The Management Accounting Profession Will Double by 2024 - Are We Prepared?
As a management accountant and a CEO, I know first-hand the field continues to grow and expand. I was happy to learn that the Bureau of Labor Statistics expects management accountants and auditors to experience double-digit growth through 2024.
Despite this growth, a troubling pattern has emerged in the profession. Students at many U.S. colleges and universities are largely preparing for entry-level audit and compliance work, but not for long-term careers in our rapidly growing field. The skills needed to succeed in management accounting extend well beyond audit, compliance and reporting to include financial planning and analysis, merger and acquisition activity, strategic cost management and more.
According to a survey, most professionals stay in public accounting only three to six years before moving to a management accounting (CFO team or controller) position inside an organization (for-profit, private and nonprofit). Why is this so important? Because when these professionals move from the audit pathway to the corporate financial management pathway, they may not have the full range of competencies to succeed long-term, creating a gap between what is desired by organizations and what skills accounting talent actually possess.
This skills gap is not just limited to young professionals; it exists at the executive level as well. According to the 2015 Crist/Kolder Volatility Report, 33.3 percent of Fortune 500 and S&P 500 companies recruit CFOs from outside of the company. Clearly, there’s a lack of succession planning and internal grooming for CFOs, compared to, for example, the CEO succession pipeline. When businesses promote employees without training for higher-level skills, or they only import established managers from other businesses, they contribute to the established and harmful “entry-level economy.”
What’s the answer? To address a multi-pronged problem that threatens the next generation of management accountants, we must execute a multi-pronged approach.
In 1986, the Bedford Report, commissioned by the American Accounting Association, found that the courses accounting educators teach do not align with what accountants (broadly defined) actually do and need in practice. While we’ve seen some broadening of accounting curricula over the decades to include decision support, the expanded role of the CFO team to include financial management, strategy and operations has actually exacerbated the talent gap. Read more on Accounting Today.