A managerial accountant records financial information much like a financial accountant but for an entirely different purpose. Instead of providing pertinent information to stockholders and other parties outside of the organization, like a financial accountant, a managerial accounting professional will gather information and build reports that are aimed to help managers and executives within the organization make decisions. If you are trying to decide which branch of accounting is the right fit for you, read on and learn more about managerial accounting.
What Are the Duties of Managerial Accountants?
Managerial accounting, which is often referred to as management accounting, is a process of recording and analyzing financial data that is very useful to management inside of the organization. The data that is gathered, identified, and reported to management can be used for planning, making financial decisions and controlling money.
Management accountants are responsible for major business activities. If you work in a large organization, you will oversee the lower-level accountants that perform basic tasks like recording income, writing financial reports, preparing cash flow statements, and more. In addition to overseeing accountants, a managerial accountant will analyze the data in the financial statements to make budget forecasts, manage risk, arrange financing, enforce compliance, measure performance, and present information to executives. If you work in a smaller firm, you might be responsible for all of these lower-level and upper-level tasks.
What Skills Do You Need to Work in Managerial Accounting?
Like all accountants, you need to be skilled at math and business concepts. You also need a solid foundation of accounting skills so that you have knowledge in basic taxation, financial reporting, compliance, ethics, and tax principles. Managerial accountants also need leadership and communication skills so that they can present information in a way that management will understand. The best managerial accountants are those who can inform and persuade the decision makers in an organization. Having an expertise in human capital management and financial capital management is a must.
What Formal Education is Required to Work in Managerial Accounting?
At a minimum, a managerial accountant should hold a Bachelor’s degree from a school with a respected accounting accreditation. While a Bachelor’s degree is sufficient, most employers are looking for applicants who hold their Certified Management Accountant credential. In order to earn your CMA designation you will need a Bachelor’s degree and a sufficient GMAT or GRE score. You will need to pass a national exam that covers financial reporting, planning, performance, control and financial decision making. This will give you an advantage when you are applying for competitive positions.
There is a high demand for managerial accountants. As more and more organizations begin to look for ways to cut costs, lower budgets and increase their profits, the need for management accountants with an expertise in capital management will only grow. When you are studying for your formal accounting degree, you need to select the right coursework that will help you develop the best skills for the role you are pursuing. Make sure that you take the right elective courses, decide if you want to get certified, and then climb your way up from a staff accountant to a higher paid managerial accountant with more authority.