The role of the financial manager is very crucial to an organization. They hold the most important ingredient of a company in the palm of their hands, management of cash flow of a company. Since financial managers can be found in almost every organization, it is important to understand their role in an organization. In this paper I will examine the role of the financial manager. I will further compare and contrast these roles with that of an accountant. Financial Managers Our University of Phoenix e-text states, "Financial managers stand between the firm's real assets and the financial markets in which the firm raises cash" (p.
8). They are ultimately responsible for overseeing the flow of cash between investors and the firm. Financial managers view the firm on a more global level. They are faced with managing the firm's investments and how the funds are raised for these investments.
Financial managers are growing more each day and are expected to grow faster then an average career through 2010. This will be due to the growth of the economy and the need for financial expertise. Financial managers can be found in every type of organization. They hold several titles within an organization to include treasures, controllers, credit managers, cash managers, vice president of finance, and chief financial officers (CFO).
Financial managers holding these titles prepare the financial reports required by an organization to conduct its operations and ensure that the firm satisfies tax and regulatory requirements (please find quote). Financial managers are responsible for planing, organizing, evaluating, and controlling the operation of financial and accounting departments. They hold the head positions in the accounting departments throughout organizations. They also monitor the extension of credit, assess the risk of transactions, raise capital, analyze investments, develop information to assess the present and future financial status of the firm, and communicate with stock holders and other investors (please find quote). Comparison of Financial Managers and Accountants Accountants evaluates records drawn up by the bookkeeper and shows the results of this investigation as losses and gains, leakages, economies, or changes in value, so as to reveal the progress or failures of the business and also its future limitations and possibilities. Financial managers maximize the value of the firm.
Accountants provide the financial manager reports that state the financial position of the organization. Financial managers use these reports to make better decisions for the organization. Accountants are responsible for the preparation of the budget. Financial managers use the budget reports to plan for the organization, set goals and predict results. Accountants are responsible for preparing performance reports.
Financial managers use these reports to conduct performance evaluations, which help compare actual results with budgeted amounts. Financial managers are also responsible for financial policy and corporate planning. Accountants are responsible for tax preparations. Financial managers ensure the organization satisfies tax and regulatory requirements.
Financial managers inspect to make sure money is used correctly. They are also responsible for cash management, raising capital, and banking relationships. They obtain and manage the company's financing. Contrast of Financial Managers and Accountants Although these two occupations perform a lot of different roles within an organization, they do have some similarities.
Both are changing in response to technology. They both are faced with the increasing responsibility for compliance with all manner of financial reporting requirements. They have both taken on more importance and greater risk. They both are responsible for making important business decisions for their organization and are heavily involved in program activities. Financial managers and accountants are equally responsible for analysis, design, forecasting, evaluation and guidance within their organization. They are responsible for translating raw data into usable information and help develop strategic plans, performance goals and measures.
Finally, both financial managers and accountants develop useful analyses and reports comparing planned activities to actual results.