Finance Manager :
1. Certified Management Accountant (CMA)
The CMA is an advanced certification designed to measure the accounting and financial management skills that drive the organisation. CMA is certified by the IMA organisation.
2. Chartered Certified Accountant (ACCA)
The Association of Chartered Certified Accountants (ACCA) is a globally recognised body for professional accountants. It makes you eligible to work globally and has an extensive partnership network with other professional accountancy organisations.
3. Chartered Financial Analyst
A Chartered Financial Analyst is an expert in investment and security. CFA Institute administers this certification. CFA is one of the most respected and recognised investment management certifications worldwide.
4. Certified Financial Planner (CFP)
Certified Financial Planners (CFPs) are well recognised in the financial field. They assess the client’s financial portfolio and provide personalised financial plans.
5. Chartered Financial Consultant (ChFC)
ChFC certification is an alternative to CFP certification. A chartered financial consultant deals with matters like financial planning for divorce or small business planning.
6. Financial Risk Manager (FRM)
As the name indicates, a Financial Risk Manager is a risk management specialist. The person with Financial Risk Manager certification usually works with the banks as a risk analyst.
Finance managers’ planning, directing, and coordinating investments make the profession always in demand. Some special sectors in finance management, such as cash management and risk management, are expected to be in high demand.
Other careers related to Financial managers are :
- Accountants and Auditors
- Budget analyst
- Financial Analyst
- Insurance Sales Agents
- Insurance Underwriters
- Loan Officers
- Personal Financial Advisors
Importance Of Practical Knowledge
Financial management is the sector that deals with the financial aspects of an organisation. The main objective is to achieve financial stability and profitability of the organisation. As a finance manager, you must thoroughly know every aspect of financial management.
Academics give theoretical knowledge, but for a successful career, you must have theoretical and practical skills.
You can choose financial management training courses to enlarge your knowledge. Many courses help to improve your skills.
Chartered Financial Analyst (CFA), ACCA, CMA, Risk Management, Financial Planning, Financial Risk Management, Corporate Finance etc. are some of the finance management courses for skill development.
Some advantages of Finance Management Courses are :
- Career opportunities increases
- Adapts well to other training
- Get used to learning
- Better job satisfaction
- Better understand the basic finance
- Advancement in career
- Improved salary scale
1. What is Financial modelling?
Financial modelling is a quantitative analysis. It is often employed in asset pricing and corporate finance. In the financial modelling process, they consider the company’s expenses and earnings to predict the future impact of current decisions.
2. What is cost accounting?
Cost accounting is a type of managerial accounting that helps to determine the company’s entire cost of production.
3. What are the different types of financial statements?
- Income statement
- Balance sheet
- Statement of shareholder’s equity
- Cash flow statements
4. What is capital structure?
It is a method that a company uses to finance its entire operations and growth by combining several funding sources.
5. What is quarterly forecasting?
Quarterly forecasting is the data collected over three months. This includes various data like time-series data graphs, balance sheet forecasts etc.
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