The finance function and the role of the accountant
Over the past decade the role of the finance function, and hence the role of the accountant, has changed. Traditionally, the accountant and finance function focused on three key roles:
- Collecting money from customers
- Paying suppliers
- Reporting financial performance to the business
However, some of those tasks have now become automated whilst the business expectations of the accountant have been increased significantly.
The accountant can now be expected to be involved in areas such as:
- Gaining a competitive advantage in capital markets
- Forward-looking decision support, sensitivity and scenario planning
- Providing quantitative and qualitative analysis
- Finding areas for cost efficiency
- Improving the quality of information and decision making
In this way, the value of the finance function has been transformed and it is now becoming a strategic partner to the business. New skills and practices are needed from the function. It needs to be more forward-looking. It needs to be proactive rather than reactive. It needs to become a centre of excellence as a shared service for the business. The finance function needs to be focused on creating value for the business – just like any other business unit.
An organisation in which the finance function provides timely, useful information to management is likely to achieve better business performance than in others where this is not the case. Likewise, if the finance function can identify opportunities for cost savings, this can support, develop or improve an organisation’s competitive position. Organisations are recognising this value and the role of the accountant has transformed as the role of the finance function has transformed. In the past there were often organisational boundaries (and sometimes physical ones too) between the accountant and the rest of the organisation. The finance function was kept apart and rarely worked with other functions or with clients.
Today, in modern organisations, this has changed. Accountants are no longer just the counters of information, but they are also the providers and analysts of information. The accountant will now typically be involved in all aspects of the strategic planning process.
At outsourced ACC we automate all day to day functions which allows us to focus and stress on the importance of planning and budgeting using real-time financial information. If you think your accountant is spending far too much keeping up and updating your financial information and not focussing on the future its time for you to change.
Written by Irina Stucere