5 things you should know about Management Accounting

Interested in understanding what Management Accounting (MA) is all about?

Learn about a career where you are important for the ongoing success of the organisation or company you work for.

Firstly, what is the difference between an accountant and a management accountant?

The main difference is that accounting involves reporting and recording of financial information to external stakeholders, or people outside the company.

Management accounting replicates this process to internal stakeholders, helping people inside the company with decision-making, control and planning.

1. MA is for forward thinkers

According to Seek.com, MAs are “futurists who drive business strategy to generate and preserve value”.

The information that MA’s source, analyse, communicate and use – both financial and non-financial information – is presented to company stakeholders in a way that directly affects the future of the business.

2. MA is for multi-taskers

Your role will vary widely depending on where you work, how large the company is, and what focus area you have been tasked with. Wherever and however that may be, you will combine skills in the keys areas of business, accounting, finance and management. These will come together to help improve the growth and profitability of the firm and organisation of which you are a part.

3. MA is for multi-skilled professionals

No day in the office is the same as you provide a holistic view of the company through the following ways:

* Looking at outstanding debts, revenue and cash flow and collating this information;

* Assisting in the formation of budgets and accounting policies;

* Forming a complete overview of how the company is performing by using both non-financial and financial data;

* Prepares reports, conducts investigations and advises on matters such as mergers, capital financing, the buying and selling of businesses, insolvency and taxation; as well as

* Intelligently providing stakeholders with advice on the financial implications of business decisions, strategy, and the best way to monitor risk.

4. MA is for problem solvers

It can be difficult to obtain timely and accurate information, and this is a difficulty you have to resolve. You will implement well-developed systems for tracking financial data, and deciding which data is relevant.

You will also have to understand both accounting and finance, but in developing this understanding you will set yourself apart as a professional in high demand.

CPA Australia, in this article, advise MAs on how to steer businesses through tough times. It is clear that this role is key to organisations having a plan in action to survive, and thrive, through forecasting, the reduction of costs, and maximising operational capacity – all of which an astute MA and team can map out.

5. MA is an in-demand profession

Considering the broad scope of sectors where you can work – from private businesses to government agencies, public companies or not-for-profits, if there is one thing you can count on is being able to find a role that suits your individual ambitions and aspirations.

For example, there are currently over 6,000 MA jobs available in Australia currently, with a projected job growth of 9.2% in five years.*

Pros and Cons

Seek.com offers a space for working MAs to review their roles, which is interesting if you are thinking of pursuing this avenue of accounting.

Pros: Job security, great pay and work life balance. Dynamic and challenging role in identifying areas for improvement and others that exceed expectations. Budgeting is a core requirement of this role. Having to think critically and analytically, understanding the roots of the business and what happens operationally to understand what is happening transaction-wise and how to improve.

Cons: Hard work and long hours in the early stages of your career. Working with various stakeholders that have different needs. Communication is key in this role. Always a new challenge to overcome to comply with reporting requirements.

Your path to becoming a Management Accountant

The first step towards becoming a MA is to complete an accounting degree, such as the ICMS Bachelor of Business (Accounting).

As part of the ICMS Bachelor of Business (Accounting) you can take two subjects specific to Management Accounting – Management Accounting I (ACC120A) and Management Accounting II (ACC210).  The subjects build on each other to provide students with the management accounting skills and knowledge required to enable an in depth understanding of business and how to manage a variety of stakeholder interests.

Not only will students examine cost management, costing, forecasting, budgeting, pricing and variance analysis, but students will also be shown how to present and interpret these findings. This information is critical to managers interested in knowing the most effective and efficient use of the organisation’s resources.

The ICMS Bachelor of Business (Accounting), like all degrees offered at ICMS, includes Work Integrated Learning (WIL) subjects, which add up to two trimesters of industry training. This internship will take you into the workplace at any one of ICMS’ industry partners in the accounting and finance industry.

You will graduate with relevant workplace experience on your resume, taking you one step closer on your journey to becoming a management accountant.

Once you have completed your accounting degree, you will complete a CIMA (Chartered Institute of Management Accountants) Certificate in Business Accounting. This is a specialised qualification. CPA Australia, an ICMS industry partner, has a Member Pathway Agreement (MPA) with CIMA.

For more information on the ICMS Bachelor of Business (Accounting), click here.

Sources:

* Statistics: Seek.com, July 2023

Australian government Labour Insights