• Thu. Apr 18th, 2024

Why The Chief Accounting Officer Role Is Getting More Strategic

Chief Accounting Officer at BlackLine, providing finance and accounting automation solutions.

At a seminar I recently attended, the role of the CFO was split into four categories. Only one involved the CFO’s traditional stewardship role in closing the books correctly, ensuring compliance with financial regulations and communicating value and risk to investors and boards. The other three captured a CFO’s growing strategic responsibilities.

Finance chiefs have long been CEOs’ strategy partners. Now, with automation and data analytics converting financial figures into business insights, CFOs are becoming strategy partners of corporate leaders in operations, IT, sales, marketing, distribution, HR and R&D, among others. Since CFOs oversee budgets, financial systems and data management, their monopoly on financial information affords an invaluable global view on the strategic impact of each function’s investments, advice that is in great demand.

What happens at the top of the mountain has a way of rolling downhill. As finance chiefs become de facto strategic advisors across operations, their need for financial analyses and reports compounds. Satisfying this need are chief accounting officers as well as accounting and finance teams. This obligation makes sense, as we generate the financial data serving as the basis of corporate leaders’ business decisions. No one is closer to the numbers.

Reams of articles have been written about the expanding role of the CFO, but few touch on the fact that when your boss assumes more responsibility, you share in those responsibilities. Today’s chief accountants do more than run the accounting operation. To support CFOs’ role as strategic business partners, our tasks have extended to building systems and processes to extract insights from the financial data on a project-by-project basis.

Accounting automation technologies enable this important work. To be successful in supporting the multitude of roles assumed by strategic CFOs, accounting leaders must close the books faster. To expand our career horizons, we must also become more efficient performing compliance activities without compromising quality. More time can then be dedicated to supporting business leaders across the organization by product line, geographic region and department, in addition to their associated reporting needs.

As Technology Advances, Careers Evolve

This multifold responsibility is several standard deviations away from the traditional role of a corporate accountant. Twenty years ago, as a newly minted CPA, my training pertained to technical accounting and auditing guidance, financial systems, internal controls and other compliance undertakings. Few accountants at the time could envision a day when we would help the CFO advise IT, sales and marketing leaders on the impact of their strategic investments.

Over time, as automation and data analytics became more accessible and cost-effective, the ability to draw conclusions from raw data improved business decisions. Since accounting chiefs are closest to global financial systems and data, our role gradually expanded from assembling the consolidated financial and earnings reports to gathering data from across the business. In no time, we were building necessary financial systems and related processes to help operational leaders address their reporting demands. And now we assist them in dissecting and analyzing what the numbers mean.

This information is generated in different formats, based on the corporate function the finance chief is strategically advising. To ensure the CFO’s meetings are productive, the accounting chief has to understand each business leader’s strategy, tactics, opportunities, challenges and end-game goals in detail on a global basis. They can then reverse-engineer these items into systematic reporting to extract illuminating insights of competitive value.

Certainly, this purpose-driven, high-level, value-added responsibility makes the role of the chief accounting officer more strategically important. By extension, that alters the workload in the accounting and finance department. As mentioned before, when your boss assumes more responsibility, you share in those responsibilities.

Accounting chiefs must rely on their teams to handle more than the traditional tasks involved in closing the books on a consolidated basis. While this responsibility continues, the majority of the team’s time will increasingly involve synthesizing financial data to generate diverse reports analyzing how each function’s investments fit into the organization’s overall strategy.

Data Management Becomes A Key Competency

While technology is an important element in the accounting function’s support of transforming the Office of the CFO to become an effective strategic partner to the rest of the business, talent is another key factor.

The days of having teams performing accounting tasks and building finance models no longer are sufficient. More important than basic accounting and finance skills are people whose competencies include data management expertise.

Hiring practices will need to change in many accounting and finance organizations to process big data and create ways to provide colleagues across the business with automated reporting. As the shared services center concept (people in low-cost countries processing invoices and doing data entry work) falls by the wayside, the accounting and finance function is becoming a “center of excellence,” composed of skilled data scientists managing aggregate data, automating shared services center work and generating dynamic reporting for the company.

A More Engaging And Rewarding Career

Executing this crucial responsibility requires basic building blocks such as automated accounting and financial processes, which are well in place at most midsized and larger companies, along with talent skilled in data management. As automation proliferates, accountants are set free from mundane tasks to provide the financial analyses and reports needed at the top of the mountain to align real-time financial information with business strategy. The quicker the global financial close, the more time teams have at their disposal to provide this information.

Twenty years ago, I never imagined I could be an analytical force driving business strategy on a project-by-project basis. As the CFO’s role expands from the top down, the career of an accountant is extending from the bottom up. The opportunity to assist strategic decisions across the organization promises a more engaging and rewarding career, one that I believe will eventually put an end to the prolonged accountant shortage.

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