Category Archives: financial manager/ controller

Financial Management

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This is one of the most typical career paths for a chartered accountant. After qualifying as a CA, you would typically find a role as an accountant at a company in your industry of interest. This would invariably progress into a financial manager/ controller role, after which you could progress into the Financial Director and ultimately CFO positions.

This is an ideal path for many accountants, and at the right company this could be a very rewarding path.

Having already analysed the various accountant – roles (see link above), we will now look at the next step – Financial management, and highlight the various roles & responsibilities this path can include:

Financial Manager (FM)

Almost every firm, government agency, and organization has one or more financial managers who oversee the preparation of financial reports, direct investment activities, and implement cash management strategies. As reporting processes become more computerized and automated, many financial managers are spending more time developing strategies and implementing the long-term goals of their organisation.

The duties of financial managers vary with their specific titles, which could include controller, treasurer or finance officer, credit manager, cash manager, and risk and insurance manager.

  • Controllers direct the preparation of financial and regulatory reports that summarize and forecast the organization’s financial position, such as income statements, balance sheets, and analyses of future earnings or expenses. Often, controllers oversee the accounting, audit, and budget departments. (See below for further explanation on controllers)
  • Treasurers and finance officers direct the organization’s financial goals, objectives, and budgets. They oversee the investment of funds and manage associated risks, supervise cash management activities, execute capital-raising strategies to support a firm’s expansion, and deal with mergers and acquisitions.
  • Credit managers oversee the firm’s issuance of credit. They establish credit-rating criteria, determine credit ceilings, and monitor the collections of past-due accounts.
  • Cash managers monitor and control the flow of cash receipts and disbursements to meet the business and investment needs of the firm. For example, cash flow projections are needed to determine whether loans must be obtained to meet cash requirements or whether surplus cash should be invested in interest-bearing instruments.
  • Risk and insurance managers oversee programs to minimize risks and losses that might arise from financial transactions and business operations undertaken by the institution. They also manage the organization’s insurance budget.

Big organisations could have a number of FM’s, each responsible for specific areas/functions of the business. In addition to the general duties described above, all financial managers perform tasks unique to their organization or industry. For example, government FM’s must be experts on the government appropriations and budgeting processes, whereas healthcare FM’s must be knowledgeable about issues surrounding healthcare financing.

Moreover, FM’s must be aware of special tax laws and regulations that affect their industry. In addition to his financial, accounting and management responsibilities, the FM also has HR responsibilities within his department, including hiring, training, managing and mentoring his staff.

Financial managers play an increasingly important role in mergers and consolidations, and in global expansion and related financing. These areas require extensive, specialized knowledge on the part of the financial manager to reduce risks and maximize profit.

Financial Controller

Traditionally this person acts as a helper to the FM. His overall responsibility is reporting to the FM/ Finance Director on the financial reporting function of an organization. As mentioned above, the controller is traditionally responsible for the financial and regulatory reporting and accounting processes within an organization. In essence this person oversees the daily financial activities of a firm and he/she is directly answerable to the FM.

This is however not always the case, in many companies the roles of FM and controllers are interchangeable, depending on the size and structure of the company.  Furthermore, the roles of financial managers and controllers vary significantly. The generic nature of the job title can be misleading and job descriptions should be scrutinised carefully as the level and scope of the responsibilities involved in any role coming under the banner of financial management can vary enormously. In larger companies for instance, the role is more concerned with strategic analysis; in smaller organisations, a financial manager may be responsible for the collection and preparation of accounts.

Typical responsibilities of a FM/controller could include:

  • Providing and interpreting financial information;
  • Monitoring and interpreting cash flows and predicting future trends;
  • Analysing change and advising accordingly;
  • Formulating strategic and long-term business plans;
  • Researching and reporting on factors influencing business performance;
  • Analysing competitors and market trends;
  • Developing financial management mechanisms that minimise financial risk;
  • Conducting reviews and evaluations for cost-reduction opportunities;
  • Managing a company’s financial accounting, monitoring and reporting systems;
  • Liaising with auditors to ensure annual audits are carried out;
  • Developing external relationships with appropriate contacts, e.g. auditors, solicitors, bankers and statutory organisations;
  • Producing accurate financial reports to specific deadlines;
  • Managing budgets;
  • Arranging new sources of finance for a company’s debt facilities;
  • Supervising staff;
  • Keeping abreast of changes in financial regulations and legislation.
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Are you a FM/ controller? What industry are you working in and where do  you see your career heading? Share your thoughts with us.