What is the difference between a finance manager and an accounting manager?

Whilst a finance manager and an accounting manager might sound like the same thing. The terms refer to separate job roles within the financial sector. If you’re looking to enter or progress in a career in the world of finance, it’s useful to know the difference. So you can search and apply for the job that best suits your preferences and skillset. 

In a nutshell, an accounting manager focuses on the day-to-day financial aspects of a company’s finances, whereas a finance manager focuses more on long-term planning and risk management. There is also some overlap between tasks, and people in both roles often start with the same qualifications.

Here, we take a look at the different responsibilities for each role and share information about how to pursue your chosen career path.

Accounting Manager

 

What are the responsibilities of an accounting manager?

Every business needs someone who keeps the finances running smoothly. An accounting manager role primarily focuses on overseeing the day-to-day running of a finance department. Making sure that a company is legally compliant by preparing financial reports and ledgers for review and audit purposes.

This will include overseeing a team of accountants, making decisions around hiring of new employees, training and upskilling current employees, and letting people go where necessary. In essence, this part of the job is very similar to many managerial positions that you might have come across before.

It will also include project management, delegating tasks to make sure deadlines are hit, and putting processes into place to ensure that finished work is completed to the required standards. Most accounting managers will also review junior team members’ work before submission, to check for any errors or advise on areas for improvement.

Accounting managers will also need to keep up-to-date with relevant legal legislation and make sure that all company procedures are updated in line with this. They may also try and progress their own skillset, learning from industry peers and bringing in new ideas for improving processes.

What skills does an accounting manager need?

Just like other managers, the position requires expertise. You’ll need several years of experience as an accountant first, before progressing to a management position. This is to make sure that you’re confident when it comes to the rules and regulations of accounting, as well as being familiar with the everyday tasks. As a manager, you’ll need to be confident with making decisions, as well as knowing when to ask for help and lean on the specialist expertise of others.

Whilst you’re gaining experience in this area, you should also look to improve your soft skills, since you’ll be managing a team of people. Not everyone who is good at accounting will naturally make a good leader, so brushing up on the other skills that you’ll need to support the team will lead you towards success.

For example, you should work on your communication and planning skills. To ensure that you can delegate work fairly and clearly. This will reduce the chance of any confusion and errors. Not only is this wasted time frustrating, but it can also be costly when you work in a deadline focused environment.

You’ll also need to be happy giving and receiving feedback. Not every one will work the way that you do, nor will you get everything right the first time, so you should be open to suggestions, as well as being able to give constructive criticism and praise. Creating a happy team environment, where everyone pulls together towards deadlines and goals will be vital for success. This doesn’t mean that everyone will be your best friend, but you should aim for a good working relationship with your team. 

Having experience in all of the above when you apply for a job will show an employer that you have the right accounting manager skills.

How to become an accounting manager

In order to be eligible for this role, you’ll first need to be qualified as an accountant, and get several years of experience under your belt. Some accounting jobs require a bachelor’s degree or an equivalent qualification that has been earned through a foundation apprenticeship role over several years. 

You will also need to hold a professional accounting qualification. There are several available, so choosing the right one will depend on the academic qualifications you already hold or are working towards, cost, and experience. The most common accountant qualifications in the UK are:

• Association of Certified Chartered Accountants (ACCA), offered by the governing body of the same name.
• Associate Chartered Accountant (ACA), offered by the Institute of Chartered Accountants in England and Wales.

Additionally, those who have taken an apprenticeship route may hold a foundation certificate or diploma from the Association of Accounting Technicians (AAT).

 

Financial Manager

 

What are the responsibilities of a financial manager?

A financial manager is a key part of a company’s future success. Finance is at the heart of every business – without proper care and planning, it can be hard to remain competitive and profitable, let alone grow.

A person in this job role focuses on monitoring cash flow across the whole business. This includes managing budgets for different departments and flagging any concerns. A financial manager will rely on having accurate information flowing to them from each team to complete their analysis. Rather than getting involved in the small details.

Using this information, a financial manager will be able to forecast future financial trends in the business, to inform bigger business decisions like whether to hire more staff, or which area to invest profit in. This also includes observing competitors to see what can be learnt from their successes or mistakes. They’ll also manage risk, putting strategies in place to reduce any weaknesses and help see the company through any volatility.

Financial managers will also make sure that a company’s accounts are in line with any legal requirements and will work with auditors to provide information and reports when required. They’ll keep up-to-date with new legislation, to ensure that the company is ready for any changes.

In summary, the finance manager’s responsibilities focus on long-term financial planning, tracking information and managing risk to ensure that the company remains profitable and competitive.

What skills does a financial manager need?

Planning is at the heart of every task that a financial manager does. Anyone in this role will need to be extremely organised, have a strong eye for detail, and be comfortable with managing large quantities of information. 

You’ll need to be good at keeping track of deadlines, as missing one could have consequences. Often, you’ll have to work under pressure, and be comfortable with the fact that information you share can impact people’s jobs.

When it comes to forecasting, not everyone you share your work with will have the same financial training, so you’ll often need to be the expert voice in the room, presenting your knowledge clearly and effectively, to help stakeholders make their decisions. You’ll need to be confident in talking in front of a room and creating slide decks and graphs. 

In times of change, you need to be capable of giving quick and informed feedback. This allows to allow the company to react quickly. To support this, one of the key financial manager skills is building relationships, so that others can feel comfortable and confident when it comes to trusting the information that they’re given.

You’ll also need to be confident in using technology daily. To create reports and to model any future goals in an easy-to-understand way. In summary, a successful financial manager will have strong project management skills, take an analytical approach, and have excellent business awareness.

How to become a financial manager

Similar to an accounting manager, most financial managers will have a higher education qualification, in a degree such as:

•  Maths
• Business
• Economics 

After graduating, you’ll need to complete one of the professional accounting qualifications, such as the ACCA or ACA qualifications. Then work to get several years’ experience in the sector to become fully qualified. This is a job with a high level of responsibility, so you must be well-grounded in the accounting field. Additionally, some experience in project management can stand you in good stead for the planning aspect of your career.

Whilst you might not be involved so heavily in people management as a financial manager, you’ll still need to have excellent communication and interpersonal skills. Working on those soft skills whilst you earn your accounting qualifications can add value to your skillset in the future.

The road to success

Now you’ve discovered the difference between accounting manager and financial manager skills. Hopefully, you have a better understanding of which role might be right for you. Remember, there’s no reason you can’t change your career path in the future.

If you have a management career in mind, then the best thing you can do is to learn as much as you can on the job. Look at what’s working in the team, as well as what’s not, and don’t be afraid to volunteer for tasks. When the timing is right, you might also want to look to find an industry mentor. A mentor can share their knowledge and experience with you too.

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