Management Accounting – Skills, Scope and Salary

Management accounting is the process of analyzing and interpreting data to make informed decisions about an organization’s business operations. A person working as a management accountant will likely perform:

• Internal auditing
• Monitoring costs and expenses
• Identifying financial trends
• Forecasting future needs

The goal of management accounting is to help manufacturers make decisions and provide accurate information about the company’s financial activities.

Management Accounting Vs. Financial Accounting 

The main difference between the two types of accounting is that management accounting focuses on strategic decision making within a business, while financial accounting provides level analysis for external use.

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Management Accountant Job Titles

Your management accountant title varies depending on a number of factors, including:

• Size of organization
• Level of experience
• Industry Type
• Titles needed to prepare informative financial statements

Roles, responsibilities, and job titles can vary widely within the field. Some common management accounting titles are:

1. The controller serves as the manager of the finance department and will likely report to a supervisor such as the director of accounting. Their job is to collect financial data and prepare documents according to the needs of the end user.
2. Financial analysts or accounting analysts primarily focus on analyzing key financial documents and creating reports and presentations for the organization’s decision makers. They can note trends, give financial advice and determine the value of a business.
3. The chief operating officer (COO) may be the primary decision maker about the company’s financing options. They use financial reports prepared by management accountants.
   In a management position, a financial manager is the person who implements financial strategies and builds plans based on the financial situation.
4. Accounting managers conduct financial processes such as tracking cash flow, conducting company-wide audits, and preparing budgets. Account managers oversee the finance department and report to company executives and decision makers.

Management Accountant Responsibilities

The responsibility of a management accountant is to analyze and interpret a company’s financial information. Because management accountants can work in many different industries, responsibilities can vary, but some common tasks include:

• Perform cash flow analysis to help make decisions relating to business purchases
• Determining the price of goods and services
• Planning the total cost of goods and services
• Monitoring performance measures (e.g., debt-to-equity ratio )
• Calculate inventory turnover
• Manage outstanding accounts receivable
• Use performance reports to record changes in budgets or prepare budgets
• Evaluate a performance company finances
• Prepare company financial budgets
• Recommend financial investment proposals such as stocks and bonds or other investments
• Monitor revenue, costs and expenses
• Perform internal audits
• Supervise employees in the finance department
• Manage tax returns

What is the salary of a Management Accountant ?

Management accountant salaries vary based on factors such as title, industry, location, education, certifications, and years of experience. The estimated total salary for management accountants in the United States is $111,514 per year. This includes an average base salary of $90,606 and $20,908 in additional bonuses. Additional compensation may be profit sharing, commissions or bonuses.

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Skills needed by a Management Accountant

Management accounting jobs require financial and business skills, so demonstrating proficiency in both is essential. You will work with the company’s financial transactions and in daily operations. Therefore, you will be better equipped in this field if you are analytical and practical in making decisions that are in line with the company’s goals and future plans.

Here are some of the skills you need to be successful in management accounting:

• Excellent numerical and analytical skills: As a management accountant, you will spend the majority of your time take your time to understand financial documents and translate those data in a simple language to understand relationships. Management accountants do this through data analysis tools such as Excel spreadsheets.
• Accuracy and attention to detail: It is important to pay attention to detail to spot deviations and errors, as well as spot patterns and trends that you have can be used in budgeting and forecasting.
• Having business knowledge: Understanding your industry and how your business operates within it can help you better understand your company’s finances and develop strategic plans.
• Good oral and written communication skills: From oral presentations to written reports, much of your work in management accounting will involve transferring Complex financial processes, reports and reports into easy-to-understand content.

Is management accounting right for you?

Management accounting may be right for you if you enjoy working with data, numbers and finances. Management accounting can be a rewarding and exciting career, especially with ever-evolving technologies that make data collection and analysis more accurate.

Consider the following to determine if this field is right for you:

• You want to do something that requires analytical skills. If you have the patience and attention to studying data for patterns or trends, this career could be for you. Data analysis requires examining the details and based on your findings, interpreting the results for presentation purposes.
• You are interested in management. In this field, there are a number of management positions available, making this a great field to work in if management is one of your future career goals.
• You are good with numbers. Management accounting is a subsection of accounting, so you’ll need to be good with numbers and have a solid grasp of basic skills.
• You are passionate about accounting. In addition to mastering math and analytical skills, if you enjoy the challenge of balancing the books, budgeting and problem solving, this field may be for you. Accounting requires critical thinking and deductive reasoning.

Steps to becoming a management accountant

To become a management accountant, you must earn an accounting degree, gain professional experience, and consider the Certified Management Accountant (CMA) certification.

Here are six steps to start studying management accounting.

1. Consider an accounting degree.

Earning a bachelor’s degree in accounting, finance, business administration or a related field is the first step to becoming a management accountant. Some people may pursue an associate’s degree in management accounting; however, you will need a bachelor’s degree to earn the certificate. Many employers prefer an advanced degree because it is a management position within the company, so be prepared to pursue a master’s degree in management accounting if necessary.

2. Accumulate professional experience.

After earning your degree, develop your skills while gaining experience to prepare for future employment or certification. You may also want to pursue higher education. Specialized experience will be required for management positions. Some management accountants advance to mid- or low-level positions, such as audit clerk, accountant, or assistant controller.

3. Register as a member of the Institute of Management Accountants (IMA).

If you want to become certified as a chartered management accountant, you will need to be a member of the IMA. Membership in IMA allows you to access IMA resources and apply for certification. To continue certification, you will have to pay an annual fee and complete continuing education requirements.

4. Enroll in the Certified Management Accountant (CMA) program.

CMA program application requirements include IMA membership, payment of program fees, a bachelor’s degree from an accredited university, and at least two years of consecutive professional experience. Once registered, you have up to one year to study and prepare for the CMA program.

5. Pass the CMA exam.

The two-part CMA exam will test your knowledge of financial planning, performance and analysis, and strategic financial management. The test can be taken in person at an approved testing site or remotely. IMA offers several testing slots each year. There is a separate exam fee.

6. Start fieldwork.

Once you’ve met the education and experience requirements to begin working as a management accountant, it’s a great time to network and continue developing relevant skills. Be prepared to start in an entry-level position in the finance department within an organization. Focus on gaining practical experience in this role and look for opportunities to hone your skills to advance in the management accounting field.

Practical Accounting by Entri: Course Features

• Industry Experts & Qualified CA Faculties
• Live Sessions by CA Professionals
• Master Excel & TallyPrime
• Computerised Accounting, Assignments & Assessments
• Specialisation Offered on UAE Accounting & Finance Module
• Soft Skill & Interview Training
• 100% Internship & Placement Assistance
• Course Completion & Internship Certification
• Effectual Workshops
• Module Wise Exams
• Live Doubt Clearing Sessions

Course Curriculum in Detail

Fundamentals of Accounting

• Accounting Principles & Concepts
• Journal & Ledger
• Preparation of financial statements
• Bank reconciliation Statement

Business Structure

• Types of Company
• Sole Proprietorship
• Partnership Firm

Computerised Accounting
(Tally Prime)

• Company Creation
• Creation of Accounting Masters & Inventory Masters
• Voucher Creation
• GST
• TDS & TCS
• Payroll
• Reports – Profit and loss account, balance sheet
• Cost Centre & Cost Categories
• Ratio Analysis
• Other tools in tally
• Source Of income
• Tax slab
• Assessment Year and Previous year
• Key Provisions of Profit and gains from business /Profession
• Income Tax filing
• Advance Tax
• TDS & TCS Compliance
• Accounting for taxes

Direct Taxation Compliance

• Concept of GST
• CGST, SGST, IGST
• Tax Structure
• Exemptions
• Input Tax Credit
• Taxability
• Reverse Charge
• Filing Returns

Indirect Taxation 

• Introduction of banking
• Types of banks
• Objectives of banking
• Bank funding

Banking

• Introduction
• Key provisions & compliance of LLP Act
• Key provisions & compliance of Companies Act

Corporate Law

• Introduction
• Key provisions & compliance of LLP Act
• Key provisions & compliance of Companies Act

Labour Law

• Introduction
• Key Provisions of ESI & PF Act
• Accounting & Compliances of ESI & PF

Communication

• Basic Etiquette
• Correspondence
• How to prepare a resume
• How to attend an interview

Add on Modules

UAE Accounting

• Applicable accounting standards
• Quick book / Peach Tree

Finance Module

• Analysis of Financial Statement
• Working Capital Management
• Accounts Payables & Receivables management
• Inventory Management
• Budgeting & Controls
• Costing Basics
• MIS reporting

Excel

• Introduction
• Quick Access , Cell , Row , Column
• Entering Data
• Formulas and Functions
• Formatting
• Adjusting worksheet Layout & Data
• Printing & Charts
• Worksheet and Workbooks
• Functions
• Data Management And Pivot Table
• Security Sharing And Macros

Benefits of Learning From Entri: Why to Choose

Learning accounting can be a daunting task, but the rewards of mastering this skill can be invaluable. With Entri, you can learn accounting in an effective and efficient way to maximize the benefits of mastering this skill. Entri provides comprehensive and engaging courses that make learning accounting easier than ever before. With Entri, you can become an expert in accounting and unlock many potential opportunities. We offer

• Recorded & Live Sessions
• Personal Mentorship
• Expert Training
• Course Certificate
• Guaranteed Internship
• Placement Assistance
• 100+ Hiring Partners

Conclusion

Management accounting can be a quick and rewarding career choice. Jump-start your career by enrolling in an accredited program and develop your skills through online courses provided by Entri App.