CIMA knowledge fast forward
CIMA knowledge fast forward is a knowledge sharing initiative which strives to improve the conceptual clarity of the business community with regard to a core management/financial accounting knowledge area, describing the concept, and explaining how it applies in practice. Being an effective finance professional Sudarshan Senaratne, FCMA, is a past president of the CIMA Sri Lanka Division. He was also a Member of CIMA U.K. Council and holds a BSC from Colombo University. He has held senior positions including board positions in leading public and private sector institutions. Currently, he works as a financial and management consultant and has carried out assignments for several international institutions in the Southasian region. He is also the managing director of Development Concepts Pvt Ltd, a consultancy firm which he established.
The finance profession varies from mere book keeping to practice of complex financial transactions and analysis. In a more traditional sense, a finance professional is expected to perform the role of preparing financial statements while adhering to the accounting standards and statutory regulations. Further he/ she is expected to be good in working with numbers especially when it comes to analysing financial information. However, in recent times with the expansion and diversification of business and commercial activities, the finance profession itself has become complex and has expanded its core functions to cover a range of related disciplines. This transformation has provided opportunities for several financial careers in fields such as corporate finance, financial planning, banking & insurance, investments and securities, equity & fund management, derivatives, real estate financing etc.
If one needs to be recognised as a finance professional, he /she should have at a minimum strong technical skill in finance. Such skills can be acquired by following a formal course of study. Unlike in the past, today there are several degree courses that offer academic qualifications in accounting and finance in addition to the professional courses of study such as CIMA, ACA, ACCA, AAT etc. In general, a person who is formally certified by a body belonging to a finance profession after completing a course of study and/or practice is considered a finance professional.
A typical career path of a finance professional would begin as an assistant or an understudy to a senior member of the profession. From this point onwards one would generally follow the path throughAccountant, Finance Manager, Chief Financial Officer / Finance Director and probably end up as a CEO or Managing Director. Alternatively some during their mid careers, move directly into some of these positions.
At a basic level a finance professional is generally assigned to carry out routine tasks. What is expected at this level is to carry out the tasks assigned to him /her diligently and in an efficient manner. This will help one to win the confidence of the seniors where he/she will be regarded as a person who could shoulder responsibility and on whom they could rely upon to deliver the delegated tasks in an accurate and timely manner.
At an intermediate level, expectations of a finance professional will be different to that of the basic level. At this level one should be able to develop the capability of interpreting results or analysis to facilitate decision making processes in addition to carrying out work diligently. For example, an accountant analysing financials, should first try to understand the purpose of the task assigned, interpret results and advice his /her superiors to enable the latter to make effective decisions.
At the senior level the finance professionals are expected add value and demonstrate the ability to take an initiative rather than merely responding to instructions or carry out tasks assigned to him/her by the superiors. An exceptional finance professional will try to go beyond the mere performance of assigned tasks and proactively contribute towards achieving the organisation’s objectives. Further, at this level, one needs to provide leadership in respect of the finance function. To perform these functions effectively a finance executive needs to be able to manage both internal and external relationships. Internal being superiors, peers and colleagues and those reporting to you, while externally he / she has to maintain relationships with other stakeholders such as lenders, investors, regulators and general public. Today managing such relationships have become a core function of a finance professional.
To perform such a role and excel in the profession, formal qualifications alone are not sufficient. One needs to have several attributes and characteristics like integrity, good work ethics, confidence, and humility as well as several other skills which are commonly bunched as ‘ soft skills’ such as leadership, communication, professional networks, staff motivation, managing conflicts etc. Some develop these skills during the early stage of life especially while in school by participating in sports and other extra curricular activities. However during later stage of life if one needs, such skills could be acquired through learning and training.
Experience shows that though there are many professionals with qualifications, a good professional who can effectively contribute to an organisation and add value is not easy to find. Invariably such professionals are always in high demand and highly sought after.
In summary, although a person with recognised financial qualifications is considered as a finance professional, to be an effective performer one needs to add value to an organisation. Qualifications alone are not sufficient to be an effective performer, where one has to have several other attributes and character traits which could be easily acquired and developed with self discipline and training.