In December of 2021, the Institute of Management Accountants (IMA) released a report outlining essential skills that entry-level accountants should have as they begin their careers.
The report recognized that the accounting profession is changing, which emphasizes the need for an updated accounting curriculum. New developments in technology and greater sources for data analysis are eliminating the need for accountants to perform routine tasks. Instead, there is a move for accountants to perform activities that directly impact the company as a whole.
Instead of performing data entry and recording simple transactions, businesses are looking to their accountants for strategic planning and direction. There is a need for accountants to provide more value-added activities and fewer routine functions.
As technology continues to evolve, the skills of accountants must do so as well. The skills that once dominated the accounting profession are becoming obsolete and it is up to educators to align their accounting programs with the needs of modern businesses.
Identifying Core Competencies for New Accountants
The IMA has identified six competency domains in the IMA Management Accounting Competency Framework. Within each domain, the IMA suggested new skills for accountants to develop to remain competent and valuable to employers. These are discussed below.
As new accountants begin their careers, there will be a greater expectation for candidates to possess leadership abilities. These types of skills take time to develop, but there are different classes and programs that an accountant can take part in to strengthen their qualifications.
For example, students can consider volunteering for an organization in a leadership role or they may opt to take public speaking courses to enhance their presentation skills.
Strategy, Planning, and Performance
In the core area of strategy, planning, and performance, accountants should seek to add value beyond financial statements. To do this, they must look at the company as a whole and provide guidance outside of traditional finance or accounting departments.
The use of technology and analysis for strategy and performance improvement can greatly enhance the value of accountants to a business. High-level reporting tools can also provide managers with insight to drive decision-making.
Technology and Analytics
Recognizing the changing technological environment is a key factor that accountants need to consider when they are beginning their careers. There is a significant shift occurring in businesses, turning from a focus on historical review to real-time analysis.
New accountants that take the time to learn business analytics and data visualization techniques will stand out from traditional accountants, providing an enhanced level of value to their employers.
Reporting and Control
Learning internal reporting techniques and ways to enhance the internal controls of a business are great skills for a new accountant to bring to a business.
Demand for internal reporting that examines company performance and environmental, social, and governance factors will greatly increase in future years. Accountants who understand the need and have the ability to create these types of reports will have an advantage over those who do not.
Business Acumen and Operations
Another area in which entry-level accountants must improve their skills is in business acumen and operations. It is not helpful for accountants to operate in a silo; instead, they must think in terms of all departments. They must understand the different functions that each department performs and how those functions impact the business as a whole.
There is a need for accountants to contextualize revenue and costs. These skills can be developed by engaging in continuous learning programs and working with different teams on a variety of projects.
Professional Ethics and Values
Ethics have always had a place in accounting and business, but as technology continues to develop, greater attention to organizational ethics should be sought. It is also necessary for new employees to utilize technology and analytical tools to improve their understanding of ethics.
Learn Management Accounting Skills as Part of a University Program
The IMA’s report recommends that two courses be created to promote enhanced skills for future accountants who are still in school. The first class is an introductory course devoted to the core concepts of management accounting, including decision analysis, strategic planning, and performance management.
Students who take this class will learn the basic skills required to perform more value-added accounting activities outside of the traditional accounting model.
A second course will continue to cover these topics, but at a more advanced level. Reporting and data analytics tools can be taught in detail, giving students the opportunity to use these technologies in a hand-on manner. Performance models that examine revenue, costs, and profitability management will be a part of a well-rounded program.
If a student is interested in pursuing an accounting career, they can pursue a management accounting elective that considers other aspects of the IMA domains and sharpens their skills for the future.
Technological developments are expanding into all aspects of business and industry. Accountants who keep up with these developments, stay on top of the trends, and incorporate them into their own roles will add greater value to their companies. These skills will allow accountants to move forward in their careers at a quicker pace than those who do not move to embrace the changes.
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