I’D LIKE TO PUR­SUE A CA­REER IN FI­NANCE

Friday - - Beauty -

Q I’m a grade 10 stu­dent study­ing in a Bri­tish cur­ricu­lum and I’m con­sid­er­ing a ca­reer in fi­nance. I’ve taken an ac­count­ing IGCSE course. How­ever I can­not stand ac­count­ing and am won­der­ing if it is pos­si­ble to have a ca­reer in fi­nance without ac­count­ing? More­over, would busi­ness schools ac­cept my ap­pli­ca­tion if I don’t take AS ac­count­ing?

AAt the out­set I must con­grat­u­late you for be­ing as­tute enough to distinguish be­tween ac­count­ing and fi­nance. These are two separate func­tions and re­quire dif­fer­ent skill sets but are more of­ten than not clubbed to­gether be­cause both deal with man­ag­ing money and busi­ness as­sets.

Ac­count­ing in­volves record­ing and analysing the fi­nan­cial trans­ac­tions of a com­pany in ac­cor­dance with in­ter­na­tion­ally ac­cepted norms and en­sur­ing the fi­nan­cial state­ments thus pre­pared re­flect the true and fair state of the fi­nan­cial health of com­pany. Ac­coun­tants are re­spon­si­ble for man­ag­ing the cash flow, debt, recog­nis­ing rev­enue, analysing profit and pay­ing taxes.

Fi­nance, on the other hand, uses this in­for­ma­tion to make fu­tur­is­tic fi­nan­cial and bud­getary de­ci­sions for the com­pany and by its very def­i­ni­tion in­volves an el­e­ment of risk and un­cer­tainty. An­tic­i­pat­ing, eval­u­at­ing, and man­ag­ing these risks and un­cer­tain­ties is a large part of the re­spon­si­bil­ity of fi­nan­cial man­agers.

Their work in­cludes man­ag­ing and dis­tri­bu­tion of as­sets, co­or­di­na­tion of capital and in­vest­ments with a view to im­prove the value of the busi­ness.

Fi­nance tends to have broader scope and more of macro out­look and one can con­sider ac­count­ing as a part of fi­nance. The tools used by each to reach their goals are also dif­fer­ent. Ac­coun­tants tend to rely on bal­ance sheets, profit and loss and cash flow state­ments while fi­nance man­agers would rather use per­for­mance re­ports, ra­tio anal­y­sis, risk anal­y­sis, break evens and re­turns on in­vest­ment.

Ac­coun­tants are re­spon­si­ble for un­der­tak­ing au­dits, tax re­turns, bud­gets and man­ag­ing cash flow while fi­nan­cial an­a­lysts would fo­cus on in­vest­ments and var­i­ous fi­nan­cial prod­ucts that could be used by in­vestors, be it cor­po­rate or in­di­vid­ual.

Ac­count­ing deals with to­day’s rev­enue and ex­penses while in fi­nance you would be plan­ning and work­ing on to­mor­row’s profit.

Ac­coun­tancy it­self can be fur­ther sub­di­vided into pub­lic, man­age­ment and govern­ment spe­cial­iza­tions. Pub­lic ac­coun­tants are re­spon­si­ble for record­ing and man­ag­ing the fi­nan­cial doc­u­ments for their clients, usu­ally cor­po­ra­tions, in­di­vid­u­als or govern­ment en­ti­ties, in ac­cor­dance with the law of the land.

These would in­clude au­di­tors and tax con­sul­tants. Foren­sic ac­coun­tants work for the govern­ment to de­tect fraud and em­bez­zle­ment. Man­age­ment ac­coun­tants work in pri­vate or­ga­ni­za­tions and over­see bud­gets and cost con­trol.

Ac­coun­tants should have an eye for de­tail and strong quan­ti­ta­tive and an­a­lyt­i­cal skills. Their du­ties are pro­ces­sori­ented and the jobs re­quires both con­cen­tra­tion and pre­ci­sion.

While both job de­scrip­tions would need the per­son to have math­e­mat­i­cal and an­a­lyt­i­cal skills, fi­nan­cial an­a­lysts are re­quired to make de­ci­sions quickly, of­ten un­der pres­sure. The re­sults of their work can eas­ily be quan­ti­fied and re­quires con­fi­dence and strong com­mu­ni­ca­tion skills.

It is not un­com­mon that

Ac­coun­tants are RE­SPON­SI­BLE for un­der­tak­ing au­dits, tax re­turns, BUD­GETS and man­ag­ing cash flow while FI­NAN­CIAL an­a­lysts would fo­cus on IN­VEST­MENTS and var­i­ous fi­nan­cial prod­ucts

stu­dents bol­ster their bach­e­lor’s de­gree in ac­coun­tancy and fi­nance with a professional spe­cial­i­sa­tion in ei­ther ac­coun­tancy (Char­tered ac­coun­tant, Man­age­ment Ac­coun­tant, CPA) or Fi­nance (CFA, MBA-Fi­nance, Mas­ter of Fi­nance).

It is also pos­si­ble to pur­sue these professional spe­cial­i­sa­tions or a mas­ter without nec­es­sar­ily hav­ing pur­sued a bach­e­lor de­gree in ac­coun­tancy or fi­nance.

To an­swer your ques­tion, you need not pur­sue ac­count­ing ei­ther in school or even in col­lege and still end up with a spe­cial­i­sa­tion in fi­nance.

Har­vard, MIT, Whar­ton, Chicago, LSE, LBS, Stan­ford, NYU, Ox­ford, Manch­ester, NUS and Univer­sity of Melbourne are con­sid­ered as the lead­ing uni­ver­si­ties of­fer­ing pro­grams in ac­coun­tancy and fi­nance.

SAN­JEEV VERMA is an in­ter­na­tional ed­u­ca­tion coun­sel­lor

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