In today’s dynamic and fluid business landscape, the role of management accounting is evolving rapidly. The foundation of management accounting is built upon technical financial and business competencies, but the profession now encompasses a much broader scope of work. With the aid of digitalization, management accountants are bringing additional value to their organizations by offering insights on digital transformation, risk management, new business opportunities, diversity, equity, inclusion initiatives, and sustainability matters.
The Expanding Role of Management Accountants
Traditionally, management accountants have excelled in budgeting, forecasting, and reporting. While these skills remain essential, management accountants are now taking on a more strategic role within their organizations. The breadth of this expansion is evident in a research paper titled “Future of Finance 2.0 Emerging Themes: The Changing Role and Mandate of Finance,” conducted by AICPA & CIMA. This 18-month-long research study explores the newfound dynamism within the finance profession.
Redefining Value: The Gateway to Adding Value
Management accountants are no longer confined to the finance function alone. They now advise various functions within their organizations, such as human resources, governance, and marketing. By offering data-driven insights, management accountants help redefine value, better serve internal clients, and discover new markets. Their role has shifted from being mere gatekeepers who safeguard assets and resources to becoming strategic business partners.
Irena Teneva, DBA, an associate technical director at AICPA & CIMA and co-author of the research paper, emphasizes the importance of business partnering. She states, “Business partnering is the gateway to adding value, which is what the future of the profession is about.” To be successful in this role, management accountants need commercial acumen and the ability to think about what the numbers mean for the future of the business. They must also collaborate with colleagues and partners to refine ideas and make them workable.
Communication and Interpersonal Skills: A New Emphasis
The level of reliance on communication and interpersonal skills has significantly increased for management accountants. They are now expected to provide a fuller picture of their numbers and reports, including through data visualization. Multi-level, multi-situational, and multi-audience conversations have become the norm, requiring specific communication skills and abilities to operate simultaneously.
Telling Complete and In-Depth Stories
While management accountants still provide data and reports, their role now extends beyond the numbers. They are tasked with telling complete and in-depth stories that encompass both financial and nonfinancial data. Lori Sexton, CPA, CGMA, an associate technical director at AICPA & CIMA, likens this role to a compass for the future. When hiking, you periodically check your compass to ensure you’re heading in the right direction. Similarly, management accountants provide guidance and direction for organizations, even when the exact destination is not yet known.
The Future of the Profession
The Future of Finance 2.0 research program conducted by AICPA & CIMA addresses the wider changes within the profession. While it does not define a specific destination for the finance professional, it provides a direction for the journey ahead. The research highlights the need for management accountants to embrace flexibility, agility, and relevancy in today’s complex business landscape. By expanding their skills and mindsets, management accountants can adapt to the evolving demands of the profession.
In conclusion, the role of management accounting is undergoing a significant transformation. Management accountants are no longer limited to technical financial and business competencies; they now play a pivotal role in driving strategic decisions, redefining value, and telling complete and in-depth stories through data visualization. By embracing these changes and enhancing their communication and interpersonal skills, management accountants can navigate the future of finance with confidence.
This article was written by a senior content writer at the Association of International Certified Professional Accountants, representing AICPA & CIMA.