The Role of a Financial Manager: Job Description, Skills, and How to Become a Finance Manager in 2023

How to Become a Successful Financial Manager in 2023

A financial manager plays a critical role in the financial health and success of any organization. This article provides a comprehensive overview of what a financial manager does, skills required, job outlook, salary, and how to start a career as a finance manager. Read on to learn everything you need to know about this essential executive position.

Outline:

What is a Financial Manager?

• Definition and job description

Responsibilities and Duties

• Core tasks and responsibilities

Skills and Qualifications

• Hard and soft skills needed

Education and Experience Requirements

• Degrees, certifications, and experience needed

Career Outlook and Salary

• Job growth, opportunities, and average pay

How to Become a Financial Manager

• Education, experience, and steps to enter the role 

Financial Manager vs Financial Analyst

• Key differences between the roles

Types of Financial Managers

• Different types of manager roles

Day in the Life of a Financial Manager

• Typical work activities and schedule

Job Satisfaction and Work Environment

• Pros and cons of the role and work settings

FAQs about Becoming a Finance Manager

• Common questions answered

Key Takeaways and Tips

• Summary of crucial points

What is a Financial Manager?

A financial manager, also known as a finance manager or finance director, is an executive who oversees the financial operations, planning, reporting, and analysis for an organization. Their primary responsibility is managing the financial health of a company or organization to support sustainable growth.

The financial manager job description entails working closely with senior leadership and department heads to guide high-level strategic financial planning and day-to-day financial activities. They prepare and analyze financial statements, direct investment activities, and develop solutions for long-term financial goals. Financial managers also ensure regulatory compliance regarding all financial operations.

Responsibilities and Duties

The core responsibilities and duties of a financial manager typically include:

• Overseeing the preparation of financial reports, financial plans, and budgets

• Monitoring cash flow, expenses, revenues, and financial performance

• Conducting risk management and competitive analysis

• Advising on long-term business and financial planning

• Managing investment and capital activities

• Ensuring compliance with financial laws and regulations

• Leading financial department staff and activities

• Presenting financial information to executives, investors, and stakeholders

• Analyzing financial data to provide strategic recommendations

• Identifying cost reduction and growth opportunities

• Implementing financial management procedures and controls

Financial managers are accountable for the accuracy of all financial reporting and operational performance. Their oversight helps guide executive strategy and key business decisions.

Skills and Qualifications

To be successful as a financial manager, certain skills and qualifications are required:

Hard skills:

• Financial analysis and reporting

• Budgeting and forecasting

• Financial modeling and valuation

• Accounting principles

• Risk management

• Data analysis

• Strategic planning

• Financial regulations and compliance

Soft skills:

• Leadership and management

• Communication and presentation

• Analytical thinking

• Problem-solving

• Decision making

• Organizational skills

• Attention to detail

• Teamwork and collaboration

Most financial manager positions require a combination of education, certifications, and experience to demonstrate required competencies.

Education and Experience Requirements

The typical education and experience requirements for becoming a financial manager include:

• Bachelor's degree - Most financial manager jobs require a bachelor's degree in finance, accounting, business administration, economics or related field. Coursework covers financial principles, analysis, reporting, accounting, management, and statistics.

• Master's degree (optional) - Some senior manager positions may prefer candidates with a master's degree in finance, MBA, or related graduate degree. This provides additional analytical and leadership training. 

• Certifications (optional) - Certifications such as Certified Public Accountant (CPA), Chartered Financial Analyst (CFA), or Certified Management Accountant (CMA) can improve job prospects. These demonstrate financial skills mastery.

• Work experience - Previous experience in finance, accounting, analysis, or management roles is usually required. This provides necessary knowledge and competencies for the manager position. Progression often begins as a financial analyst or accountant before advancing to manager.

Career Outlook and Salary

The job outlook for financial managers is strong and projected to grow faster than the average for all occupations according to the U.S. Bureau of Labor Statistics (BLS). Opportunities for financial managers are expected to be good over the next decade.

Several factors contribute to positive growth:

• Increased complexity of financial operations and strategies

• More regulatory requirements needing oversight

• Demand for in-depth financial analysis and planning

• Retirement of current financial managers opening up roles

According to the BLS, the national average salary for financial managers in the United States as of 2021 was $134,180 per year. Salaries can vary based on experience, industry, location and specific manager role. Many senior financial executives earn well over $200,000 annually.

How to Become a Financial Manager

Here are some key steps to starting a career as a financial manager:

• Earn a bachelor's degree in a relevant field like finance, accounting, economics or business administration. Consider a master's degree for high-level roles.

• Gain relevant work experience through finance, analysis or accounting roles. Progress to managerial positions over 3-5 years.

• Develop required hard skills like financial analysis, budgeting, financial modeling, accounting and regulatory principles.

• Build leadership, communication, analytical and problem-solving skills.

• Consider earning an MBA or certifications like CPA, CFA or CMA to boost credentials.

• Apply for open financial manager positions at various companies once you meet the qualifications. Leverage networking and your professional experience.

• Continually expand financial operations knowledge and keep updated on financial regulations and best practices.

Proving yourself as a skilled financial analyst or accountant is often the initial step before advancing into an executive financial manager role. Gaining broad experience across financial disciplines allows you to demonstrate strong competencies to become an effective finance manager.

Financial Manager vs Financial Analyst

Though related roles, financial managers and financial analysts have some key differences:

• Focus - Financial managers oversee the big picture financial operations and health of an organization. Financial analysts perform more specialized analysis and reporting.

• Scope - Managers plan and direct overall financial activities while analysts support specific analyses and initiatives.

• Authority - Managers act as financial leaders directing teams and strategy. Analysts follow direction and make recommendations.

• Experience - More experience is required to be a manager vs analyst. Managers are more senior-level roles.

• skillet - Managers require leadership, communication and strategy skills. Analysts focus more on technical analysis competencies.

• Salary - Financial manager salaries tend to be higher than financial analyst pay at more senior levels.

So in summary, financial managers have a broader executive oversight role while analysts play a more specialized, supportive function focusing on specific analyses.

Types of Financial Managers

While all financial managers oversee an organization's financial operations, some common specialized types of managers include:

• Treasurers - Oversee cash management, capital budgeting, and financial risk management.

• Controllers - Manage the preparation of financial statements and recording of assets, liabilities, and capital.

• Credit managers - Oversee credit policies, credit-rating, and collection of payments.

• Cash managers - Direct strategies for marketable securities investments to optimize cash flow.

• Risk managers - Identify and mitigate financial risks through insurance policies, controls, and hedging strategies.

• Pension fund managers - Oversee employer-sponsored retirement plans and pension fund investment mix and performance.

Day in the Life of a Financial Manager

A typical day for a financial manager may include activities such as:

• Reviewing financial statements, reports, and metrics to assess current financial performance

• Preparing budgets and financial plans in collaboration with leadership

• Presenting financial results and recommendations at executive or board meetings

• Overseeing the preparation of regulatory reporting and filings

• Analyzing market trends, competitive environment, and potential growth strategies

• Leading team meetings with direct finance reports 

• Evaluating potential risks related to investments, liability, credit or operations

• Managing investment portfolios and capital allocation

• Interacting with stakeholders, investors, auditors, and financial institutions

• Implementing process improvements for financial management and reporting

The specific activities can vary greatly depending on the industry, company size, and manager's specialty. But the focus remains overseeing day-to-day financial operations and long-term strategic planning.

Job Satisfaction and Work Environment

Pros of being a financial manager:

• Lucrative career with high earning potential

• Engaging analytical and strategic work

• Key leadership role with influence on decisions

• Opportunity to improve business performance

• Career advancement and growth opportunities

• Wide range of industries and employer options

Potential challenges:

• Work can be stressful with tight deadlines

• Need to keep updated on regulations and guidelines

• Responsible for organization's financial health

• Extensive experience and education required

• Long hours may be necessary at times

Financial managers typically work full time office hours, but may need to work overtime during peak closing and reporting periods. They often travel to meet with clients, investors, or attend off-site meetings and conferences.

Financial managers are employed across all sectors and within any large organization. Typical employers include corporations, financial institutions, government, non-profits, and consulting firms. Work settings are generally professional offices with access to computers, software, data systems, and collaboration technology.

FAQs about Becoming a Finance Manager

- What degree do you need to be a financial manager?

Most financial manager positions require a bachelor's degree in finance, accounting, business, or other business-related majors. Master's degrees can improve prospects for senior roles. 

- How much do financial managers make?

According to the Bureau of Labor Statistics, the average salary for financial managers in 2021 was $134,180 annually. Salaries range based on experience, qualifications, and location. Senior managers can make $200,000+ per year.

- How long does it take to become a finance manager?

It typically takes around 5-10 years of experience in finance, accounting or analysis roles to have the necessary competencies, leadership abilities, and track record to become a financial manager.

- What skills do you need to be a good financial manager?

Key skills include financial and data analysis, accounting, budgeting, leadership, communication, presentation abilities, strategic thinking, decision making, and organizational skills.

- What does an entry level financial manager do?

Entry level financial managers often start in assistant or analyst roles supporting budgeting, reporting, analysis and planning. This experience prepares them to advance into manager positions.

- Can you become a financial manager without a degree?

Most corporate financial manager roles require at least a bachelor's degree along with certifications and experience. However, smaller companies may consider candidates with extensive financial experience but no degree.

Key Takeaways and Tips

• Financial managers are senior executives responsible for the financial health and strategy of an organization.

• Typical duties include overseeing financial reporting, planning, investments, regulatory compliance, risk management, and leading the finance team.

• Required qualifications are a bachelor's degree in a business or finance-related field, certifications like a CPA, and 5+ years of experience in accounting, analysis or finance roles.

• Strong leadership, communication, analytical, and problem-solving skills are equally important for success.

• Financial analyst or accounting experience provides a solid foundation before progressing to manager.

• Continuing education and keeping current on financial regulations and best practices is essential for any financial manager.

The role of a financial manager is complex but offers a rewarding career managing the financial operations of an organization. If you have a passion for finance, analytics, strategy and leadership, it can be a great profession with opportunities across many industries.