Management accountants work for all types of organisations, all over the world, in all business functions – but what do they actually do? Here’s what you need to know about management accounting.
Management accounting combines accounting, finance, and management to drive successful businesses, explains Paul Turner of the Chartered Institute of Management Accountants (CIMA). “Management accountants enable better strategic decision-making by combining financial and non-financial data to paint a complete picture of a business,” he continues.
A management accountant may be called on to advise senior leaders on a project’s financial implications, for example, or help to formulate strategies to negotiate challenging conditions, he says, and often they’re called upon to assess costs and spending. “It’s an entirely different field of accounting to audit, tax and advisory services,” Paul stresses.
Key skills and qualities
Paul describes management accountancy as an exciting and rewarding career option that calls for a wide range of skills. Being good at “number-crunching alone won’t cut it”, he emphasises. “You must be able to identify patterns in data and use past trends to make predictions and guide business decisions.”
Management accountants also have to “look at the big picture”, while “having an awareness of global business – following the news to see how business decisions, successes and scandals impact markets around the world – is also essential.”
To succeed as a management accountant, you need to be proactive, forward-looking, curious and a quick learner, Paul says. “This includes a desire to learn about other parts of your employer’s business,” he adds, “because management accountants have a crucial role to play in joining the dots to keep track of different departments’ budgets, needs, and plans.
Matt Upton began his career in 2008 working for a Berkshire-based importer and distributor of photographic and digital imaging products. After eight years he had worked his way to an assistant accountant role, gaining his AAT Advanced Diploma in Accounting Level 3 in 2016, before joining London-based ethical and sustainable clothing brand Gandys.
In January 2020, Matt joined Gordon Murray Design – a highly innovative Surrey-based automotive design and engineering business that is very well known in global motorsport – as a management accountant. “My duties vary according to the company’s needs, but they include analysing sales, customer behaviours, costs, and labour efficiency, as well as producing monthly management accounts,” he explains.
“When I joined Gandys there were five staff members, but when I left there were 47. I was the only team member responsible for managing finance, so I gained experience of the whole finance function, involving a broad level of management, financial, and management accounting. My passion has always been about business, more specifically, modernising the finance function to ensure greater success.”
Matt says his skills are tailored towards a “commercial way of looking at finance and using numbers to drive a business forward”, not simply reporting data. “It’s a real passion of mine. Every successful business has a key focus on the finance function and harnessing it to improve in all areas.”
Management accountants can play a pivotal role, Matt believes. “The information we provide can really change views and strategic direction. If you truly love business, management accounting is for you. And it allows you to gain skills in other areas, which is so important in the modern business world.
“My advice, if you want to develop your career in management accounting? Never shy away from challenges, because overcoming them brings the biggest rewards. Take your time, gain more knowledge and skills – and always look for ways to add value
to your company.”
Payscale and career opportunities
In the UK, the current average yearly salary is about £60,000 for a qualified CIMA member, while a part-qualified student could expect to earn about £32,000 a year.
There are many reasons why someone may choose to become a management accountant, Paul says. “Demand is high, in companies and industries worldwide – there is a wealth of great and varied career opportunities. Management accountants also get to use a wide range of skills. And management accounting offers a clear career pathway, whether you want to move your way up in the corporate world
or run your own business.”
CIMA has more than 110,000 members and students in the UK, and there was an increase in new student registrations in 2019. “Many students want to build their career in business and finance with CIMA, particularly as the remit of management accountancy continues to expand,” Paul reveals.
“Management accountants work for all types of organisations, all over the world, in all business functions, which is attractive to younger people. Our students and members work in a wide range of roles, from financial analyst to senior finance director and CFO, and for private, public and not-for-profit organisations, including the ‘Big Four’ [Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers], Accenture, Virgin, Lloyds, the BBC, Unilever, Gap, Innocent Drinks, Boots, Veolia, the NHS, the Ministry of Defence and the Salvation Army.”
- Potential to earn between £32,000 and £60,000 a year.
- Work for various organisations in many different industries worldwide.
- Combine accounting, finance, and management to drive business success.
- You must be able to identify patterns in data and guide business decisions.
- To succeed you need to be proactive, forward-looking, curious, and a quick learner.
- Management accounting offers a clear career pathway.
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The content team are the owners of AAT Comment.