How Do I Start My Career in Financial Management?
By Roland Madison, CPA

Recruiters from public accounting firms seem to dominate campus placement offices at many colleges. Their agendas for student include office visits and follow-up contacts with a number of young senior staff members who offer a variety of social activities designed to attract the "best and brightest" to the exciting lifestyles enjoyed by members of public accounting firms.

Is the lifestyle of public accounting more exciting, financially more rewarding, and intellectually more challenging than Corporate America has to offer? No! We have quality financial career paths that should attract entry-level professionals who have distinguished themselves as leaders in the university classroom and in various aspects of the academic community. As a professor of accounting, I wanted to help my students identify the best starting point for their careers in corporate financial management, so I set out to talk with as many finance and accounting professionals as I could. Controllers, CFOs, and other representatives of companies like Ashland Oil, Avery Dennison, GenCorp, M.A. Hanna, Parker Hannifin, and Sherwin Williams offered several suggestions, which I have put into a question-and-answer format.

1.		Are all entry-level financial career paths alike? If not, what are their major differences? Certainly there are differences among how organization start entry-level accountants in their careers. A major difference is hiring an individual for a specific position that is permanent in nature versus starting him or her in a "management accounting training program."
2.		Can you elaborate on the "direct hire" into a specific position? The type of hiring occurs when a specific need must be met for a financial function and when the job must be done on a regular basis such as developing product cost at the factory, calculating production variances, revising cost standards, and dealing with production-cost corners. This position is called a cost analyst or a cost accountant. Positions such as this one have two levels - the latter might require some experience. If so, the position may be filled by a person already employed by the company through seniority or a qualification bidding process, or a new graduate may start at the lower level and progress to cost accountant.
3.		In general, how do management accounting training or internship programs operate? They expose the entry-level accountant to several financial areas within an organization. Large organizations, such as the Fortune 1,000, provide a variety of opportunities for the entry-level accountant to sample a number of situations in which the company can evaluate the performance of the accountant. Most of the companies have financial personnel at the plant, division, group/line of business, and corporate levels. Each of these organizations will give a new management accountant experience in two to four financial areas.
4.		What types of positions are assigned to management accounting trainees? In generic sense, most organizational units have positions related to the following areas: Financial reporting -- corporate accounting; regulatory reporting, financial accounting, special reports Financial systems -- receivables, payables, collections, credit management, property, plant and equipment Production/cost analyst -- inventory costs/controls Planning/analysis -- strategic planning; operational budgets, special reports, acquisitions, capital budgeting Taxes -- state/local/federal taxes; compliance tax work, payroll taxes, tax planning (markets, business combinations) Internal audit -- various levels; corporate, division/group/line of business, and plant level
5.		Are all these positions usually available to entry-level management accounting trainees? Not always. First, some organizations are highly centralized, while others are decentralized. As an example, one highly centralized firm generally accepts only experienced people into internal audit because that group functions primarily out of the corporate level. Other firms will use some management accounting trainees mostly at lower levels of internal audit (such as plant and division) because they overall corporate magnitude is too great to grasp in a short time frame. Another area that management accounting trainees may not see quite often is planning an analysis at the higher levels for the same reason as stated for internal audit. Entry-level personnel may not be able to discern the long-run overall direction of the entity, so they will need to get lower-level experience first. The good news is that entry-level management accountants may do P&A work in the form of the preparation of operating budgets, capital investment analysis, and a variety of special projects at the division level. Likewise, financial reporting at the corporate level may be a little restricted but certainly not at the division and group levels. Even the corporate level may be open in some cases to the brightest and most aggressive entry-level management accounting trainees in some limited cases.
6.		What are the financial benefits of being an entry-level management accounting trainee rather than a public accounting entry-level person? First, the basic compensation for corporate entry-level accounting personnel is competitive with that paid by the national public accounting firms. Next, the fringe packet offered by corporations in terms of medical, dental, vision and other health benefits generally is quite good because corporate employers often absorb the bulk of the cost of these health-related programs. Also, corporate employers have 401(k) programs and tuition reimbursement plans with textbook and supply plans available to employees who want to earn advanced degrees such as a M.B.A. or M.S. degree.
7.		What traits do students need to cultivate to succeed in these types of organizations? One corporation suggests that the following traits will lay the groundwork for success: Professionalism -- high character and standards of technical competency Teamwork -- work and communicate effectively with others to achieve a common goal for the organization Individuality -- champion your own ideas with an effort toward continuous improvement Initiative -- identify what needs to be done, and see that it is done in a timely and high-quality matter Leadership -- help others to strive for high standards by providing an exemplary model for others to emulate Ingenuity -- bring new ideas to the front with creative solutions to business problems Intellectual capacity -- full utilization of high mental and analytical capability
8.		Generally speaking, how do corporations view efforts by their employees to seek advanced education beyond the bachelor's degree? Do they provide support for financial management personnel who want to seek advanced degrees? In a far-reaching report titled "What Corporate America Wants in Entry-Level Accountants," corporate financial management urged entry-level personnel to first seek professional certification and experience for several years and then look to expand their education formally with an advanced degree in business that was relevant to their career goals. Unlike public practice, corporations traditionally have had programs to provide either partial or full tuition and materials assistance for their manager who want to study in approved graduate programs. Before employees invest extensiv3ely in graduate studies, however, they should have the full understanding and approval of the appropriate management personnel unless they intend to pay for the full cost of their graduate degree. Naturally, corporations tend to be supportive of studies they believe will be in the best long-run interests of the company.

On Your Way
While the preceding questions are not intended to be all-inclusive, they should be a good start for students who want to pursue a career in financial management. Students with another year of study remaining also should investigate a local corporate internship opportunity because such a position would provide a general und3erstanding of how industry operates. In any case, it is wise to consider all financial opportunities available - whether in public accounting or corporate financial management.

Roland L. Madison, CPA, Ph.D., is a professor of accountancy at John Carroll University in Cleveland, Ohio. He is a member of the AICPA, the American Accounting Association, the Ohio Society of CPAs, and the Cleveland East Chapter of IMA.

Source: Institute of Management Accountants.